Professional Documents
Culture Documents
Management
Framework:
Total Cost
Management is a
systematic approach
to managing cost
throughout the life
cycle of any enterprise, program, facility, project, product or service.
AACEs agship publication, the TCM Framework: An Integrated
Approach to Portfolio, Program and Project Management, is a
structured, annotated process map that for the rst time explains each
practice area of the cost engineering eld in the context of its
relationship to the other practice areas including allied professions.
Visual TCM
Framework:
Visual TCM graphically
demonstrates the
integration of the
strategic asset
management and
project controls
process maps of the TCM Framework. The Visual TCM application has
been designed to provide a dynamic view of the TCM processes, from
the overall strategy process maps to the mid-level processes and
detailed activities. The processes are hyperlinked, giving the user the
ability to move to and from related process maps and reference
Recommended Practice
Certification:
Virtual Library:
Members receive free
access to the Virtual
Library, an online
collection of over 5000
complete technical
articles on virtually
every aspect of cost
engineering. Search
this extensive database and immediately retrieve the best techniques
and potential solutions to the problems confronting you and your
organization.
Recommended Practice
Professional
Practice Guides
(PPGs):
Online Learning
Center:
Professional Practice
Guides contain the
most worthwhile
contributions to the
eld of total cost
Conferences:
AACE Internationals
Annual Meeting brings
together the industrys
leading cost
professionals in a
forum focused on
learning, sharing, and
networking. Over 100
hours of technical presentations and an industry tradeshow that will
challenge you to better manage, plan, schedule, and implement
technology for more eective and ecient business practices.
The International TCM Conference is a similar event that is held outside
of North America complete with technical presentations, seminars
and exhibits.
Recommended Practice
Discussion
Forums:
The discussion forums
encourage the
exchange of thoughts
and ideas, through
posting questions and
discussing topics. They
provide a great means for networking and interaction with your peers.
Participate anytime at your convenience and receive automatic e-mail
notications on topics that are of interest to you. With several thousand
users, if you have questions or concerns about a technical subject,
program, or project - the forums are a great resource for you.
Mentoring
Program:
Looking to gain more
knowledge from an
experienced
professional or an
opportunity to help
another professional?
Included with your membership, AACE oers a comprehensive
mentoring program for individuals interested in sharing knowledge with
others or advancing their own careers to the next level.
Recommended Practice
Career Center:
Periodicals
Members receive a
complimentary
subscription to the
Cost Engineering
journal, AACEs
bi-monthly
professionally
peer-reviewed publication. It contains best-in-class technical articles on
total cost management related subjects.
It is published as both a print version and an online version.
Our bi-monthly digital publication, Source, focuses on AACE activities
and items of interest to the total cost management community, with
special features for our members.
Salary and
Demographic
Survey:
Conducted annually,
salary survey is a great
resource for
employers that want
to gain a better
understanding of the competitive marketplace for talent and for
employees interested in knowing how their compensation compares
with their peers in the profession.
Recommended Practice
Recommended Practice
Acknowledgments:
Hans E. Picard, (Author)
Charles E. Bolyard, Jr.
Robert C. Creese, PE CCE
Earl T. Glenwright, Jr.
Copyright 2004 AACE, Inc.
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3 of 18
A = Z p (1 p ) N
(1)
Where:
A = absolute accuracy
Z = number of standard deviations (for the 95 percent confidence level, the value of Z = 2)
p = the observed percentage, obtained by work sampling
N = the total number of work sampling observations made.
Copyright 2004 AACE International, Inc.
4 of 18
5 of 18
6 of 18
p(1 p ) N
(2)
Where:
= standard deviation
p = percentage occurrence of observed activity (e.g., productive utilization)
N = total number of observations obtained on work sampling tours.
4) Randomness of observation tours, both of start-time and analysts path of observation tour
(random time/walk). With a computer-based random times generator or a random times table (see
Appendix G), the analyst randomly selects the start time for an observation tour. Tour start points are
randomized by selecting different start locations and paths taken on the project site. Sampling tours
must be conducted randomly and without bias over the course of all work periods. Every worker on
every assignment during each work period should have an equal chance of being observed on each
work sampling tour.
The scatter diagram of tour start times during work periods (sample diagram included in Appendix F,
showing average direct, productive work percentages and start-times of observation tours, plotted for
a specific shift during the course of a construction project) can be used to verify randomness of
observation, as well as to analyze work process variability.
