You are project manager on construction

of Hydel-Power project comprising of four

main works viz. Main Dam, Weir, Electric

Power Station and Tunnel. The

requirement of ten construction materials

including cement, steel (six size), sand,

aggregate etc. need to be monitored

daily. Consumption, requirements,

resources on site and in depot needs to

be checked every day. Design an M.I.S.

for efficient working. Assume suitable

data.

MANAGEMENT

INFORMATION

SYSTEM

SODE-NCP 28

Suhaib Juwale

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SCOPE OF WORK

Construction of Hydel Power Project

The above project is divided into four parts:

1. Main Dam

2. Weir

3. Electric Power Station

4. Tunnel

Construction of a Dam - Step 1

To build a Dam the engineers must first de-water the part of the river valley in which

they wish to place the dam. This is usually achieved by diverting the river through a

tunnel.

The tunnel is built through one side of the valley around the planned construction

area. A series of holes is drilled in the rock. Explosives are placed in the drill holes,

blasting takes place and broken rock is then removed. This procedure is repeated

many times until the tunnel is completed. Diversion tunnels are often lined with

concrete.

Construction of a Dam - Step 2

Work on diverting the river starts in summer when river levels are low. Earth-moving

equipment is used to build a small dam (called a cofferdam) upstream of the main

construction area. This acts as a barrier to the river and causes it to flow through the

diversion tunnel.

Another cofferdam is built downstream of the main dam site to prevent water flowing

back into the construction area. Pumps are used to remove any water that seeps

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through the cofferdams. Diversion tunnels are not always necessary when concrete

dams are being built. The river can sometimes be channeled through a large pipe

and the dam constructed around it.

Construction of a Dam - Step 3

The construction methods used in building a dam depend on the type of dam being

built. The first stage normally involves the removal of loose rock and rubble from the

valley walls and river bed.

Concrete-faced rock fill dams require a footing (or plinth) to be constructed around

their upstream edge. The plinth is made from concrete and serves as a foundation or

connection between the dam and the valley walls and floor. It has an important role

in preventing water leakage around the edges of the dam. The area under the plinth

is waterproofed by drilling holes and pumping cement grout into cracks in the rock.

The thin concrete face on the upstream side of the dam is connected to the plinth via

stainless steel and rubber seals called water stops.

Construction of a Dam - Step 4

During dam construction the associated power station and intake works are also

being built. When the dam is completed the diversion tunnel is closed and the lake

begins to fill. The closure of the diversion tunnel has two phases. During low flow a

large re-usable steel gate is lowered across the entrance. The diversion tunnel is then

permanently blocked off by the construction of a concrete plug. In some instances

dewatering outlets are built into the plugs so water can be released during an

emergency.

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MATERIALS MANAGEMENT ORGANISATION

Construction materials which may be required for an embankment dam are clay (for

the core of an earth and rock fill dam) and sand and gravel (for concrete aggregate

and also for filter zones which are placed between the clay core and rock fill of an

earth and rock fill dam. Cement and concrete aggregate are, of course the main

construction materials required for a concrete dam. Structural steel for weirs, gates

and switch yard towers and 40 mm aggregates would be needed for switchyard.

Natural materials (clay, sand, gravel, rock fill) still form the bulk of the materials used to

build many dams. However, man-made geo synthetic materials are increasingly

being used in engineering construction for special purposes.

The basic need of quality material management is to have readily available quality

materials required by the organisation and to keep optional levels of stock of essential

and frequently used items.

Strategic

Developing vendors for critical items

Determining optimum levels of inventory

Reducing varieties of inventory

Tactical

Developing vendor’s performance measures

Determining the impact on material cost, availability and procurement with

design changes

Determining optimum re-order levels

Controlling high value inventory

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Operational

Goods received, rejected and issued

List of excess and deficient items used

List of items rejected items and backlog of supplies

Critical items received and value of inventory in hand

Stores in transit and in inspection

INVENTORY CONTROL MEASURES

In material management, inventory control is an important function. The basic need

of I.C is to ensure the continuity of the construction work with minimum investment in

material. It is mainly concerned with laying down the policies regarding how much

quantity of material should be held in stock so that the main aim of the material

management can fulfilled.

Two Bin System

The Two bin system of inventory control is for materials, the consumption rate for which

is non-uniform. In this system two storage places are made for costly but important

materials. The capacity of stores is more than the quantity consumed in lead time. This

type is useful for less durable materials that are to be used as first come and first use.

EOQ:

The principle of EOQ has very limited applicability in project situations. Usually

sequential arrival of material is desired. The demand of material in project is by and

large highly deterministic. Sufficient care has to be taken in the selection of vendors

has significant impact on the project performance. The demand of materials in a

project situation is highly deterministic.

