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    A FRAMEWORK FOR A DECISION SUPPORT MODEL

    FOR SUPPLY CHAIN MANAGEMENT IN THE

    CONSTRUCTION INDUSTRY

     by

    Jose Luis Perdomo-Rivera

    Dissertation submitted to the Faculty of the Virginia Polytechnic Institute and

    State University in partial fulfillment of the requirements for the degree of

    Doctor of Philosophy

    in Environmental Design and Planning

    Doctoral Committee:

    Dr. Walid Thabet, Chair

    Dr. Flynn Auchey

    Dr. Ralph Badinelli

    Dr. Yvan Beliveau

    Dr. Julio C. Martínez

     November, 2004

    Blacksburg, Virginia

    Keywords: Supply Chain, Material Management, Electrical Contractors, Construction,

    Decision Modeling, Decision Analysis, Knowledge Management, InformationTechnology

    Copyright © 2004, Jose Luis Perdomo

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    A Framework For A Decision Support Model For Supply Chain

    Management In The Construction Industry

     by

    Jose L. Perdomo

     ABSTRACT 

    Materials are one of the areas that require special attention while creating a project’s

    master plan as well as during the daily construction progress. The absence of materials

    when needed is one of the main causes of loss of productivity at a jobsite. Inefficient

    materials management can lead to an increase of 50% in work hours. As a result, a

    detailed plan for the materials management of each construction project is necessary.

    The critical role of materials management in the success of a construction project

    motivates the development of a new framework for the process of materials management

    for the construction industry, specifically the electrical construction industry. Materials

    management problems have a great impact on general contractors, but are more critical

    for specialty contractors such as electrical contractors. Based on the co-authors’

    experience, the construction industry has moved toward specialty contractors in the last

    decade to the point where at least 80% of the work performed on a typical construction

    contract is done by specialty contractors. General contractors have become, for the most

     part, project managers.

    Currently, materials management functions in the construction industry are often

     performed on a fragmented basis with minimal communication and no clearly established

    responsibilities among the parties involved. In addition, the collaboration required among

    departments has not been considered and implemented. This fragmentation creates gaps

    in information flow, which leads to delays in material ordering and receiving, expediting

    costs, excessive inventories of some items and project delays. However, model-based,

    computerized solutions to materials management problems are proliferating.

    Unfortunately, the typical electrical contractor may be overwhelmed by the technology

    required by these solutions and the challenges of implementing them into their business

     practices. A way out of this dilemma is presented by designing an industry-specific

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      iii

    framework for the development of computerized decision support systems for the supply

    chains of the electrical contracting industry. Decision models are ever-present in the

    materials management processes of industries other than construction and have proven

    their worth in improving productivity and profitability. Knowledge-management

    concepts were applied to design an integrated, effective system of decision-support tools

    for materials-management decisions of an electrical contractor during the construction

     phase of a project.

    The framework developed is valuable in two fundamental ways. First, the

    framework identifies and describes all phases of materials management for an integrated,

    holistic view of all factors that affect the total cost of materials and material shortages.

    The research created detailed mappings of the essential decisions, decision models and

    data that are required to support supply-chain activities of construction contractors

    throughout a project life cycle.

    Second, the framework differentiates those steps in the materials management

     process that are straightforward applications of methods from those steps that are

    decisions. For these decisions, that are critical to the performance of the materials

    management process, we introduce the concept of a decision model and describe how

    such models can be incorporated into an advanced materials management system. This

     phase of the research developed a structured systems design of distributed, integrated

    decision support systems for materials management of the electrical contractor. The

    research derives the optimal integration of people, decision processes, decision support

    systems and data that are required to support efficient and effective systems for

    acquisition, procurement, transport, storage and allocation of material in the construction

    industry.

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      iv

     

    “The construction industry is as much a manager of information as it is a manager of

    materials”

    -  

    John Hollingworth (Building Centre Trust, 1990)

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      v

     

    DEDICATION

    To Arliz, Gaby, Amanda and Cristian

     Nancy (†) you’ll always be with us

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      vi

     ACKNOWLEDGEMENTS

    First of all I would like to thank God for what I am, for everything I have, for taking care

    of my family and for being everything.

    Thanks to my committee members who assisted and guided me to complete this work.

    The guidance, inspiration and encouragement of Drs. Walid Thabet and Ralph Badinelli

    are greatly appreciated. The continued interest, assistance, and inspiration of Dr. Flynn

    Auchey, Dr. Yvan Beliveau and Dr. Julio Martinez are deeply appreciated. Thank you for

     being part of my committee and for the great relationship that grew among us. I would

    say that I consider you my friends.

    Special thanks to Dr. Walid Thabet, the chairman of my advisory committee, and to Dr.

    Ralph Badinelli, who was like a co-chairman, for their continuous guidance, support in

    all aspects, and for all the time spent helping me to finish this research and the

    subsequent document. Thank you for always having time for me, for the countless hours

    that we spent discussing ideas, and for the extensive time dedicated to review the

    document. Thank you for being my mentors and for the friendship that you offered me.

    I would like to extend my gratitude to my friends and colleagues from the Department of

    Building Construction, specially Brendan, Fairuz, Svetlana and Brett. Also thanks to my

    dear friends Vineet and Sonia. You always had words of encouragement when things

    were rough.

    The support of the University of Puerto Rico at Mayagüez is deeply appreciated.

    The support of the National Electrical Contracting Association (NECA), Electrical

    Contracting Foundation- ELECTRI’ 21 is deeply appreciated.

    Thanks to the following companies that allow me to collect data through interviews and

    site visits: Dynalectric, TradePower, Truland Systems, J.E. Richards Inc., Graybar, Starr

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      vii

    Corporation, Crescent Electrical Supply, A.C. Corp., Home Depot, New River Electrical,

    Varney Electric, Amprite Inc., Square D, Accubid Systems

    I would also like to thank my parents and all my family in Puerto Rico for their

    unconditional support, encouragement and love for my family and me.

    Thanks to our friends Nicole, Tony, Valerie, Joe and their kids for being there with us

    when we needed them the most. Your encouragement and friendship helped us to live

    through the immense pain that we were feeling.

    To my mother in-law Nancy (†): when things were rough, you always fought to be with

    us. God knows better and you are in a better place now. The suffering is over, although

    we miss you dearly. Thank you for everything you did for us.

    Finally, I would like to thank my wife Arliz, my kids Gaby, Amanda and Cristian for

    their love, support and for tolerating the days and nights that I spent working with my

    research. You put a smile on my face every time that the research was driving me crazy.

    This work is dedicated to you.

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    Table of Contents

    ABSTRACT........................................................................................................................ ii

    DEDICATION.................................................................................................................... v

    ACKNOWLEDGEMENTS............................................................................................... vi

    List Of Figures ................................................................................................................... xiList of Tables ..............................................................................................................