Risk Management and Cost Overruns due to delays in Construction Project using Primavera

Risk Management and Cost Overruns due to delays in Construction Project using Primavera

1MITCOM Project & Construction Management Department ***

Abstract - The construction industry is critical to the socioeconomic developmentofanyemergingcountry.building delays are possible inany buildingproject.Constructiondelays occur regardless of whether the project is simple or complex. Construction time is used to evaluate the achievement of any project. Unexpected issues encountered throughout the conception, design, and construction phases can cause unwelcome delays in project completion. Scheduling and organizing are two of the most crucial components in completing a project successfully. Industry need necessitates specific design, scheduling, and administration to enable for total cost, time, and resource optimization. Due to increased workloads and shrinking resources, the public works department discovered new technology that aids in project management. There are numerous computer software’s available on the market today for project management, such as MSP, Primavera P6, and others. Proper project planning andschedulingcanbe accomplishedwiththeassistanceofthis programme. Primavera willonlycompare theplannedpaceof building activity to the actual progress of the project. In Primavera, starting time, completion time, and length are documented by distinguishing between task and essential activity. The delays in the project's important activity are analyzed usingthe provided data andthe Gantt chart created by Primavera. This initiative's goal is to identify construction project delays and recommend solutions for dealing with them.

Key Words: PrimaveraP6,Scheduling,Ganntchart

1.INTRODUCTION

The building sector is one of the primary areas that contributesignificantlytothegrowthofaneconomy.Many projects, however, encounter significant delays and hence surpass early time and expense forecasts. Construction delaysareregardedasafactorinprojectsuccessintermsof time, cost, quality, and safety. However, construction has already begun to exhibit specialisation features for large buildings with diverse construction operations and an assortmentofcomponentsandmaterials.Apartfromrecent achievements of standardisation of construction with modular or preengineered housing and prefabricated standardised components, concepts taken over from the manufacturingindustries,theproject-basedorganisational structureinconstructionhaslargelyremainedthesamefor centuries. However, despite its age, building remains an unsustainablebusinessbecauseofthetriplebottomlineof sustainability, which includes economic, ecological, and

social factors. Construction is characterised by costly and time intensive manufacturing procedures that make it susceptibletoprojectrisksandfailure,mostlyinregardsto time and expense. Many projects face significant delays, causing them to surpass their initial time and expenses forecasts. Construction projects are typically one-time events.Aprojectteamgetstogethertoproduceaone-of-akind development on a specific location under conditions thatareunlikelytobeduplicated.

1.1 Construction Delays

Abuildingendeavorisconsideredsuccessfulasitfinisheson time,underbudget,andtothesatisfactionofallstakeholders. However, the majority of the projects did not conclude on schedule.Instead,duetotheuncertaintyofeventsandtheir distinctiveness, they finished ahead of or behind schedule. Delay in construction could be described as time overrun eitherbeyondthecompletiondatestipulatedinacontractor beyond the date agreed upon by the parties for project delivery.Itisaprojectthatisrunningbehindscheduleandis aregularissueinbuildingprojects.Themajorityofproject delays occur during the construction phase, where unforeseencircumstancessuchasenvironmentalconcerns and limits, ground conditions, and so on are constantly present.Constructiondelaysincreaseoverallprojectcosts; therefore, finishing projects on time benefits all parties engagedintheproject.

1.2 Cost Overrun

Costoverrunissimplydescribedas"whentheproject'sfinal cost exceeds the original estimates." Cost overruns are a typicaloccurrenceinprojectsallaroundtheworld.Because constructioncostisthemostessentialcriterionforproject success, construction project performance is commonly reportedintermsofcostandvariationfrombudget.Thecost variation that results from project cost overruns has a negativeinfluenceontheeconomyandprofitability.Despite existingliterature,costestimationmethods,costindices,and so on, building projects rarely reach their budgeted costs. Costperformanceisthemostimportantandcommonissue intheworldwideconstructionbusiness,outofthefourmain restrictionsofscope,cost,time,andquality.

1.3 Risk Management

Risk management (RM) is a concept that is employed in various industries, including information technology,

vehicles, and pharmaceuticals, as well as the construction industry.EachindustryhascreateditsownRMstandards; however,theoverallnotionisusuallythesameirrespective ofthesector.Projectmanagementofrisksisoneofthenine most crucial aspects of project commissioning, per The ProjectManagementInstitute(PMI)(2004).Thissuggestsa stronglinkbetweenriskmanagementandprojectsuccess. While RM is regarded as the most demanding aspect of construction management. The Risk Management Plan coversthemanagementmethodsusedontheundertakingto plan, identify, analyse, categorise, quantify, handle, and reportriskrelatedtomeetingtheproject'sneedsandgoals. A "Risk" is defined as an incident with the potential to generateanunfavourablechangeintheproject.Thegoalof this research is to critically examine and discover the applicability of previous studies on finding the reason causingscheduledelaysandexpenseoverruns.Contractors mostly deal with quality, time, and money, yet the bulk of construction contracts are awarded based on only two of thesecriteria,typicallytimeandcost.

