8

Adding Value in Construction Design

Management by using Simulation Approach
Hemanta Doloi
The University of Melbourne
Australia
1. Introduction
This chapter focuses on a technique for integrating upstream and downstream project
information from the conceptualisation, planning and implementation to the operational
phases of projects. A new perspective for adding value in design management practices has
been presented by emphasising a whole of project lifecycle approach. An appropriate
mechanism for supporting design management practices at an early stage of project is
crucial in terms of adding value over scope, time and total investment decisions. Simulation
technology acts as a vehicle for analysing the strategic change management of the projects
scope and helps fine-tuning the dynamic business environments.
Increasing complexity and sophistications in construction create new challenges in design
management practices. The clients are not only interested in value for money in relation to
the investment in project development but costs associated in operation and maintenance
over project life cycle as well. While the clients interests may be profit driven in the
competitive market, the design professionals have to understand the commercial aspects in
terms of design innovations, sophistications and cost effectiveness of the project. Coping
with these challenges requires a full understanding of the wide variety of design parameters
and technical expertise of each party to deliver the project as per original project objectives.
Most project fails due to an inadequate definition of project objective at the early stage of the
project. Due to involvement of various stakeholders in the decision making process, the
public sector projects are even more vulnerable compared to the private sector projects.
Increasing complexity and requirements for continuous improvement of capital projects
exert further constraints for adding values in both construction and project management
disciplines in the competitive global environment.
Within the construction industry, there is a definite trend towards outsourcing specialise
work to subcontractors, and thereby pushing the liability from one party to another. As
such, with each construction project, the need for good design management and appropriate
design communication between the designers, the main contractors and subcontractors is
becoming increasingly important. Various methods of design management have been
emerging with technology, to increase efficiency and reduce the costs and incrased values.
Computers/IT has become a huge influence in this regard. The outsourcing of the design
has also become a cheaper and more efficient approach to construction industry. This
increases the need for efficient design development, effective design quality, information
sharing and dealing with constructibity issues in deliverying the projects. The increased

www.intechopen.com

120

Robotics and Automation in Construction

trend of procuring public projects with Public-Private partnerships (PPP) procurement

methods, such as schools, roads, social infrastructure etc. requires furhter attention on value
for money outcomes in projects. Under the PPP contract, the contractors resposibility
extendes over substantial period of project life cycle and the impacts of design and the
performane of overall project filter down to the subcontractor, engineers, architects,
consultants and project end users. This greatly influences on the upstream design
management process for meeting or exceeding expected benefits of project downstream.
Based on research undertaken by the author over last eight years, it has been evident that
the simulation is one of the best options in adding value in design management practice and
to sustain in the emerging complexity in competitive project environment.

2. Objectives
Poor design management practice often leads to confusions and conflicts in complex
engineering projects. Innovations in engineering design, construction and operational
processes along with increasing regulations have significant contributions in resulting
complexity of projects (Nicholson & Naamani, 1992). This chapter portrays how an
appropriate analysis of design at an early stage and proactive management practices
increase chances for adding values in projects from the operation and end users
perspectives. An integrated design management framework has been presented to holistic
evaluation of project selection and investment decisions based on functionality and
operability of the end facility over operational phase of projects. In the evaluation process,
selection of design configuration must enable meeting the target associated with business
and strategic objectives of the organisation. A thorough analysis of these objectives is an
important requirement to determine the optimum project selection from the available
competing alternatives. Simulation based project evaluation and decision analysis adds
significant value in evaluating such alternatives by reducing uncertainties in design,
implementation and operations with a greater confidence (Jaafari & Doloi, 2002; Doloi,
2007).
Use of process simulation technique assists in analysing feasible design solutions based on
technical, functional and operational aspects of projects. Simulation techniques allow design
of mathematical-logical models of a real world system and experimentation with different
alternatives digitally. It provides a basis for real time scenario analysis by analysing process
level decisions at a lower level in the project hierarchy followed by the evaluation of
conflicting criteria for making holistic decisions at the project level. A new design
management framework, dubbed as Lifecycle Design Management (LCDM) has been
discussed with examples where a set of lifecycle objective functions (LCOFs) are employed
as the basis for decision making to determine the optimised solution throughout the
projects life.

3. Life cycle management

Generally, life cycle management refers to management of systems, products, or projects
throughout their useful economical lives. Projects pass through a succession of phases
throughout their lives, each with their own characteristics and requiring different types of
management. There is no complete agreement on the identification of these phases but they
usually entail the following, as described by Morris (1983):

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

1.

2.
3.

4.

121

Conceptual phase where projects are first identified and feasibility is established
(financial, non-financial, and technical). This phase is subject to high-risk levels and
should be examined before detailed planning. Consequently this stage includes the
analysis of alternatives, development of budgets, setting up of a preliminary
organisation, definition of size and location (facility site), and arrangement of
preliminary financial and marketing contacts;
Planning/design phase when all work from the conceptual phase is detailed and
produced further. All major contracts are defined, and prototypes may be built;
Execution/implementation phase when plans developed in the previous phases are
turned into reality. At this stage, the number of people and organisations involved
would have increased, requiring a redefinition of the project organisational structure.
Estimation is replaced by performance monitoring. All construction works and major
installation activities are completed; and
Handover and start-up phase when installation is completed, final testing is done, and
resources are released for the start of business operations.
Interaction Effects
(Among the four variables)

