CPM Resource & Cost Loading Requires Inside Knowledge

CPM Resource & Cost Loading Requires Inside Knowledge

Like construction project management, CPM Resource & Cost Loading is a science in which the best practitioners have administrative, as well as practical and theoretical skills specific to the industry in which they work. This condition generates some interesting perceptions, all of which point to a lack of consensus as to which schedulers are best suited to which industries, if any, and how well qualified they might be to generate resource and cost loading.

In one corner, as I have said in previous posts, are the certification agencies, from which various non-industry specific certificates are issued to applicants, many of whose industry experience has been, and will be, chiefly confined to desks and text-books. Those with both the industry experience as well as the certifications have the highest expectations. Those with only a certificate to show have the lowest expectation. But then there are crack schedulers, autodidacts (self-taught), and various hybrids in between, who can out-schedule the best of certified schedulers.

In other words, a motivated field mechanic with years’ experience would be a better candidate to train as a scheduler than a rookie with a freshly printed certificate.

What is it that best practice schedulers with little or no book experience utilize to cost and resource load their schedules? It depends who you work for. If you work for a subcontractor, optimally you would have experience in that trade. Conversely, a scheduler with little or no experience in a given trade is hard-pressed to resource and cost-load his schedules. This is because he lacks the nuts-and-bolts, or assembly and prosecution sequence of operations, that an industry specialized scheduler has, and the estimating prowess to parse quantity take offs into cost loading. On a good day, he has the sense to know what questions need to be answered, and who to ask.

Why would an electrical contractor take-on a scheduler who only had plumbing experience?

We must add this conundrum to the mix when contemplating the dearth of project controls talent in the industry: the electrician would seldom have the luxury of waiting to find a scheduler with electrical background. The same holds true for project managers in other industries: you wouldn’t take a software project manager and assign him to lead a construction project without a considerable internship. In other words, experience seldom translates across industries, and often not even within industries.

One huge advantage industry specific project controls professionals have when preparing cost and resource loading is the ability to visualize and interpolate complex assemblies when data is limited or inaccessible.

Schedulers working for general contractors and construction managers have a harder task on their hands because they are frequently the de facto scheduler for all trades that failed or neglected to issue a CPM schedule. This means they should have a minimum of working knowledge of all trades. In the trades in which they are less informed, they will get with the subcontractors, build a timeline with them, and use that schedule as a project control.

But a subcontractor will be reluctant to share all of his cost-loading data – if he even has it, with a contractor, as these data are proprietary.

That leaves a general contractor or construction managers’ scheduler in the position of resource and cost-loading without the respective contractor’s input. This is, in fact, a deal-breaker for his loaded schedule, unless he is able to disseminate and extrapolate the labor and materials rates from the contractor’s breakouts. Often, this is simply not possible to do accurately, such as in MS Project, and with limited operability in P6, which is the raison d'être for the $1/hr. unit price, divided by duration, which I highlighted in my previous post.

Resource and cost loading is tough work. You need one part estimator, one part scheduler, and one part clairvoyant, for all the non-participating parties. It is not unusual for stakeholders and their suppliers, and construction managers to either under-perform, or flat out refuse to participate in the scoping of their project CPM baseline, even when they hold, or withhold, critical information that the scheduler should have.

They’d rather assume the approve/reject position, and leave it at that. This position is quite often nothing more than an obfuscation to mask ignorance of CPM or construction methodology. This bandwidth shortfall is painfully regretted on the back end of a schedule, when contractor-coordinated activities - like OFW (owner-force work) and systems integration, take over the longest-path. 

I should think stakeholders would want to be more educated in CPM technology; especially when it serves their best interests, yet I fear pride is their biggest obstacle.

At the end of the day, a CPM scheduler may have cobbled very little indeed from third-parties to patch together his baseline schedule. It is then that he must become resourceful, and insistent that the need for resource and cost loading back-up is exigent, and that in the absence of it the loading will be best-guess. Any scheduler would rather sub-contractors furnished cost loading data with a CPM timeline, but that’s not what sub-contractors do, so we do it for them, if we are able. Stakeholders, in withholding critical OFW and vendor data from the scheduler, do the entire team a disservice. Furthermore, it is impossible to prepare risk simulations without that data.

