Importance of Planning and Process Management Methodology in Sustainable Construction Projects

*Hayati Küçük and Hayati Yıldırım* 

#### **Abstract**

One of the most important factors to complete a construction project successfully and achieve a sustainable construction is to create a detailed business plan and to progress in accordance with this plan. To realize the long-term and multiple input construction projects successfully from business development phase to conceptual development, engineering solutions, site organization, construction phase, and pre-commissioning phase, there should be a right business plan. Business plan is a roadmap for construction phase. As planning, all the details related to the project must be considered separately (investment strategy, feasibility, zoning status of land, land properties, optimal usage analysis, region housing analysis, conceptual design, engineering projects of all disciplines, construction methodology, work schedule, team organization, selecting the right sustainable construction materials, etc.), and a process management methodology must be created. This process management methodology should include steps to help sustainable real estate development and management, possibly promoting adoption of sustainable management approaches for future green building projects. In this study, the following subjects are explained: what kind of planning must be performed to carry a construction project successfully in accordance with sustainability, and which steps are encountered in this process.

**Keywords:** project management, planning, sustainable projects, business plan, process management

#### **1. Introduction**

The project management is a dynamic process that starts with the preparation and utilizes the four principles of the management, planning, organizing, leading, and controlling, which are standard across industries. By taking advantages of these principles, it should be aimed to develop the sustainability, habitability, and durability of the project.

To manage and automate the projects and businesses and transfer them to the digital platform, enterprise resource planning (ERP) applications can be used as a solution. ERP is used:


#### **2. Project management phases**

 After preparation (initiation), planning is the first step for a successful project management. After executing step (leading), controlling follows planning which are tracking each other to make the project successful, and the process finalizes with closing shown in **Figure 1**.

In process management methodology, all works must be described step by step, all authorizations must be performed, and work flow charts must be created. In planning phase, the boarders of the project and resource allocations are defined, budgets are calculated according to the BOQ , and how the project will go is decided. Executing step involves collecting, allocating, and coordinating the activities and resources. As a result, planning and executing should be performed, to carry out the functions of controlling (monitoring, comparing, measuring, and correcting) effectively. And at the end of the project, project closure can be performed with the documentation of the work and lessons learned.

For a successful project management, initiation, planning, executing, controlling, and closing cannot be underestimated. In most of the construction projects, making an effort for planning is 5%. However, the impact of planning is more than construction, almost 65% which is shown in **Figure 2**. Unfortunately, planning does not take its deserved importance generally.

After planning, success parameters of the project (quality, timing, cost, consistency, efficiency factors) should be measured to control throughout the project. Leading may rely on the manager performance and ability, but if there is no reliable data/report, nobody can understand the real situation to manage the project. So defining a system, whether ERP or not, should be the first step for a successful project management.

ERP software automates core corporate businesses like purchasing, tender management, planning, accounting, cost control, contract management, etc. These core businesses should be defined in conceptual design and then can be implemented into a system to make the resource usage more efficient and provide cost reduction.

**Figure 1.**  *Process of the project management [1].* 

*Importance of Planning and Process Management Methodology in Sustainable Construction… DOI: http://dx.doi.org/10.5772/intechopen.87836* 

**Figure 2.**  *Impact and effort chart.* 

 For customer satisfaction, quality, cost, and timing parameters (performance parameters) should be under control and be reported. Because of the customer requirements, project manager should control and lead the project by measuring cost and time values with the specified quality. If there is no limited time, no limited resource, and no limited quality requirements, the project would be perfect without any stress. But in real, there will be always a limitation for time, resources, and quality expectations to adjust the baseline. According to the conditions, project manager should lead the project in terms of three parameters to take an action for success. It is necessary to control the cost, time, and quality parameters while the project is ongoing. Maybe it can be possible to control everything manually for some of the projects. But for the complex construction projects, it cannot be possible to control all the items without a system help. Although if it can be possible, it takes too much time, energy, and cost.

The method of construction Know-How is having priority, but it is not enough without real-time controlling in the case of taking an immediate action. The challenge in project management is not only Know-How knowledge, but also Do-How knowledge. The company should develop its Do-How aspects with a system requirement. By controlling and reporting, you can take actions for the conditions and develop the Do-How ability.

