Logistics in Construction

By 1. Mr. Srinivas 2. Mr. Prasad 3. Mr. Shriprasad 4. Ms. Niitu 5. Ms. Divya

What is logistics?
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Peter F. Drucker called logistics as The last frontier for cost saving. Logistics is concerned with getting products and services where they are needed, when they are desired. Or The movement and handling of goods from the point of production to the point of consumption or use Or The process of planning, implementing and controlling the efficient, cost effective flow and storage of raw material, in-process inventory, finished goods and related information from the point of origin to the point of consumption for the purpose of confirming customer requirements

History of Logistics
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Around 2700 B.C.: Material handling technology in erection of Great Pyramid of Giza. Blocks of stone weighing several tons were transported and assembled at the construction site. Around 300 B.C.: Revolutionary Greek rowing vessels the new foundation of intercontinental trade. Using these logistics capacities, Alexander the Great undertook campaigns with his troops, their families and their weapons of war that extended all the way to India.

Around A.D. 700: Procurement logistics in the construction of the Mezquita Mosque in Cordoba, Spain, began in 756AD. Pillars came to Spain from all parts of the Islamic empire. Around 1200 A.D : In 1188, the city of Hamburg, Germany, was founded as a base on the North Sea for the Hanseatic League to make travel on the sea more secure and to represent business interests abroad.

Around 1500: Progressive postal service in Europe Under an agreement with Philipp of Burgundy, Franz von Taxis organized the first postal service with strictly defined transit times. Letters were delivered to places such as Paris, Ghent, Spain and the imperial court ofVienna. Around 1800: The practical use of the steam engine, the invention of vehicles, railroads and ships as well as the discovery of crude oil ushered in a new economic era that generated new missions, tools and opportunities for logistics.

Around 1940: During World War I, military logistics was the vital link in the network that supplied troops with rations, weapons and equipment. With the onset of World War II, logistics was further refined. 1956: The invention of the sea container by the American Malcom P. McLean changed production conditions for nearly all industries around the world and, as a result, altered peoples consumption habits.

Around 1970 1980: The Kanban and just-in-time (JIT) concepts were developed and introduced at Japans Toyota Motor Co. by Taiichi Ohno with the objective of effectively linking logistics to other operational functions. Around 1990: The quick response and efficient consumer response (ECR) technologies were developed during the 1990s and applied by many retail and wholesale companies. These technologies had a major impact on logistics.

Today: Supply chain management a term that has grown enormously in use and significance since the late 1980s. Today, supply chain management is viewed as a holistic consideration of key business processes that extend from the vendors supplier to the end user. Today: Advancing globalization Efficient logistics creates a crucial competitive edge for companies that are expanding in global markets. Successful logistics efforts in international supply chains can fuel the development of global markets.

How does Construction Industry operate

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The construction industry is greatly concerned with aspects of daily operations, which are typically operational decisions, reflecting day-to-day operations up to 2 weeks ahead. The construction industry attempts to optimize daily operations of facilities through careful planning, organizing, directing, and controlling activities before and during the construction. In terms of construction logistics, multidisciplinary processes are categorized as follows: (i) material supply, storage, processing and handling; (ii) manpower supply; (iii) schedule control; (iv) site infrastructure and equipment location; (v) site material flow management on a job site; and (vi) management of information related to all physical and services flows. Logistics is rooted in senior-level decision making.

Logistics in Construction fieldnumber of aspects

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In the field of construction, procurement planning and execution (ordering, transport, reception and storage) dominates the logistic processes Also the building site can be considered as a production system and a member of many logistic chains, where complex processes are executed within time, space and within budget constraints whole project logistics. logistics. The supply chains can be considered to be delivering products from external sources from to the building site-supply logistics. sitelogistics. The co-ordination of material flows on the building site- on-site logistics. cosite- onlogistics. The participants in the construction project can be considered as separate entities as participating in other projects at the same time.

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Construction Logistics

Problems in logistics (Construction)

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The actual size of company is important. 97% of all contractors employ up to 20 people and, therefore, have no logistics department in their structure. There is diversification of projects (various materials, methods, location of each project means a new group of supply chain members each time). The technical complexity of a project. The number of participants in the project. The domination of the bidding system of contractor acquisition (random partnership within the chain). The difficulty in adjusting each members logistic routines to the logistic system of the project.

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Challenges on the material front.

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Logistic systems WRT material part in construction project relate to:

Sources of supply, Delivery contract routines, Criteria of suppliers selection, Reasons of delivery inaccuracies, Bases of material demand forecast and Distribution of responsibility for logistic decision

Challenges on the delivery systems part..

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Any arrangements concerning the project delivery system are meant to be most economic for the owner and allow him to be involved in any decisions he wishes to influence. The most common delivery systems in construction are: the design-bid-build systems the design and build or turn-key systems the professional construction management systems

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What are the consequences of poor Logistics?

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Unnecessary cost in the system

there being additional cost in the system that could be saved if the process operated more efficiently as a result of improved logistics. working day of site operatives in all trades is lost due to waiting for materials, or waiting collecting materials, tools, and equipment.

