Posting operational work (resource costs/price calculation) – part 6

Using NAV4Construction, we can use specific resource cost or price models. When we post resources, we have next quantity fields:

  • Quantity – total time of resource engagement
  • Waiting time – time when resources do not make usage, because poor site organization
  • Extremely Stagnation Time – time when resources do not make usage, because force majeure
  • Effective Time – calculative field = Quantity – (Waiting time + Extremely Stagnation Time)

In NAV4Construction, we use Cost field for actual resource cost and Price form internal resource cost (transfer price for internal needs). Cost and Price are not calculate in the same way. Definition of them are placed on:

  • Quantity:
    • Cost – ‘Direct Unit Cost’ on Resource Card
    • Price – ‘Unit Price’ on Resource Card
  • Waiting time:
    • Cost – same as Quantity Cost
    • Price – ‘Standby Unit Price’ on Resource Card (using of this price depends of setup)
  • Extremely Stagnation Time:
    • Cost – no
    • Price – no

Cost Calculation

Cost Calculation is always the same. This calculation is based on resource usage and we calculate it by next pattern: Direct Unit Cost X ( Quantity – Extremely Stagnation Time )

If we want to use total quantity in calculation, we need to put ‘Extremely Stagnation Time’ blank.

Price Calculation

Price Calculation is more complex and depends of setup in ‘Res. Utilization Margin %’ field at Construction Setup. In this field we need to configure what is ‘acceptably utilization’ for us. In our example I will define that it is 70%. That means that if (Quantity-Waiting Time) is 70% or more in regard to total Quantity, this is good usage. Based on this, we have two different models of price calculation (we will use factor 0,7 instead of 70%):

Model 1: ( Quantity – Waiting Time ) >= 0,7 X Quantity

( Quantity – ( Waiting time + Extremely Stagnation Time ) ) X Unit Price

Model 1: ( Quantity – Waiting Time ) < 0,7 X Quantity

( ( Quantity – ( Waiting time + Extremely Stagnation Time ) ) X Unit Price ) + ( Waiting time X Standby Unit Price )

These Costs and Prices are the base of Construction Position cost and price calculation, based of their actual consumption.

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Posting operational work (posting differences) – part 5

What is a main difference between using Output Order and Job & Position Journals?

As I wrote in my first post for this theme, we can post the operational work on next ways:

  • Using ‘Output Order’ – posting of Construction Position output work and Resource and Item consumption per Project in the same time;
  • Using ‘Position Journal’ – posting only Construction Position output work per Project; we need to post consumption separately;
  • Using ‘Job Journal’ (standard NAV functionality with some specific customizations) – posting only Resource and Item consumption per Project; we need to post output separately;

Advantage of the first method is that we can post all entries with the one document. We get posted document with ‘Navigate’ functionality. Also, this method enables us to have complete statistic of cost per every Construction Position for each Project.

As we look up in Construction Position Statistic for position posted using Output Orders, we can see Using (position cost), Sales (position revenue) and Profit:

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On previous picture we see position cost for each period.

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In previous example, I presented Construction Position Statistic from NAV, and this is shown only costs, revenue and profit, without analytics. Also, if we use Output Orders for posting, we can make deeper analysis with complete analytics of resources and items cost or quantities, as picture bellow (from BI4CONS):

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Failing of this method is that if we have many complex position works per day, it is too complicated to make evidence and post it.

If we choose posting without ‘Output Order’, we get simply procedure for posting. We use ‘Position Journal’ for evidence of work per all Construction Position we have and separately we use ‘Job Journal’ for evidence of consumption all Items and Resources, not linked with Construction Positions. On this way we get simpler method, but we lose connection of consumption with Construction Position output. Using this method of posting, we know revenue for each position on project, but we don’t know position cost and profit. We could know cost and profit only per complete project or combination project and project task, and of course we will know this data per required period. As we look up in Construction Position Statistic for position posted using Position and Job Journals, we can see only Using (quantity, not a position cost) and Sales (position revenue):

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On previous picture, we cannot see position cost.

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Position sales data (previous picture) are the same as when we use Output Orders. But when we try to see profit, we will get a wrong data with 100% margins.

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We cannot get all things and we must to decide what method we want. Good thing is that we can choose different method for each project, depend of complexity and project requirement. Good thing is also that we can set filter on Position Statistic and we can see complete data for position posted using Output Order on each project.

Posting operational work (Construction Management) – part 1

In NAV4Construction, we can post the operational work on next ways:

  • Using ‘Output Order’ – posting of Construction Position output work and Resource and Item consumption per Project in the same time;
  • Using ‘Position Journal’ – posting only Construction Position output work per Project; we need to post consumption separately;
  • Using ‘Job Journal’ (standard NAV functionality with some specific customizations) – posting only Resource and Item consumption per Project; we need to post output separately;

Advantage of the first method is that we can post all entries with the one document. We get posted document with ‘Navigate’ functionality. Also, this method enables us to have complete statistic of cost per every Construction Position for each Project. Failing of this method is that if we have many complex position works per day, it is too complicated to make evidence and post it.

