OPM625 University of Maryland Portuguese Construction Company Project Management Paper The Portuguese Construction Company discussed in the case successful

OPM625 University of Maryland Portuguese Construction Company Project Management Paper The Portuguese Construction Company discussed in the case successfully used project management to improve their operations that resulted in supply chain management gains.What is interesting about this case is the organization worked to change many of their operations to improve their business overall. In general, having such a large scope can result in serios delays and possible failures but this construction company worked very hard to reduce problems that resulted in successful project results.

The objectives of the case are:

To introduce new project and/or operations management practices that would help the Portuguese Construction Company improve their operations.
Make improvements using project management methodology to change and optimize the Portuguese Construction Company’s operations.
To reengineer some of the Portuguese Construction Company’s operations to increase their supply chain management efficiencies.

The case study shows what resilient planning, effective project management, technology and decision making can do to enhance the supply chain management capabilities of an organization. The name of the organization isn’t disclosed but there is a significant amount of information about the current and new operations and supply chain management capabilities as well as their project management practices.

Assignment Questions

How would you characterize the construction company’s process, organization, culture, and management based on the facts of the case?Also, based on the facts of the case what else would you propose to improve the operational system to increase the Portuguese Construction Company’s supply chain management practices. (Note: Consider more than just the internal operations of the organization, stakeholders, etc.)
Decision point:The construction company is planning a future development of the ICS to integrate a dynamic project management module where the activities will be linked together in a way that any change made in the plan version of any given project can easily be reflected in all the other construction site plans.
Imagine one of Portuguese Construction Company’s project is broken down into the following 10 activities:

Using a project management plan how you would go about implementing this plan and what would you recommend the organization do from an operations management standpoint to ensure the project is a success.

(cont’d. – see question 3 below)

ACTIVITY

IMMEDIATE PREDECESSOR

DURATION (WEEKS)

1

–

4

2

1

2

3

1

4

4

1

3

5

2,3

5

6

3

6

7

4

2

8

5

3

9

6,7

5

10

8,9

7

A. Draw the network diagram (identify each activity and its duration inside their respective nodes, and include ES, EF, LS & LF numbers outside each node – see sample for activity 1 below)B. Identify the critical path and list the activities in it. Based on this, how many weeks will it take to finish the project?

