Quality Control

Quality Control 、Safety During Construction and Cost Control Quality and Safety Concerns in Construction Quality control and safety represent increasingly important concerns for project managers. Defects or failures in constructed facilities can result in very large costs. Even with minor defects, re-construction may be required and facility operations impaired. Increased costs and delays are the result. In the worse case, failures may cause personal injuries or fatalities. Accidents during the construction process can similarly result in personal injuries and large costs. Indirect costs of insurance, inspection and regulation are increasing rapidly due to these increased direct costs. Good project managers try to ensure that the job is done right the first time and that no major accidents occurs on the project. As with cost control, the most important decisions regarding the quality of a completed facility are made during the design and planning stages rather than during construction. It is during these preliminary stages that component configurations, material specifications and functional performance are decided. Quality control during construction consists largely of insuring conformance to these original design and planning decisions. While conformance to existing design decisions is the primary focus of quality control, these are exceptions to this rule. First, unforeseen circumstances, incorrect design decisions or changes desired by an owner in the facility function may require re-evaluation of design decisions during the course of construction. While these changes may be motivated by the concern for quality, they represent occasions for re-design with all the attendant objectives and constraints. As a second case, some designs rely upon informed and appropriate decision making during the construction process itself. For example, some tunneling methods make decisions about the amount of shoring required at different locations based upon observation of soil conditions during the tunneling process. Since such decisions are based on better information concerning actual site conditions, the facility design may be more cost effective as a result. Any special case of re-design during construction requires the various considerations discussed. With the attention to conformance as the measure of quality during the construction process, the specification of quality requirements in the design and contract documentation becomes extremely important. Quality requirements should be clear and verifiable, so that all parties in the project can understand the requirements for conformance. Safety during the construction project is also influenced in large part by decisions made during the planning and design process. Some designs or construction plans are inherently difficult and dangerous to implement, whereas other, comparable plans may considerably reduce the possibility of accidents. For example, clear separation of traffic from construction zones during roadway rehabilitation can greatly reduce the possibility of accidental collisions. Beyond these design decisions, safety largely depends upon education, vigilance and cooperation during the construction process. Workers should be constantly alert to the possibilities of accidents and avoid taken unnecessary risks. Total Quality Control Quality control in construction typically involves insuring compliance with minimum standards of material and workmanship in order to insure the performance of the facility according to the design. These minimum standards are contained in the specifications. For the purpose of insuring compliance, random samples and statistical methods are commonly used as the basis for accepting or rejecting work completed and batches of materials. Rejection of a batch is based on non-conformance or violation of the relevant design specifications. An implicit assumption in these traditional quality control practices is the notion of an acceptable quality level which is a allowable fraction of defective items. Materials obtained from suppliers or work performed by an organization is inspected and passed as acceptable if the estimated defective percentage is within the acceptable quality level. Problems with materials or goods are corrected after delivery of the product. In contrast to this traditional approach of quality control is the goal of total quality control. In this system, no defective items are allowed anywhere in the construction process. While the zero defects goal can never be permanently obtained, it provides a goal so that an organization is never satisfied with its quality control program even if defects are reduced by substantial amounts year after year. This concept and approach to quality control was first developed in manufacturing firms in Japan and Europe , but has since spread to many construction companies. Total quality control is a commitment to quality expressed in all parts of an organization and typically involves many elements. Design reviews to insure safe and effective construction procedures are a major element. Other elements include extensive training for personnel, shifting the responsibility for detecting defects from quality control inspectors to workers, and continually maintaining equipment. Workers involvement in improved quality control is often formalized in quality circles in which groups of workers meet regularly to make suggestions for quality improvement. Material suppliers are also required to insure zero defects in delivered goods. Initially, all materials from a supplier are inspected and batches of goods with any defective items are returned. Suppliers with good records can be certified and not subject to complete inspection subsequently. The traditional microeconomic view of quality control is that there is an “optimum” proportion of defective items. Trying to achieve greater quality than this optimum would substantially increase costs of inspection and reduce worker productivity. However, many companies have found that commitment to total quality control has substantial economic benefits that had been unappreciated in traditional approaches. Expenses associated with inventory, rework, scrap and warranties were reduced. Worker enthusiasm and commitment improved. Customers often appreciated higher quality work and would pay a premium for good quality. As a result, improved quality control became a competitive advantages. Of course, total quality control is difficult to apply, particular in construction. The unique nature of each facility, the variability in the workforce, the multitude of subcontractors and the cost of marking necessary investments