Project Management and Determining Economic Quality of Charge and Discharge Automation System of New DRI Silos of Mobarakeh Steel Company

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1 Advances in Environmental Biology, 7() Cot 2, Pages: NSI Journals Advances in Environmental Biology Journal home page: Project Management and Determining Economic uality of Charge and Discharge Automation System of New DRI Silos of Mobarakeh Steel Company Fatemeh Shabanian Boroujeni Master of Socio-Economic Systems Engineering, Islamic Azad University, Dehaghan branch, Iran ARTICLE INFO STRACT Article history: Received September 2 Received in revised form 2 October 2 Accepted October 2 Available online November 2 Key words: Project Profitability, Performance Index, Economic uality, weight Factor This paper examines the profitability or lossof charge and discharge automation of new DRI silos of Mobarakeh Steel Company. In fact, the main objective of this research is to determine the economic quality of project in the automation of unit (6) of Mobarakeh Steel complex during 22-2.In this study, activities along with network transpositions have been studied. Project profitability and loss indicators (ACP, BCP and CPI) are calculated according to weight Factor of activities and their percent of completion, and project quality is economically reviewed. Results indicate that the cost performance index in all the activities is smaller than, and this shows that the project is already associated with loss and providing ways to minimize loss is inevitable. INTRODUCTION 2 NSI Publisher All rights reserved. Project management is a process of integrated and interrelated set of activities that the results of each of the areas of project management are usually effective in others and interaction between the areas have positive and negative results. Project planning and control is an art form and art requires creativity, ingenuity, innovation, elegancy and discipline and tools such as software, forms and instructions are secondary priorities. A project is a set of activities that are performed to achieve a certain purpose or goal []. In economic projects, reviewing profitability of the project is of great importance. If a project is associated with loss and preventive measures to reduce or eliminate losses are not used, it can become a disaster for the project owner, because project s losses are more than its benefits and profitability. In some cases, small changes and altering strategy can prevent the disaster. Introducing charge and discharge automation of new DRI silos of Mobarakeh Steel Complex: Mobarakeh Steel Complex is located 7 km south west of Esfahan on a land area of square kilometers (7 square kilometers of production hall) and is the largest industrial complex in Iran. It is noteworthy that in order to achieve a production capacity of 7/2 million tons of steel in Mobarakeh steel and its requirement sponge iron production, direct reduction project of Martyr Kharrazi in two A and Bmodels, each with an annual capacity of / million tons of sponge iron started in July 2and its A model began working in July 22 in the presence of president. Transportation lines of sponge steel produced from reduction unit of Martyr Kharrazi and its charge to new DRI silos in direct reduction unit of Mobarakeh steel and also the discharge lines of these silos to steel making area has been installed and commissioned. In this study, a total of activities were identified along with their transposition [2]. In this study, the control structure of project and the balance of time and cost on the project of charge and dischargeautomation of Mobarakeh Steel Complex have been investigated. In this study, primary and secondary activities associated with their transposition were identified. List of activities and how they relate to each other is given in Table. eight Factor of activities: eight Factor represents the portion of activity from % of the project volume and calculation methods are mentioned below: MATERIS AND METHODS Corresponding Author: Fatemeh Shabanian Boroujeni, Master of Socio-Economic Systems Engineering, Islamic Azad University, Dehaghan branch, Iran, fa_shabanian@yahoo.com

2 276 Fatemeh Shabanian Boroujeni Advances in Environmental Biology, 7() Oct 2, Pages: Methods of Calculating eight Factor: - eight factor as a function of Rial number of activity is calculated dividing the number of each activity over the total number of project. - eight factor as a function of Rial number of activity and experience and expert evaluation means that first weight is calculated for activities based on activities number and then in one or more expertise sessions with executive and technical managers of the project, weights are checked and amended. - eight factor as a function of activity volume is for projects that are made up of same activities. This kind of weight factor is calculated dividing activity volume over the sum of activities volumes. - eight factor as a function of business sources of project []. eight factor of activities is presented in Table 2. Evaluation of Project Profitability or Loss Report: Budgeted of ork Performed (BCP): BCP is calculated multiplying the percent of work completed by based cost of activity. BCP is a budget that investigator gets if a work is performed and gets it based on expected number for performing the activity. Actual of ork Performed (ACP): Actual cost of work performed is the amount of money that is spent for performing project activities until reviewing the project. s of projects are usually divided to two direct costs and indirect costs. Direct costs are spent on performing activities directly and indirect costs or overhead costs are spent on support costs and performing activities indirectly []. Performance Index (CPI): performance index is calculated dividing BCP over ACP. Using CPI is the best and most convenient way to show project s profitability or loss. If CPI is equal to, it means that the actual cost of the project is in accordance with the received budget for the project. If CPI is greater than, it means that the project s received budget is greater than project s actual cost and in other words the project is now profitable. If CPI is less than, it means that project s cost is more than its income and in other words the project is now associated with loss []. Determining the quality of the project in terms of economic: According to Table, all the activities of the project have a CPI less than, and therefore, it can be concluded that the project is currently associated with loss for investigator and project s cost is greater than its income. s include direct costs (operational) and indirect (non-operational) costs. Since there are indirect costs under any circumstances, if project s time increases such will increase the cost of project. Results and Conclusions: In this study, activities along with network transpositions have been studied. Due to weight factor of activities, it is clear that and activities have the least amount of weight factor and are equal to.2 which has the least effect on the process of project. According to Table, all the activities of the project have a CPI less than, and therefore, it can be concluded that the project is currently associated with loss for investigator and project s cost is greater than its income. However, the biggest cause of incurred financial losses is economic sanctions that caused significant differences in predicted costs and arising costs. In order to reduce incurred losses, observance of followings can help to improve the current situation: ) Using shareholders out of the project is one of the ways of increasing income. In this way more budgets can be obtained for project performance by selling a part of stock. 2) In order to perform an activity in a shorter time than usual, increasing the amount of resources such as labor, equipment and machinery, more expensive and more powerful equipment and changes in techniques are recommended. Thus, reduction of activity time shorter than usual is associated with cost increase. But, reducing the project completion time is beneficiary for contractors and employers, such as: - Captive capitals will be working sooner. - In competitive conditions, new product comes to market sooner. - Contractors can be entered in a new project sooner. - Major repairs in a firm with continuous and mass production leads to faster onset of production. - Contractors are free from latency and delay crimes. - Contractors can benefit from the rewards in earlier completion of project.