4

0

C. If activities 1 and 10 cannot be shortened, but activities 2 through 9 can be shortened to a minimum of one week each at a cost of $10,000 per week, which activities would you shorten to cut the project by four weeks? OPM 625
The Portuguese Construction Company discussed in the case successfully used project
management to improve their operations that resulted in supply chain management gains.
What is interesting about this case is the organization worked to change many of their
operations to improve their business overall. In general, having such a large scope can result in
serios delays and possible failures but this construction company worked very hard to reduce
problems that resulted in successful project results.
The objectives of the case are:
1. To introduce new project and/or operations management practices that would help the
Portuguese Construction Company improve their operations.
2. Make improvements using project management methodology to change and optimize the
Portuguese Construction Company’s operations.
3. To reengineer some of the Portuguese Construction Company’s operations to increase their
supply chain management efficiencies.
The case study shows what resilient planning, effective project management, technology and
decision making can do to enhance the supply chain management capabilities of an
organization. The name of the organization isn’t disclosed but there is a significant amount of
information about the current and new operations and supply chain management capabilities as
well as their project management practices.
Assignment Questions
How would you characterize the construction company’s process, organization, culture, and
management based on the facts of the case? Also, based on the facts of the case what
else would you propose to improve the operational system to increase the Portuguese
Construction Company’s supply chain management practices. (Note: Consider more than
just the internal operations of the organization, stakeholders, etc.)
2. Decision point: The construction company is planning a future development of the ICS to
integrate a dynamic project management module where the activities will be linked together
in a way that any change made in the plan version of any given project can easily be
reflected in all the other construction site plans.
Using a project management plan how you would go about implementing this plan and what
would you recommend the organization do from an operations management standpoint to
ensure the project is a success.
1.
(cont’d. – see question 3 below)
3. Imagine one of Portuguese Construction Company’s project is broken down into the following 10
activities:
ACTIVITY
IMMEDIATE PREDECESSOR
DURATION (WEEKS)
1
–
4
2
1
2
3
1
4
4
1
3
5
2,3
5
6
3
6
7
4
2
8
5
3
9
6,7
5
10
8,9
7
a. Draw the network diagram (identify each activity and its duration inside their respective nodes,
and include ES, EF, LS & LF numbers outside each node – see sample for activity 1 below).
0
4
1 (4)
0
4
b.
Identify the critical path and list the activities in it. Based on this, how many weeks will it take
to finish the project?
c.
If activities 1 and 10 cannot be shortened, but activities 2 through 9 can be shortened to a
minimum of one week each at a cost of $10,000 per week, which activities would you shorten
to cut the project by four weeks?
Exceeeds Expectations (30 – 27 points)
30%
Question 1: Plan an
Operational System
Demonstrates an excellent ability to devise and plan an
operational system
Exceeeds Expectations (30 – 27 points)
30%
Question 2: Improve an
Demonstrates an excellent ability to analyze improve
Operational System
an operational system
Exceeeds Expectations (30 – 27 points)
30%
Accurately demonstrates project process flow and
Question 3: Design an calculates required additional steps precisely.
Operational System Proficiently converts pertinent information into an
insightful graphical and mathematical representation
contributing to further subject matter understanding.
Exceeeds Expectations (5 – 4.5 points)
5%
Communication
Professionalism
Grammar, sentence structure, paragraph structure,
spelling, punctuation were correct without any errors
Exceeeds Expectations (5 – 4.5 points)
5%
100%
APA Format
Paper format, In-text references and references are in
APA format without any errors
Meets Expectations (26 – 24 pts)
Demonstrates an appropriate ability to
devise and plan an operational system
Meets Expectations (26 – 24 pts)
Demonstrates an appropriate ability to
analyze improve an operational system
Meets Expectations (26 – 24 pts)
Demonstrates project process flow with
minor errors and calculates most of the
required additional steps. Converts pertinent
information into graphical and mathematical
representations with partially appropriate
outcomes.
Meets Expectations (4.5 – 4 pts)
Fails to Meet Expectations (23 – 21 points)
Doesn’t demonstrate an ability to devise and
plan an operational system
Fails to Meet Expectations (23 – 21 points)
Doesn’t demonstrate the ability to analyze
improve an operational system
Fails to Meet Expectations (23 – 21 points)
Attempts to demonstrate project process flow
with major errors and miscalculates most of the
required additional steps. Improperly converts
pertinent information into graphical and
mathematical representations with
inappropriate outcomes.
Fails to Meet Expectations (4 – 3.5 points)
Grammar, sentence structure, paragraph
Grammar, sentence structure, paragraph
structure, spelling, punctuation were correct structure, spelling, punctuation were correct for
for the most part with minor errors
the most part with some major errors
Meets Expectations (4.5 – 4 pts)
Paper format, In-text references and
references are in APA format for the most
part with only a few errors
Fails to Meet Expectations (4 – 3.5 points)
Paper format, In-text references and references
are vaguely in APA format with multiple errors
SUPPLY CHAIN MANAGEMENT IN
CONSTRUCTION – CASE STUDY OF A
PORTUGUESE COMPANY
Tiago Pinho1, José Telhada2 and Maria S. Carvalho3
ABSTRACT
The purpose of this paper is to present the preliminary results of the implementation
of a construction supply chain management application, which is being developed in a
PhD graduation project. This project was thought to overcome significant
inefficiencies of the rudimentary and bureaucratic communication system of a case
study company. The main result of this implementation was the design and the
implementation of a web portal that allows the adequate portability to help local
project managers on construction sites filling their material and equipment orders to
the central warehouse. The project involved several stages, including preparatory