5) Data Collection Form and Foremen Sheet. Samples are observations obtained by observing
workforce activities, either as groups of workers simultaneously or as individuals working separately
on the project during observation and classifying the observed activities, impersonally, into predefined activity categories. The Data Collection form included in Appendix B is an example of a form
the analyst uses to record observations. The Foreman Sheet in Appendix C is used to record
foremens work area location and crew size information, and is used by the analyst to ensure
covering all work areas, foremen and entire workforce.
6) Work Sampling Activity Category Definitions. Workforce activities are distinguished, essentially, in
three major categories: Productive Work (Utilization)," "Non-productive Work," and "Downtime". Each
7 of 18
DOWNTIME
Personal, 3%
Personal
Ready, 15%
Ready
Planning, 5%
Planning
Wait at
Tool Crib,
1%
Wait at Tool Crib
Wait at Elevator,
Wait at Elevator
3%
INDIRECT,
Walk Empty, 12%
NON-PRODUCTIVE
WORK
Walk Empty
Walk w/
Tools/Materials, 3%
Walk w/
Adjust Equipment,
Tools/Materials
2%
Assist
Adjust Equipment
Assist, 7%
Hands-On, 49%
Hands-On
DIRECT,
PRODUCTIVE
WORK
8 of 18
Failing, Robert G, Jerry L. Jantzen and Larry D. Blevins, 1988, Improving Productivity Through Work
Measurement: A Cooperative Approach, American Institute of Certified Public Accountants, New
York.
Harley R. Macklin and Hans E. Picard, "Continuous Improvement of Productivity - How an electric utility
uses work measurement to innovatively manage contractor labor requirements on maintenance
outages," Cost Engineering, Vol. 34, No. 10, Oct.1992.
Harrington, H.James, 1991, Business Process Improvement, McGraw-Hill.
Niebel, Benjamin W., 1993, Motion and Time Study, Erwin
Picard, Hans E., "Productivity and Value Management on Utility Construction and Maintenance
Projects," Proceedings, Project Management Institute Seminar Symposium, Sep. 1991, Dallas, Texas.
Picard, Hans E. and C. Robert Seay, Jr., "Competitive Advantage through Continuous Outage
Improvement," EPRI Fossil Plant Maintenance Conference, Baltimore, Maryland, July 1996.
Picard, Hans E., Sc.D., "Industrial Construction Efficiency and Productivity," Transactions, 44th Annual
Meeting of AACE International, June 2000, Calgary, AB, Canada.
Pitt, Hy, 1994, SPC for the Rest of Us, Addison-Wesley.
Picard, Hans E., "Construction Performance Benchmarking Measurement," Transactions, 46th Annual
Meeting of AACE International, June 2002, Portland, OR.
Picard, Hans E., "Construction Process Measurement and Improvement", Proceedings, 10th Annual
Conference on Lean Construction, Aug. 2002, Gramado, Brazil.
DCAA (2002). Defense Contract Audit Agency (DCAA) Document Title: DCAAM 7640.1; DCAA Contract
Audit Manual, Vol. 2; Jan. 2002 Appendix 1.
CONTRIBUTORS
Hans E. Picard, (Author)
Charles E. Bolyard, Jr.
Robert C. Creese, PE CCE
Earl T. Glenwright, Jr.
Stephen M. Jacobson, CCC
Richard A. Selg, CCE
Ronald M. Winter
James G. Zack, Jr.
9 of 18
10 of 18
11 of 18
Direct,
Productive
Work Activity
Comments
Foremen
Possible
Foremen
Available
Un-accounted
For
Total
Observations
Personal
Ready
Planning
Wait at Tool
Crib
Wait at
Elevator
Walk Empty
Walk w/ Tools
/ Materials
Adjust
Equipment
Assist
Hands On
Finish
Start
Tour No.
Shift Totals /
Avg.