3 277 Fatemeh Shabanian Boroujeni Advances in Environmental Biology, 7() Oct 2, Pages: ) Dynamic and efficient role of project s control unit is required. Unfortunately, our country still does not seem to pay much attention to this problem and project control usually is not involved in project decisions. ) Culture building and appropriate training: During research and interviews with managers and practitioners in various projects in Mobarakeh Steel Company, it was observed that necessary training and culture building between project agents can be used as an important factor for better implementation of project management techniques. ) Senior manager s support: ith proper and informed support of organization s senior managers, any industry can certainly witness the remarkable growth of applying project control techniques. 6) Providing a suitable platform: Due to the production of related bundles and more complex industrial projects, using this software can greatly help project agents. 7) Using experiences of successful companies: In the area of using project control techniques, experiences of successful industries in different areas can be used in this context. Tables : Information explorationactivityin theproject Task y PU6 new DRI bins charge A 6 & discharge automation Engineering B 6 In source G ork Basic engineering I S V Task Detail engineering Detail design Cabinets manufacturing y X Y Z ork 6 6 Y,D,F Y,D AC Shipment Erection AF Cabinet & equipment and network installation Supervision to termination & telephone check Power on & signal check Basic Engineering AI AJ T AK AJ Detail Engineering AM AN,AO Logic Detail Design HMI Detail Design Logic HMI AN AO AP AT A AX AT A AN AO Task Signal check Function check Management AZ y U ork.6 CZ,DB,DI,DJ, AT,A AJ,

4 27 Fatemeh Shabanian Boroujeni Advances in Environmental Biology, 7() Oct 2, Pages: H Technical management S Technical management Basic engineering BC BD J BE BH Detail engineering BJ BK,, Detail design Cabinets manufacturing BK BL BN BK,D Shipment Erection Cabinet & equipment installation Supervision to termination & telephone check Power on & signal check BT B BY BZ BF , B,N BZ B Basic Engineering Detail Engineering Task Logic Detail Design HMI Detail Design Logic implementation HMI implementation Erection CA CC y CD CE CF CG CH CI CK ork CD,CE CG CH CL CD CE,CG,CH Cabinet installation Signal check Function check Management CL CM BG DD,DF,DK,DL,DO BZ,CL H Technical management S Technical management Training CP CT K C CY maintenance CZ DA maintenance maintenance Task maintenance As Built documentation DB CX DC DD DE y DF L ork.6

5 279 Fatemeh Shabanian Boroujeni Advances in Environmental Biology, 7() Oct 2, Pages: Guarantee period Out source DG DI DJ DH DK DL M DM DO DP DN D H DO DP D DP D DI, DJ,DO DK,DP DL, Cabling & Installation Project management PlanningPhase Execution andcontrolphase Termination Phase Procurement Procurement-New Procurement-Exist N O P R C D F R, P Table 2: eight Factor DC.9 DD.9 DE.2 DF.2 DG.9 DH. DI.2 DJ.29 DK.2 DL. DM. DN. DO.29 DP.6. D.9.26 R. CF CG CH CI CK CL CM CP CT C CX CY CZ DA DB BJ BK BL BN BT B BY BZ CA CC CD CE AM AN AO AP AT A AX AZ BC BD BE BF BG BH S T U V X Y Z AC AF AI AJ AK A B C D F G H I J K L M N O P T Table : CPI ACP BCP %Complete % Complete ACP BCP CPI PU6 new DRI bins charge & discharge automation 62%,2,9, 6,99,7,9.6 Contract enforcement % Engineering 6% 2,,9,,79,7,9. In source 7%,6,6,,6,7,9. New DRI bins charging (PU6) % 779,7,67 69,69,6. % 97,672,97,2,2.7 Basic engineering %,,99 26,9,6.7 General Design %,,99 26,9,6.7 Detail engineering % 2,96,66 9,,66.7 Detail Design % 2,96,66 9,,66.7 implementation % 7,92,76 9,2,97.7 Cabinets manufacturing % 7,92,76 9,2,97.7 FAT and shipment %,22,76,67,7.7 FAT (including document %,7,,26,9.7 Shipment %,9,7,,7.7 Erection %,66,92 7,6,2.7 Cabinet & Equipment and network Installation % 27,2, 2,9,.7

