INVENTORY MANAGEMENT IN CONSTRUCTION USING VALUE STREAM MAPPING AND STOCHASTIC MODELS

Researchers have long been trying to implement supply chain management practices in the construction industry after its successful implementation to the manufacturing industry. The construction industry, however, is highly fragmented, does not have a uniform workflow and its efficiency largely depends upon the site conditions where the construction process is carried out. These factors make the application of Supply chain management practices to the construction industry difficult. However, due to the completion of most processes in the factory like environment, prefabricated buildings have a striking resemblance to manufacturing. This research intends to apply supply chain management practices to the construction process of a single-story prefabricated steel structure. Based on classic stochastic inventory models the economic batch quantity for each of the steel elements involved in the construction is calculated. Based on this a new inventory management system is proposed. The present inventory management practices are mapped to calculate the total inventory cost, which is then compared with the total inventory cost estimate of the proposed system. Results depicted an overall reduction in the lead time of fabrication and savings in the total inventory cost by applying the proposed inventory management system.