12 of 18
Technician:_______________________________
Partner: __________________________
Date: ________________________________ _
Location: _________________________
Shift: ________________________________ _
Weather Conditions
Clear
Cloudy
Rain (How Long ____ hrs)
Foreman
#Men
Where
Foreman
#Men
Where
Miscellaneous Notes
13 of 18
DOWNTIME
Personal, 3%
Ready, 15%
Planning, 5%
Wait at Tool Crib,
1%
Hands-On, 49%
Wait at Elevator,
3%
INDIRECT,
NON-PRODUCTIVE
WORK
DIRECT,
PRODUCTIVE
WORK
10003 Observations
55.3% Foreman Availability
7.6% Un-accounted For
Example chart of labor hour utilization by work category with actual observed percentages as might be
used for a daily report.
14 of 18
Direct Work
Indirect Work
Downtime
Cum DW
Foreman Avail
Crew Size
100.0
300
280
90.0
260
240
80.0
220
70.0
200
180
60.0
Percentage
Crew Size
160
50.0
140
120
40.0
100
30.0
80
60
20.0
40
10.0
2/12 2/14 2/16 2/18 2/21 2/23 2/25 2/28
3/3
3/6
4/3
4/5
15 of 18
16 of 18
0:10
0:25
0:15
0:25
0:20
0:15
0:55
0:55
0:45
1:00
0:30
0:25
1:10
2:30
1:10
1:05
1:25
0:40
0:55
1:25
3:05
1:45
2:20
1:55
1:00
1:20
1:40
3:25
2:05
2:30
2:45
1:40
1:35
1:45
4:00
2:50
3:40
3:50
2:15
1:55
2:40
4:10
3:20
5:00
4:25
2:20
2:30
2:55
4:55
3:30
5:45
5:10
2:30
2:45
3:45
5:00
4:45
5:55
6:20
2:45
3:35
4:55
5:55
4:55
6:00
6:25
3:35
4:05
5:15
6:45
5:00
6:45
6:50
4:00
5:00
5:45
6:50
6:05
7:45
6:55
4:15
6:25
6:25
7:10
7:10
7:55
7:15
6:25
7:20
6:35
7:25
7:35
8:25
7:40
7:30
7:40
7:50
8:20
8:15
8:40
8:25
8:05
8:20
8:10
9:55
8:25
9:10
8:30
8:15
8:30
8:20
10:00
9:40
9:20
9:05
8:40
9:30
9:35
10:30
9:55
9:30
9:25
9:30
9:50
10:40
10:40
10:00
10:25
10:20
9:45
10:25
10:55
11:10
10:30
10:35
11:25
10:25
11:10
11:35
11:50
11:10
10:40
11:45
12:15
11:50
12:35
17 of 18
1%
396
784
1164
1536
1900
2256
2604
2944
3276
3600
3916
4224
4524
4816
5100
5376
5644
5904
6156
6400
6636
6864
7084
7296
7500
7696
7884
8064
8236
8400
8556
8704
8844
8976
9100
9216
9324
9424
9516
9600
9676
9744
9804
9856
9900
9936
9964
9984
9996
10000
2%
3%
99
196
291
384
475
564
651
736
819
900
979
1056
1131
1204
1275
1344
1411
1476
1539
1600
1659
1716
1771
1824
1875
1924
1971
2016
2059
2100
2139
2176
2211
2244
2275
2304
2331
2356
2379
2400
2419
2436
2451
2464
2475
2484
2491
2496
2499
2500
44
87
129
171
211
251
289
327
364
400
435
469
503
535
567
597
627
656
684
711
737
763
787
811
833
855
876
896
915
933
951
967
983
997
1011
1024
1036
1047
1057
1067
1075
1083
1089
1095
1100
1104
1107
1109
1111
1111
4%
25
49
73
96
119
141
163
184
205
225
245
264
283
301
319
336
353
369
385
400
415
429
443
456
469
481
493
504
515
525
535
544
553
561
569
576
583
589
595
600
605
609
613
616
619
621
623
624
625
625
5%
16
31
47
61
76
90
104
118
131
144
157
169
181
193
204
215
226
236
246
256
265
275
283
292
300
308
315
323
329
336
342
348
354
359
364
369
373
377
381
384
387
390
392
394
396
397
399
399
400
400
18 of 18
Responsible
Person
Site
Superintendent
04/08
Craftwokers waiting in
work areas for unknown
reasons
1)
2)
Completion
Date
Assigned 02/08
expediters
Site
Superintendent
05/08
Done
07/08
Fuel Truck
Operator
04/08
Being
04/08
done as of
today
Site
Superintendent
05/08