1.4 Primavera P6

PrimaveraP6representsanOraclesoftwareapplicationthat isusedtomanageprojects,programmes,andportfolios.Itis a sophisticated, user-friendly solution for project and programme planning, management, and execution. PrimaveraP6canbeutilisedinprogrammesorprojectsof allkinds,fromsmallbusinessestohugecapitalprojects.In actuality, it is not industry specific, and it is currently employed in healthcare, banking, information technology, construction, government, and defence, as well as any organisationexecutingaprojectorprogramme.Primavera P6comesintwoflavours:PrimaveraP6PPM(alsoknownas Primavera P6 Professional) and Primavera P6 EPPM (EnterpriseProjectPortfolioManagement).

2. LITERATURE REVIEW

(WaqarAhmadParay,2020)statedthatgeneralcategories of construction delays should be thoroughly investigated before beginning schedule delay analysis. Construction delaysareclassifiedinavarietyofways.Constructiondelays areclassifiedintofourcategories.

•CriticalandNon-critical

•ExcusableandNon-excusable

•CompensableandNon-compensable

•ConcurrentDelay

(A. F. Serpella, 2014) proposed that the three main characteristics of cost overruns were contractor-related problems, material-related problems, and owner-related financerestrictions.Toreducetimeandexpenseoverruns, they recommended that the project owner dedicate appropriatetimeandmoneyduringthedesignphase,have

sufficientfundsavailable,andhireacompetentconsultant andatrustworthycontractortodothetask.

(Bajaj,1997)Theydiscoveredthatthetopgroupsbasedon overall replies were labor-related, contractor-related, equipment-related, material-related, and client-related variables. They also confirmed that the maximum level of agreementis83.1%betweenclientandconsultant,whilethe lowestlevelis61.7%betweenclientsandconsultants.

(Hegazy,2002)statedthatthegoalofthisarticleistoassess thecurrentstateofriskmanagementinIndianfirmsandto investigate the reasons for the widespread use or lack of adoptionofanintegratedriskmanagementmethodology.It highlights the requirements for implementing comprehensiveriskmanagementsolutionsthatwillleadto enterprisewide risk management (EWRM). The paper demonstrates that good risk management can increase organisational performance, but organisations lack the necessaryinfrastructuretoadoptEWRM.

We came to the conclusion when reading the research articles that the development of analytical techniques or methodsforconstructionsprojectplanningchallengeshas only recently begun. However, these problem-solving approachesarenotyetmethodologicallysoundenoughto make a valuable and realisable contribution to problem resolution. There are no approaches to addressing these planning issues. As a result, more sophisticated methodologies are required to incorporate the building project'senvironmentduringconstructionprojectplanning.

3.1 Assigning Activity IDs

WhenP3assignsanewID,itfirstcheckstoseeiftheIDis alreadyinuseintheproject.Ifitexists,P3searchesin10pointincrementsuntilitdiscoversanunusedID.

3.2 Adding Activities in Bar chart

TheBarchartallowsyoutoaddactivitiesinaspreadsheetlike format. You enter the corresponding data into each column cell for each action. After you've added activities, extendandmovethetimelinebarstoselectexactdatesand durations.

Figure

ToaddactivitiesinPERT

3.4 Estimating Durations

P3givesnewactivitiesaplanningunits(hour,day,week,or month) duration. Estimate the original time as the time requiredtofinishtheactivitybasedontheproject'splanning unit. P3 sets the remaining length (the time remaining to performtheactivity)totheoriginalperiod.

Figure 3: ToaddactivitiesinBarchart

3.3 Adding Activities in PERT

When you add activities to PERT, you can watch the progressionoflogicasyoucreateyourproject.Youcanalso add activities in PERT on a daily or monthly timeframe to buildtheworkchronologicallyratherthanbyrelationship. SelectView,PERTfromtheBarchart.Todisplayatimescaled PERT layout rather than relationship logic, select Format, Organise, the Arrangement tab, and the PERTLayout with TimescaleoptionfromPERT.