in education and procedures make programs of total quality control in construction difficult. Nevertheless, a commitment to improved quality even without endorsing the goal of zero defects can pay real dividends to organizations. Safety Construction is a relatively hazardous undertaking. These are significantly more injuries and lost workdays due to injuries or illnesses in construction than in virtually any other industry. These work related injuries and illnesses are exceedingly costly. The Construction Industry Cost Effectiveness Project estimated that accidents cost $8.9 billion or nearly seven percent of the $ 137 billion (in 1979 dollars) spent annually for industrial, utility and commercial construction in the United States. Included in this total are direct costs (medical costs, premiums for workers? compensation benefits, liability and property losses) as well as indirect costs (reduced worker productivity, delays in projects, administrative time, and damage to equipment and the facility). In contrast to most industrial accidents, innocent bystanders may also be injured by construction have resulted in fatalities to passerby?s. Prudent project managers and owners would like to reduce accidents, injuries and illnesses as much as possible. As with all the other costs of construction, it is a mistake for owners to ignore a significant category of costs such as injury and illness. While contractors may pay insurance premiums directly, these costs are reflected in bid prices or contract amounts. Delays caused by injuries and illnesses can present significant opportunity costs to owners. In the long run, the owners of constructed facilities must pay all the costs of construction. For the case of injuries and illnesses, this general principle might be slightly qualified since significant costs are borne by workers themselves or society at large. However, court judgments and insurance payments compensate for individual losses and ultimately borne by the owners. Various measures are available to improve jobsite safety in construction. Several of the most important occur before construction is undertaken. These include design, choice of technology and education. By altering facility designs, particular structures can be safer or more hazardous to construct. For example, parapets can be designed to appropriate heights for construction worker safety, rather than the minimum height required by building codes. Choice of technology can also be critical in determining the safety of a jobsite. Safeguards built into machinery can notify operators of problems or prevent injuries. For example, simple switches can prevent equipment from being operating when protective shields are not in place. With the availability of on-board electronics (including computer chips) and sensors, the possibilities for sophisticated machine controllers and monitors has greatly expanded for construction equipment and tools. Material and work process choices also influence the safety of construction. For example, substitution of alternative material for asbestos can reduce or eliminate the prospects of long term illnesses such as asbestosis. Educating workers and managers in proper procedures and hazards can have a direct impact on jobsite safety. The realization of the large costs involved in construction injuries and illnesses provides a considerable motivation for awareness and education. Regular safety inspections and safety meetings have become standard practices on most job sites. Pre-qualification of contractors and sub-contractors with regard to safety is another important avenue for safety improvement. If contractors are only invited to bid or enter negotiations if they have an acceptable record of safety (as well as quality performance), then a direct incentive is provided to insure adequate safety on the part of contractors. During the construction process itself, the most important safety related measures are to insure vigilance and cooperation on the part of managers, inspectors and workers. Vigilance involves considering the risks of different working practices. In also involves maintaining temporary physical safeguards such as barricaders, braces, guiltiness, railings, toe boards and the like. Sets of standard practices are also important, such as: ? requiring hard hats on site. ? requiring eye protection on site. ? requiring hearing protection near loud equipment. ? insuring safety shoes for workers. ? providing first-aid supplies and trained personnel on site. While eliminating accidents and work related illnesses is a worthwhile goal, it will never be attained. Construction has a number of characteristics making it inherently hazardous. Large forces are involved in many operations. The jobsite is continually changing as construction proceeds. Workers do not have fixed worksites and must move around a structure under construction. The tenure of a worker on a site is short, so the worker?s familiarity and the employer-employees relationship are less settled than in manufacturing settings. Despite these peculiarities and as a result of exactly these special problems, improving worksite safety is a very important project management concern. A cost control procedure for construction works Introduction The construction industry, unlike many manufacturing situations, is concerned mostly with one-off projects. This naturally creates difficulties for effective management control, because each new contract is often characterized by the following features: ? A fresh management team ? Labor is transient and recruited on an ad hoc basis ?Sites are dispersed through the county, which tends to cause problems in effective communications with other parts of the company ?Subcontractors and …lump? labor are common ? Added to all this are the ever-changing weather conditions Nevertheless, irrespective of the scale of operation from small sub-contractor to the multifaceted project, production costs need to be monitored and controlled if the anticipated level of profit is to be received. Fundamentals To control costs is an obvious objective of most managers, but it should be reconciled that no amount of paperwork achieves this control. Ultimately the decision of the manager that something should be done differently, and the translation of that decision into practice, are the actions that achieve control. The paperwork can provide guidance on what control actions should be taken and, while we shall continue to call it …the cost control system?. It should more properly be called …the cost information system?. The elements of any control system are: ? Observation ? Comparison of observation with some desired