ERP brings the management approach of the construction sector "Do-How" perspective instead of "Know-How" perspective [2]. At the end, if a company decides to implement any ERP system, it should decide requirements for a continual action. These requirements should not be changed year to year. Making a decision about which ERP system will be selected, there should be decision factors to be considered:


### **3. Construction process phases**

 YPU is a not a contractor, it is a consultancy service provider. The company has a role of consulting in construction sector for planning, designing, tender management, project management, and construction site operations. For managing and controlling all these different services with different work flows, LOOP® has been developed, specialized in construction project management to digitalize the services of the construction phases. It gives some advantages to the company such as planning and monitoring the project forecasting. The construction works start with defining the investment strategy to the end of commissioning phase, as presented in the **Figure 3**.

#### **Figure 3.**

#### **4. Sustainable ERP systems**

Sustainability creates new opportunities through innovation to achieve competitive advantage and enhance cost reduction programs. Besides the obvious cost savings resulting from the use of less energy, additional benefits include changing behaviors that increase productivity and improve morale, streamline business processes, creative innovations, and better use of technology [3]. Companies that recognize and adopt key driving forces for sustainability will eventually receive market opportunities and effective commercial activities. For this reason, many companies integrate sustainability initiatives into their corporate strategies. They are aware that they are responsible for increased environmental impacts and that

*Importance of Planning and Process Management Methodology in Sustainable Construction… DOI: http://dx.doi.org/10.5772/intechopen.87836* 

**Figure 4.**  *Sustainability-ERP relation [6].* 

the company customers expect them to provide sustainable products and services [4]. Sustainability requires the development of sustainable projects. To do this, information systems play an important role in the companies' evolution toward sustainability initiatives as presented in **Figure 4**. Sustainability information system is seen as an opportunity for companies to increase productivity, reduce costs, and increase profitability [5].

#### **5. Construction process in LOOP®**

The ability of the software is given in **Figure 5**. As it is shown, planning, budgeting, tender, purchase, contract, progress payment, site management, project scope, documentation, all the module reports, weather reports, daily reports, and user authorizations are the services related to the construction process in the system which is developed in-house. A skeleton version of the software can be implemented and in the case of necessity extra functionality can be added while operating the system according to the customer requests.

#### **5.1 Design works and BOQ operations**

 The software is developed in project-based approach. Every project starts with defining BOQ structure. Instead of "BOQ ," the word "activity," which does not mean task of the work schedule, is used. As it is shown in **Figure 6**, the function of the software starts just after the design works with BOQ study.

 Activity structure shows the scope of the project by defining BOQ details and their amounts. The system has a standard activity skeleton related to cost codes that corresponds accounting system directly. Every company (customer) has a different uniform chart of accounting system. While implementing a project, the standard activity skeleton can be matched with the investors' accounting system. It provides planning and actual data comparison based on the same level, in activity base. An ability to check the cost variation in activity base strengthens the company competitiveness and provides advantage to the company for the future projects.

#### **5.2 Tender management**

BOQ amounts and tender-related documents (technical specifications, land surveys, draft contract, LC forms, site delivery protocol) are formed manually

**Figure 5.**  *LOOP® module abilities.* 

and then input to the system via tender management module. Tender management module consists of tender evaluation, cost analysis, publish of tenders, collection of quotations, optimization, short lists, black lists, comparison tables, tender result announcement, contract signing, and site delivery preparations. The flow can be seen in **Figure 7**.

By the help of the system, a tender management process is easy to operate. Firstly, the tender company data and tender activities with amounts are defined in *Importance of Planning and Process Management Methodology in Sustainable Construction… DOI: http://dx.doi.org/10.5772/intechopen.87836* 

the system. Secondly, tender specifications like start and finish dates, LC requirement, special conditions, site visit documents, projects, material lists, etc. are defined. After the companies send their quotations, their quotations are input into the system easily and very fast by the software team. The notes can be written to the quotation details of the specific company. Comparison table forms automatically with its graphics. According to the comparison table, the max. and min. prices can be seen. The last phase of tender management is announcement. In the module, all the details of the tender closure are shown.

#### **5.3 Scheduling**

 Most of the professionals prefer to do scheduling with popular planning programs. Also, sometimes project provider may force the contractor to use a specific program with specific version. This may cause the planners work twice both with software and planning program. For standard structure of the system, making scheduling for progress input and activity tracking is not preferred and managed in the system.

Scheduling module is used for progress following, reporting, and cost distribution; however, integration with other planning programs can be applied which is not a standard feature. While using scheduling module, activity structure should be used so that BOQ (activity), scheduling activity (task), and accounting structure (cost codes) are in the same level.

#### **5.4 Contract management**

After the tender announcements, contract sign and site delivery steps come. As it is shown in **Figure 6**, the final contract document is formed from the draft one and sent to the company after tender announcement. At the end of document signing, the contract document is installed to the system, and contract details are input to the system.