Environment
Scope
Diversity
Uncertainty
Opportunities
Constraints

Processes
Participation
Monitoring
Human resource development
Motivation

Strategy

Structure

Service-beneficiary-sequence
Demand-supply-resource
mobilisation

Structural forms
Decentralisation
Organisational autonomy

Performance
Accomplishment of goals

Fig. 1. Key Variables and Performances

In practice, normally these phases overlap. At the end of each phase, the project can
progress forward or backward (i.e. a recursive process) depending on the amount of
information gathered, produced and utilised (PMBOK, 2004). In LCDM approach as
discussed in next section, the project life cycle has been extended to cover the operation and
maintenance and disposal phases as well. All these phases are influenced by external and
internal variables over the project life cycle (Paul, 1982). Paul (1982) identified four key
variables influencing a project in his project management view. As shown in Fig.1, the four
key variables are environment, strategy, structure and process (Paul, 1982). The interaction
among these variables affects the project performances over the entire life cycle. The
adequate interventions to these four variables of the project, and according to the specific
type of project and environment, project performance can be positively influenced. It is
clear that a design management approach requires well-defined strategic objectives, as
highlighted in the following sections.

www.intechopen.com

122

Robotics and Automation in Construction

4. Lifecycle design management (LCDM)

Design professionals and project managers are involved in each phase of the project life
cycle that entails distinct activities and skills. Failure to properly address the design issues
and their underlying impacts over successive phases of the project life cycle can jeopardise
the ultimate success of the project. In typical project delivery approach, there is a heavy
concentration on the analysis of design and setting objectives for success in terms of three
main parameters: time, cost and quality. Time with respect to project start and finish dates,
cost with respect to cash flow and the project budget, and quality with respect to predefined standards and specifications laid down by the client or the relevant classification
society.
LCDM installs a set of business and strategic objectives for decision making throughout the
project life cycle in place of the traditional project development protocols. It employs an
integrated and concurrent design management approach to substitute the process-based and
activity-driven traditional management approach (illustrated in the current practice) for
innovative strategy-based and outcome-driven project outcomes. LCDM components
comprise:

A culture of collaboration based on strategic partnership and unity of purpose;

A life cycle philosophy and framework and an integrated single phase approach;

An integrated project organisation structure and real time communication system

among the design professionals;

An integrated design management system linked with project information and

development systems ; and

A set of project strategic objectives, known as Life Cycle Objective Functions (LCOFs)
for assessing and evaluating holistic project outcomes based in downstream operational
conditions. These LCOFs are usually derived based on the Triple Bottom Line (TBL)
principles (Doloi, 2007).
Fig.2 represents the perspective that Lifecycle Design Management (LCDM) takes, as
opposed to the perspective adopted by the traditional design management practices. As
seen, the LCDM framework embraces all the life cycle phases from conceptualisation to
demolition (re-cycle) phase with a significant emphasis on the operation and maintenance
phase. Such holistic view encapsulating the lifecycle in design management is a major shift
in the new LCDM approach.

Fig. 2. Lifecycle view of design management

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

123

5. Importance of design management

Design management is a leadership activity, focused on managing the creation of an entity.
An entity may be an object (motor car, building, etc.), an event (wedding, conference, etc.), a
concept (such as the theory of relativity), or a relationship (such as that between employer
and employee). Based on this definition of entity, literally anything can be the focus of
design management. The design managers role includes establishing and clarifying a
shared vision of the entity, defining, acquiring and allocating the resources needed to create
this entity, managing the effective use of those resources, and monitoring the design teams
performance (Chaaya & Jaafari, 2000).
Design management and design managers are popular expressions in most industries
except the construction industry where they have been realised relatively late (mid 1980s).
There is nothing innovative in the notion of design management. However, the separation
of powers between designers and design managers is clearly a new synthesis in design
management practice (Berk, 1994). In the construction industry, the architect used to be at
the same time architect, project manager, cost manger, design manager, principal consultant
and the undisputed leader of the building procurement team. Specialisation and evolution
of professions led the way to a variety of consultants doing much of what architects used to
do, including now the design management services.
We are witnessing a fast migration of the value of architectural services from strictly Information
Creation to the incorporation of Information, Management and Distribution. Over 25 years ago,
architects gave up certain risks, rights and responsibilities of construction supervision and a new
profession emerged to fill those needs of the client, the Construction Manager. Construction
management has blossomed into a profession that most projects use today. We are seeing history
repeat itself as most architects and other design professionals are fast losing control of their main
asset, their information (Cyberplaces, 1998).
Separating design from management is not a straightforward task since design is a process
of decision-making and decision-making is a key process in management. Decision-making
often involves defining a list of objectives, analysing the information, considering the
alternatives, assessing the consequences of the options, judging the risks, costs, penalties
and bonuses, and selling the decision. These steps are naturally reflected in management.
Hence, a good designer is envisaged as a good manager and it is often concluded that bad
designers are bad managers.
If it is acknowledged that design management is neither a process of managing a design
consultancy or practice, nor the education of designers about the importance of the
management world, then the importance of defining design management becomes
apparent. Throughout this chapter, design management is defined as the effective
deployment by the project management team of the design resources available to them in
the pursuance of the overall project and business objectives defined at the outset of project.
The growth in new knowledge and increased customer focus has increased the design
complexity in projects. Customers no longer simply settle for generic product but want
customised product design and services that cater for their ever increasing needs. In today's
digital age with an ever growing of consumers appetite for more sophisticated products
and services, increasing product complexity significantly impacts on design management
practice. The need to integrate diverge technologies, and thus project management, has
emerged as an important discipline for achieving these objectives. The functionality of new
production systems to service the changing markets is crucial in responding to shorter

