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Abstract
The purpose of this research is to find out the relationship between productivity and project
performance on a residential multi-storey construction site by finding out the indicators and
gathering the data via survey method and by performing the quantitative analysis.
Alok Mishra
Alokm.mc16@ricssbe.edu.in
i
DECLARATION
I, Alok Kumar Mishra, hereby declare that this mid-term report is a record of
authentic work carried out during the period from 19th Feb 2018 to 23rd Feb 2018 and
has not been submitted to any other university or institute for award of any
degree/diploma etc.
Signature
Alok Mishra
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ACKNOWLEGDEMENT
NTCC capstone project is a great learning curve for me. I am indebted to a great many
people for their help and support during my project days.
First, I am grateful to God Almighty, for all the blessings showered on me and to my
family for their love and support.
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Table of Contents
DECLARATION........................................................................................................................ ii
ACKNOWLEGDEMENT ......................................................................................................... iii
Introduction ................................................................................................................................ v
Literature review of 1. Construction Equipment Management practices for improving
construction productivity of Multi-Storey Residential Building Projects & 2. Managerial
practices in measuring Productivity and Performance and its relationship .............................. vii
Introduction .......................................................................................................................... vii
Main Body ........................................................................................................................... viii
Question and Response Analysis............................................................................................... xi
Methodology for Analysis ....................................................................................................... xvi
Qualitative Data Analysis ................................................................................................... xvii
Labour Productivity ....................................................................................................... xviii
Equipment Productivity ................................................................................................. xviii
Managerial Decision ........................................................................................................ xix
Material Unavailability .................................................................................................... xix
Fund Unavailability .......................................................................................................... xx
Cash flow .......................................................................................................................... xx
Waste ................................................................................................................................ xx
High Performance Professionals ...................................................................................... xx
Key Performance Indicators ............................................................................................. xx
Productivity vs Performance ........................................................................................... xxi
Resource Management ................................................................................................... xxii
Construction Defects ..................................................................................................... xxiii
Quantitative Analysis ........................................................................................................ xxiv
Relative importance index ............................................................................................. xxiv
Conclusion ........................................................................................................................... xxviii
References ................................................................................... Error! Bookmark not defined.
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Introduction
In India, construction industry is contributing approximately US$ 308 billion in GDP
in 2011-2012 which is total 19% of the total Indian GDP. Despite of being so much
contribution in Indian GDP, this industry has faced too much loss over. And there are
many factors pointing towards this problem. But, the main problem is the focus of
construction industry only on profits. (Saurav Dixit, Amit Kumar Pandey, & Satya N
MandalS. Bansal, 2017)
Indian construction industry provides huge number of jobs in the country to those
professionals who are directly or indirectly related to this industry. So, it is clear that
there will be lots of problems in managing those people.
To manage those people, optimum use of technology, optimum use of material etc. all
are governing by productivity.
And Performance of a construction site depends upon how good the productivity is on
the site. And this performance decides how the construction industry’s performance is
compared to other industries.
Many authors have demonstrated that there is a relationship between productivity and
performance and this relationship can govern the project in an efficient manner and
with great productivity.
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If overall productivity increases of a construction site, overall performance of the site
also increases.
If optimum use of advance technology and the good practices of the management will
be used, then productivity of a construction site can be improved then as a result
overall performance of the residential site will improve.
Strategic location of equipment and proper use of machines and equipment and timely
maintenance can improve the overall productivity of the site and same as with
materials and labours. Then as a result, overall performance of the residential project
site will improve.
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Literature review of 1. Construction Equipment
Management practices for improving construction
productivity of Multi-Storey Residential Building
Projects & 2. Managerial practices in measuring
Productivity and Performance and its relationship
(Aki Pekuri, Harri Haapasalo, & Maila Herrala, 2011)
Introduction
1. This research paper focuses on how can one improve the construction
productivity by using construction equipment management practices to improve the
overall productivity of a residential projects.
