Management and Construction Project Formulation

Construction Management
and Entrepreneurship
(18CV51)
By,
Prof. Surajkumar S Sonar
Veerapa Nisty Engineering College
Department of Civil Engineering

Module 1
Management: Characteristics of management,
functions of management, importance and purpose of
planning process, types of plans.
Construction Project Formulation: Introduction to
construction management, project organization,
management functions, management styles.
Department of Civil Engineeirng, VNEC
Shorapur
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We apply management in
every walk of life.
It will be working in all
situations where man
directs human resources or
technology to achieve
stated goals.
It has characteristics of both
science and art.
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Few definitions:
 Management is a multipurpose organ that manages a
business, manages a manager and manages workers and
work. - Peter Drucker
 Management is knowing exactly what you want men to
do and then seeing that they do it the best and cheapest
ways. - F W Taylor
 Management is a process consisting of planning,
organizing, actuating and controlling performed to
determine and accomplish the objectives by the use of
people and resources.
- George R Terry
 Management is the art and science of decision making
and leadership. -D J Clough
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Characteristics of Management
• It is a universal process (applied in all types of activities).
• It is goal oriented (always aims at achieving goals).
• It is a social process (deals with human beings).
• It is a coordinating force (avoids duplication and
overlapping).
• It is intangible (unseen force).
• It is dynamic (ongoing process).
• It is multi-disciplinary (needs knowledge from various
disciplines).
• It is a creative activity (needs creative ways to handle
different situations).
• It is decision making (selection of proper option from the
available options).
• It is a profession (a person can be educated and trained to
become a successful manager).
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Functions of management
Forecasting.
It is the estimation of future events.
Planning.
It is thinking before doing. It is preparing for acting.
Organizing.
It is establishing relationship between people, work and
resources and coordinating these factors to achieve
maximum output with minimum cost.
Staffing.
After understanding sociological and psychological structure
of the work force, it is selecting right man for the right
job.
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Functions of management Continued
Directing and Motivating.
It is guiding, supervising, helping and motivating
the subordinates in their work.
Controlling.
It is setting standards, measuring actual performance
and taking corrective actions if necessary.
Coordinating.
It is the orderly arrangement of group efforts to
provide unity of action, thus achieving common
goals.
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Functions of management Continued…
Communication.
It is the process by which instructions are
transmitted, received and understood by people
working in the organization.
Leadership.
It is leading the workers towards common goals.
Decision making.
It is the course of action chosen from the available
actions.
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Assignment 1
1. Collect detailed information about the manger of any
company like Name, education, his / her role in the
company, salary, achievements, work experience et.,
and prepare slides on the collected information.
*Suggest to collect information about Manager from
Indian company!
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Planning
Planning is essential before starting of any work.
Planning is deciding in advance what is to be done. It
involves the selection of objectives, polices, procedures
and programs from alternatives. - M E Harley
Planning is deciding in advance what to do, how to do,
when to do and who to do it. It bridges the gap from
where we are, to where we want to go. It makes it
possible for things to occur which would not otherwise
happen. - Koontz and O Donnel
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Importance and Purpose of Planning Process
 Planning provides direction and purpose to all activities in an
organization.
 Planning minimizes risk and uncertainties.
 It ensures coordination from different divisions, departments and
people.
 It leads to better economy through optimization.
 It facilitates decision making.
 It reduces overlapping and wastages of efforts.
 It encourages innovation and creativity.
 It facilitates control of people and their activities.
 It improves morality of the employees.
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Types of Plans
There are different types of plan. Some of the important types are
given and discussed below.
Strategic plans
Strategic plans are detailed action steps mapped out to reach
strategic goals. These plans apply to the entire organization
and position the organization in term of its environment.
Strategic plans address the broad issues such as changing
conditions, allocation of resources, international competition,
etc.
Generally such goals are developed by top management after
consulting board of director and middle management. The time
horizon of strategic goals exceeds 3 to 5 years.
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Tactical Plans
Tactical plans are developed to support the
implementation of the strategic plans.
These are important to the success of strategic plans and
cover intermediate time horizon usually encompassing
1 to 3 years.
Such plans are developed by middle managers after
consulting lower-level managers.
Tactical plans are more specific and concrete than
strategic plans.
