Multi-Project Resource Allocation: Parametric Models and Managerial Implications

William J. O'Brien¹

Abstract

Subcontractors have finite resources they must allocate to multiple projects, often in conditions of competing demand and uncertainty about project schedule. Subcontractors will shift resources fluidly between projects to meet demand, seeking to optimize productivity across projects. Choices about resource allocation are perhaps the most important operational decision that subcontractors make. Despite this, construction research has only recently begun to appreciate the multi-project environment of subcontractors, taking instead a view of production in the context of single projects. As a starting point for a multi-project model, this paper presents a parametric model of subcontractor productivity on a work package. The model relates site conditions, resource allocation, and productivity, allowing quantitative assessment of the impact of shifting resources to or from the work package. An application of the model is presented for one subcontractor with calibrated parametric functions. Use of the model for multi-project resource allocation decision is discussed, and several implications for subcontractor and site management are developed. Many of the central implications are derived from the shape of the productivity modifying functions in work area and resource balance, suggesting a natural categorization of subcontractor technologies.

Keywords

Subcontractor production, resource allocation, multi-project coordination, supply chain management.

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Reference

O'Brien, W. J. 2000. Multi-Project Resource Allocation: Parametric Models and Managerial Implications, 8th Annual Conference of the International Group for Lean Construction , -. doi.org/

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