The paper has been completed in two phases. Phase 1 and Phase 2. During phase 1,
almost 19 experts have been interviewed, who have involved in the construction
activity, to get the data for qualitative analysis. The data had been analysed by the
experts and the practices have been listed by those experts by which productivity can
be improved. (Argaw Tarekegn Gurmu & Ajibade Ayodeji Aibinu, 2017)
In phase 2, total 39 contractors have been given questionnaires. Responses have been
analysed to get the quantitative analysis and to prioritize the results that have been
identified in the phase 1. For the analysis purpose, many statistical methods and tools
have been used to get the appropriate results. (Argaw Tarekegn Gurmu & Ajibade
Ayodeji Aibinu, 2017)
2. In this paper, the author talks about the ways productivity and performance
can be measured. According to author, timely information and proper decision
making should be the recommended way of measuring the productivity and
performance of a construction site, not only productivity should be the measure to
judge the performance. At first, author has cleared the terms productivity and
performance.
Author has emphasized that productivity should not be measured only on the basis of
labour productivity.
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And the myth is there in the industry that performance is only judged on the basis of
financial growth over the years by comparing it with the benchmark. But, these are
only the results of the actions by the high authorities and nature of the decisions and
market conditions.
Main Body
1. According to many researchers, use of new and advance technology may
improve the productivity but on an activity level, not on a project level. So, to
improve the project performance level, use of best management practices should be
adopted. (Argaw Tarekegn Gurmu & Ajibade Ayodeji Aibinu, 2017)
The paper talks about specific management practices because there are thousands of
practices available and all the practices can’t be suitable for a project. Such as control
system can be a great tool for industrial projects but for infrastructure projects. Same
as equipment utility has been found a best tool to improve productivity in an
infrastructure projects but not for an industrial project.
The author has made an assumption that many a times labour productivity had gone
down just because of unavailability of equipment on site because it needed
maintenance at that time and the overall project performance will go down.
In this paper, author will talk about equipment maintenance on time to improve the
overall project performance.
In phase 1, interviews have been taken from all 19 participants until saturation point
came. And the output of the phase 1 had been used in phase 2.
In phase 2, scoring tool and regression model have been developed to get the relation
between performance and productivity.
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On the scale of 1-5 they answered and their responses have been collected for
analysis.
Using the statistical tools, author has calculated the correlation between productivity
and performance of building residential project and Productivity factor has been
calculated of all 39 different projects.
In the end, author has analysed the equipment management practices score and as per
the analysis, if the score is below 0.93 then the whole project performance will be
calculated as low and same as with productivity of labours.
So, by using this paper a contractor can analyse the score for his building site and can
compare the productivity from baseline to get the higher number of productivity and
thus high project performance.
2. Now, the paper will focus in explaining the concepts and related terms to
improve the productivity and performance of the construction site.
Some authors have said that productivity is all about to how much extent the
resources can be used on the site. On the other hand, some said how efficiently and
effectively the resources can be used on the construction site.
There are many engineers and managers who believe that productivity and
performance is closely related and performance is only judged by the progress of the
residential construction site. Performance should not be judged on monetary terms.
Productivity can be explained on both economic and employee levels. Economic level
describes the whole industry productivity and employee level productivity is limited
to site performance.
In this paper, author has talked about employee level productivity and how can the
performance of the site can be improved using the same productivity.
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Productivity depends upon the input and output factor. The input factor is hours
worked and how much output came. And total productivity contains everything
including capital, energy, material etc.
According to the graph analysis, there is very less different between labour and total
productivity. And the main problem is that there is very less innovation to develop the
productivity.
But author has suggested there are so many innovations in other industries and
construction industry should implement the measures on the construction site.
Productivity always work on the index of relativity. Nobody can judge the
productivity on the basis of decreasing or increasing.
Many authors have concluded that there is a problem in productivity development like
new technology, skilled labour and management capability. Author says that anybody
can judge in anyway the productivity and performance of the residential construction
site but it should be measured only on the basis of quality of the work. (Aki Pekuri,
Harri Haapasalo, & Maila Herrala, 2011)
Many authors have concluded that performance of the work should not be judged on
productivity but it helps sometimes to create a relationship between them because
productivity is too specific to work upon and performance of the site is always quality
of the work and excellence of the work. It includes profitability too.
