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Gunnar Lucko

Abstract

Contractors must carefully manage their cash outflows (e.g., for materials to enable their work) and inflows (after the work) to be profitable, particularly in an economy that is still recovering from the 2008-2012 recession that grew out of the mortgage crisis. Their importance for business success is undisputed, as bankruptcies due to insufficient cash flow underline. Therefore, this study investigated current business practices of electrical contracting companies of different sizes with respect to their financial planning and management. A detailed questionnaire was developed with best guidelines on survey studies and pilot testing. It was sent to members of the National Electrical Contractors Association. Respondent anonymity was ensured. The survey recorded demographics, business practices, operating conditions, and other important factors using 57 subquestions. Each section allowed feedback to clarify the numerical responses. Responses were well distributed across company sizes, so that the results are representative for the entire industry. The results indicated that contractors generally have a substantial amount of experience in financial decision making. Their approach is conservative and focuses on healthy growth. Yet, opportunities to fine-tune business practices are identified, e.g., immediate invoicing, considering discounts to accelerate payment receipts, attempting to negotiate and use favorable credit terms, reviewing payment performance, and performing frequent cash flow forecasts. Some of the differences in the responses can be attributed to different company sizes. To help especially smaller companies in planning their cash flow, a spreadsheet for implementation has been created.

Open access

Gunnar Lucko and Yi Su

Abstract

The inaugural challenge of the 2016 Creative Construction Conference has posed two related questions on how many possible criticality constellations with different behaviors for delays and acceleration exist and how said constellations can occur for nonlinearly and monotonously progressing activities that have continuous relations. This paper systematically solves these questions by performing a thorough literature review, assembling theoretical foundations for link constellations, performing a computer simulation of all possible permutations, and providing a mathematical proof by contradiction. It is found that (for the initially assumed self-contained activities in a network schedule that exhibit only a linearly growing production), three newly hypothesized criticality constellations cannot exist. Nonlinear activity constellations with diverging or converging relative pro­ductivities are examined next. Lags in networks become buffers in linear schedules. It is found that a nonlinear curvature of the progress may induce middle-to-middle relations besides those between start and finish. If multiple curvatures are allowed, then partial segments can form relations, which increase the number of criticality constellations. This paper is extended from the 2017 Procedia Engineering conference version.