Poor image of the construction industry

Lorries parked in an inconsiderate way outside construction sites whilst waiting sites to unload does not give the image of an efficient industry. Disorganised sites Disorganised with skilled craftsmen being used for un-skilled jobs does not encourage quality unpeople to join the industry. Vehicles driving around empty or with part-loads with partdoes not convey the image of an industry that has environmental concerns at the top of its agenda, nor does large amounts of waste being removed from site, removed 85% of which goes to landfill. None of this seems consistent with the growing with attention that companies are expected to pay to corporate social responsibility.

Poor quality construction

Working in a disorganised environment will inevitably make the production of quality construction more difficult. Work interrupted whilst materials are sort from elsewhere on site, or delayed whilst products are delivered, will have an adverse effect on quality. Secondary working of products on site is also less likely to provide the same quality of product that could be manufactured in a factory environment. Most of those features of construction projects that point to poor logistics will add to the time of construction projects. Delays whilst product is unloaded, subsequent movement of products around site and secondary working of product all add unnecessary time that would be eliminated in a well organised project. Unnecessary products stored on site inevitably bring with them additional potential hazards. Additional manual handling (either because product is in the wrong part of the site, or because the right equipment is not available) adds to the health risks to those on site. Secondary working of material also brings risks and research has shown that a number of accidents on site occur as a result of workers tripping over discarded material arising from secondary working.

Increased project time

Added risks to health and safety

Probable solution-4 basic models of supply systems:

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Independent supply chains for individual contractors, where selection ofsuppliers, supply planning and scheduling is the duty of each contractor. Centralised supply system managed by general contractor or other party. Managing the whole project, by means of their own logistics departments. Centralised supply system managed by an external logistics company. Combination of the above.

What is required..
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As the success of the project depends on the co-ordination of the on-site and external logistics in all above aspects, a considerable managerial effort is required to bring the efforts of all participants of the project in consonance and to reach the synergetic effect The selection of the logistic system depends, however, on economical, physical and organisational conditions of the project e.g. scope of the project, location and delivery system. There is a need for the development of a very precise planing tool. Such a tool would allow the anticipation of actions (especially, but not only actions related to the delivery of goods to the site) and would make the construction process smoother and probably more efficient.

Suggested model-Integrated Logistics

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Integrated logistics for the whole project means the possibility of optimising supply supply chains and co-ordinating deliveries, which is significant for sizeable construction coconstruction projects that involve many contractors working in confined space. space. Since if there is shifting of responsibility for supplies to many subcontractors may many result in the building site congestions, excessive expenses and delays. Business organisations offering service in the field of logistics may exist in the form of logistics independent companies or be created specially for the needs of a construction project. According to their scope of activities they may take over all the logistic over processes within the projects life cycle or focus on some functions, e.g. supply project control, transport and warehousing. Centralisation of logistics is meant to lower total cost of the project, improve quality of works and reduce the project completion time. The advantages of logistic centres are not limited to cost reduction. The quality of reduction. service is also higher due to specialisation of logistic organisations. Logistic centres organisations. are able to co-ordinate and optimise their transport and therefore diminish the traffic coloads (important in cities) and reduce air pollution.

Other solutions
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Minimization of handling of the construction materials, which reduces cost and chances of damage or misplacement Development of relationships with the vendors, which allows flexibility in packaging, shipping, and delivery such as online access, use of computer software, and automation Prioritization of material logistics in up-front planning Provision of up-front detailed design, scope of work, plans, and specifications for better understanding of total requirements, design, and value engineering Continuous communication among all parties involved Development of standards for information flow from manufacturers Advancements in E-commerce must be adopted by the vendors and subcontractors Sharing of lessons learned among project and team members

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Short-term costs versus long-term benefits..

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Almost everything that happens in a construction company that relates to productivity loss has an association with the project process: scope definition, financial planning, requirement procedure, and operating procedure. Construction material logistics management aims to make project processes easier and quicker and at the same time more visible and controllable. Occasionally, these goals can conflict, and managers must decide whether to assign more value to the short-term or long-term goals. This issue in the construction industry is related to the use of information technology (IT). Even though rapidly emerging new technology immensely helped professionals in the IT business for the past decade with one breakthrough tech-nology after another promising to solve IT problems, the construction industry only lately began to implement information technology. Recently construction companies began to invest billions of dollars in everything from faster computer networks and Web Sites on the Internet to wireless connectivity solutions, in an attempt to improve their process efficiency.

SUMMARY
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Construction logistics deals with many technical, organisational and environmental issues affecting the cost of a project, time and quality of execution. Traditionally, each contractor uses and manages his own supply chains. In the case of larger projects involving a number of contractors, incompatibility of logistics concepts and lack of co-ordination results in serious disturbances in material and information flows. The main task of an integrated logistic system is to provide just-in-time deliveries, eliminating most of material handling and storage on site, to shorten the time of project completion by eliminating reasons of work stoppage, to minimise disturbances in local traffic and air pollution due to exhaust gases emission. It is clear that there is no typical or best system of project logistics. In a longer perspective each system must be readjusted to the external conditions or even completely redesigned.