There are so many indicators are available one can take to judge the performance and
productivity of the construction site. But the main drawback is that it is hard to decide
which input to take to judge the productivity which governs the performance of the
site.
Many authors have analysed that three parameters quality, safety and time are the best
parameters to analyse the relationship between productivity and performance.
In conclusion, the development and the research happening in the productivity and
performance area is relatively slow and still there is much more place for
improvement. Performance and productivity relationship can’t be judged in solely.
Construction performance of a residential site always depends upon the quality of the
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work, safety measures for labour and time management of the project and all it
depends upon the productivity.
Q1. Which type of project you are handling or you had managed?
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Q3. How many years of experience do you have in the above mentioned industry?
Q6. Above listed productivity types, which one governs the performance of the
residential project?
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Q7. What was the main reason of lowering down the site performance, in your
knowledge?
Q8. What was the main reason of lowering down the construction productivity on
same site?
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Q9. Please Rank all these Performance Indicators and tell us which performance
indicator matters to you most?
Q12. Rate which project performance indicators affects the labour productivity?
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Q13. Rate which performance indicator affects the equipment productivity?
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Methodology for Analysis
A questionnaire has been designed related to productivity and performance for a
construction site and has been asked to almost 50 experts from the industry. The
respondents have responded as per their capability and best of knowledge.
For the research part, survey has been done and 13 questions has been asked to them.
Afterwards, survey has been analysed on the basis of qualitative and quantitative data
analysis.
The qualitative analysis has been used as a tool to understand about the problem and
why those performance indicators have been chosen so that research can go in
direction well. This data analysis will further provide a proper backup for the
quantitative data analysis.
For the research objective such as to find a relationship between productivity and
project performance, some indicators have been found separately for productivity as
well as performance. Then afterwards, a relationship between productivity indicators
and performance indicators have been found by the help of statistical tool spearman
coefficient.
Finally, we will see that the quantitative analysis data will be done in two phases. One
will be the analysis part and second will be conclusion part.
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Qualitative Data Analysis
For the survey purpose, some productivity types and indicators and some performance
indicators have been collected from various sources.
Productivity types-
1. Labour Productivity
2. Equipment productivity
3. Managerial Decision
Productivity Indicators-
1. Material unavailability
2. Employee Irregularity
3. Safety
4. Fund Unavailability
5. Poor Decision Making
Performance Indicators-
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18. Research and development
19. Impact on society
20. Waste
21. Energy use
Labour Productivity
The whole construction project runs only on three basic elements and i.e. cost, time
and quality and they are called triple constraint in any of the construction project. No
doubt, on a construction site, labours are the main variable. Either their productivity
can lead the project or make it in loss. That’s why labour productivity is also a part of
construction planning. Generally, we judge labour productivity in cost and work hour
terms. It is the ratio of output upon labour cost or work hour.
If labours are showing less productivity on a construction site, it means either scope
has been changed or rework is there. According to a research, almost 29% loss has
been faced just because of change in scope that is scope creep.
So, it is well known that labour productivity is one of the main factors in success or
failure of the project.
Equipment Productivity
Let’s take an example of tower crane. If, on a construction site, tower crane is
situated where it can perform only 2 or 3 task then the overall productivity of the
crane will reduce. So, the strategic location of crane should be planned way back the
construction starts. So it is clear that a manager should plan these things at project
level not on activity level.
xviii
If any construction plan is increasing the productivity of an activity, then it is not
necessary that it will increase the productivity of project. Equipment location or work
should be planned on project level, not on activity level.
It is clear that almost 50-55% equipment cost is there in any of the construction
project and it is very important to plan for their maintenance and strategic location.
Otherwise, the project may go cost overrun or delay.
When the equipment is being hired or bought, the planning should start at that time
only not after that. Bringing exact equipment on site that is required for that particular
task can be key for a successful project.