www.intechopen.com

124

Robotics and Automation in Construction

product life cycles and market dynamics. The definition of a product directs the added
knowledge in scope management, and provides challenges for operative tools that are
designed for putting the component parts and processes of the project together (Jaafari,
2000).
The need for better design management in the architectural, engineering and construction
(AEC) industry has never been so high. This is due to emerging factors that reflect both
changing market conditions, advent of new materials and new procurement processes
(Nicholson & Naamani, 1992). To maintain profit margins, the industry needs to focus on
the improvement of the design process, especially to cope with tougher competition and
tighter fee scales.
Capital projects have necessitated design input from an increasing range of specialists. The
increased emphasis for keeping the construction projects on time and within budget has
required effective management of project scope associated with multifaceted stakeholder
groups in the project (Cleland, 2004). Thus, definition of projects scope in the concept
phase vastly influences the project development and its overall business outcomes.
Understanding the complexity of design in both functional and operational contexts at the
early stage is important in defining appropriate facility of the project.
The primary objective of this chapter is to discuss how to enhance the projects operational
performance and increase projects business outcomes from an effective design management
perspective. Inherent in this issue are the several sub questions such as: 1) how does the
design management impact on setting a benchmark on appropriate project management
practices? 2) how the process simulation approach can be used for integrating operational
processes and managing design complexity upfront? 3) what will be the consequences of
applying project simulation in decision making and overall business outcomes?
Focusing on the above questions, authors research resulted in a new model of project
design management that can deliver a view and an understanding of the strategic objectives
of projects in a proactive and explicit manner. Process simulation is employed for evaluating
operational performances and managing the process complexity at the early phase of the
project. Simulation based project evaluation and decision analysis allows evaluating project
alternatives by reducing uncertainties with a greater confidence (Artto et al., 2001;
Puthamont & Charoenngam, 2007). The approach provides a platform for real time project
definition based on technical, functional and operational aspects of projects.

6. Proactive design selection and project performance

Many organisations have found design to be the key to project success in meeting growing
and changing conditions. Growing pressure on design innovation and timely delivery is a
fact of life for project managers and architects (Heath et al., 1994). The design phase of a
project offers the greatest scope for reduction in overall project costs and adds maximum
values in the project. The size and complexity of modern design with increased uncertainty
requires front-end planning throughout the life of a project. Design management is an
incremental continuous iterative process and as the project moves on, it provides feedback
points for new information and the flexibility to assimilate and act on it. Thus initial design
and planning must concentrate on building viable project bases for each principal
subsystem in the context of life cycle planning of projects (Cleland, 2004). In the case of
strategic planning, one takes a set of fixed interests, juxtaposes them within a fixed
environment (or world, or set of conditions), and then invents a strategy for attaining ones
interests given the constraints imposed by the environment (Doloi & Jaafari, 2002).

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

125

Current project management philosophy tends to concentrate on the delivery processes and
associated functions of contractual scope, time and cost management (Jamieson & Morris,
2004). Traditional design selection and investment decisions in projects are based on static
and simplified assumptions regarding the functionality and operability of the production
processes. Economic analysis, reflecting the final customers or investors life cycle costs is
important during decision making, particularly at the early phase of projects (Jaafari, 2000).
This is because solutions devised and commitments made at the early phases constitute a
major part of the downstream project costs. Modelling of technical and operational
functionalities of the end deliverable supports strategic decision making in the early phase
of the project. Thus, appropriate design and optimal scope definition considering the entire
life cycle are the key for overall project success.

7. Design complexity and process simulation

In recent years, the concept of a modelling has become increasingly important in
engineering design management practices. It is no longer sufficient to pay detailed attention
to the design of the various elements of a project individually, rather, all elements must be
considered in relation to others in order to make the overall system effective. However,
good project design is not restricted to detailed design coupled with attention to
interrelationships between physical parts and elements. Design must be analysed and
evaluated at a deeper level and in relation to the projects operational environments
(Cleland, 2004; Doloi, 2007). Design configuration and scope of projects must reassess and
readjust to ensure that the objectives are met at the end. As a result, the overall process to
reach these goals becomes iterative, involving in the design of each of the parts and
products, which constitute the overall project. Simulation approach allows building a model
of the proposed system capturing the salient features of the overall system.
Digital computer models facilitate analysis of complex processes associated in projects. A
simulation model is a means for collecting information about the likely performance of a
system, based upon user-defined conditions (Marmon, 1991). Simulation models can
improve the planners understanding of the real life situation during conceptualisation and
final design or actual construction (Luk, 1990). By using the simulation model, the effect of
changes in process design can be justified and fine-tuned and investment decisions are
optimised over the project life cycle. The life cycle project management (LCPM) model is
indeed capable of responding to the global challenges and achieving the true value on
investment in the integrated project development.

8. Project development in design management context

A typical project life cycle includes phases such as feasibility, planning and design,
execution, commissioning and handover (PMBOK, 2004). As revealed by Artto et al. (2001),
the investment project phases are preparation, execution and operation, whereas the phases
associated with the post project implementation are sales and marketing, execution and
after-sales services. In front end planning, the investment project phases must be integrated
with the post project implementation phase (Shi & Abourizk, 1998). Fig.3 depicts the links of
three board criteria over project life cycle phases. As seen, the three broad criteria associated
with project investment are Risk and Uncertainty, Financial Objectives and Facility
Performance. It is important to understand that the impact of the technical and operational

www.intechopen.com

126

Robotics and Automation in Construction

functionality of the final deliverable on the end users is an important parameter that
contributes to the benefits obtained from the investment (Artto et al., 2001; Dikmen et al.,
2005). All these three criteria should be analysed upfront before making the final decisions
on project investment and development.