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The gross requirement of various materials is worked out during the detailed project

report stage. The primary concern in material planning for project is that the cost of

not meeting a demand is very high as it may lead to delay in proper completion.

Hence the right time is the key word in material planning for projects.

This economic order quantity (EOQ) and the numbers of orders are determined

mathematically as under:

Inventory cost C = Ordering cost + Inventory carrying cost

C = Co . N + Ci . A/2N

For cost to be minimum:

dC/dN = Co – Ci . A/ 2. N2 = 0

N2 = Ci . A/2. Co

And C = CoN + Ci A/2N = 1/2N (2CoN2 + Ci A) = 2Ci A/2N

Therefore

Least Inventory cost = square root of 2CoCiA

Re-order Level (ROL):

This is that level of materials at which a new order for supply of materials is to be

placed. In other words, at this level a purchase requisition is made out. This level is

fixed somewhere between maximum and minimum levels. Order points are based on

usage during time necessary to requisition order, and receive materials, plus an

allowance for protection against stock out.

The order point is reached when inventory on hand and quantities due in are equal to

the lead time usage quantity plus the safety stock quantity.

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Formula of Re-order Level or Ordering Point:

The following two formulas are used for the calculation of reorder level or point.

Ordering point or re-order level = Maximum daily or weekly or monthly usage × Lead

time

The above formula is used when usage and lead time are known with certainty;

therefore, no safety stock is provided. When safety stock is provided then the

following formula will be applicable:

Ordering point or re-order level = Maximum daily or weekly or monthly usage × Lead

time + Safety stock

SITE STORAGE AND REPORTING

Storage facilities for construction project could be of several types but generally these

may be classified as:

Open space storage

Closed storage

Intermediate of above two

Open storage is used for materials, which do not deteriorate appreciably due to

exposure to atmosphere and are less costly. These materials are sand, aggregates,

stones, moorum, earth etc.

Closed storage is required for costly materials like cement, equipment parts, etc.

These have to be kept under lock and key.

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An intermediate type of arrangement is also done where material is stored in open

but a protective fencing encloses the storage area. This is suitable for steel bars,

timber scantlings, asphalt drums etc.

For the project undertaken the open storage will be near all construction works for

sand, aggregates, etc. The main centralized store shall be only at one place having

easy approach and wide road, enough open space for loading and unloading, high

in level to prevent any submergence during rains at commanding position so as to

have minimum distance to deliver the material at the place of use.

The data to be maintained by Engineers in their respective work sites shall be:

1. Consumption record of all materials

2. Inventory of balance stocks at the end of each day

3. Requirement of materials – quantity and by time

4. Miscellaneous – damages or losses, scrap material or empties, etc.

The above data shall be made available to Assistant Engineers and Executive

Engineers daily. The Assistant Engineers shall monitor the cost part also and shall be

responsible for data of:

Internal transportation cost

Storage cost

Comparison of consumed verses estimated consumption of material

All the above data shall be monitored and recorded daily.

The Executive Engineer (Materials & QC) shall get the daily material consumption

data from all work places and the inventory available. The cost of stores and transport

are also made available. The estimated rate of material consumption shall also be

available with him from the project planning cell.

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INTEGRATED REPORTING SYSTEM

Construction being an unorganized sector has always been neglected for the want

of the better proceeded information that can only be achieved by implementing

effectiveness and efficient management information systems to achieve better

quality and timely completion of the project.

FUNCTIONS OF DIFFERENT LEVELS:

TOP MANAGEMENT:

Policies

Plans

Budgets

Objectives

TOP MANAGEMENTDECISION SUPPORTING

SYSTEM (DSS)

MANAGEMENT INFORMATION

SYSTEM(MIS)MIDDLE MANAGEMENT

TRANSACTION PROCESSING

SYSTEM(TPS)

OFFICE AUTIMATION SYSTEM(OAS)

BOTTOM MANAGEMENT

SALES

MANUFACTURING

ADMINIS

TRATION

PERSONNEL

Representation of management levels

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MIDDLE MANAGEMENT

Revenue

Costs

Profit

Schedules

Measurements

OPERATING MANAGEMENT

Goods

Services

Performance

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MATERIAL MANAGEMENT INFORMATION SYSTEM:

MATERIAL MANAGEMENT INFORMATION

SYSTEM

1. INVENTORY MANAGEMENT

MODULE

Material code nos. Purchase data Purchase supplier Location of the purchase

Description Manufacturer Purchase price

2. COST TIME PRODUCTION RECORDS

MODULE

TRANSACTION FILE MASTER FILE

Receipt notes Purchase order Daily material cost Weekly material cost Monthly material cost Material production

report Quantity and surveying

sheets

Records of received materials

Daily progress report Weekly/monthly

progress report Daily material issue

statement Material consumption

report

3. STORE MANAGEMENT

MODULE 4. REPORT

GENERATOR MODULE

Final bills submitted to H.O./client

General progress report with

respect to time and cost

Gate pass entry Daily/weekly/monthly

stock statements Check notes for

quality and quantity Material allocation

documents (job layout)

