Professional Documents
Culture Documents
CDR.05
CDR.05.1
2002 AACE International Transactions
the contractors own pricing errors, if any, and inherent perform-
ance inefficiencies, are included within the DLE calculation.
Only labor expended in excess of that DLE productivity model is
ultimately considered as a claimable cost.
Typically, the following tests are applied to ensure the accu-
racy, reasonableness and acceptability of DLE analysis.
CDR.05.2
2002 AACE International Transactions
data, the authors developed a detailed as-built on a day-by-day and
bay-by-bay basis that recorded glass panel installation.
CDR.05.3
2002 AACE International Transactions
DLE calculations. They were treated as overhead and applied STEP THREE: ALLOCATION OF LABOR
only in making the cost calculation. BY DAY AND BY BAY
An additional problem, not unique to such analyses, was mis-
placed documents. Labor records for a two-week period in mid- Armed with the detailed unit/activity as-built records, and the
February 1997 were lostalthough the aggregate for this period daily labor for each of the glass panel installations, the authors
was known. The authors excluded all glass installation quantities proceeded to allocate labor by a linear pro rata distribution. For
and associated labor during this period from the DLEs in order example, the data recorded on November 19, 1996, showed that
that this missing data not skew the DLE calculations. 112 workers installed 79 glass panels. Therefore, each glass panel
Finally, there were labor allocation problems that occurred required .71 workdays of work (79/112). The results of the alloca-
intermittently for certain crew groups. The individual who pre- tion for this example are given in table 3.
pared these reports simply omitted any information for days on The authors concluded that while this linear allocation of
which glass panel installation was reported, but not its associated workers to location was not flawless, it did represent a reasonable
labor. In virtually all such cases, the labor reported for the follow- and best available means by which to allocate workers. The
ing day included two days of labor workhours. The authors were authors recognized that on any given day the workforce for a sin-
able, by the use of cross-referencing in the database, to determine gle bay might vary but when aggregated over several continuous
what work was actually performed because the as-built data days, the results would be substantially correct. The product of
showed installation on a day on which no labor was reported. In this allocation was a data grid of 25,050 cells (75 bays over 334
such situations, the authors allocated the two days of labor report- days) recording labor and production. The database, therefore,
ed in accordance with a pattern based on the overall daily labor contained approximately 175,000 data points for the DLE calcu-
records. Those records showed that there were differences in the lations associated with the departure level glass panel installation.
number of workers reported to be installing glass panels depend-
ing upon the day of the week, as shown in table 1.
The completed database provided a fast and accurate method STEP FOUR: IDENTIFICATION OF
for excluding data. It allowed the authors to exclude data from THE DLE OR MEASURED MILE
areas where the production figures were suspect, as well as where
the labor data were inaccurate or incomplete. Thus, at the com- The database detailed above also facilitated the preparation
pletion of this second step in performing the analysis, following
of graphic representations of this information. Two readily under-
the merger of these various exclusions, a substantial portion of all
standable graphic presentations were developed: one reflecting
actual labor had been assigned. Of the entirety of the actual labor
average productivity by bayexpressed in units per workday for
expended in performing the three categories of work reported by each bay over the entire periodand one reflecting average pro-
the contractormullion erection, mullion alignment and glass ductivity by date. Figure 3 depicts the first graphic presentation of
panel installationbetween 12 and 18 percent of such was average productivity by bay.
excluded from the database. Stated differently, after considering There were two bay groups (437 through 440, and 467
organization and allocation, the DLE calculation was based upon through 470) where there was consistently high productivity (in
between 82 and 88 percent of the original available data. excess of one panel per workday). Based upon this data, the
In addition, a total of more than 8,500 glass panels were authors undertook a detailed review of the appropriate records,
installed. However, 1,300 panels (8,500-7,200) installed after which revealed the actual events, influences, and issues that
March 31, 1997, (the end of the study period) were not included occurred or affected the work at these specific locations. This
within the database (see table 2). analysis showed that there was no evidence of specific contractor-
caused problems at these particular locations. Further, the
Table 1 analysis revealed that work in these areas could be per-
formed in a manner similar to the original plan. Stated
Mon Tue Wed Thu Fri Sat Sun Total another way, the contractor was able to mobilize its glass
15.3% 16.4% 15.4% 15.6% 15.4% 14.9% 7.0% 100.0% installers and work in several adjacent stages in a near con-
tinuous operation. Finally, there were no specific disrup-
Table 2 tions that prevented work from proceeding in a manner that
most closely approximated the original plan. The original
DLE Unit As-Built In DLE Percentage plan was known because the contractor was required, prior
Mullion Erection 46,500 m2 40,934 88.0 to the commencement of work, to develop detailed method
Mullion Alignment 46,500 m2 38,850 83.5 statements that described and depicted in diagrams how
Glass Panel Installation 7,200 pieces 5,917 82.2 each task, in this case glass panel installation, was to be per-
formed.
