ix
TABLE OF CONTENTS
CHAPTER
1
2
TITLE
PAGE
DECLARATION
ii
DEDICATION
iii
ACKNOWLEDGEMENT
iv
ABSTRACT
v
ABSTRAK
vi
TABLE OF CONTENTS
vii
LIST OF TABLES
x
LIST OF FIGURES
xii
INTRODUCTION
1.1
Introduction
1
1.2
Research Problem
3
1.3
Objectives
4
1.4
Scope of the Study
5
1.5
Significant of Study
5
1.6
Methodology
6
MATERIAL MANAGEMENT IN CONSTRUCTION
2.1
Introduction
8
2.2
Obtaining the Material
9
2.2.1
Pre-contact Arrangement
10
2.2.2
Manufacturers and Suppliers
13
2.3
Material Handling
16
x
3
2.3.1
General Objectives
16
2.3.2
Unit Loads
17
2.3.3
Pallets
19
2.3.4
Deliveries
20
2.3.5
Waste in Handling
22
2.4
Material Delivery Problem in Construction Project
25
2.5
Summary
28
INVENTORY MANAGEMENT
3.1
Introduction
30
3.2
Origin of Inventory Management
31
3.3
Definition
33
3.4
Theory of Inventory Management
34
3.5
Concept of Inventory Management
36
3.5.1
The Purpose of Inventory
36
3.5.2
Types of Inventory
38
3.5.3
Economic Order Quantity
39
3.6
Methodology of Inventory Management
41
3.7
Role of Inventory Management in Working Capital
42
3.8
Role of Inventory Management in Construction
43
3.8.1
Purchase Costs
43
3.8.2
Order Costs
44
3.8.3
Holding Costs
44
3.8.4
Unavailability Costs
45
3.9
Contemporary Approaches to Managing Inventory
45
3.9.1
Material Requirement Planning (MRP)
46
3.9.2
Just in Time (JIT)
46
3.10
New Inventory Management Products, Services, and Ideas 48
3.11
Summary
49
xi
4
VENDOR MANAGED INVENTORY
4.1
Introduction
50
4.2
Definition
51
4.3
Historical Development of VMI
53
4.4
Vendor Managed Inventory System
54
4.5
Survey: VMI’s Value As Tools for Inventory Reduction
57
4.6
Vendor Managed Inventory in Construction
60
4.7
Case Study: Adaption of VMI for Small Items Logistics
61
In Construction
5
6
4.7.1
Company Description
62
4.7.2
Initial Ways to Achieve Goals Exploration
62
4.7.3
Solution Design: The Small Items Store
64
4.7.3.1 Jumping In
64
4.7.3.2 Co-opting Unintedned Consequences
65
4.7.4
Pilots and Results
66
4.7.5
Discussion and Further Development
67
4.8
Application of VMI in Malaysia Constrution Industry
69
4.9
Summary
72
DATA COLLECTION AND PRELIMINARY ANALYSIS
5.1
Introduction
73
5.2
General Approach
73
5.3
Questionnaire
74
5.3.1
75
Questionnaire Structure
5.4
Method of Analysis
76
5.5
Limitation of Study
79
5.6
Summary
80
RESULT AND ANALYSIS
6.1
Introduction
81
6.2
Reliability Analysis
82
xii
7
6.3
Discriminant Analysis
85
6.4
Frequency Analysis
90
6.5
Crosstabs Analysis
95
6.6
Summary
104
DISCUSSION
7.1
Introduction
105
7.2
Problem Related to Inventory in Project Undertaking
105
7.3
The Level of VMI’s implementing in Local Construction
107
Industry
7.4
The Expected Barriers and Benefits of VMI’s
108
Implementing
7.5
8
Summary
111
FINDINGS, CONCLUSION AND RECOMMENTATIONS
8.1
Introduction
112
8.2
Findings
112
8.2.1
112
To study the inventory and its problem in
undertaking construction project
8.2.2
To analyze the potential of VMI in construction
113
industry in Malaysia
8.2.3
To investigate the extent of expected benefits
114
and barriers from the construction personnel
viewpoint.