reengineering processes conducted in the logistics sector and the implementation of a
fleet management system. The web portal is being currently used by the company and
there are now clear evidences that its implementation brought effective competitive
gains by minimizing communication errors, improving resource usage, lowering stock
levels and, most of all, by reducing the overall costs of construction projects.
KEY WORDS
supply chain management, construction logistics, information system, case study
chains offers an important competitive
advantage.
The internal supply chain is related
to the management and delivery of
construction materials originated from
several internal production plants,
whereas the external supply chain is
associated
with
the
suppliers’
deliveries
and
transportation
management. So, developing and
implementing an information system
capable of aggregating the scattered
information across several departments
inside a given company will constitute
an internal competitive advantage.
INTRODUCTION
As market evolution drives players
into a more competitive struggle, it is
important for companies to improve
their internal potential and minimize
their internal waste. The construction
industry sector is not an exception to
this new market rule. Hence, managers
seek ways to improve their companies
and realise that it is inside the internal
structure of companies that lay the
more chance to have effective gains.
Hence the managerial orientation for
the optimization of internal supply
1
2
3
PhD Student, Systems and Production Department, School of Engineering – Gualtar, University of
Minho, Braga, Portugal, tiago.pinho@dps.uminho.pt
Professor, Systems and Production Department, School of Engineering – Gualtar, University of
Minho, Braga, Portugal, telhada@dps.uminho.pt
Professor, Systems and Production Department, School of Engineering – Gualtar, University of
Minho, Braga, Portugal, sameiro@dps.uminho.pt
821
Supply Chain Management in Construction – Case Study of a Portuguese Company
Tiago Pinho, José Telhada and Maria S. Carvalho
storage facility (Agapiou, 1998) and
not
measuring
and
registering
everything that it is possible to
measure and register (Bertelsen, 1999).
In particular, the company had been
suffering
from:
(i)
deficient
communication
between
the
construction site and the main office,
the orders were made by phone calls
and fax; (ii) at the main office, and
between departments, the information
was successively replicated by form
papers and copied to non-standardized
spreadsheets. In conclusion, the
excessive bureaucracy and the
deficient communication channels are
extremely susceptible to induce errors
in the internal supply chain, thus
elevating the final cost of the
construction projects.
All of the problems described
above arouse the importance of the
design and implementing new
procedures
and
an
adequate
information
and
communication
system, capable of providing accurate
and up-to-date information across the
various departments of the company.
This paper is organized as follows:
the next section describes theoretical,
namely the lean construction and the
computer integrated construction,
including the ICS. The following
section presents explanation of the
reengineering process conducted inside
the company. The web portal and their
features are presented in the
continuous section. Main results are
discussed and in the final section
conclusions are presented.
This paper aims to describe the
most critical reengineering processes
carried
out
in
a
Portuguese
construction company and to describe
the development stages, main features
and the results of the implementation
of
a
new
Information
and
Communication System (ICS), as part
of a PhD project. The PhD project is
entitled “Definition of a Logistics
Network Model in the Construction
Industry: Case Study”, that is being
carried out in dst – domingos da silva
teixeira, s.a., with the main office in
Braga – Portugal. The research project
under development aims to elaborate a
detailed analysis of the logistic system
of a construction company, which
includes processes of reengineering for
the logistics activities by developing
appropriate methodologies and tools
aiming the compression of time,
eliminating waste and improving the
global performance of the logistics
network. A more strategic objective of
the research, in a socio-economical
view, is to contribute to the
improvement of the efficiency and
competitiveness of the construction
industry.
The project started with a
bibliographic review and a deep
analysis in the dst supply chain and the
warehouse management rules. Later,
several reengineering processes were
implemented, prior to the introduction
of a newly developed information
system. Finally, the project addresses
the impact of the information system
inside the company and proposes a
logistics model for the company.
The main problems found during
the initial analysis of the company
logistics network were similar to those
described in the literature, such as the
delays onsite, wastage and shortage of
materials, construction site used as an
LITERATURE REVIEW
Some bibliographic review was made,
in the early stages of the project, which
was the basic knowledge in the
application of the current concepts.
Next, it is presented some of the more
Proceedings for the 16th Annual Conference of the International Group for Lean Construction
Enabling Lean with Information Technology (IT)
822
Supply Chain Management in Construction – Case Study of a Portuguese Company
Tiago Pinho, José Telhada and Maria S. Carvalho
common infrastructure makes possible
all those small wins: the new ICS.
important concepts used in the
development of the information
system.
COMPUTER INTEGRATED
CONSTRUCTION
LEAN CONSTRUCTION
Lean construction has the “goal of
better meeting customer needs while
using less of everything” (Howell,
1999) or “provide a custom product
exactly fit for purpose delivered
instantly with no waste” (Ballard,
2007).
In the following sections, it will be
described how the supply chain
efficiency
was
improved
and,
simultaneously, how the usages of the
resources, both material and human,
were reduced. By developing and
implementing some reengineering
processes, the concept of lean thinking
was implemented inside the company,
in a new customized ICS.
In order to achieve lean, it is
necessary to identify a “clear set of
objectives for the delivery process,
aimed at maximizing performance for
the customer at the project level,
concurrent design of product and
process and the application of
production control throughout the life
of the product from design to delivery”
(Howell, 1999).
Another
interesting
