Activity-based costing simulation as a tool for construction process optimization

Abstract

The goal of this research was to develop and illustrate a procedure to achieve time- cost optimization for a construction operation by finding the adequate crew configurations. The time-cost relationship in a construction operation was defined to develop the scope of time-cost optimization in this research. Optimization tools, such as neural networks, genetic algorithms, and simulation methods were analyzed to determine an effective tool for the optimization based on the planning and execution phases in construction. An optimization procedure was developed employing ABC-SIM (Activity-Based Costing Simulation), an activity based, Monte Carlo simulation program. The procedure was based on the resource balance point theory. A resource balance point is the point at which the production rates among resources are matched in such a way that unnecessary idling time of a certain resource is eliminated. Also, a validation model was developed to verify that best alternatives, resulted from the suggested optimization procedure, were really optimized for a given operation. 6 network models were used to develop and test the suggested procedure. Also, the procedure was applied to 2 real construction projects, which are Grade Beam Erection Project and Library Project. With the suggested optimization procedure, a construction manager can select the best resource configuration(s), which achieves the optimized time and cost for a given operation.