Fig. 3. Broad phases in project development

The three criteria are highly interrelated from the projects end product performance point
of view. The role of total quality management (TQM) along with the traditional project
management functions intrinsically governs the project development process in delivering
the end product. Thus, the scope of the project is the sum of products and services
produced in the project. The term project product is used as a synonym to scope of the
project. The purpose and benefit of project is realised only when an appropriate scope
configuration is achieved. The process includes aspects of 1) quality of the project product;
and 2) performance, functionality and technical characteristics of the project product
(Jamieson & Morris, 2004). The implications of the scope definition are that the project scope
management should focus on fulfilling individual needs of the end users of the project.
Decisions and information generated over feasibility (or conceptual design) and planning
phases of projects have a great impact on the downstream activities and consequently on the
overall cost (Artto et al., 1991). Understanding the project and its underlying processes,
supported by relevant information and tools leads to better decisions on projects.
Integration of implications of investment on product life cycle with project development
cost is an important consideration in front-end planning of project (Laufer, 1999). Thus the
validity of the hypothesis that the contemporary project management approach embodying
process simulation technique helps proactive decision making on optimal design, scope
definition and overall operating processes to achieve optimality across all phases is a
significant advancement in the LCDM concept.

9. Process simulation and decision making in project lifecycle

The simulation is a numerical technique for conducting experiments on digital computers
involving certain types of mathematical and logical models to describe the behaviour of a

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

127

system over extended periods of the real time (Pidd, 1984). During the last decade, discrete
event simulation has gained a significant role in engineering planning and design (Doloi &
Jaafari, 2002). Numerous examples reported in the literature, provide evidence how
organisations can save millions of dollars and avoid major risks using process simulation
(Irani et al., 2000). For instance, in early 1993, the IBM PC Company in Europe faced a
number of challenges that were eroding its market share, such as frequent price cuts, rapid
customer order response times, and a steady arrival of new products by aggressive
competitors. The IBM management reacted to record corporate losses by emphasising the
necessity of reducing operational costs and inventory throughout the company. The process
simulation technique was used to evaluate different manufacturing execution strategies and
to identify the lower-cost distribution policies. A strategic distribution policy was adopted
based on the analysis of alternative scenarios which resulted an estimated $40 million per
year savings in the distribution costs of the company (Artto et al., 2001; Kirkham, 2005).
The research on how the discrete event simulation works is not embryonic. Development of
computer-aided process simulation techniques have accelerated in recent years. However,
its use for project definition, management practices and life cycle investment decisions is not
widespread (Doloi, 2007). The application and influence on setting the benchmarks for
management practices within the complex project management framework has proven to be
a significant contribution in this research. Table 1 shows how the simulation can be applied
as a tool for appropriate front-end management of respective objectives over the project life
cycle. As seen, most of the project objectives and the decision making subjects have a natural
link to the process simulation outputs.
Definition and effective management of project scope, as well as management of the
investment life cycle incorporating the dynamic considerations of the market and customers
needs is a challenge within project management practice. Furthermore, simulating an
individual process within a project does not add significant value for the evaluation of project
level decisions in real life situations. Thus an integrated model embodying simulation
capability within the hierarchical project structure simplifies the task of project managers for
making strategic decisions on complex projects (OKane, 2003). The framework facilitates
strategic decision making by defining facility characteristics and improved process design on
fluctuating operational environments over the entire life of projects.

10. Project decision framework

Given the increasing use of computers as management and evaluation tools, it is natural to
consider their potential applications to design information management. Much valuation
work has already been done on the application of computers to understand and modelling
design processes and mechanising design tasks. The attempt to reduce design complexity,
increase functionality, clarity and constructability at an early stage has now been the focus
among researchers in the field. Selection of an appropriate design and configuration of
operational processes of project facility is an important consideration in competitive project
development environment. Project level decisions are greatly influenced by the feasible
alternative designs and their consequences (Goldschmidt, 1992).
Life Cycle Design Management (LCDM), as subset of the Life Cycle Project Management
(LCMP) is an approach for integrating business and strategic objectives of projects
throughout the project life cycle phases (Doloi & Jaafari, 2002; Jaafari, 2000). The LCPM
approach employs an integrated and concurrent project management principle to substitute

www.intechopen.com

128

Robotics and Automation in Construction

the process-based and activity-driven approach in the project management paradigm. Much
work has already been published LCPM methodology in project evaluation and
management contexts (Doloi & Jaafari, 2002; Jaafari, 2000).
Project
objectives
Project concept
development
Project facility
planning

Subjects for decision making

-

Project
implementation

Project operation
and maintenance
Sales and
Marketing
Research and
Development

IT/IS support

Project
Organisation

Market need analysis

Project option analysis
Decision process for project
development
Product design
Project Management
functions
Scope control and
management
Time management
Cost management
Market economics and
changes
Facility operation and
flexible production
Market consumption
Customers satisfaction and
acceptance
Product design and redesign
Product innovation and
process reengineering
Process automation and
optimum facility utilization
Waste reduction, cost
minimization
Resources and skills
requirements and utilisation
Self managing teams and
cross cultural integration
Key performance measures
and controlling
Risk resilient and uncertainty
management
Change management

Usability of simulation tools in

front end management
Supply-demand planning,
optimum utilisation of resources
Capacity planning and scope
definition

Constructability analysis,
change control and alternative
planning
Project functionality and
operability of the end project
product
Supply-demand analysis,
evaluation of logistics
Simulation model for what-if
analysis, process reengineering.
Simulation model for evaluating
facility utilisation, activity-based
costing

Simulation model for resource

planning, resources levelling
and optimisation

Table 1. Project objectives and front-end management tools

Fig.4 depicts an overall design management framework embodying the phases over project
lifecycle. As seen, selection of design alternatives and investment decision has direct
influence on the strategic project objectives and overall performance of projects (Irani et al.,
2000). Thus the projects design and their underlying capability should be defined
integrating optimum projects configuration and inherent business intents.