4. IMPACT OF DELAY

Iftheownerapprovedaforcemajeureclaim,thecontractor must demonstrate the damages caused by the COVID-19 epidemic. A project's impacts can be divided into five categories:

1. Cost: - TheexpensesofCOVID-19shouldbetracked individually by calculating damages and performanceimpediments.Thecostanalysisshould be based on the impacted scope of work, idle equipment, general conditions, and other preventive measures such as heat readings, employeescreening,andfacilitymanagement.

2. Schedule: - Evaluate and quantify the idle time, costsincurredthusfar,andtimetabledelayscaused bythisincident.Thecontractorshouldreviewthe present situation and revise the schedule to incorporatethenewlate-startandlate-finishdates of operations, as well as the revised project completiondate.

3. Resources: - Evaluatetheavailabilityofresources duetosicknessandsocialdistancingguidelines.

4. Logistics: - Examine the influence on material, shipment,andcriticalcomponentcriticalleadtimes.

5.

5. RESULTS & DISCUSSION

Thetwomostcrucialaspectsfortheeffectivecompletionof the project are planning andscheduling. The construction industry'sneednecessitatesaccurateplanning,scheduling, and administration, allowing for total cost, time, and resource optimization. Due to increased workloads and shrinking resources, the public works department discoverednewtechnologythataidsinprojectmanagement. Software for project management is used as a tool for managingandorganizingworkinbusinessesthatarerapidly growing.Therearenumerouscomputersoftware’savailable onthemarkettodayforprojectmanagement,includingMSP, Primavera P6, and others. Proper project planning and control can be accomplished with the assistance of this programme. Primavera makes it simple to compare the projectedprogressofbuildingworktotheactualprogressof theconstructionproject.PrimaveraP6projectmanagement software collects, records, monitors, controls, and reports informationonprojectperformance.

Thecreatedframeworkfocusesontheconstructionindustry and the difficulties that it faces. Construction delays, cost overruns, and risk management are all part of this. We investigated how it affects the overall project. In the precedingreport,weexaminedthereasonsandeffects,as well as how to handle the delays. We attempted to summariseallofthosestudiesinordertocreateareview. Softtools,likeasPrimavera,arealsodiscussedinthepaper. Primavera has hoped that successful adoption of this approachwillbenefitnotonlyclientsbutalsocommunities andtheenvironmentitself.

OraclePrimaveraP6isusefulinavarietyofways,including assisting you to easily prepare and control project tasks, optimisingresourcemanagement,providingaclearfieldof visionofwhat'sgoingoninthespecificproject,andassisting you to easily breakdown projects' and activities' structure.Primavera also helps to mitigate risks and is relatively simple to use. It issimple to constructforecasts withit.Mostnotably,itaidsinthebreakdownofmassively complexundertakings.

6. SCOPE FOR FUTURE WORK

The current research study focused on the building construction industry in Kalyan, namely Athena Enclave. Futureresearchcouldbeconductedindifferentpartsofthe world,focusingonspecificformsofconstructiondelayssuch astimemanagement,riskassessments,costoverruns,andso on. A study similar to the current research is required for construction projects to identify factors that affect productivity, which will assist construction project

departments in minimizing excessive cost escalation and projectscheduledelays.

REFERENCES

1. F. Serpella, X. F. (2014). Risk management in constructionprojects:aknowledge-basedapproach. Procedia-Social and Behavioral Sciences, 119,653662.

2. Al-Bahar,C.K.(1990).Systematicriskmanagement approach for construction projects. J. Constr. Eng, 116(3),533-546.

3. Bajaj,J.(1997).Analysisofcontractorsapproaches toriskidentificationinNewSouthWales,Australia. Construction Management and Economics,363-9.

4. Bing,L.(1999).Riskmanagementininternational constructionjointventures. Journal of Construction Engineering and Management,277-84.

5. Hamzah Abdul Rahman, C. W. (2015). Implemetation of Risk Management in Malaysian ConstructionIndustry:CaseStudies. FacultyofBuilt Environment. University of Malaya, 50603 Kuala Lumpur,Malaysia.

6. Hayes, R. P. (1986). Risk Management in EngineeringConstruction:AGuidetoProjectRisk AnalysisandRiskManagement.London.

7. Hegazy, T. (2002). Computer-based construction projectmanagement.PrenticeHall,NJ,USA.

8. Ibrahim Mahamid, N. D. (2013). Risks Leading to Cost Overrun in Building Construction from Consultants’Perspective'.

9. NakhonKokkaew,W.W.(2014).CompletionDelay Risk Management: A Dynamic Risk Insurance Approach. KSCE Journal of Civil Engineering.

10. WaqarAhmadParay,C.K.(2020).Delayanalysisin construction projects. International Research Journal of Engineering and Technology, 07(10).