Schedule Compression and Time-Cost Trade-Off - Construction Project Scheduling and Control - page 227

or having the laborers work 10 hours per day (but no work on Saturdays and
Sundays). If overtime hours are compensated at 1.5 times the regular rate,
workers will work 10 hours per day but get paid for 8 * 1 (straight time) +
2 * 1.5 (overtime) hours, or 11 hours. The increase in labor cost will be 10%
(we ignored the effect of overtime on productivity). Going from 11 days to
10 days may require working on Saturdays (at 1.5 times the regular pay). The
increase in labor cost will be 17% 10 (we again ignore the effect of overtime
on productivity). To accelerate the schedule more, we may have to change the
method of placement (pumping in lieu of using a crane and bucket) or acquire
a different formwork system. In other words, when we start accelerating, we
may have many options, and we select those that are the least expensive. As
we accelerate, we run out of inexpensive options, and we may be left with only
those that are expensive. At the entire project level (or, rather, the critical path
level), we may have many activities from which to choose. We always choose
the activity that has the least cost for crashing. As accelerating progresses, we
may have fewer and more expensive choices. Also, as demonstrated previously,
in the early stages of acceleration, the compression of one activity may result in
the compression of the entire project. In later stages, when multiple paths are
tied as critical, we may need to compress several activities (each on a different
path) to reduce the project duration by only one day.
For the preceding two reasons, direct costs usually increase nonlinearly (at an
increasing rate), as shown by the curve in Figure 8.6. Note that the x -axis represents
the total duration of the project in days. For this reason, as we accelerate the project,
we move from right to left on the x -axis.
Cost $
Accelerating
Duration (days)
Figure 8.6 Nonlinear increase in direct costs with project acceleration
10 In a typical 10-hours-per-day, 6-days-per-week situation, the worker works 60 hours, 20 of which are
overtime. If overtime is compensated at 1.5 times the normal rate, the worker will receive 70 hours' worth of
pay for the 60 hours' work. The additional pay ratio is 70/60 * 100% = 116.7%.2.