Message for Construction Industry on the day of India's Independence Day


Resource Productivity Index – A must for the development of Indian construction

                                                                                                            12/26/2013 12:00:00 AM
Resource Productivity Index – A must for the development of Indian construction industry Productivity Index is also understood as the ratio of Actual productivity and standard productivity norm. This is also a parameter for understanding the utility of resource in a particular activity. This can be taken as the layman introduction of productivity index. Most of the senior & experienced engineers are aware of the need of having productivity norms and measuring performance of a resource against that established norm but unfortunately there is no standard document compiled, updated & released by the industry giants on regular intervals. We are still banking on the productivity norms considered in big government organization like CPWD, MES, state PWD etc. whereas today the construction industry is mainly private work force oriented. Many private companies are taking contracts from government organizations and are executing the contracts on their behalf at either on item rate contract, Lumpsum contract or cost plus contract. The process of tendering and estimation of cost is also being used as an outdated concept making it unscientific method of costing. This is a very big statement but the very reason for my big statement is the way the available data is being used by these companies. There are majorly two methods being adopted in cost estimation of civil or structural works viz. while calculating the cost of resource deployment then either an estimator is banking on the norms as taken by the CPWD, MES etc. or they base their estimation on the rates given by them to their sub-contractors in the previous projects which may or may not be of similar nature in execution. Now what is wrong in either method? Why both methods are kept under the category of unscientific in my personal opinion? Let me try & explain the very reason behind this understanding.First and foremost is the method of working which is different in government organizations and private organizations. Government organizations work on standardization of rates to form a basis for estimation so whatever data is collected is grouped under standard groups and the quotations are asked from vendors on those rates then it is left to the wisdom of vendor to use their experience and quote based on the project / site conditions. The tendering department uses a difficulty factor in line with company strategy to take or leave the project and quote accordingly. This makes a non-level playing platform for all vendors. The efforts to attain a better productivity while executing the project gets a back seat and to allow a profit or loss in a particular item based on overall profitability of the projects takes the driving role in which the reference from the previous project is taken is also not scientific as the data related to site conditions of previous projects and new projects are not related while assuming the cost, only some escalation in cost factor based on time is assumed and applied in most of the cases. As a suggestion companies record their own productivity of resources based on the type of resource, activity type, project type, difficulty in execution and other parameters which can be then compiled by any central construction organization like CIDC etc. Information so shared by companies can then be compiled, analyzed, standardized and published on regular interval as a norm. The norms so established will be based on the type of project, location; difficulty level etc. shall certainly help in quoting a proper tender and hence enable clients in getting proper quotation. The standard norms of resource productivity shall also form a datum for evolution of bids as a mandatory check like basic material cost which is one of the factors to cross check while understanding the correctness of bid. Now why construction industry need to work towards establishing, upgrading, updating and standardizing the productivity norms? There are many new items and resource variations have been introduced in Indian construction industry since the last norms were updated for building works and a since effort to upgrade and update the data is required to keep Indian construction industry at par with international standards.

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