Managerial Decision
Despite of having best equipment and labour force on a construction site, if manager
is not capable of taking decision right then the whole project can be messy and may
lead to failure. It is found in a study that managers are the main factor of making the
project successful or failure. It is the manager who give directions to the team how,
when and where to operate to get the maximum result.
Suppose there is a task which is on critical path and instead of deploying resources
there, manager diverts the resources because of his poor managerial decision power,
the project will definitely fall in loss or delay.
So, it is very important to deploy a good manager on site who can lead the team
effectively and efficiently.
Material Unavailability
If material is not available on the right location at the right time, then the overall
productivity of the project or an activity may go down. If the construction site is
small, then there is no problem because movement of labour and equipment will not
be much but if the construction site is very large then it can impact the overall
productivity of the site because movement of labour and equipment will make such an
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impact that it may decrease or increase the overall productivity of the construction
project.
Fund Unavailability
If the project is cost budget and not very huge then it will not impact the project much
because the needed funds can be taken from contingency or can be loaned. But if the
project is huge such as 5000 Cr. Then it might be a problem for the contractor to bring
the required money on the site and it will definitely impact the project’s overall
productivity
Cash flow
Proper cash flow to all the subcontractors and shareholders always increase the
overall productivity of the project. But if this is not happening then subcontractors
might fall into the situation where they are not able to put proper resource on the
particular activity.
Waste
Waste is a biggest threat now-a-days for the most of big companies who are working
on a big project. If not controlled properly, it can convert resource into waste in
moments. So, waste minimization is necessary on any construction projects. It can
increase the productivity of the project. Waste can be used as a resource also
sometimes such as finishing work or for aesthetics work etc. It can minimize the cost
of the project and improve the productivity and overall performance of the project.
Most of the time high performance professionals increase the productivity of the
project or an activity on site. Their knowledge and understanding of the things make a
difficult task very easy. Their way of working and knowledge and experience can be
explicated and later on can be used in different projects to get the maximum output.
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measure the performance of the project. For that matter, key performance indicators
have been developed by experts to measure the performance of the project. But, now-
a-days key performance indicators have been criticized because they don’t provide the
way how performance of the project can be improved and it does not tell us whether
there is a way to change or not.
The most important aspect of key performance indicator is that it should match with
project requirement and its need otherwise it may work reversely. And it should be so
simple that it can be fit with any project very easily.
The problem is that most of the key performance indicators are built only for the
product and to increase the profit. No any company has built the key performance
indicators to meet the customer expectations. Then some companies started building it
accordingly and the started focussing on waste, cost, safety, quality, work process.
As a result, it has been stated that to take most out of performance indicators, any
company should shift their attention from measurement towards management.
Productivity vs Performance
All the analysis will be done on these two- Productivity and performance to better
understand which factor affects the most to the residential site.
For gathering the data, survey method has been used to perform the qualitative
analysis. After getting the 18 responses on above mentioned questions from the
respondents, it is clear that the most effective performance indicators are time and
cost, safety and client satisfaction on a multi-storey residential project.
After the response, it is also clear that construction productivity equally depends upon
labour productivity, equipment productivity and managerial decision.
xxi
The reasons to lower down the site performance was found Material unavailability,
Employee Irregularity, Fund unavailability and poor decision making.
To the surprise, reasons to lower down the productivity on same site, found Material
unavailability, Employee Irregularity, Fund unavailability. It does not depend upon
the poor decision making.
The respondents have been asked to rank all the performance indicators that they
think can affect the project site in a positive or negative manner and the response was
highly precise and i.e. Risk Control, Labour efficiency, Partnership with suppliers,
Innovation in process, Number of high performance professional, Defects, R&D,
Waste and Cash Flow.
But when respondents have been asked about Labour productivity Vs project
performance, response was strong and it’s true because labours are the first life line of
any construction project and rest of the things come after.
Resource Management
Managing the resource on a construction site is not an easy task if the construction site
is very big. Equipment movements and labour movements on the site can reduce the
overall productivity of the project and hence overall performance of the project. It
may reduce the performance of the project or increase depending upon the planning of
the construction planner how he is planning for the movement of the labours and
xxii
equipment. Suppose, on a big residential construction site the cements and the tiles
have been stacked on block b-2 but the requirement of the tiles are on the block c-3
which is 300 m far away from the block b-2. It means that the resource has not been
managed properly on the site. Instead, the resource planning should have been put one
day before wherever the requirement is, as per the planning source.