If it’s untenable to try to cost-load a schedule owing to a lack of participation, then how can any P3 (public/private partnership)  or IPD (integrated project delivery) ever take-form?

That’s sort of like saying “if you don’t give me the real story, I’m going to have to make one up,” to which many will not object, at least until they notice that their timeline or payment schedule was attenuated as a result of the CPM scheduler erring on the general contractor’s side. Not having an accurate cost loaded schedule is a handicap to any sub-contractor hoping to file a disruption claim, especially a compensable one. Even if it is an in-house schedule, it should be resource and cost loaded. After all, that’s best practice, and what makes your loading data bona fide, as opposed to a guess-work..


Robert, I came up through the

Robert, I came up through the trades, like yourself. Thanks for these valuable insights into best practices that I doubt most planners and schedulers rely on or even know about.  A good distinction you make between bid and sell price. The trouble is getting schedules from subcontractors to calculate resources. Even more rare is a risk assessment.

I especially like the Team hierarchy you establish according to degrees of skill. 

If I may say, I am not totally convinced enhancing resources does not increase costs; whenever we demand extra men or shifts we get an acceleration fee. That's assuming the shortfall is not the fault of the contractor.

I'm also a little reluctant to believe that methodology trumps specific industry experience. I call that the theoretical in lieu of the practical, or jumping the shark,

Again, it was great to hear your insights.

I am a former lead tradesman,

I am a former lead tradesman, foreman, civil project inspector, civil construction manager, construction consultant and currently project controls in many industries (civil, facilities (airports, rail, embassies), telecom, R&D with airspace, defense and heavy industry manufacturing, claims and their defense.) 

I agree that project controls needs technicians with the capacity to understand the work at the actvity level. However, methodology trumps a lack of specific industry experience.

I find resource loading to be simple but arduous work whether I am develolping Primavera for rocket scientists at SpaceX or the Plumber at the new mall. Give me any subcontractor and I will look at his project records of previous work for successful completions by crew and make deliverables templates, then read this contract for any contract-specific durations. These become his design, engineering, manufacturing, logistics, prep, install, punch, commission and close out durations for each of their deliverables, sequenced. Now he has his 'enterprise' capacity for his A Team, B Team and C Team production unit Roles. Templates are Resourced with Roles, not humans, but the high level containers Expense Roles as well as the Humans on the payroll, Machines in the yard and Material ordered for the job. The sub is strongly recommended to schedule their work (deliverables durations) based on the B Team.

Why the B Team? Because this is what the Sub can do week after week, forever. You save the A Team for difficult, special and recovery work, then use them in regular work as available.

The template of the deliverables is maintained in high level containers by feeding in current expenses for men, machines and supplies as units and the resources of the activity are production units. Add the quantites per segment activity (expense loaded as manpower and machine units/day, and material at units/foot) and calculate the project.

You confuse expense (proprietary information) with cost (bid amount), but what you export to the contractor is the Unit Cost he is offering or you are bidding. The expense IS proprietary information. You estimate work at your expense, then add a % profit as your Global Change for the Unit Cost. Qty times Unit Cost is your bid. (There are always bid-balancing techniques based on the plan Redline and the Bid Tab units, but that is strategic stuff, after the Planning fact.)

With contractor and other subs in schedule meetings to determine project schedule for submission, the sub has what he can do with his B Team production units for the project. If the durations are not meeting the plan, you add B Team resources or substitute the A Team. Compressing time does not add expense, it simply adds production units to complete work faster. You earn Cost sooner by using Expense sooner.

Sub should meet his obligations by using his production units to plan his Resource Assignments. Meanwhile, sub can overcome Risk by moving his fastest talent to lagging work (same piece price, no loss) or working weekends (at a loss).  REAs are built on this. 

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