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Operational Plans
Plans aimed at supporting the implementation of tactical
plans and achievement of operational goals. Such
plans clearly specify the things needed to be done in
the short run, in order to achieve the operational
goals. These plans are developed by lower-level
managers after consulting the middle managers. The
time period of operational plans is less than one year,
such as few months, weeks or even days. The success
of strategic and tactical plans depends upon the
achievement of operational goals.
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Specific Plans
Those plans which are clearly defined and leave no
room for interpretation are called specific plans. Such
plans require specific stated objectives and do not
contain ambiguity.
Specific plans require clarity and a sense of
predictability that often do not exist therefore they are
not preferable.
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Directional Plans
Directional plans refer to the flexible plans that set out
general guidelines. Such plans are preferable in
dynamic environment where management must be
flexible in order to respond to unexpected changes.
Managers use the directional plans to remain focused
and do not lock themselves into specific goals or
course of action.
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Single-use Plan
Single-use plan is one-time plan specifically designed to achieve particular goal
that, once achieved, will most likely not recur in the future. Such plan is
developed to meet the needs of a unique situation. There are two important
types of single use plans: programs and projects.
a. Program
A single use plan aimed at carrying out a special project in an organization that if
accomplished will contribute to the long term success of organization. Programs
are composed of several different projects and may take more than 1 year to
complete.
b. Project
A project is a plan that organizes a set of limited-scope activities that do not need to
be divided into several major parts in order to reach a significant nonrecurring
goal.
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Standing Plans
Standing plans are ongoing plans that aimed at providing guidance for performing recurring
activities. There are three important types of standing plans which are: policies,
procedures, and rules.
a. Policy
Policy is guideline that establishes parameters for making decisions. It specifies the broad
limits with in which organizational members are expected to operate. So it means,
policy does not mention the specific action but provides a parameter for action.
b. Procedures
Procedure is a series of related actions that must be taken to accomplish a particular task.
Policy does not allow much flexibility or deviation because they provide detailed step-
by step instructions as to what should be done. In this way procedures outline more
specific actions than policies do.
c. Rules
An explicit statement that tells managers what they can or cannot do. Rules do not allow
any room for interpretation because it clearly specifies the actions needed to be done in
a particular situation.
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Assignment 2
1. Prepare a detailed plan about any work.
2. Assign time duration for each work.
3. Select any particular work from the prepared plan.
4. Assign time duration for each work.
5. List all the resources required to perform the
selected particular work.
6. Assign particular work to particular resource.
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Project:
A project is a series of tasks that need to be completed
in order to reach a specific outcome. A project can also
be defined as a set of inputs and outputs required to
achieve a particular goal. Projects can range from
simple to complex and can be managed by one person
or a hundred.
Scope:
the opportunity or possibility to do or deal with
something / look at carefully; scan.
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Project formulation
Formulation consists of identifying the scope, schedule
and budget for the proposed project. Scope is
identified typically through a sketch prepared by a
member of project Management.
Once the scope has been identified, the director of the
project management evaluates the plan, estimates its
total project cost and estimates elapsed time schedule
for the project.
The scope, schedule and budget information is
summarized in letter form and sent to the initiator.
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Project formulation is defined as taking a first look
carefully and critically at a project idea by an
entrepreneur to build up an all round beneficial to
project after carefully weighing its various components.
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If the initiator wishes to proceed, he or she must identify
a fund source and confirm the source with the
business manager of facilities finance and
administration. When confirmed, the project is placed
in the project management queue for assignment to
the next available project manager.
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When assigned a project, the first act of the project
manager is to familiarize himself or herself with the
project by reviewing the formulation file. The project
manager then begins to prepare the required
approvals paperwork that must go to the appropriate
approval bodies.
Simultaneously, the project manager begins to develop a
work plan which is the basis of a request for proposal
from the design team for the project.
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The project then follows the normal course of
events such as design phase, construction phase
and closeout phase.
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Assignment 3
1. Prepare a report on selected Work plan from previous
assignment.
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Introduction to construction management
"[Construction Management is] A project delivery method
whereby the client retains a construction manager to provide
certain preconstruction expertise including cost estimating,
value engineering, and scheduling and, during the construction
phase of the project, coordination of all construction
activities.” University of Colorado
“Construction Management is a professional management
practice consisting of an array of services applied to
construction projects and programs through the planning,
design, construction and post construction phases for the
purpose of achieving project objectives including the
management of quality, cost, time and scope.” Construction
Management Association of America
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"[Construction Management is the] Organizing,
scheduling, mobilizing, and directing equipment,
material, and personnel in performance of a
construction contract." Business Dictionary
In short we can say that, Construction Management and
the role of Construction Manager covers the design and
science of buildings along with the management of
business, people, money and time.