Sometimes, just before the start of an activity, proper needed equipment is not
available and productivity and performance of the project may go down.
But, if the resource management has been done properly like material is available on
time or equipment is maintained on time then the productivity of employees will
increase and hence the overall performance of the project will increase.
Construction Defects
1- There are certain defects which occur in design stages. These defects are
generally occurred due to architects who design the building and it does
not come as dictated or deigned in the plan.
2- This can be the biggest factor for the productivity and performance of the
project and i.e. material defect. On some construction sites, the low quality
material has been used and it does not meet the customer requirement at all
and then it reduces the performance of the project.
It occurs because suppose doors or windows are not good in quality and the leaks or
air are breaking into the house then the repair cost will be occurred by the company
and it will reduce the productivity of the resource and overall performance of the
project.
So, it is clear that material defects can also decrease the overall productivity and
performance of the project. So, project manager or site engineer should aware what
the company policy is regarding the quality and meet that standard.
xxiii
Quantitative Analysis-
For the quantitative analysis purpose, correlation analysis and linear regression model
will be used to know the relationship between Productivity and Performance of the
multi-storey residential project.
RII analysis is done to prioritize the responses of the respondent and get the actual main
factor for the analysis.
The formula for RII is = (Total no. of responses) / (No. of responses*Highest response)
As per the RII analysis, we got that respondents believe that safety, risk control,
partnership with suppliers, productivity, quality control, empowered work force,
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waste, energy use should be taken care on the construction site. But this analysis is not
crisp. To get the more accurate relationship between productivity and performance
indicators, correlation data should be taken. This analysis will provide the more
accurate analysis.
This analysis will help us in finding the main indicator or indicators that affect the
construction site.
More or less, most affective ranking suggests that labour efficiency and innovation is
also important as they lead the construction project from the back end. A construction
manager can’t ignore the labours productivity, their safety and their productivity. As
labours can make the project successful and they can make the project failure.
And, for sure, this will impact the project negatively and it will affect the project
delivery as well as productivity and performance of the project.
That’s why, in India, most of the small construction companies are struggling and
trying to come in economies of scale. But they can’t because their motives and
attention are focused on only profit margins.
xxv
10.
[Q10] Please
Rank all
0.209048 0.5 0.16 -0.03 -0.39
these Pe ...
Effectiveness
of planning
10.
[Q10] Please
Rank all
these Pe ... 0.314762 0.18 -0.11 0.65 0.49
Partnership
and
suppliers
10.
[Q10] Please
Rank all 0.314762 0.6 0.09 0.15 -0.33
these Pe ...
Productivity
11. [Q11]
Rate how
equipment 0.55 1 0.12 -0.04 -0.1
productivit
...
12. [Q12]
Rate how
labor 0.37 0.12 1 0.37 -0.29
productivity
af ...
13. [Q13]
Rate which
project 0.18 0.72 0.32 0.047059 -0.04
performa ...
Defects
xxvi
14. [Q14]
Rate which
performance -0.4 -0.37 0.19 0.75 0.052941
i ...
Motivation
14. [Q14]
Rate which
performance
i ... 0.19 0.37 0.57 0.68 0.052941
Partnership
and
suppliers
xxvii
Conclusion
As per the correlation analysis, it is clear that effectiveness of planning and quality of
service and work is directly related to productivity. Furthermore, Partnership with
Supplier is directly related to project performance.
Since, it is clear that there are many indicators of project performance and
productivity on a construction site but analysis says that there are very few and
important indicators which affects that productivity and performance of the
construction site.
It is true also because effectiveness of planning covers most of the thing, say, resource
management, cost overrun or whatever the indicators are that can disturb the
performance of the project.
Partnership and suppliers has also been emphasised by the respondents. It is because it
covers most of the stakeholders that can make the project successful or failure.
xxviii
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