Benchmarking and productivity guide

005005
BENCHMARKINGBENCHMARKING
ANDAND
PRODUCTIVITYPRODUCTIVITY
Dr f De jahang (BSc CEng , BSc (Ho ns) Co nstructio n Mg m t, MSc, MCIO B, PhD
http://www.cpi-team.com

BENCHMARKINGBENCHMARKING
BENCHMARKING.htm
BENCHMARKING-2.htm

BENCHMARKING AND
PRODUCTIVITY
The successful application
and limitations of
benchmarking in
manufacturing industry
helped the industrial nation’s
growth in mass production.

BENCHMARKING AND
PRODUCTIVITY
The benchmarking tool
can also help construction
industry to become more
competitive.
Only possible by
improving the level of

BENCHMARKING AND
PRODUCTIVITY
 The Construction industry has
been slow to follow other
industries in adopting
benchmarking
 The foresight of some contractors
has led to two groups of
contractors
 from medium sized firms in the

BENCHMARKING AND
PRODUCTIVITY
The idea of Benchmarking process:
to compare the activity of one
company with activities of the best of
other companies.
UK construction industry-
Benchmarking has been identified as:Benchmarking has been identified as:
a powerful tool for assistinga powerful tool for assisting
managers to improve efficiency withinmanagers to improve efficiency within
the industry.the industry.

BENCHMARKING AND
PRODUCTIVITY
Organisation specific benchmarks are developed
during:
 the benchmarking process;
 the analysis phase.
 Benchmarking has proved to be a flexible toolBenchmarking has proved to be a flexible tool
used to support other strategies.used to support other strategies.
 It looks at the organisation’s strength and
weaknesses to compare with other
organisations.
 It helps to change strategies at the right time to
become more competitive in global market.

BENCHMARKING AND
PRODUCTIVITY
IMPROVING BUSINESS RESULT
THROUGH
BENCHMARKING
The term benchmarking includes aThe term benchmarking includes a
number of different activities builtnumber of different activities built
around a single, simple and powerfularound a single, simple and powerful
idea.idea.
benchmarking is a continuing
process;
opens the organisation to new and
radical ideas;

BENCHMARKING AND
PRODUCTIVITY
A major project
management
benchmarking company
in the United States and
in Europe concluded that
at least 20 billion dollars
was wasted due to items
such as:

BENCHMARKING AND
PRODUCTIVITY
Competitive benchmarking is
the benchmarking applied to
one’s performance against
competitors;
measures of project
excellence and
effectiveness.

BENCHMARKING AND
PRODUCTIVITY
 Unlike the construction sector, the
manufacturing sectors have been
relatively quickto respond to changes
within the business environment.
 An example of this-the relatively rapid
and flexible response to the global
economy.
 The construction industry has lagged
behind the manufacturing industry.

BENCHMARKING AND
PRODUCTIVITY
 Adopt a similarresponse in improving
its performance within the universal
market.
 Develop a culture of ‘lean
construction’ through continuous
improvement.
 The objective of this approach is to
increase the performance, and at the
same time reduce costs.

BENCHMARKING AND
PRODUCTIVITY
The ‘European Powers of Construction 2008’,
 Report fromDeloitte, presents an annual ranking
of the 100 largest European construction
companies;
 by revenue
 insights into an increasingly challenging building
environment
 BalfourBeatty leads the UKmarket ahead of
companies such as TaylorWimpy and Carillon,
the UK’s second and third largest construction
companies
 which were listed in 13th and 15th respectively
in the European Top 100.

BENCHMARKING AND
PRODUCTIVITY
 Despite only having one company in the
top 10, the UKcontinues to dominate
the top 100 survey, accounting for28 of
the top 100 places - compared to 33 in
2007.
 In 2007, the UKhad over250,000
companies active in the industry,
representing 6.64 percent of UKGDP.
 Most of top 100 construction companies
are involved in benchmarkand
benchmarking.

BENCHMARKING AND
PRODUCTIVITY
House builders are usually the
first to be affected by an
economic downturn.
Companies with having
Benchmarking process take
their organisation into new
opportunities worldwide.