lean
construction concept is the “small
wins” that Vrijhoef introduced when
he said “one small win begets another
and that the change propagates through
snowballing” (Vrijhoef et al. 2001).
In the last sections of the paper, it
will be related and discussed the fact
that the overall improvement of the
company’ supply chain has been
gathering numerous small gains at
different organizational levels and
departments, rather than an off-on
great improvement at any specific
point of the supply chain. However, a
The concept of Computer Integrated
Construction (CIC) is derived from the
computer integrated manufacturing,
where the application of information
technologies was expanding the
manufacturing capabilities. Basically,
CIC is the integration of corporate
strategy,
management,
computer
systems, and information technology
throughout the project’s entire life
cycle and across different business
functions (Jung et al. 1999).
The main issue in CIC is the
integration of several computing
applications used in a construction
project, such as computer aided design,
engineering
analysis,
production
planning and facilities management.
This
kind
of
integration
is
accomplished via automated digital
data transfer between applications
(Björk, 1994).
An interesting example of an
integrated automation system, for
construction industry, is MITOS multi-phase integrated automation
system (Kanoglu et al. 2004).
The most important feature in CIC
is, obviously, the adequate Information
and Communication System (ICS) that
can assist the users in their tasks and
maintain the key factors in close
observation.
The development of a CIC system
in the company is beyond the scope of
the project, but it is a straightforward
aim for further development, as it will
be discussed in the last section. The
conceptual structure of ICS was
thought to allow its future integration
an easy task.
Proceedings for the 16th Annual Conference of the International Group for Lean Construction
Enabling Lean with Information Technology (IT)
823
Supply Chain Management in Construction – Case Study of a Portuguese Company
Tiago Pinho, José Telhada and Maria S. Carvalho
their products or services are important
drivers
in
developing
market
competitiveness. To support electronic
logistics (e-logistics) and reverse elogistics it is necessary to maintain this
competitiveness (Sarkis et al. 2004).
The use of an internet-based portal
adds portability to the ICS, giving
users the ability to access (view &
edit) the information from construction
sites as well as from anywhere else,
including from the company intranet.
Beyond their portability, internetbased systems for information
management are intended to extract
and filter information from a large
amount of information in a database
(Kopanaki et al. 2001).
INFORMATION AND COMMUNICATION
SYSTEMS
A common difficulty in engineering
companies is achieving effective
communication between different
disciplines or departments in house
(Arbulu et al. 2002).
Information Technologies (ITs) in
construction can serve various kinds of
processes, such as production support,
for
instance,
management
of
production (including management of
costs), material administration and
trade of products for building
(Brandon et al. 1995). Making use of
the latest ITs to support construction
projects it is now a common practice
among the several research projects
that have been developed along
previous years. A recent example is the
use of cellular phones to assist and
share information between the foreman
and the engineers (Nakagawa, 2006).
This proved to be very successful in
the online transmission of information.
More recently, Tarantilis et al.
(2008) identified the importance of a
web system to help several business
areas, namely, construction industry.
This system was tested in more than 40
companies in Greece, in areas such as
construction, education, production,
insurance and finance. This system is
used in several areas, such as office
automation, customer relationship
management,
supply
chain
management,
human
resources
management, equipment management
and quality management.
Many Internet and traditionallybased electronic commerce (ecommerce)
companies,
whether
focused on business-to-business (B2B)
or
business-to-consumer
(B2C)
markets, have come to realise that easy
access
to
information
and
communication and the delivery of
REENGINEERING PROCESSES
Before introducing the information
system it was necessary to carry out
some reengineering processes of the
logistics activities. The analysis and
restructuring of the processes were the
starting point for the implementation
of the new information and
communication system and their
completion was a crucial start for the
new improvements to come.
WAREHOUSE RESTRUCTURING AND
AUTOMATION
The most important reengineering
process was perhaps the complete
restructuring of the main headquarters
warehouse, in order to allow a more
efficient storage and handling of
products and equipments (a significant
percentage of the total requirements of
the company pass through this
facility).
As part of the reengineering
process, the interior warehouse was
divided in four separated sections, with
two for the more dangerous and fragile
products and two for the more
Proceedings for the 16th Annual Conference of the International Group for Lean Construction
Enabling Lean with Information Technology (IT)
824
Supply Chain Management in Construction – Case Study of a Portuguese Company
Tiago Pinho, José Telhada and Maria S. Carvalho
(Pinho et al. 2006) and after the test
and implementation phase, the system
was implemented in 60 vehicles. The
system is composed of a Global
Positioning System (GPS) unit and the
communication is made through a
General Packet Radio Service (GPRS)
modem that connects to the central
offices, which allows the real time
visual tool for control. This system
registers the speed, geographical
coordinates, driver identification and
several other parameters, allowing
monitoring,
statistical
analyses
including cost estimation.
expensive and complex equipments.
The external area, of about 18.000m2,
was divided in 33 sections, where the
products are stored according to their
weight and rotation. It was also
necessary
to
develop
several
procedures for the usage of the
warehouse and to create supporting
documents to register the information
in a systematic manner.
The restructuring of the warehouse
allowed more effective receiving and
expediting
of
materials
and
equipments. The products are all
tagged with bar codes in order to
accelerate the expediting, especially in
the documents preparation. This new
procedu…
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