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

129

Fig. 4. Process simulation and measure of the project's effectiveness

Once the initial decision on a feasible design is made and project products are established,
the underlying processes are identified for analysing feasible alternatives, selection and
allocation of appropriate resources and establishment of the best project option for
development. The processes of analysing alternative product configuration and selecting
best project option are facilitated by the simulation technology. The projects are broken
down in smaller products and process models are constructed incorporating operational
scenarios for simulation analysis (Doloi & Jaafari, 2002). The outcome of simulation forms
the basis for evaluation of the suboptimal configuration against the target LCOFs of the
project. After the project is developed and commissioned, operation is monitored based on
the performance on LCOFs, organizational strategy and competitive advantages. The
dynamic scanning and assessment processes are then continued in the project operating
environment.

11. Framework for simulation analysis

The simulation assists management on analysing the functionality and operability of project
deliverables by focusing on the business objectives in the early phase of the project. The
platform allows a real time project definition based on technical, functional and operational
aspects of the project (Doloi & Jaafari, 2002).

www.intechopen.com

130

Robotics and Automation in Construction

Fig. 5. Integration of functional disciplines within project operation

Fig. 5 shows how the micro project environment and their functional disciplines are scanned
and relevant process information is integrated over project life cycle. Hierarchical process
models are built and simulated by linking the processes and allocating available resources
across all disciplines. Alternative processes are identified and tested for optimal project
configuration. The project level decisions on operability, functionality, quality or
performance issues are then optimised using a set of criteria known as life cycle objective
functions (LCOF) (Jaafari et al., 2004).

Fig. 6. Framework for life cycle decision analysis

Fig. 6 depicts the overall decision process over the life of the project. Project investment
decision and organisational business intents have direct influence on the strategic planning
and development of the project (Yeo, 1995). The project concept and alternatives are then
identified and resources and product specifications are defined for feasible project solution.
The outcomes from simulation modelling on project configuration, operational requirements
and resource utilisation are used as input for analysing required management capabilities

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

131

and transformation for a project specific environment. Continuous assessment on the

functionality and operability of the project product and feedback mechanism allow dynamic
interaction and evaluation of the projects performance over the life cycle of projects
(OKane, 2003).

12. Simulation enabled design management a practical example

In order to demonstrate the use and benefits of the process simulation, a case study is
presented in this section. The simulation model representation provided a key decision
making platform that quantified the effectiveness of varying level of design and planning to
support an optimum operational plan. A significant implementation challenge during a
planning level study can be understood from the analysis flow chart shown in Fig. 7.
The selected project was a commercial Ductile Iron manufacturing plant (named
hypothetically as XYZ manufacturing plant) located in a regional area of Sydney in
Australia. The manufacturing plant was due for a major overhaul for which a front-end
decision analysis was quite appropriate to support the strategic management decisions. The
ability to quantify the impacts on alternative process design is a huge benefit of using a
simulation model. Once the design is altered to suit the required service requirements, the
projects life cycle objectives are assessed and validated. The framework presented provides
the functionality of make such changes and adjust related variables at project levels
impacted by the changes.

Fig. 7. Typical planning level analysis

12.1 Client project brief
The XYZ manufacturing plant commenced production in 1962 making grey cast iron pipes
and was later converted to ductile iron pipe manufacturing in 1976 to take advantage of
superior mechanical properties of ductile iron. Ductile Iron Pipeline Systems represent
significant improvements in terms of waste recycling. Pipes and fittings are manufactured
from 100% scrap steel. Raw materials used in production are selected scrap steel, ductile
iron returns, ferro silicon, coke, limestone and fluorspar. Thus steel scraps are converted into
valuable assets using less energy and thereby minimizing greenhouse gas emissions during
the manufacturing process.

www.intechopen.com

132

Robotics and Automation in Construction

The ductile joint pipes in XYZ manufacturing plant are produced by the centrifugal casting
process to a standard length of 5.5 meters in diameters of 100mm to 800mm. The overall
project can be described in terms of major processes from the crane operating in the scrap
storage area feeding the raw materials onto a conveyor to the final production of pipes after
undergoing hydrostatic pressure testing before going through weighing and inspection
processes.
12.2 Target production, budgets, and LCOFs
The main stakeholders for the XYZ Manufacturing plant is Tyco Water and the targeted
customers, who are both local (40%) and overseas markets (60%). The use of the ductile iron
pipes is mainly for transportation of potable water and sewage. Ductile iron pipe standards
for the domestic market are the Australian/New Zealand Standard AS/NZS 2280 and for
the international market is the British/European Nations Standard BS/EN 545. The total
investment on assets in present worth terms is about 100 million dollars. Yearly turnover
was not disclosed due to the competitive market. However, it was known that the 60% of
the overseas market share was not producing any profit to the company but meeting the
running cost of the plant. Current project facility and management capability have long
been under increasing scrutiny for its strategic existence in the global business environment.
Fig. 8 shows the current trend of utilization of the project facility and resources throughout a
calendar year. According to the production manager, the plant is currently running at about
80% of its capacity on average due to falling market demand. However, there is an
increasing threat for plant breakdown and higher maintenance cost due to aging facilities in
the plant. The simulation study was conducted to see how the overall facility and the
existing project business could respond to variable demands and how to make best use of
the exiting facility optimally. Table 2 depicts the target LCOFs derived from the available
financial data used for decision making at the project level (refer to Fig. 6). The target equity
internal rate of return of 30% is the focus of all the decision making on this project.
12.3 Simplified case data and analysis
The case study processes have been designed in order to understand the operational context
and utilization of existing facilities. Various products and major processes have been
identified from information provided by the production manager and onsite data collection.
It is worthwhile to mention that among many functional disciplines within the micro project
environment, only the plant operation has been considered for simulation here. The plant
produces a number of different size pipes on demand. Production rates vary with internal
pipe diameter: smaller diameters have faster production rates than larger diameter pipes.
For example, 100 mm diameter pipes can be produced at 50 pipes per hour and 800 mm
pipes can be produced at 17 pipes per hour.
12.4 Scenario 1: process network
Figs. 9, 10 and 11 depict process network diagrams built on the existing capability, an
alternative and the optimised alternative of the plant respectively. Fig. 9 shows part of the
model for a few key processes involved in manufacturing the pipes. Overall, there are four
lines of centrifugal casting machines with two annealing furnaces. After annealing, testing
and finishing processes take place in three parallel lines. The workflow sequencing and
connectivity between processes are shown in the figures.