Material requisition report

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LABOUR MANAGEMENT INFORMATION SYSTEM:

SYSTEM DEVELOPMENT, DATA PROCESSING & FLOW CHARTING

SYSTEM DEVELOPMENT

The following points need to be given due attention while designing the

Management Information System for the project of such magnitude and nature.

As the Hydel Power site is far away from the city/urban area so the

procurement of materials shall have variable lead time - the same should be

considered.

The timely completion of project is very important, as any delay will lead to

liquidated damages/losses to either party.

The project comprises of Heavy jobs which lead to heavy consumption of bulk

materials. The cost of materials is going to affect the project cost on major

scale. Hence proper handling and co-ordination for use of materials is to be

done.

LABOUR MANAGEMENT INFORMATION SYSTEM

LABOUR STRENGTH MODULE LABOUR COST MODULE

Attendance time card Daily labour report Weekly labour report

Monthly labour report

Labour cost statements

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The site location does not allow safe storage for huge quantities of materials

and also the inventory cost is high.

Proper planning of works i.e. planning for inventory along with the expected

material ,consumption as well as monitoring of daily consumption of material is

essential for the proper and efficient work at site

The following steps shall be involved in the design of the MIS for the construction of

Hydel Power Project:

1. Detail study of construction of works and specifications

2. Study of Material management and its Organization structure

3. General flow of information

4. Inventory control system

5. Development of the network

DATA PROCESSING

Data can be defined as a group of non random symbols, which represent things that

have happened. Data are derived from both external and internal sources and while

most external data external data are in readily usable form.

Information consists of data that have been retrieved, proceeded or otherwise used

for informative or interface purpose, argument or as a basis for forecasting or decision

making. Data are facts and fighters that are currently being used in a decision

process and usually take the form of historical records that are recorded and filled

without immediate intent to retrieve for decision making.

Information is the knowledge and understanding that is usable by the recipient and if

the report or a message doesn’t have this attitude, as far as the recipient is

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concerned. It continues a mere data and not information. Information has no value in

itself. Its value is derived from the value of change in decision behavior caused by the

information available minus the cost of production of such information.

The information is transmitted by the process of communication. Communication

involves the interchange of thoughts or opinion by word, letters or by similar means.

It also involves the concept of combination system such as telephone, computers,

internet facilities, etc.

INTERNAL

EXTERNAL

DATA

PROCESSOR

INFORMATION

MAN

MACHINE USER

The structure of data and information

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FLOW CHARTING

At the time of start of project a predefined plan is made which acts as a guideline for

reference in control purpose. Once the execution of job starts at site, it becomes an

indicator of progress like quantities in place, elapsed time, money spent etc. on

various activities which are scheduled, in progress or complete. These may be

measured and fed as data into the system to produce required information in time.

During the course of the project, the schedule may differ from initially planned

schedule, hence corrective measures are made to cover the backlog on it. The data

from the project site is collected by the project planning and control staff, analyzing

the data and information created. The information reports are made available to site

personnel. Summary and exception reports are sent to the higher level.

FLOW OF INFORMATION ON SITE

PROJECT MANAGER

Project Engineer

Plant and Machinery Engineer

Billing Officer

Accounts Department

Stores Department

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FLOW OF INFORMATION ON SITE FOR MATERIALS

Planning Engineer (site)

Storekeeper (site)

Project Manager

Purchase Department (H.O.)

Supplier of materials

Flow of Information for the Material

Requirement At site

Monthly Material requirement

Material Indent

Approve Material Indent

Purchase Order

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FLOW OF INFORMATION ON SITE FOR LABOURS

Supervisor

Site Engineer

Project Engineer

Project Manager

Head Office

Daily Labour Report

Monthly Labour Report

Monthly Labour Productivity Report Monthly Labour Cost Report

Time Office

Monthly Labour Productivity Report

Monthly Labour Cost Report

Accounts Department

Planning Engineer

Approved Monthly

Labour Report

Daily Labour Status Report

Approved Monthly Labour report

Flow of Information for the

Labour working on site

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COMPUTER APPLICATIONS, FILE DESIGN

DATA COMMUNICATIONS

The network development shall require a well designed system of reports and records

as below:

Standard Codification & Classification of Various Materials

All the materials used at site shall be given a unique code number for its identification

and easy control. The codes shall be given in alphanumeric system as shown below.

