Monday, 19 June 2023

Project costs in Construction Project management


Project costs

In engineering project management, the main content is "three control, two management, one coordination", that is, schedule control, quality control, cost control, contract management, safety management and organization and coordination, and "three control" is the core content of engineering project management. Therefore, in order to ensure the quality of the project and improve the interests of the enterprise, the three major control goals are the core work.

1. Control measures for the three major objectives in project management

1. Strictly grasp the progress of the project

(1) Make sufficient construction preparations

Construction preparation of engineering projects is an important part of construction production, and the main contents of pre-construction preparation are: 

(1) implement the relevant construction personnel to carefully do the joint review of drawings, design disclosure, etc., and prepare the construction budget in a timely manner; 

(2) Clarify the technical quality requirements, combine the specific conditions of the site and relevant data, prepare the construction plan and sub-project organization design; 

(3) Ensure the quality of comprehensive installation, carefully draw the comprehensive layout drawings of various pipelines, clarify the elevation positions of each system pipeline, uniformly set the lifting point brackets of each system pipeline, reasonably arrange the construction sequence of each system pipeline installation, and formulate the "traffic rules" for the construction of each system pipeline in this order; 

(4) Prepare construction equipment plan, labor plan, arrange construction stage entry, etc.;

 (5) Make technical disclosure to the construction unit, implement the construction process, and clarify the construction procedure; 

(6) The project department reviews the construction organization design or construction plan prepared by each professional subcontracting team.

(2) Prepare the construction schedule and do a good job in the implementation of the construction schedule

The construction schedule can be divided into daily, weekly, and monthly construction schedules according to the time stage, so that each department of the project can arrange the work of its department according to the daily, weekly and monthly engineering schedule. According to the object, it is subdivided into the overall construction schedule, the unit project schedule, the phased project schedule, the sub-project schedule, the construction operation schedule, etc. At the same time, the schedule should specify the heads of each department.

(3) Establish a strict contract management system

Establish a strict contract system to mobilize everyone's enthusiasm, so as to avoid mutual dismantling and ripping off. Minimize engineering changes or make as few changes as possible and reduce on-site rework by controlling construction quality.

(4) Improve the quality of staff

Technicians should be familiar with specifications, regulations, technical standards, and familiar with construction drawings. It was therefore important to provide staff with the necessary training and to strengthen quota learning. Continuously improve the professional and technical quality of relevant personnel in order to effectively control unnecessary engineering rework.

2. Pay attention to project quality

(1) Strengthen the control of relevant personnel

The quality of relevant personnel includes the quality of personnel at all levels of the project: 

(1) The project manager is the direct organizer and implementer of project management, must have strong management and organizational skills, rich practical experience, be good at leading the team, make decisive and correct decisions, and lead employees to complete various tasks; 

(2) The technical personnel in the project must have strong business quality and teamwork ability; 

(3) The operator should have rich professional knowledge and skilled operation skills, and be familiar with the operating procedures and quality standards.

(2) Strengthen the control of construction materials

Material is the material condition of engineering construction, material quality is the basis of engineering quality, material quality does not meet the requirements, engineering quality cannot meet the standard. Material control measures mainly include the following aspects: 

(1) formulate material procurement schedules, clarify material quality requirements, uses, input time, quantity, etc.; 

(2) Pay attention to the comparison and inspection of materials and samples when purchasing, ensure quality, and choose long-term stable suppliers as much as possible; 

(3) Strengthen the inspection and acceptance of materials, and prohibit the use of raw materials, semi-finished products, structural accessories and engineering equipment that are inspected or inspected as unqualified;

 (4) Do a good job in the storage and reasonable use of materials; 

(5) Do a good job in material testing and inspection; 

(6) Reasonably organize the supply of materials to ensure normal construction.

(3) Formulate a reasonable and effective construction plan

In the process of engineering construction, the progress is often delayed due to the poor consideration of the construction plan, which affects the quality. 

Therefore, when formulating and reviewing the construction plan, the relevant technical personnel must combine the actual situation of the project, conduct a comprehensive analysis from the aspects of technology, management, technology, organization, operation and economy, and strive to make the scheme technically feasible, economically reasonable, effective in measures and convenient in operation, so that the construction plan can help improve quality, accelerate progress and reduce costs.