Table 3 A similar analysis of bays with low productivity revealed
PRODUCTION November 19, 1996 that there were often times at which specific owner-caused
Bay Glass Panels Number of Workers events negatively impacted productivity. However, the over-
407 4 6 riding conclusion was that there were few specific owner
408 55 78 interferences that explained the low productivity. Rather, it
421 20 28 was observed that in areas of low productivity the overall
TOTAL 79 112 pattern of work was expansive, resulting in multiple mobi-
CDR.05.4
2002 AACE International Transactions
1.600
1.400
Panels per Workday
1.200
1.000
0.800
0.600
0.400
0.200
0.000
401
405
409
413
417
421
484
488
492
496
500
504
426
430
434
438
442
448
452
456
460
464
468
472
476
480
Bay Number
Figure 3
1.40
1.20
Panels per Workday
1.00
0.80
0.60
0.40
0.20
0.00
10 t-96
-F 7
17 t-96
24 t-96
31 t-96
7- -96
-F 7
27 b-97
6- -97
-S 6
-D 6
-S 6
-S 6
3- 96
-D 6
-D 6
2- 96
9- -97
16 n-97
8- -96
15 g-96
23 -97
30 -97
6- -97
-A 6
29 g-96
5- -96
14 v-96
21 v-96
28 v-96
5- -96
13 r-97
20 r-97
27 r-97
7
13 b-9
12 p-9
12 c-9
20 b-9
19 p-9
26 p-9
19 c-9
26 c-9
22 g-9
-9
-
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ct
eb
n
ep
ec
g
n
ug
ov
ar
Oc
a
a
a
De
Fe
Se
No
Ja
Ja
e
e
e
Au
Au
-Ja
-Ja
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u
-O
-O
-O
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M
-M
-M
-M
-F
-N
-N
-N
-A
-A
1-
Figure 4
lizations, frequent returns to a specific bay, and the inability to but only secured in place by temporary clamps. These panels
work consistently in a single area. Figure 4 depicts the data viewed were not listed as installed until the following day, when final
by number of panels installed by date. clamps were inserted. Thus, on day-one only a few panels were
The data depicted in figure 4 were averaged, or smoothed, completed, while on day-two numerous glass panels were
over a seven-day period to address production reporting vagaries. installed. A rolling seven-day productivity average in panels per
For example, the analysis revealed that, although infrequent, there workday was, therefore, a more meaningful representation of the
were instances in which glass panels were installed on day-one actual performance of the work.
CDR.05.5
2002 AACE International Transactions
25,000
20,000
Man-days
Owner Impacts
15,000
Contractor Impacts
10,000
Owner Impacts
Estimate
Owner Impacts
5,000 Contractor Impacts
Contractor Impacts
Estimate
Estimate
0
Mullion Alignment Glass Panel Installation
Mullion Erection
Figure 5
Notwithstanding the accuracy of the depicted productivities, ly add a false sense of detail and accuracy to calculations. This
two aspects of the above charts require further explanation. First, level of detail is not always supported by the DLE methodology.
there is relatively high initial productivity in late August 1996, Stated differently, DLE calculations in general, and the glass
when low learning-curve productivity might be reasonably expect- panel installation calculations specifically, were the best approxi-
ed. This anomaly was the result of the premature reporting of the mation of the actual productivities achievable as measured at the
installation of the glass panels by the field supervisors. At this task level. The smaller the data segment or unit utilized in the cal-
early period of performance, supervisors were only starting to culation, the less precise the resulting calculation became. Nev-
understand some of the design defects they needed to overcome, ertheless, the arbitration panel required that damage calculations
and their resulting implications on task completion. The supervi- be very detailed. The authors, therefore, converted the DLE into
sors were reporting as installed glass panels that had not, in fact, a calculation of what the workforce should have been on a day-by-
been finally aligned or clamped into place. Second, and as a bay basis by using the DLE productivity. In response to that
corollary, low productivity in October 1996 was a direct conse- demand, the following calculations were performed.
quence of the initial high productivity reporting. During this time,
a significant amount of labor was expended completing the over- 1. Glass panels installedbased on the actual daily field counts
stated work that had earlier and erroneously been recorded as of the contractor as confirmed by the owners inspections,
installed. inaccurate data excluded.