BENCHMARKING AND
PRODUCTIVITY
Steps to take in Benchmarking can be
Described as:
 ConsiderActivities with low Key
Performance Indicators( KPIs);
 Considera process model first;
 Considerwhat to benchmarkfromthe
process model first, second, and so on;
 Define the measures;
 Develop data collection methodology;
 Collect data;

BENCHMARKING AND
PRODUCTIVITY
 Identify deficiencies in the use of best
practices and project management
performance.
 Identify reasons fordeficiencies (root
causes).
 Develop an action plan (select best practices
to reduce shortfall).
 Integrate best practices into the project
delivery process.
 Adopt benchmarking as part of a continuous
improvement program.

BENCHMARKING AND
PRODUCTIVITY
 Monitorfactors such as:
 cost
 time
 waste
 safety
 client satisfaction
 and also many othercritical issues.

BENCHMARKING AND
PRODUCTIVITY
 VINC1 is No.1 Construction Company of FRANCE and
the WORLD
 1-BECHTEL is No.1 Construction Company of the U.S.
 2-HOCHTIEF is No.1 Construction Company of
GERMANY
 3-CCCC Ltd is No.1 Construction Company of PRC
 4-ACS is No.1 Construction Group of SPAIN
 5-SKANSKA is No.1 Construction Company of
SWEDEN
 6-TAISEI is No.1 Construction Company of JAPAN
 7-SAIPEM is No.1 Construction Company of ITALY
 8-STRABAG is No.1 Construction Group of AUSTRIA
 9-BALFOUR BEATTY is No.1 Construction Company in
the U.K.
 10-ROYAL BAM GROUP is No.1 Construction Group of

BENCHMARKING AND
PRODUCTIVITY
 11-LEIGHTON is No.1 Construction Group in
AUSTRALIA
 12-AKER SOLUTIONS is No.1 Construction Company
in NORWAY
 13-ENKA is No.1 Construction Company of TURKEY
 14-SNC-LAVALIN is No.1 Construction Company of
CANADA
 15-HYUNDAI E&C is No.1 Construction Group in
S.KOREA
 16-LARSEN&TOUBRO is No.1 Construction Group of
INDIA
 17-YIT is No.1 Construction Company of FINLAND
 18-ODEBRECHT is No.1 Construction Company of
BRAZIL
 19-CCC is No.1 Construction Company of the MIDDLE-

BENCHMARKING AND
PRODUCTIVITY
 20-ORASCOM is No.1 Construction Group in EGYPT
 21-MURRAY&ROBERTS is No.1 of S.AFRICA
 22-ELLAKTOR is No.1 Construction Group of GREECE
 23-MTHOJGAARD is No.1 Construction Company of
DENMARK
 24-SHIKUN & BINUI ARISON Group is No.1 in ISRAEL
 25-BUDIMEX is No.1 Construction Group in POLAND
 16-JULIUS BERGER is No.1 Construction Company in
NIGERIA
 27-GRANIT is No.1 Construction Company of
MACEDONIA

Step 1-pull information from bill of quantity

Step 2-carry out calculations-use

BENCHMARKING AND
PRODUCTIVITY
 ACTIVITIES 1-2, 2-3, 3-4, 1-12, 1-9, ….
To measure Items such as:
 Time (increase/decrease)
 Cost (increase/decrease)
 Labour (increase/decrease)
 Material (Material waste-
increase/decrease)
 Machinery (efficiency

BENCHMARKING AND
PRODUCTIVITY
 Compare Actual completion time for
Activities 1-2, 2-3,..aganist allocated
time for Activities 1-2, 2-3,
 Compare Actual completion cost for
Activities 1-2, 2-3,..aganist allocated
cost for Activities 1-2, 2-3,
 Compare Actual waste allowed(%) for
Activities 1-2, 2-3,..against allowed
waste (%) for Activities 1-2, 2-3,

BENCHMARKING AND
PRODUCTIVITY
 COST OF MATERIALS
31.14
5% WASTE ALLOWED
6.50% WASTE
EXPERIENCED
31.14(6.50-
5)=31.14X1.50=£46.71
46.71X156=7286.76
THE ESTIMATED
COST FOR THIS
ITEM=
7286.76-46.71=7240.05
Total MD
=Cost
of
material
Waste Waste
Quanti
ty
(TQ)
Deliver
ed to
site
(Estima
te)
(Actual
)
(Act-) % %
156 31.14 5% 6.50%
264 18.88 5% 6.50%
282 8 5% 7.00%
708 1.71 5% 6.50%

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