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Reducing construction material cost by optimizing buy-in decision that accounts the flexibility of non-critical activities

Author(s):




Medium: journal article
Language(s): English
Published in: Engineering, Construction and Architectural Management, , n. 8, v. 25
Page(s): 1092-1108
DOI: 10.1108/ecam-12-2016-0263
Abstract:

Purpose

The goal of making buy-in decisions is to purchase materials at the right time with the required quantity and a minimum material cost (MC). To help achieve this goal, the purpose of this paper is to find a way of optimizing the buy-in decision with the consideration of flexible starting date of non-critical activities which makes daily demand adjustable.

Design/methodology/approach

First, a specific algorithm is developed to calculate a series of demand combinations modeling daily material demand for all the possible start dates. Second, future material prices are predicted by applying artificial neural network. Third, the demand combinations and predicted prices are used to generate an optimal buy-in decision.

Findings

By comparing MC in situation when non-critical activities always start at the earliest date to that in situations when the starting date is flexible, it is found that making material buy-in decision with the consideration of the flexibility usually helps reduce MC.

Originality/value

In this paper, a material buy-in decision-making method that accounts non-critical activities’ flexible starting date is proposed. A ternary cycle algorithm is developed to calculate demand combinations. The results that making material buy-in decision considering non-critical activities’ flexible starting date can reduce MC in most times indicates that contractors may consider non-critical activities’ flexibility a part of the buy-in decision-making process, so as to achieve an MC decrease and profit increase.

Structurae cannot make the full text of this publication available at this time. The full text can be accessed through the publisher via the DOI: 10.1108/ecam-12-2016-0263.
  • About this
    data sheet
  • Reference-ID
    10576668
  • Published on:
    26/02/2021
  • Last updated on:
    26/02/2021
 
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