standard ? Corrective action to take if necessary The domestic thermostat is a good example of a controller. This instrument measures temperature, compares it with the desired range, and then switches the temperature heating system …on?or …off?depending on how the current temperature compares with the desired range. A cost control system should enable a manager to observe current cost levels, compare them with a standard plan or norm, and institute corrective action to keep cost within acceptable bounds. The system should help to identify where corrective action is necessary and provide pointers as to what that action should be. Unlike the humble thermostat, most cost control systems have an inordinately long response time. Even the best current system provides information on what was happening last week or last month. As the work is typically part of a one-off project it is quite likely that the information is only partly relevant to the work going on now. So the scope for corrective action is limited. For example, the system might indicate on 1 May that the from-work operation in March cost too much. If from-work operations are still continuing the manager will give this work particular attention, but if form-work is complete nothing can be done to correct the situation. In the conventional systems described below two fundamental points are important. First, all costs must be allocated, even if this is on a very …coarse grained?coding arrangement. If only the major items are monitored you can be sure that the wasted time will be booked against the items which are not being monitored. Thus the manager will be deluded by the reports on the …important items?into thinking the whole site is satisfactory; in fact it might be incurring disastrous hidden losses. Second, there must always be a standard against which to compare recorded costs. In simple projects this might be the bill of quantities; generally, however, a properly prepared and appropriately updated contract budget forms a better basis. Systems in Current Use The following systems and variants of them are in use in the construction industry. The selection of a system depends in part on the size and complexity of the contract, but more on the attitude and level of sophistication of top management. By overall profit or loss The contractor waits until the contract is complete and then compares the sums of money that have been paid with the monies incurred in purchasing materials, payments for labor, subcontractors, plant and overheads. The figures are normally extracted from the financial accounts compulsorily kept by all companies. Such a system is useful only on minor contracts of short duration involving a small workforce and little construction equipment. It sacredly qualified as a control system as the information it produces can only be used to avoid the recurrence of gross errors in later contracts. Profit or loss on each contract at valuation dates The total costs to date are compared with valuations gross of retentions. Care has to be taken to include the cost of materials delivered but not yet invoiced and to exclude materials on site not yet built into the permanent work. If the certificate is not a time reflection of the value of work done, a further adjustment is necessary. This system suffers from the disadvantage that there is no breakdown of the profit figure between types of work; it therefore provides guidance only which contract requires management attention. It is not suitable for contracts, which involve significant set-up costs, which are distributed over the unit rates. Unit costing In this system costs of various tapes of work, such as mixing and placing concrete, are recorded separately. The costs, both cumulatively and on a period basis, are divided by the quantity of work of each type that has been done. This provides unit costs, which can be compared with those in the tender. Considerable care must be taken to ensure that all costs are accounted for, as indicated above under …Fundamentals?. Any miscellaneous costs must be recorded and allowed for in some way, e.g. by proportional distribution over the defined work-types. It is usually best to record site costs only and to compare with bill rates net of contribution for profit and head office overheads. Systems based on the principles of standard costing Standard costing has been used successfully in manufacturing industries, particularly in companies producing a limited range of products or at least a limited range of basic components. Standard minute values are associated with the production of each component and assembly and converted to money values by reference to the hourly rates of the appropriate grades of operatives. Variances are calculated, basically by comparing the value of the output with the cost of producing it. A variance is the amount by which the achieved profit differs from the budgeted profit. With appropriate records it is possible to analyze the total variance into sub-variances, e.g.: ? Material price ? Material usage ? Labor rate ? Labor efficiency ? Fixed and variable overhead expenditure ? V olume of production ? Sales Standard costing is seldom directly applicable in construction owing to the variety of the product. This makes the use of standard minute values difficult if not impossible. However, as an alternative, the value of work done can be assessed in relation to the contract budget, which, in turn must reflect the amount that the contractor can expect to be paid. One of the important features is the calculation of a sales variance. This encourages the company to define sales (marketing, public relations, negotiations, estimating and bid strategy) as the responsibility of one department. An adverse variance indicates immediately that the level of acquiring new contracts is inadequate. Altogether, quite substantial departures from the manufacturing system are necessary and this accounts for the fact that standard costing is not in common use in construction. However, the system is basically very sound and provides comprehensive control of the company from boardroom down to workforce. PERT/cost This system requires each contract to be networked with PERT (performance evaluation and review technique). The values of work packages, which in essence are groups of activities, are assessed in advance. The time update of the network provides the value of work done as a …by-product? of the calculation. The value can be divided by cost code, provided that the work package information is similarly divided. Thus, when incurred costs are recorded against the same codes, variances can be calculated for management information.