www.intechopen.com

133

Adding Value in Construction Design Management by using Simulation Approach

Plant production capacity: 70,000 tonnes/year

% Utilisation

100%
85%
82%
78%
50%
Current demand: 55,000 - 60,000 tonnes/year

0%
Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Months

Fig. 8. Current trend of utilization of the facility

LIFE CYCLE OBJECTIVE FUNCTIONS (FINANCIAL)
Total Life Cycle Cost (TLCC) $ in present value
Equity Internal Rate of Return (EIRR) %
Net Present Value to Capital Investment Ratio (NPV/C)
Total Life Cycle Cost (TLCC/Po) $ p.a. to unit production output
Cost to Worth Ratio (C/W)
Environmental emission standard
Table 2. Targeted LCOFs

Fig. 9. Base case processes for production of ductile iron pipes

www.intechopen.com

TARGET
A$100 million
30%
1.50
Confidential
Confidential
Confidential

134

Robotics and Automation in Construction

Fig. 10. Alternative scenario for production of ductile iron pipes

12.5 Simulation output and the LCOFs evaluation in scenario 1
Details of the statistical outputs from the simulation run for Scenario 1 have not been
presented. The simulation model was run for 500 hrs and the average utilization of
processes was found to be about 62%. In Scenario 1, seven processes: water cooling, cutting,
grinding, hydraulic test, weighting, cement lining and coating processes were highlighted. It
was found that while the first four processes (water cooling, cutting, grinding and hydraulic
test) were utilised on average 85%, the remaining processes were utilised less than 30% on
average. A severe bottleneck has been experienced near the water cooling and cutting
processes.
12.6 Alternative scenario and optimization
An alternative was developed by reconfiguring some of the processes under consideration
as shown in Fig.10. In this reconfiguration process, one additional cutting and grinding
processes were added while weighing processes were reduced to only one and the cement
lining processes were cut down to two. Cement lining processes also have been reduced
from three to two as these processes were found underutilized in the base case scenario.
Details of the network process diagrams have not been shown for brevity. Simulation was
run for the equal time period as the base case and capacity utilization for the processes were
recorded.
In order to optimise the proposed design, evolutionary optimization approach was
employed on proposed scenario and impact on performance of the processes were analysed.
In the optimization process, the modelling parameters were varied and best performance
was monitored by defining a range of objective functions. Fig.11 shows an output of the
optimiser with approximately 99% convergence for maximum output in the model. The
Genetic Algorithm based optimiser produces significantly better operational performance
and utilization of the proposed processes over existing situation. The optimiser includes a
number of parameters such as the probabilities of crossover and mutation, the population
size and the number of generations (Khral, 2002).

www.intechopen.com

135

Adding Value in Construction Design Management by using Simulation Approach

Fig. 11. Alternative case with optimization

12.7 Impact of new process configurations
Fig. 12 shows a comparative analysis of process utilization between base case, proposed and
optimized scenarios. The optimized process configuration for maximum output values in
Comparison between base, proposed and proposed with optimisation scenarios
1.2

Utilisation (%)

0.8

Optimised case
0.6

Proposed Case
Base Case
0.4

0.2

0
Water Cooling

Cutting

Grinding

Hydro Test

Weighing

Cement Lining

Coating

Processes

Fig. 12. Comparative impacts of new process configuration

the proposed design over the base case scenario was achieved by increasing the capacity of
four processes over the proposed scenario. As seen, there is a good balance with about 95%
average utilization of processes in the new optimized design. An introduction of an
additional processes along with the alteration of flow sequences on processes have
significant impact on overall process performances of the project. It is evident that the
capability of the manufacturing facility could be enhanced by altering the current baseline
operation; obviously there is a limit to what can be achieved without significant investment
in new plant and facilities.

www.intechopen.com

136

Robotics and Automation in Construction

These decisions then investigated in terms of target LCOFs in the integrated framework by
using the existing operations as the starting point. Management strategies and require
capability are then built supporting the reengineered processes and project operation. As
has been demonstrated in this example, the process simulation approach is a powerful tool
in achieving this objective.
Strategic Business Objectives
Facility/Asset
performance
(6)

%
Market demand
%
Utilization TLCC* Financial
Feasible
(7)
Utilization
(5)
alternative
(%)
of
of project
New
scenarios
operational (4)
Waste Shorter Improv
Unit
facility
custome
ROI
(1)
resources
reduction cycle, e-ment
cost
(2)
(%)
rs
(3)
(%)
(%)
(%)
(%)
(%)

