The contractor “A” requires more overhead resources than Rosendin under the
assumption that project conditions are almost identical.
[2] PPA results would give the management the insight into the performance of
subcontractor if components were analyzed.
The comparison of two PPA results (Table 12 and Table 13) would tell the
management that contractor “A” requires more resources on procurement than Rosendin.
It would trigger exploration into the reason. The investigation, for example, would reveal
that contractor “A” submitted submittals, which do not include the details of suppliers,
which make it necessary for DPR personnel to get additional information. Such change of
manner in which procurement submittal is made would reduce DPR resource input for
procurement. The PPA results, as seen in the scenario, would pinpoint the area to be
investigated for improving the profitability relationship.
[3] The detailed cost data resulting from this analysis will be used for fee negotiation
for an additional work. With traditional overhead costs reporting overhead costs for
additional work scope is usually determined by the ratio of direct costs to the overhead
cost for the entire project.
[4] The fact that employees are required to fill out activity forms forces them to work
more efficiently.