(4) Strengthen the control of the engineering environment

There are many environmental factors affecting the quality of engineering, including engineering technology environment, engineering management environment and labor environment. The impact of environmental factors on project quality has complex and changeable characteristics, such as changes in meteorological conditions, temperature and pressure, storms, etc. directly affect the quality of the project, the main targeted measures are: 

(1) In terms of engineering and technical environment, effective measures to ensure the quality of construction should be formulated seasonally according to the characteristics of the project, so as to avoid the harm of freezing damage, dry cracking, erosion, etc.; 

(2) In terms of project management environment, establish quality assurance system, quality management system and other management systems; 

(3) In terms of labor environment, it is necessary to continuously improve the environment of the construction site, and do a good job in the division of labor and cooperation.

(5) Strengthen mechanical control

Any project needs to invest a lot of mechanical equipment, the construction stage must comprehensively consider the construction site conditions, building structure form, construction technology and methods, building technology and economy, etc.

Reasonably select the type of machinery and performance parameters, rational use of mechanical equipment, correct operation. Operators must carefully implement various rules and regulations, strictly abide by operating procedures and pay attention to the maintenance and repair of mechanical equipment.

Second, control engineering costs

(1) Take technical measures to strengthen project cost control

The adoption of technical measures is to give full play to the subjective initiative of technical personnel in the construction stage, and make necessary technical and economic demonstrations for the main technical solutions in the tender to seek economical and reliable solutions, so as to reduce project costs, including the use of new materials, new technologies to save energy consumption, improve mechanized operations, etc.

(2) Do a good job in cost forecasting and determine cost control

Target cost forecasting is the basis of cost planning and provides a basis for the preparation of scientific and reasonable cost control targets. Therefore, cost forecasting plays an important role in improving the scientificity of cost planning, reducing costs and improving economic efficiency. The content of cost forecasting is mainly to use scientific methods, combined with the winning bid price, according to the construction conditions, machinery and equipment, personnel quality of each project to predict the cost target of the project.

(3) Improve the awareness of economic costs of all employees

Cost control is not simply the responsibility of engineering accountants and financial personnel, nor is it only a matter for the financial department and the project department, but the common task of all builders. Therefore, enterprises should pay attention to improving the awareness of economic costs of all employees: 

(1) The project manager should sign a letter of responsibility with the superior leader to clarify the responsibilities he should bear when encountering different situations during the construction process. Determine the cost of liability while clarifying responsibilities.

 (2) Decompose responsibilities layer by layer within the project department, decompose responsibility costs layer by layer, and sign responsibility letters layer by layer. Clarify the responsibilities of each member of the project department, who is responsible and who bears. Raise awareness of the responsibilities of members of the project department.

(4) Take economic measures to strengthen project cost control

Labor costs account for about 20% of all project costs, and it is necessary to control the number of workers, and reduce or shorten the man-day consumption of the process in a targeted manner, so as to achieve the purpose of reducing the consumption of working days and controlling the cost of the project; Material costs generally account for 65%~70% of all project costs, which have a direct impact on project costs and economic benefits. First of all, under the premise of ensuring quality, select the best materials; 

The second is to rationally organize transportation to reduce transportation costs; 

Then it is necessary to reasonably determine the incoming batch and batch to reduce the material reserve as much as possible; Minimize the amount of mechanical shifts consumed in construction, and improve the utilization rate of mechanical equipment through reasonable construction organization and mechanical allocation. Strengthen the repair and maintenance of on-site equipment, reduce the expenditure of overhaul, regular repair and other expenses, and avoid the idle of mechanical equipment caused by improper use; Strengthen the management of the rental equipment plan and reduce the price of mechanical shifts from different angles.

(5) Conscientiously carry out project evaluation, strengthen mid-term financial inspection and audit supervision

The project evaluation must be carried out under the corresponding conditions, in-depth and delicate on-site investigation, careful and reasonable calculations and scientific analysis on the basis of the project department's implementation team and budget, in order to draw correct conclusions, so as to mobilize the enthusiasm of the project department for profit and safeguard the legitimate interests of the enterprise. In addition, we must strengthen the control of the construction process, strengthen the mid-term financial inspection and audit supervision.

(6) Strengthen safety and quality management, control rework rate, and control engineering costs

In the construction process, it is necessary to strictly control the quality of the project, and the quality self-inspection personnel at all levels should fix points, posts, responsibilities, and strengthen the quality self-inspection and management of the construction process to truly implement the whole process, take preventive measures, eliminate quality problems, and achieve that the project is formed once and qualified at one time, eliminating the occurrence of rework, and avoiding the increase in project costs due to unnecessary people, finance, materials and other large inputs. Enable all employees to establish a sober awareness of safety and quality, and eliminate hidden dangers of safety and quality accidents from the source.

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