Sustainability &
Risk (8)
Sustain- Reduced
Risks
ability
(0 6)** (0 6)**

Base case

72

65

100

12

Proposed
case

93

79

95

10

15

10

15

10

Optimised
case

95

87

91

12

19

15

10

20

* TLCC is the Total Life Cycle Cost for scenario under consideration.
** Sustainability and Reduced Risks are measured on an index scale from 0 for no effect to 6
for highly effective.
Table 3. Holistic analysis of alternative project solutions

13. Life cycle decision analysis

Table 3 shows the overall evaluation matrix by integrating upstream and downstream
information for optimal management decisions in the project. While all three options in
column (1) are assumed feasible, each has an estimated total life cycle cost and a
corresponding level of various high level criteria influencing strategic business objectives
(LCOFs). Result of simulation analysis provides the input values in columns (2) and (3).
Values in column (4) are the result of the traditional life cycle cost analysis using the raw
data from Table 2 (Jaafari, 2000). In order to determine the optimal solution, values in
columns (5) (8) are used to see what tradeoffs are available against values in columns (2),
(3) and (4). These trade-offs are then analysed using Multi-criteria Decision Modelling
(MCDM) technique (Doloi, 2007) to locate the optimal solution among those which meet the
target criteria. Details of MCDM techniques can be found in Doloi (2007) and Jaafari et al.
(2004).
As already stated, an appropriate conceptual model to facilitate holistic evaluation and
management of projects complexity is not currently available. Much work needs to be done
to better understand and apply a project-based approach by integrating processes and
operations in the front-end management practices. An optimization model was in dire need
to evaluate a given operation to show if current processes are in balance within the expected
present or future demand patterns while maintaining its business and environmental
performances (Doloi, 2007; Cleland, 2004). This chapter has demonstrated an approach that
sets a benchmark for an integrated framework enabling management of complex projects. It
has shown a way forward in computational aspect of the project management approaches
for sustainable project development and management practices.

www.intechopen.com

Adding Value in Construction Design Management by using Simulation Approach

137

14. Conclusion
Simulation modelling has been introduced as a decision support tool for front end planning
and design analysis of projects. An integrated approach has been discussed linking project
scope, end product or project facility performance and the strategic project objectives at the
early stage of projects. The case study example on tram network demonstrates that
application of simulation helps assessing performance of project operation and making
appropriate investment decisions over life cycle of project.
Optimised design and maintenance of physical project facilities in competitive business
environment triggers the strategic positioning of the project organisations over life cycle of
the project. The preliminary research has identified the key roots of inefficient operations in
terms of the capabilities and utilisation of the project facilities and resources and contributed
in devising optimal solutions based on life cycle objective functions of the project. The
framework assists organisations in their management decisions in respond to market
dynamics, customer needs and organisational intents.
In developing the prototype, the process simulation approach has been used in the projects. The
simulation based framework facilitates evaluating the functionality and operability of feasible
project configuration for strategic implementation. Research by the author reveals that there has
been little attempt to assess the link between the physical projects facility and the underlying
business capability and ability to respond to market shifts in contemporary project management
practices. The concept presented in this research has taken into consideration multiple views of
project facility within a business operating environment. Process reengineering or investment
decision on the existing facility depends on the target LCOFs of the project. Analysis of
alternative project solutions (based on alternative process scope and configuration) rather than
focusing on well designed activities for project implementation has significant contribution in
supporting decision making and management of future project outcomes.
While for design visualisation, the simulation modelling is immensely valued, project
selection and overall investment decisions are holistically evaluated incorporating strategic
business objectives in the cycle project model. The simulation based framework put forward
provides the engineering assistance in optimizing projects configuration, planning and
design and investment decision on capital projects. The ability for quick exploration of the
multiple scenarios of significant benefits and the capability incorporating results on design
and engineering processes in devising the best possible solution on complex projects are the
significant contributions in this chapter.

15. References
Artto, K., Lehtonen, J.M. & Saranen, J. (2001). Managing Projects front-end: incorporating a
strategic early view to project management with simulation, International Journal of
Project Management, Vol. 19, pp. 255-264.
Berk, V. (1994). The Architect as a Project Manager, A publication of the University of New South Wales.
Chaaya, M. & Jaafari, A. (2000). Collaboration and integration of project life cycle design
information using IT systems, Proceedings of International Conference on Construction
Information Technology, pp. 277-291, 2000.
Cleland, D.I. (2004). Strategic Management: The Project Linkages, In: The Wiley Guide to
Managing Projects, J.K. Pinto and P.W.G. Morris (Eds.), pp. 206-222, Wiley, New York.
Cyberplaces (1998). http://www.cyberplaces.com/columns/archive/
Dikmen, I., Birgonul, M.T. & Artuk, S.U. (2005). Integrated framework to investigate value
innovation, Journal of Management in Engineering, Vol. 21, No. 2, pp. 81-90.

www.intechopen.com

138

Robotics and Automation in Construction

Doloi, H. (2007). Developing an integrated management system for optimising project

