SCAFFOLDING HOURS: What are they? Directs or Indirects? Part 1

080215-Scaffolding Header Part1

Since scaffolding can easily account for a substantial 5% to 15% or more of construction hours, it is a very significant value in terms of progress. Once it becomes a part of the progressing process, and the resources quantity uploaded to the schedule, then it will work very much in favor of the contractor or the execution team. As such, I would like you and I to try to answer the contentious question:

In a construction project, how would you categorize scaffolding hours? Are they directs or are they indirects?

Indirect labors are those whose output is not directly part of the assets erected, much like camp or construction site snow-removal, overhead, security, transportation, etc. It aligns and translates to indirect costs. Indirect costs are costs that are not directly accountable to a cost object such as a specific facility, equipment, module, function or product (Wikipedia, 2013). I came across four known methods (see list below) of progressing scaffolding workhours in my past work experience, regardless of whether scaffolding is considered direct or indirect.

  1. Use equal periodic withdrawal from start to end of Construction.
  2. Equal periodic withdrawal from start of Civil works to end of Construction.
  3. Equal periodic withdrawal from start of Mechanical or Structural works (which ever start first) to end of Construction.
  4. Resource load the scaffolding hours on each work package.

Most projects consider scaffolding hours as indirects. Okay, you would ask, “Why should scaffolding work hours be considered as indirects?” If projects reflect scaffolding hours as direct hours in the estimate and became part of the schedule resource loading in the schedule, the resource distribution in place will be suspect. Calculating and checking labor density, peak resources, resource leveling, resource planning, resource distribution, scope completeness, quantitative risk assessment, and measuring/monitoring benchmark quantities with production rates will not be accurate nor will it be useful in the future. Scaffolding erection does not produce a product or a deliverable that becomes part of the capital equipment, or constructed facilities & structures. They remove all temporary fixtures right after completely expending all direct works to install capital assets such as a tanks, compressors, or buildings. Construction workers erect scaffoldings so they can access the upper tank tiers like when one welds or paints. After all is completed, the project takes down and removes all its scaffoldings (Frago, 2013).

Direct costs are those that are expected solely to complete the activity or asset. It can be any cost that is specifically identified with a particular final cost objective, but not necessarily limited to items that incorporates into the product like materials or labors (Amos, 2007).

Indirect costs are those resources expended not only to support the completion of activities and assets but also associated activities and assets. It is any cost not directly identified with two or more final cost objectives.

To demonstrate the impact of how projects treat scaffolding hours, let us start with the resource distribution table (Figure 1). The table show direct labor hours without scaffolding. It means that scaffolding hours were not part of the base progress and performance report. It is still part of the overall project cost and has a bearing to final project cost but in a more indirect way.

Figure 1 – Construction Direct Hours without Scaffolding

Figure 2 displays a resource distribution table that includes scaffolding as direct hours. By doing so, it is the stand of the project that scaffolding has a direct cost contribution to assets erection. It becomes part of the direct cost per equipment report during the post investment review. It will later on become part of cost per unit benchmark.

Figure 2 – Construction with Scaffolding as Direct Hours

Since scaffolding as direct, results in a plan progress that considers all scaffolding work as direct hours, project controls have to add 31,518 work hours to the total discipline direct hours tallied on Figure 1. On the other hand, scaffolding as indirect, will result in a plan progress where all scaffolding works remain as indirect hours. The total direct remains as is without consideration of the 31,518 scaffolding hours. The scaffolding hours can stay invisible and separate from direct progress tracking. In our example, we use method number 2; i.e. equal monthly withdrawal from start of civil works to end of construction (Nov-15 to Mar-17), Figure 3 delineates the difference between the two approaches through the visible gaps between the two S-curves.

Figure 3 – Plan Progress Comparison

The project farms its scaffolding workhours in a straight line without respect to earned value. This seems good and convenient. The questionable thing about this methodology is the fact that it creates a progress and performance padding. It produces a gap!

I will discuss what the gap is about in “SCAFFOLDING HOURS, What are they? Directs or Indirects? Part of 2. Watch for it! Rufran C. Frago-Author (080115) Other articles authored by Rufran Frago:

  1. Risks Surrounding Canada’s TFW Part 1
  2. Risks as a Function of Time
  3. Project Schedule: P50, Anyone?
  4. Changing the Culture of Your Organization
  5. A Person Perceives Others Based on His Own Interest
  6. How Can Management Motivate and Empower?
  7. How Can Managers Increase Leadership Effectiveness
  8. Risks Surrounding Canada’s TFW Part 2
  9. Scaffolding Hours: What are they? Directs or Indirects?  Part 2

ANNOUNCEMENT! The paperback and Kindle edition of the book “Risk-based Management in the World of Threats and Opportunities: A Project Controls Perspective” are now available. Please follow the hyperlinks for more information.

 The book provides new/additional knowledge to project management practitioners (beginners to experts), risk management specialists, project controls people, estimators, cost managers, planners and schedulers, and for students of undergraduate courses in Risk Management. The sectional contents offer practical and common sense approach to identifying/managing risks. It is a must have for company managers, directors, supervisors, aspiring industry professionals, and even those students fresh from high school. The material is especially design to start with the foundational principles of risk gradually bringing the reader to deeper topics using a conversational style with simple terminologies.

So, if you are interested, check it out!

Source: Frago, R., 2015.Risk-based Management in the World of Threats and Opportunities: A Project Controls Perspective

About rcfrago

Rufran C. Frago, P. Eng., PMP, CCP, PMI-RMP, is the Managing Director of RBM&S Inc., a young Calgary company focusing on risk-based management consulting services, and online merchandising. He has many years of international industry-related work ‎experience in Oil & Gas, Petrochemicals, Oleo-chemicals, Sugar Refining, Manufacturing, Consulting, and Education. He has worked in various parts of the world (Location: Asia, Middle East, Canada, and North Africa). Rufran has worked with Caltex, Uniman, Unichem (now Cocochem), ARAMCO-KSA, Central Azucarera de Tarlac, Arabian Gulf Oil Company-Libya, Batangas State University, Saint Bridget’s College, JG Summit Petrochemicals, Halliburton-Kellogg, Brown and Root, OPTI Canada, and Suncor Energy Inc. His expertise includes risk-based project management, risk analysis, planning & scheduling, cost management, auditing, maintenance, operation, EH&S and reliability engineering. He is interested in providing solutions and innovations to all clients and stakeholders. Rufran is the author of the books “Risk-Based Management in the World of Threats and Opportunities: A Project Controls Perspective” and "How to Create a Good Quality P50 Risk-based Baseline Schedule" published in 2015 and 2017. Mr. Frago is a Filipino-Canadian risk management practitioner. He studied at BSU graduating with a Diploma in Petroleum Refinery Maintenance Technician, and BS Mechanical Engineering. He was also a BS Management Engineering graduate of UB. He took up MBA courses under UP-PBMIT Consortium. Rufran completed Computer Technician Program at ICS-Pennsylvania, USA, APM Certificate program at SAIT-Calgary, and PM Certificate program-Construction Management. He is presently taking up PM Certificate program-Risk Management at University of Calgary. He was a recipient of the Gerry Roxas Leadership Award, the American Field Service (AFS) Scholarship grant, and the CALTEX scholarship grant where he specialized in Petroleum Refinery Maintenance. The author wants to share his knowledge and leave behind some legacy to all readers, most especially to his wife, children and lovely grandchildren, Eva and Mia.
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