From these studies, the authors concluded that the actual 2. Labor workdaysknown for each day, allocated each day by
DLE, or measured mile, for this project was 1.1 panels per work- number of glass panels installed. Inaccurate data excluded.
day, as achieved in mid-March 1997, at bays 437 through 440, and 3. Productivitynumber of glass panels installed by day and
467 through 470. bay divided by the labor workdays for that day and bay.
The authors also reviewed the initially planned workday esti- 4. Direct labor efficiency workdaysnumber of glass panels
mate in order to ascertain and confirm that contractor-caused installed by day and by bay multiplied by the DLE produc-
problems were included within the DLE calculations. Figure 5 tivity.
summarizes that study. 5. Impact workdaysactual labor workdays minus DLE work-
days.
6. Impact workdays adjusted for sample sizedue to adjust-
STEP FIVE: TURNING THE DLE CALCULATIONS ments made in the early steps associated with misreporting of
INTO DAMAGES data and other apparent data inaccuracies, the DLE was cal-
culated using only a portion of the actual labor expended
The arbitrators in this matter required that the damages be doing the work. This calculation applies the DLE calculation
date, cause and location specific. The authors believe that such an to all the labor for this task.
uncompromising requirement, absent either an understanding of 7. Total labor cost for taskadjusted impact workdays multi-
the validity or thoroughness of the available data, might ultimate- plied by workday labor rate.
CDR.05.6
2002 AACE International Transactions
Calculation 6 requires further explanation. Through the ini- complete than other calculation methodologies that attempt to
tial steps, deficiencies in the underlying data required that certain obscure defective or suspect data.
portions of that data be excluded (corner bays, as previously dis- In sum, the ability to look at virtually all components of a
cussed). The overall workdays expended performing this work, project as individual, discernable DLEs is a comprehensive and
including the missing days in February 1997, were known in the accurate method for calculating labor inefficiencies and their
aggregate. Therefore, the DLE calculated productivities were attendant loss of productivity costs. This methodology is preferred
applied to all the labor charged to the task, not just the smaller over use of aggregated DLEs or total cost claims.
sample included in the DLE study.
Calculation 7 reduced a complicated set of labor cost calcu-
lations into a single statement. In reality, the authors performed REFERENCES
extensive studies to arrive at the average workday cost. First, the
actual payment to the workers had to be calculatedmade more 1. McCally, B.M. Cost Engineering (November 1999).
difficult by the differences between worker pay rates depending 2. Zink,D.A. Cost Engineering (April 1986).
upon their nationality. Further, Hong Kong labor practices often
required the use of labor brokers and corresponding complica-
tions in tracking payments. Dan Crowley
Even after average daily pay was determined, including over- Warner Construction Consultants, Inc.
time, certain overhead labor workers (who were identified as 2275 Research Blvd., Suite 100
scaffold or shop) had to be included. These workers were gen- Rockville, MD 20850
erally the material handlers, equipment operators, safety officers, E-mail: dcrowley@warnercon.com
quality control inspectors, and others who worked on one or more
tasks, and therefore had to be allocated to multiple DLEs. The
authors reduced these labor workdays to actual costs and allocat- John C. Livengood
ed them as a surcharge to each workday hour worked. Warner Construction Consultants, Inc.
Finally, the delays, impacts, and disruptions actually experi- 2275 Research Blvd., Suite 100
enced caused an increase in the overall onsite project overhead. Rockville, MD 20850
Since all work was performed on an island, and all workers had to E-mail: jlivengood@warner.com
be transported to and from the island or be provided housing on
the island, there were substantial additional costs associated with
both transportation and housing. Additional supervision was also
required, as well as a full panoply of support services. These site
overhead charges were incurred on all aspects of the project and
were allocated pro rata to the daily labor cost in order to facilitate
their inclusion in the labor rate.
CDR.05.7