Buildings and their construction have become
increasingly complex. New innovations in methods,
designs and materials mean that the management of
construction projects requires professionals with the
knowledge and skills to deliver on time and on budget
in a demanding and rapidly changing industry.
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Construction Management a combines a wide range of
techniques and knowledge. Including:
 Budgets and cash flow
 Construction law
 Construction Planning
 Procurement
 Supply chain management and tendering
 Quality Management
 Construction risk management, including Health and
Safety.
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A construction manager is in charge of the overall
planning and control of a project; this demands a
command of many skills.
The Construction Manager will be responsible for
developing a programme of work for the project. This
requires an in depth knowledge of the tasks, order of
work, dependencies and lead times.
For example for large glass panels, what glass is
needed, what needs to be done before it is installed
and when it needs to be ordered to meet construction
schedules.
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Project organization
A project organization is one, in which a project structure
is created as a separate unit or division within a
permanent functional structure; drawing specialists and
workers from various functional departments who work
under the overall leadership, control and co-ordination
of a project manager to complete projects of a technical
and costly nature.
George R. Terry defines a project organization as
follows:
“A project organization is a preferred means whenever a
well defined project must be dealt with or the task is
bigger than anything, the organization is accustomed
to.”
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The chart illustrates the permanent functional structure
of the organization, consisting of production, finance,
marketing, engineering and research departments.
There are two project managers for project I and II.
Each project manager has a project team consisting of
personnel drawn from various functional
departments; and working under the leadership and
control of their project managers.
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Merits and Limitations of the Project Organization:
(a) Merits:
(i) Concentrated attention on project work:
In a project organization, there is full and concentrated
attention of the project manager on project work; as the
project manager has no work other than attending to project
management. He has full powers to co-ordinate and control
project activities. In fact, during continuance of the project,
functional managers renounce their authority over their
project-team personnel, in favor of the project manager.
(ii) Advantages of team specialization:
The project team formed for purposes of undertaking project
work consists of specialists drawn from many functional
areas. This phenomenon makes available to the project
organization, the advantages of team specialization.
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(iii) Ability to cope with environmental
influences:
Due to the leadership of the project manager
coupled with specialized knowledge of project
team members, the project organization is in a
better position to cope with environmental
challenges. In fact, one of the reasons for creating
a project structure is to successfully combat
environmental forces.
(iv) Timely completion of the project:
The project organization ensures a timely
completion of projects; without disturbing the
normal functioning of the whole organization.
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(b) Limitations:
Following are the chief limitations of a project-
organization:
(i) Accentuated problems of co-ordination:
In a project organization, there are increased problems of
co-ordination; because of the diverse viewpoints of
team specialists. As a matter of fact, specialists have a
tendency to over-emphasize on their specialized
viewpoints vis-a-vis the manner of project designing
and implementation.
This tendency of specialists creates a serious headache for
the project manager; who, all the time, may be found
busy in reconciling conflicting viewpoints of specialists
getting little time for attention towards project progress.
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(ii) Unclearly defined relationship:
Usually, in a project organization, the relationships
between the project manager and functional
specialists are not very clearly defined. This situation
may lead to tension between them; resulting in poor
human relations, in the project organization.
Ultimately, the project work efficiency may be
considerably reduced.
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(iii) Feeling of insecurity among personnel:
Usually, there is a feeling of uncertainty in the minds of the
project team personnel as to where they will seek shelter;
after a particular project (on which they were engaged) is
over. This feeling of uncertainty about assignment creates
feeling of insecurity among personnel; and then they tend to
unduly stretch the existing project work-causing delays in
timely completion of the project.
(iv) Duplication of efforts:
A project organization suffers from the limitation of
duplication of efforts, involved in the completion of project
activities. When e.g. in a project organization more than one
or two projects is/are undertaken; it is quite likely that the
same types of activities might be duplicated, during the
completion of various projects. This phenomenon ultimately
tells upon the overall organizational efficiency and
profitability.
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Management styles
The art of getting employees together on a common platform and
extracting the best out of them refers to effective organization
management.
