Cost based Engineeinrg and Production of Steel Constructions

I found this article really interesting, showing that concentration on connection design could help Steel Entrepreneurs to focus on 50% of their production costs. As a practitioner in this area, I faced many times with unproductive design of connections which resulted in many errors during the design, production and erection phases. Modularized design is one of my solutions in this regard.

COST BASED ENGINEERING AND PRODUCTION OF STEEL CONSTRUCTIONS
H.G.A. EVERS, ICCS bv The Netherlands IR. F. MAATJE, ICCS bv The Netherlands

ABSTRACT
In the last years Steel construction companies in Northern Europe have mainly invested in production machines in the factory: Sawing and drilling machines, punching and shearing machines and Robot flame-cutting. Investments, which reduce the production costs of the Steel structure, looking at the complete development of a building, quit at the end of the whole process. We as ICCS bv state that there are more savings possible if investments are done in the engineering and design, at the start of a project. This will be the subject of our lecture. To know what the possible savings are, the engineer needs to have good knowledge about costs of Steel constructions and software that helps him to make costs clear. In our lecture we will present the state of art of software tools available for the steel construction industry.

WHERE ARE COSTS IN STEEL CONSTRUCTION
In order to be able to reduce costs, it is necessary to know how the costs of creating a steel structure are build up. In regard to this we would like to make the following statement: Approximately 50% of the total costs in a steel structure can be redirected to the connections in the structure.
Roughly, the following cost items in a steel structure can be identified:
1) Design 13%
2) Material 38%
3) Production 27%
4) Coating 10%
5) Erection 12%

COSTS RELATED TO THE CONNECTIONS
Design costs: These can be divided in:
1) Pre-design
2) Detailed design
3) Detailing and work preparation

1) Pre-design: 33% of costs related to connections:
In the pre -design most of the time is spent on main frame design and the stability of the structure. In the pre-design the engineer only has to consider connections that influence the global behaviour of the structure: The so called rigid or semi-rigid connections. Simple calculation rules are available (SG-TCA10a).
2) Detailed design:
55% of costs related to connections: In this phase the engineer has to detail all the connections that influence the behaviour of the structure in detail. When semi-rigid connections are used the behaviour of the steel frame is influenced by these connections.
3) Detailing and work preparation:
77% of costs related to connections: The draftsman spends nearly all his time on detailing connections in the steel structure. Using StruCad, the draftsman spends 10% of the time to set up the steel frame. The rest of the time is spent on detailing the connections and printing and plotting the drawings.
Material costs:
40% of costs related to connections: In normal Steel structure plates contributed approximately 5% of the total weight. Using rigid connections, the field moment will be reduced. The amount of used material can is less. So there is a strong relationship between the type of connection and the amount of material in the structure.
Production costs:
63% of costs related to connections: Nearly all the work in the shop is related to the connections of the steel structure: Prefabricating plates and cleats, the tack welding of the plates to the beams and columns and welding.
Coating costs:
38% of costs related to the connections: The coating of the small parts like plates and cleats of the steel construction takes more time than coating the main beams and columns relatively.
Erection costs:
45% of costs related to the connections: It is clear that on the erection site the connections are fitted together. Easy connections will be less time consuming then difficult connections
This means that approximately 50% of the costs are directly related to the connections in a steel structure. In order to reduce costs in the total process it is of great importance to look at the connections at an early stage. In Dutch practice there are a lot of examples of projects that ended in court due to severe problems with the connections. In frame analysis packages it is very easy to analyze a structure in which all frame elements are rigidly connected. However, in practice, it is (almost) impossible to connect frame elements fully rigid. If it possible, then the costs of that particular connection will be very high.
As many costs are related to the connections, it is fair to say that at the end of the detailing the final price of the structure is determined for approximately 88%. The connections determine the material and hence the production in the shop and on site.
The next figure illustrates this.






How are the costs built up?
On the horizontal axis the progress in the project is shown. The percentages of costs are given along the vertical axis.
The continuous line represents the costs of the wages made during the project. The middle dashed line represents the total costs made during the project. The left dashed line shows the amount of costs that is fixed.
As in the design and detailing phase many costs are fixed. It is very important for an engineer to have a tool with which he can estimate what the financial consequences of his decisions during the design will be.

Application of system dynamics model in project management

Nowadays, in spite of all attempts in the area of project management, projects often fail due to project complexity, lack of holistic approach to project and finally inattention to non-linear aspect and dynamics of projects especially due to inability of project managers. This complexity will be more controversial in EPC (Erection, Procurement, Construction) companies such as Hydro Electric Power Plant (HEPP) construction companies.

This thesis aimed initially to enhance awareness and understanding of dynamics behavior more in EPC companies in the field of HEPP and as a case study in Farab Co. by making a general project management dynamic model for this company to support the effective teaching of dynamic thinking among project managers.

Secondly, one of the controversial projects was proposed by the company to be simulated in a dynamic model based on the actual information aiming to act as a conflict resolution tool.

As a result, holistic SD (System Dynamics) model of PM (Project management) was created for company by involving project managers. in addition, the second model revealed that the major exogenous factors affecting such cost and time overruns are comprising man power idle time caused by client such as interruptive visits of VIPs, cable crane failures and etc. as well as rework and repairs caused by delivering of manufactured equipments out of sequence and high defect rate of those equipments all imposed from client side.

Context of co-opetition in SMEs- How SMEs attempt to manage knowledge sharing process?

This article is really interesting, especially different frameworks for better understanding of co-opetition forces; synergy, leverage and negative reverse impact in knowledge sharing among SMEs. Here is a part of conclusion in the article.
Enjoy it!!!

This exploratory research sought to understand the context of co-opetition in SMEs, the role of IS in managing knowledge, how the three co-opetition forces, synergy, leverage, and negative reverse impact, manifest themselves, and how SMEs may attempt to manage the knowledge sharing process. The outcomes demonstrate that co-opetition is an issue for value-added focused SMEs and may become so for others. Coopetition forces do impact on SMEs, though the context is significant. Some SMEs employ tactics to mitigate and exploit these forces through knowledge sharing management, though their efforts are largely unsuccessful. IS plays a part in these tactics.
Managing inter-organisational knowledge processes play a prominent role in sustainable competitive advantage. The game theoretic analysis provides a structure for modelling knowledge sharing under coopetition. The model investigates how SMEs will fare. SMEs need to consider how to make themselves receptive to exchanged knowledge and flexible and responsive enough to gain competitive advantage if this is ephemeral. It may be that knowledge is bundled with other physical assets and that there are pre-requisites for using the knowledge fully. SMEs are knowledge creators, but are poor at knowledge retention. Part of the resolution of this lies in the SMEs' own hands. They need to be proactive in knowledge sharing agreements, to recognise knowledge has value and the value added derived from knowledge exchange. While some SMEs here expect new technology to open up global markets, their collaborations are essentially local. SMEs will be more vulnerable as inter-organisational IS spread and the world gets more information exchange intensive. At minimum, SMEs need to recognise that these forces exist. Recognition is the first step in management, though often the SMEs cannot mitigate the forces, especially from major customers. They may however, be able to gain more value internally from the knowledge they are forced to share. As with many issues in SMEs, the owner-manager attitude is paramount. That most of the knowledge shared by SMEs is explicit, suggests that some management of the sharing process is within the hands of the SMEs.