8.3
Recommendation for Future Studies
115
8.4
Conclusion
115
REFERENCES
APPENDIX
xiii
LIST OF TABLES
TABLE NO.
TITLE
PAGE
2.1
Attitude of project participant
23
4.1
Comparison of four major RSP strategies
54
4.2
Performance measure of VMI program
55
4.3
Result of the pilots
68
6.1
Reliability Statistic
82
6.2
Item-Total Statistic
82
6.3
Reliability Statistic
83
6.4
Item-Total Statistic
83
6.5
Reliability Statistic
84
6.6
Item-Total Statistic
84
6.7
Reliability Statistic
85
xiv
6.8
Item-Total Statistic
85
6.9
Analysis Case Processing Summary
86
6.10
Prior Probabilities for Groups
86
6.11
Wilks’ Lambda
87
6.12
Function of Group Centroids
87
6.13
Structure Matrix
88
6.14
Prior Probabilities for Groups
89
6.15
Wilks’ Lambda
89
6.16
Frequency of role
90
6.17
Level of Agreement among construction roles toward the
96
lack of cooperative
6.18
Level of Agreement among construction roles toward the
97
traditional role of supplier and contractor
6.19
Level of Agreement among construction roles toward the
97
lack of commitment between parties involved
6.20
Level of Agreement among construction roles toward the
hardship to shift entire responsibility from contractor to
supplier
98
xv
6.21
Level of Agreement among construction roles toward the
98
lack of innovative in local construction industry
6.22
Level of Agreement among construction roles toward the
99
low level of acceptance in new methods
6.23
Level of Agreement among construction roles toward the
100
repeating business with key suppliers or contractors
6.24
Level of Agreement among construction roles toward
100
reducing or eliminating cost of holding inventory by
contractors at site
6.25
Level of Agreement among construction roles toward
101
greater confident for longer term planning
6.26
Level of Agreement among construction roles toward
101
avoiding the problem of storing and handling of materials
6.27
Level of Agreement among construction roles toward the
102
improving quality of supplier’s services and commitment
6.28
Level of Agreement among construction roles toward the
103
reducing wastage by inexperience handling
6.29
Level of Agreement among construction roles toward
103
reducing material handling cost
7.1
The frequency analysis result on level of VMI’s
implementing in local construction industry
107
xvi
7.2
The result on the expected barriers that preventing from
109
VMI’s implementing
7.3
The result on the expected benefits that gained from VMI’s 110
implementing
xvii
LIST OF FIGURES
FIGURE NO.
TITLE
PAGE
1.0
Methodology of overall project
7
2.0
Relationship between the building team and the site
10
2.1
Contractual links for materials
14
2.2
Improper handling of brick unit load
18
2.3
Improper handling of brick that leading to wastage
18
2.4
Used pallet placed stacking at construction site
19
2.5
Wastage during offloading process
21
2.6
Inevitable wastage generated from improper concrete
21
mixing method
2.7
BRC storing method in local construction site
24
2.8
Steel bar storing method in local construction site
24
2.9
An illustration of the Timo and Mikko model
25
xviii
2.10
The Last Planner System
26
3.1
Sample of bar code
32
3.2
The elementary storage transaction
34
3.3
Total cost of inventory
40
3.4
Supply Chain Management
41
4.1
Order-base replenishment versus VMI
52
4.2
VMI system implementation approach
57
4.3
The research process and its changing focus
66
4.4
An example of ordinary site store
68
4.5
An example of the VMI store
69
5.1
Five ordinal degree of agreement of Likert’s scale
75
5.2
Data view of SPSS statistical analysis software
77
5.3
Variable view of SPSS statistical analysis software
77
5.4
Output of SPSS on frequency analysis
78
5.5
Output of SPSS on Crosstabs analysis
78
xix
5.6
Project methodology flow
79
6.1
The level of understanding of concept of VMI
91
6.2
The level of practice of promoting preferred suppliers or
92
contractors
6.3
The level of practice of the creation of long term
93
relationship or alliances
6.4
The level of practice of development of mutual trust
94
among partners
6.5
The level of practice of willingness among parties involved 95
to share information on business plan, operation, and
best practices