Management plays an important role in strengthening the bond amongst
the employees and making them work together as a single unit. It is
the management’s responsibility to ensure that employees are
satisfied with their job responsibilities and eventually deliver their
level best.
The management must understand its employees well and strive hard to
fulfill their expectations for a stress free ambience at the workplace.
Every leader has a unique style of handling the employees
(Juniors/Team). The various ways of dealing with the
subordinates at the workplace is called as management style.
The superiors must decide on the future course of action as per the
existing culture and conditions at the workplace. The nature of
employees and their mindsets also affect the management style of
working.
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Autocratic
Autocratic managers make decisions unilaterally,
without much (or any) input of subordinates. This
unilateral format can be perceived as a good
management technique if the right decisions are
made, and it can lead to faster decision-making,
because only one person’s preferences need to be
considered. However, this style of management
can drive away employees who are looking for
more ownership of decisions, and more autonomy.
In times of crisis where time is limited, use of
autocratic management is permissible, but
extended periods could lead to high turnover.
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In such a style of working, the superiors do not take into
consideration the ideas and suggestions of the subordinates.
The managers, leaders and superiors have the sole
responsibility of taking decisions without bothering much
about the subordinates.
The employees are totally dependent on their bosses and do
not have the liberty to take decisions on their own.
The subordinates in such a style of working simply adhere to
the guidelines and policies formulated by their bosses. They
do not have a say in management’s decisions.
Whatever the superiors feel is right for the organization
eventually becomes the company’s policies.
Employees lack motivation in autocratic style of working.
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Consultative
This form allows for more discussion than an autocratic
method, but is essentially dictatorial. As the name
suggests, a leader in this form consults his or her
employees, but ultimately the leader makes the final
decision. Decisions attempt to take the best interests
of the employees in account but also focus on the
business. This type of management style often leads
to loyalty from employees included in decision-
making processes, but those who are left out are more
likely to move on. It can also lead to a dependency of
the employees on the leader.
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Persuasive
Also similar to autocratic management styles, a
persuasive leader maintains the final decision-making
control. However, he or she makes choices based on
the persuasion of subordinates. Employees will
convince their manager of the benefits of a decision
and the manager will make the final decision. This is
a great option for managers who need input from
experts, but still can keep the final decision-making
up to them. This does not work when employees do
not support management and choose not to provide
input or do not trust decisions that have been made.
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Democratic
As its name suggests, democratic managers offer employees an
opportunity to engage in decision-making. This means all decisions
are agreed upon by the majority. The communications go from both
the manager down to employees and from the employees up to the
managers. This style works when complex decisions must be made
that have a variety of outcomes. However, democracy does slow
down decision-making and could be inefficient at times.
In such a style of working, superiors welcome the feedback of the
subordinates.
Employees are invited on an open forum to discuss the pros and cons of
plans and ideas.
Democratic style of working ensures effective and healthy
communication between the management and the employees.
The superiors listen to what the employees have to say before finalizing
on something.
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Laissez-faire
This style is the complete opposite of autocracy; employees are allowed
to make the majority of decisions, with management providing
guidance when needed. The manager in this case is considered a
mentor rather than a leader. This style of management is popular in
startups and technology companies, where risk taking is encouraged.
However, it can lead to difficulties in making decisions.
In such a style of working, managers are employed just for the sake of
it and do not contribute much to the organization.
The employees take decisions and manage work on their own.
Individuals who have the dream of making it big in the organization
and desire to do something innovative every time outshine others
who attend office for fun.
Employees are not dependent on the managers and know what is
right or wrong for them.
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Management By Walking Around (MBWA)
This classic technique involves management by listening.
Managers gather information by listening to the thoughts of
employees that can stop problems at their source. When
using this type of management style, managers must be
counselors and not directors. A good decision will be well
received and respected by all. When employees do not
support management there can be problems in MBWA
management.
In the above style of working, managers treat themselves as an
essential part of the team and are efficient listeners.
The superiors interact with the employees more often to
find out their concerns and suggestions.
In such a style of working, the leader is more of a mentor to
its employees and guides them whenever needed.
The managers don’t lock themselves in cabins; instead walk
around to find out what is happening around them.
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References
• Management and Entrepreneurship by K R Phaneesh
• http://mba-lectures.com/management/principles-of-
management/637/plan-and-types-of-plan.html
Note:
This in information is collected from different sources
for better understanding of the topics.
Read the text books available on the topics and
practice.
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Thank you..!
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