If we choose posting without ‘Output Order’, we get simply procedure for posting. We use ‘Position Journal’ for evidence of work per all Construction Position we have and separately we use ‘Job Journal’ for evidence of consumption all Items and Resources, not linked with Construction Positions. On this way we get simpler method, but we lose connection of consumption with Construction Position output. We cannot get all things and we must to decide what method we want. Good thing is that we can choose different method for each project, depend of complexity and project requirement.

Output Order

New ‘Output Order’ we get with ‘New’ command on the ribbon. We need to put Project and Task we work on them and choose Construction Position for posting. System will make automatic filter for positions and we get only positions we define on Bill of Quantities.

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If we eventually must post position out-of-BoQ, we can press ‘Show All’ and we will get complete Construction Position code list. After that, we need to fill ‘Quantity’ field with output quantity for this position in presented Unit of Measure. If this is not first posting for this position on this project, we can see previous posted quantity for this position. We also can see contracted position quantity from BoQ. On this way, we have control before posting this values. If we want to see what we post for this position previous, we can press on ‘Position Executed Quantity’ field and we will get complete evidence from Position Ledger Entry.

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We can fill another specific filed, depend of construction type (civil-engineering, building construction, road, maintenance…), but I will explain this in some other posts.

When we fill all necessary header fields, we have to fill lines with consumption data. We can fill lines automatic or manually. Results is the same, but automatic can make work easier if we have good normatives for construction positions.

Automatic fill process can be started by the ‘Import outputs’ command. System will use all normative lines for position in header, recalculate consumption quantity with position quantity on header and fills it. I have to notice, these are planned quantities and I am sure, we need to change some of them.

If we have manually input of data, we need to choose line Type (Resource or Item) and choose desired Resource/Item. After that, process is different depend of line type:

Item

For Item, we need to fill ‘Location Code’. We can get default location code for project if we make this setup on Project Card. We need to fill item quantity, as well and this is all. All costs and prices for the item will be filled automatically.

Resource

For Resource, we can fill more fields. There are not all mandatory and this depend of setup for company and/or project. It is necessary to fill quantity per Unit of Measure and we can choose ‘Work Type Code’ for different Unit of Measures/Cost/Price. If this is people type of resource, this is enough and as items, costs and prices will be automatic filled. But if we choose machine resource type, we can fill more fields.

First of them are ‘Waiting Time’ and ‘Extremely Stagnation Time’. ‘Waiting Time’ is time when resource did not work because bad organization. System will be calculate cost for all quantity time, but price for (‘Quantity’ – ‘Waiting Time’) if ‘Waiting Time’ is acceptable. If this time is not acceptable, system will calculate price based on specific formula (this is very complex setup, and I will explain it in independent post). ‘Extremely Stagnation Time’ is time we use only for evidence. This is a time when we was prevented for work (nasty weather or some other force majeure).

We can fill ‘Mechanization Resource Code’ if we know exactly what machine is worked. System can propose only machines for choosing resource. If we in advance know what machine worked, we can fill this field, and ‘Resource No.’ will be filled automatically. If we have configured machinist for mechanization resource, this field will be filled automatically, but if we have not it, we can choose ‘Employee No.’ for machinist from filtered employee list only from departments who use machines.

Know we know what time machines spend for making position, but we don’t know what they are worked exactly. Because of that, we have ‘Ongoings Code’ where we can define what our machine really do. ‘Ongoings Code’ list has Unit of Measures and they are configured depending resource types. When we choose this code, we need to fill ‘Ongoings Quantity’.

If our machine is the vehicle, we can fill additional fields: ‘Mileage’ and ‘Tour Quantity’.

This is only base story about this process and I will detailed explain some specifics in some new posts.

Posting

Before posting, we need to change status. Changing status make checking of all necessary fields input. NAV will make evidence of username, date and time for making document and for status changing, because these are very important data.

After that, posting process is simply. For each posted document, we can make storno (correction) document very easy, but I will explain it in later posts.

Operational work on construction project

We finished with contracting process, We start with quote requirement from potentional customer and we have gone through full cycle contracting process. Quantity Surveyors finished their Bill of Quantites and customer accepted our quote; contract is signed.

Now we have to start with operational process. Our people and mechanization are on project site. They have own first working day and we need to monitor their activities. Before that, we had to prepare dynamic schedules and our Gantt Chart, but I will explain this process later. Curently, in next posts I will devote to operational work. I will explain all about posting of output and consumption on project. First, I will explain own consumption, and after that subcontractors work.

Tomorow, I will writte about “Output Order” in NAV4Construction…