Abstract
AbstractBudget overruns are a key performance indicator for construction projects. Current overrun forecasting methods, such as Earned Value Management (EVM), are based on accounting data or empirical judgments and provide quantitative warning signals of project overruns. However, the predictive power of EVM is limited to binary outcomes. For instance, the cost performance index (CPI), one of the EVM indices, indicates over or under-budget if index values are greater or less than one. Estimate at Completion (EAC) associated with the CPI is usually used to evaluate if a project can be completed ahead of schedule rather than an indicator for cost overruns. To fill this knowledge gap, the authors developed an estimated hour at completion (EHAC) index by integrating labor productivity measurement into the existing EAC method. The variation of labor productivity is considered a leading indicator of field disruption-induced impact on final project costs, which is less frequently addressed in the literature. Specifically, labor productivity is measured as a ratio of actual labor hours and percent completion of work put in place to estimate EHAC given various disruptions encountered during project execution. Lastly, the authors conducted a case study to demonstrate the application of the proposed EHAC approach in forecasting total labor hours for an electrical project. The findings from this study add to the body of knowledge by providing project control practitioners with a new forecasting tool to manage project overrun issues from the productivity perspective.
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