6 27 Fatemeh Shabanian Boroujeni Advances in Environmental Biology, 7() Oct 2, Pages: Supervision to Termination & telephone check % 7,72,2,2,9.7 % 2,67,76 7,276,.7 power on & Signal Check % 2,67,76 7,276,.7 %,9, 29,26,7.7 Basic Engineering % 2,29, 72,2,62.7 General Design % 2,29, 72,2,62.7 Detail Engineering % 62,,7,9,.7 Logic Detail Design %,27,27 7,67,76.7 HMI Detail Design % 6,27,,22,2.7 % 9,96,7 2,2,.7 Logic %,7, 6,6,27.7 HMI %,,27 6,7,6.7 FAT and shipment %,627,6,,662.7 FAT (including document %,627,6,,662.7 % 26,,2,96,2.7 Signal Check %,2,69,,.7 Function Check % 2,27,,,9.7 SAT % Management % 6,72,96,6,9. H Technical management % 2,99,2,6,9.7 S Technical management % 2,7,6 New DRI bins discharging (PU6) % 67,, 67,6,. %,72, 27,,76.7 Basic engineering %,2,79 9,,6.7 General Design %,2,79 9,,6.7 Detail engineering % 9,76,27,9,.7 Detail Design % 9,76,27,9,.7 implementation % 6,7,6,96,.7 Cabinets manufacturing % 6,7,6,96,.7 FAT and shipment %,7,6,27,9.7 FAT (including document %,22,9,72,29.7 Shipment %,9,7,,7.7 Erection % 6,9,6 6,69,9.7 Cabinet & Equipment Installation % 29,7,99 2,9,27.7 Supervision to Termination & telephone check %,6,27,7,6.7 % 6,, 6,7,.7 power on & Signal Check % 6,, 6,7,.7 %,6,76 27,7,2.7 Basic Engineering % 6,,97,,2.7 General Design % 6,,97,,2.7 Detail Engineering % 2,2,99,7,6.7 Logic Detail Design % 7,9,26 6,66,9.7 HMI Detail Design % 7,29, 9,6,62.7 % 72,67,7 62,7,2.7 Logic % 2,,6,2,79.7 HMI % 2,6,76 7,,.7 FAT and shipment %,,,9,26.7 FAT (including document %,,,9,26.7 Erection %,9,2,9,.7 cabinet installation %,9,2,9,.7 %,2,6 9,,7.7 Signal Check %,67, 9,6,6.7 Function Check %,7,292 9,6,69.7 SAT % Management % 6,72,96,6,9. H Technical management % 2,99,2,6,9.7 S Technical management % 2,7,6 Training %,2,6 2,7,2.7 New DRI bins charging (PU6) %,,97,,2.7 % 7,9,76 6,29,7.7 maintenance % 7,9,76 6,29,7.7 %,,7 6,992,.7

7 27 Fatemeh Shabanian Boroujeni Advances in Environmental Biology, 7() Oct 2, Pages: software maintenance %,,7 6,992,.7 New DRI bins discharging (PU6) % 7,77,697,2,9.7 % 7,9,76 6,29,7.7 %,6,2,7,2.7 As built Documentation %,,2 7,2,7.7 New DRI bins charging (PU6) %,62,29,6,.7 % 6,96,,7,7.7 % 2,6,276 2,,2.7 New DRI bins discharging (PU6) %,92,99,26,.7 % 6,,9,6,.7 % 27,6, 2,2,79.7 Guarantee Period 2% 2,7,,6,. New DRI bins charging (PU6) 2%,9,76,,7. 2%,2,,927,. 2%,9,669,2,. New DRI bins discharging (PU6) 2% 2,,969 9,,67. 2%,,,9,76. 2%,7,26,7,. outsource 7%,9, 7,,.7 Cabling & Installation % 2,, 272,,.7 Project management %,79,,,.7 PlanningPhase % 2,7, 2,,.7 Execution andcontrolphase 7% 9,, 7,,.7 Termination Phase % Procurement %,9,,,2,,.7 procurement - New %,6,,,2,,.7 procurement - Exist % 2,,, 2,,,.7 End of Project % REFERENCES [] Ajorlo, M., 26. Project Control and Planning, Imam Hussein University Press, Tehran. [2] Reporting, 22. Project Planning and Control of International Systems Engineering and Automation Company, IRISA. [] Emamizadeh, B., 22. An Introduction to Project Management (Systematic Structure of Project Management), Training workshop. [] Vandermelve, A.P., 996. Multy Project Management: Organization Structure and Control", I.J of Management, :. [] SoltaniGholamreza, 996. Engineering Economics, Shiraz University Press, Shiraz