options, Journal of Enterprise Information Management, Vol. 20, No. 4, pp. 465-486.
Doloi, H. & Jaafari, A. (2002). Towards a dynamic simulation model for strategic decision making
in life cycle project management, Project Management Journal, Vol. 33, No. 4, pp. 23-38.
Goldschmidt, G. (1992). Criteria for design evaluation: a process oriented paradigm, In: Evaluating
and Predicting Design Performance, Kalay, Y.E. (Ed.), pp. 67-79, John Wiley, New York.
Heath, T., Scott, D. & Boyland, M. (1994). A prototype computer-based design management
tool, Construction Management and Economics, Vol. 12, pp. 543-549.
Irani, Z., Hlupic, V, Baldwin, L.P. & Love, P. (2000). Re-engineering manufacturing processes
through simulation modelling, Logistics Information Management, Vol. 13, No. 1, pp. 7-13.
Jaafari, A. (2000). Life cycle project management: a new paradigm for development and
implementation of capital projects, Project Management Journal, Vol. 31, No. 1, pp. 44-53.
Jaafari, A. & Doloi, H. K. (2002). A simulation model for life cycle project management.
Journal of Computer-Aided Civil and Infrastructure Engineering, Vol. 17, pp. 162-174.
Jaafari, A., Doloi, H. & Gunaratnam, D. (2004). Life cycle project management: a platform for
strategic project management, Proceedings of Innovations: Project Management Research 2004,
D. P. Slevin, D. I. Cleland, & J. K. Pinto (Eds.), pp. 141-159, Four Campus Boulevard,
Newtown Square, 2004, Project Management Institute (PMI), Pennsylvania, USA.
Jamieson, A. & Morris, P. (2004). Moving from corporate strategy to project strategy, In: The Wiley
Guide to Managing Projects, J.K. Pinto & P.W.G. Morris (Eds.), pp. 177-205, Wiley, New York.
Khral, D. (2002). The extend simulation environment, Proceedings of the 2002 Winter Simulation
Conference, E. Ycesan, C.-H. Chen, J. L. Snowdon, & J. M. Charnes (Eds), pp. 205-213.
Kirkham, R.J. (2005). Re-engineering the whole life cycle costing process, Construction
Management & Economics, Vol. 23, No. 1, pp. 9-14.
Laufer, A. (1999). Essentials of project planning: owners perspective, Journal of Management
in Engineering, Vol. 2, pp. 162-176.
Luk, M. (1990). Hong King Air Cargo Terminals to work in Synch because of simulation
applications, Industrial Engineering, Vol. 11, pp. 42-45.
Marmon, C. (1991). Teledyne applies simulation to the design and justification of a new
facility, Industrial Engineering, Vol. 13, pp. 29-32.
Morris, P. W. G. (1983). Managing project interfaces key points for project success,
In : Project Management Handbook, Cleland, D. I. & King, W. R. (Eds.), Van Nostrand
Reinhold Company, New York.
Nicholson, M.P. & Naamani, Z. (1992). Managing architectural design a recent survey,
Construction Engineering and Economics, Vol. 10, pp. 479-487.
OKane, J. F. (2003). Simulation as an enabler for organisational excellence, Measuring
Business Excellence, Vol. 7, No. 4, pp. 12-19.
Paul, S. (1982). Managing Development Programs The Lessons of Success, Westview Press, Inc. USA.
Pidd, M. (1984). Computer Simulation in Management Science, John Wiley & Sons.
PMBOK (2004), A Guide to the Project Management Body of Knowledge, Project Management
Institute, PA, USA.
Puthamont, S. & Charoenngam, C. (2007). Strategic project selection in public sector:
construction projects of the Ministry of Defence in Thailand, International Journal of
Project Management, Vol. 25, pp. 178-188.
Shi, J. & Abourizk, S. (1998). Continuous and combined event-process models for simulating
pipeline construction, Construction Management & Economics, Vol. 16, No. 4, pp. 489 498.
Yeo, K.T. (1995). Planning and learning in major infrastructure development: systems
perspectives, International Journal of Project Management, Vol. 13, No. 5, pp. 287-293.

www.intechopen.com

Robotics and Automation in Construction

Edited by Carlos Balaguer and Mohamed Abderrahim

ISBN 978-953-7619-13-8
Hard cover, 404 pages
Publisher InTech

Published online 01, October, 2008

Published in print edition October, 2008

This book addresses several issues related to the introduction of automaton and robotics in the construction
industry in a collection of 23 chapters. The chapters are grouped in 3 main sections according to the theme or
the type of technology they treat. Section I is dedicated to describe and analyse the main research challenges
of Robotics and Automation in Construction (RAC). The second section consists of 12 chapters and is
dedicated to the technologies and new developments employed to automate processes in the construction
industry. Among these we have examples of ICT technologies used for purposes such as construction
visualisation systems, added value management systems, construction materials and elements tracking using
multiple IDs devices. This section also deals with Sensorial Systems and software used in the construction to
improve the performances of machines such as cranes, and in improving Human-Machine Interfaces (MMI).
Authors adopted Mixed and Augmented Reality in the MMI to ease the construction operations. Section III is
dedicated to describe case studies of RAC and comprises 8 chapters. Among the eight chapters the section
presents a robotic excavator and a semi-automated faade cleaning system. The section also presents work
dedicated to enhancing the force of the workers in construction through the use of Robotic-powered
exoskeletons and body joint-adapted assistive units, which allow the handling of greater loads.

How to reference

In order to correctly reference this scholarly work, feel free to copy and paste the following:
Hemanta Doloi (2008). Adding Value in Construction Design Management by Using Simulation Approach,
Robotics and Automation in Construction, Carlos Balaguer and Mohamed Abderrahim (Ed.), ISBN: 978-9537619-13-8, InTech, Available from:
http://www.intechopen.com/books/robotics_and_automation_in_construction/adding_value_in_construction_de
sign_management_by_using_simulation_approach

InTech Europe

University Campus STeP Ri

Slavka Krautzeka 83/A
51000 Rijeka, Croatia
Phone: +385 (51) 770 447
Fax: +385 (51) 686 166

www.intechopen.com

InTech China

Unit 405, Office Block, Hotel Equatorial Shanghai

No.65, Yan An Road (West), Shanghai, 200040, China
Phone: +86-21-62489820
Fax: +86-21-62489821

www.intechopen.com