**Figure 7.**  *LOOP® system process analysis.* 

 This module eases the work while increasing controlling ability. System reminders, holds, and warnings are defined according to the customer needs. All the contract issues like contract dates, LC dates, subcontracts, activity amounts, etc. can be input and followed in the system. Contract module prepares a platform to form non-mistake progress payment.

#### **5.5 Progress management**

 BOQ details like unit price or a specific amount of contract information are selected while creating a contract. This selection affects the flow of progress management. According to the information given, the system checks the BOQ progress. There are more than 10 warnings about the progress input which warns the user not to make a mistake. While forming progress payment, BOQ amount limitations do not hold the system. If there is an increase in amounts or new activity input, the system automatically forms dummy subcontract for the additional progress and warns the user. The user can change dummy subcontracts into an additional contract if it is approved. Otherwise, it can stay until the end of final progress payment. This process does not stop the progress payments in the system. Until the end of final progress payment stage, the additional activity or amounts of data can be changed. This control mechanism strengthens the progress payment controlling.

Additionally, after progress payment is saved, the cover for payment which considers necessary regulatory and legal accountant policy payments will be automatically calculated. It shows how much money will be paid in the case of deduction. Before making out an invoice, it prevents and decreases the accounting mistakes. In some cases, the project may have governmental stimulations. The charges and other accounting details are updated by the team.

#### **5.6 Invoice**

Invoice and related reports are formed and controlled in the system. Customer's accounting chart is linked to the system's activity structure. It provides not only control of all the details from tender to the invoice, but also it is used for the monthending processes. This step depends on customer information sharing. Detailed reports cannot be generated without data input.

#### **5.7 Daily and other reports**

Reports are the results of the data inputs. Progress payment reports, invoice reports, payment reports, cash reports, contract reports, cash flow, LC reports, deduction reports, budget reports, tender reports, purchase reports, daily reports, and others are some of them.

Daily reports are generated for following the subcontractor works, labor point scoring, material input/outputs, weather information, site photos, etc. Additionally, reports (daily reports Inc.) can be translated into English and Arabic automatically as default. For the other languages, it may be easy to translate and make it automatic.

#### **5.8 Meteorological report**

 The meteorological weather reports (daily, weekly, hourly) are prepared by the meteorological engineers to plan the work. It is used especially for tower crane works, concrete works, and other related works. If the project manager needs more detailed weather condition reports, it can be formed by the YPU's meteorological engineers.

*Importance of Planning and Process Management Methodology in Sustainable Construction… DOI: http://dx.doi.org/10.5772/intechopen.87836* 

#### **6. Conclusion**

ERP systems can help an organization to manage its own business by collecting, analyzing, reporting, and presenting data in an appropriate form. Construction companies may standardize and automate their business processes and improve the efficiency of their operations with the help of the system.

Companies also need an integrated sustainability information system solutions to collect, integrate, automate, and monitor sustainability information such as sustainable ERP systems. They are trying to design and reengineer their project processes so that their activities, products, and services are environmentally friendly. These ERP systems assist a company to provide complete sustainability data and integrate all sustainability information and processes across business functions. It can be seen as a holistic, integrative, and complete solution for the industry to solve sustainability business issues. In this study, the software which is developed by YPU is explained. The advantages and opinions of the ERP system are presented.

#### **Author details**

Hayati Küçük1 \* and Hayati Yildırım2

1 Member of the Executive Committee, YPU Yapi Proje Uygulama, İstanbul, Turkey

2 Department of Project Management, YPU Yapi Proje Uygulama, İstanbul, Turkey

\*Address all correspondence to: hkucuk@ypu.com.tr

© 2019 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/ by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

#### **References**

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[2] Avinal A. Selections of ERP Systems in Construction Project Management, What Should be Discussed and What Kind of a Structure Would be Appropriate. Available from: http://avinal.com/index.php/tr/ insaat-yoenetiminde-erp-nin-oenemi

[3] Hutchins G. Sustainability Is Good for Business, According to Business Leaders. London, UK: Atos; 2009

[4] Chofreh AG, Goni FA, Shaharoun AM, Ismail S, Klemes JJ. Sustainable enterprise resource planning: Imperatives and research directions. Journal of Cleaner Production. 2014;**71**:139-147. DOI: 10.1016/j. jclepro.2014.01.010

[5] Hopkins MS. How SAP Made the Business Case for Sustainability. MIT Sloan Management; 2010

[6] Boudreau MC, Chen A, Huber M. Green IS: Building Sustainable Business Practices; 2008. pp. 1-17

#### **Chapter 37**