Materials Code

Cement 53 grade OPCMNT01

Cement Quick Setting PSCMNT02

Steel 8 dia Tor STLTOR08

Steel 10 dia Tor STLTOR10

Sand Fine FAGGRT01

Sand Coarse FAGGRT02

Aggregate 10mm size CAGGRT01

Aggregate 20mm size CAGGRT02

Aggregate 30mm size CAGGRT03

FILE DESIGN

The data files shall be organized in specific fields. The materials, which have been

given the alphanumeric codes, shall be entered in the file, field-wise. The alphabets

of the code shall represent the field of the material and the number for detailed

specification and record.

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For example, the Code No.s OPCMNT01, PSCMNT02 etc. where OPC/PSC shall be the

field name of Portland cement respectively.

In PSCMNT02, PSC shall represent type of Quick Setting Cement and 02 shall represent

its grade.

All the analyzed data shall be linked to the respective material files. The field keys shall

be used for retrieving information from the file.

SYSTEM DESIGN SPECIFICATIONS

Construction of a Hydel Power plant is a very complex work, involving a lot of

activities, so proper co-ordination & planning and E.O.Q., etc. is to be maintained to

carry out the project in time.

The project undertaken consists of construction of four main works Main dam, Weir,

Electric Power Station and Tunnel. The Construction of all the four works is

independent but is interrelated with each other by functionality of the project. Hence

the schedules of the works are interrelated.

The Hydel project is an engineering project for which very strict specifications for all

the activities need to be followed during construction. Keeping all the things in mind,

monitoring of materials becomes very essential. MIS is the only tool that can help in

timely procurement of assured quality of material in right quantity at economic rates

maintaining the principle of EOQ/ROL to minimize the cost on inventory and reducing

the overall cost of project to make it more profitable.

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SYSTEM ANALYSIS & DESIGN

The requirement for information to be stored for subsequent retrieval shall be

specified. The related information shall be grouped into records and all these records

shall be in single physical file for the 10 main materials to be monitored daily as below:

Requirement of Information

1. The daily record of material consumption and inventory of all the ten items to

be monitored daily from all the local sites.

2. The daily record of main stores – material issued to local sites and inventory for

daily monitored items.

3. Cost of transportation and storage of the items, average monthly expenditure

4. Re-order level of materials being consumed continuously.

5. Material cost and Material ordering cost.

6. Material pilferage, damage or loss in any.

Data entry for all the items shall be supplemented by a key to input information’s.

Results to be retrieved

1. In the field of all the materials, the gross consumption till date, monthly

consumption, current inventory, total cost of material per unit for the month

considered and total losses / damages shall be retrievable.

2. A spreadsheet of information of the 10 ‘key materials’ consumed in the local

sites on daily basis as well as current inventory in the stores.

3. For all the materials, days left for re-order level along with EOQ (considering the

average estimated consumption for the month shall give the average daily

consumption for the month) to help in planning for procurement of material.

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4. A report of the total expenditure on materials (to be obtained fortnightly).

5. Comparison of material consumed verses the estimated consumption by

project planning department thus helping in project schedule and resources

allocating and progress of work.

FORMAT OF RESULT FOR 10 ‘KEY MATERIALS’ TO BE MONITORED DAILY

The format of the result data to monitor the 10 key materials shall be such that along

with data bank of information, it shall be helpful in planning for EOQ, procurement of

materials and funds requirement.

DATABASE REQUIRED TO SUPPORT MIS

A database shall be required for proper results of MIS that need the following

information linked to the field of each material.

Lead time of the material.

Cost of material, discounts on bulk quantity if any to help find out EOQ.

List of Vendors and addresses who supply satisfactorily.

Define the safety stock to find out re-order level.

Cost of ordering of material.

Expected scrap ratio to calculate losses and damages.

Seasonal variation of prices if any for the important items.

RECOMMENDATION & CONCLUSION

The MIS shall need inputs from all local sites as well as from main centralized store. The

input data shall be processed to give useful information. The materials to be

monitored daily shall require estimation of daily consumption and inventory data.

With the help of useful database for the materials, these data shall be processed to

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give the final consumption of the day for each material along with the inventory. By

using these data it shall also alarm for the procurement by giving the balance time of

reorder and on the basis of rate of materials and consumption rate we shall find out

EOQ and fund requirement for the same. This processed data also reflects the

progress of the day as well as help management to control the inventory.

Bibliography

NICMAR publication lesson book on Management Information System

Butterworth-Heinemann publication, Civil Engineer Project Management by Alan C.

Twort & J. Gordon Rees

McGraw Hill publication, Total Construction Project Management by George J. Ritz