Managing Highway Construction Projects In Iran Construction Essay

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There is a perception that highway construction projects in Iran suffer from delays in completion and overruns on cost and that in some cases they do not meet the required quality. This project will seek to better understand the issues that lead to this situation and where appropriate make recommendations for improvement. Because of the unique character of the highway construction industry, measuring productivity on a highway construction project is not simple. In general, productivity is defined as the ratio between an output value and an input value used to produce the output. However, a highway construction project produces different kinds of outputs that are measurable by using various units. The inputs for generating those outputs are also diverse. Therefore, it is not easy to identify appropriate input and output values for measuring productivity. In addition, various other factors affecting both the input and the output values should be considered while measuring construction productivity for analyzing its variation. In spite of the difficulties, many researchers have conducted productivity studies in the highway construction industry. Labour productivity in particular has been a major topic of the studies since labour is one of the most important input factors. The results of these studies have produced various methods for measuring productivity. However, this does not imply that these methods are suitable for measuring productivity in all sectors of the highway construction industry since each sector has different characteristics. Nevertheless, little effort has been made on productivity studies for different sectors. The highway construction industry had few productivity studies. The costs for the construction and rehabilitation of highways have continued to increase. In order to be competitive, constructors in the highway construction industry must make their construction operations as productive as possible. Thus, more research is required for the estimation and improvement of their productivity.

Highway construction projects usually involve unit price contracts. On this type of contract, the list of work items to complete a project is constituted for the purpose of payment, and the outputs produced by construction operations are recorded by corresponding work items. Therefore, it may be necessary to measure all these outputs to monitor productivity at the project level. However, existing models have been applied to measure productivity only on one or a few similar types of work items. The measurements by these models may not be good enough to reflect an overall productivity on a project. Therefore, the researcher must develop an effective model for measuring the overall productivity by accommodating various work items. In this research study, the overall productivity is named "project productivity." In addition to the measurement of project productivity, the researcher should focus on another important study to identify disruptive events that cause the loss of project productivity on highway construction. It will be necessary for controlling the variation of project productivity. Many disruptive events have already been researched and categorized in several different ways in the construction industry. However, the types of disruptive events occurring frequently on highway construction have not been specified with project productivity.

1.2 Aim

Resolving highway construction management systems in Iran

1.3 Project objective(s):

• To review the literature on managing highways construction projects with specific reference to Iran

• To identify the key issues that lead to projects not meeting their objectives.

• To make recommendations for improvement in the way that highway construction projects are managed in Iran.

1.4 Research Scope

This research study mainly focused on the procedures for measuring and controlling project productivity on highway construction projects.

1.5 Highway Construction Projects in Iran

Iran has long been involved in the transportation issues. The unique geopolitical location of Iran functioned as a bridge connecting the Orient and the Occident and provided merchandisers and globetrotters with countless opportunities in the domains of economic and socio-cultural interaction. The renowned Silk Road passed via Iranian territory from the beginning of its establishment in the latter half of the 2nd century B.C. up until the early days of the 20th century. And today as urban growth continues in Iran encompassing many of the secondary Cities, the stress on urban systems and on urban liability can be expected to grow markedly. Highway is vital to the dynamism of a City and the well being of its citizens, without access to good passenger and freight transportation services, economic development stalls. And now Highway construction sector consumes about 50 percent of oil demand through transportation in the world and is considered as an important sector for incremental oil demand in the future.

1.6 Research Structure

This research follows the common structure and relates the Harvard citation style.

Chapter one defines the topic to be observed different backdrop data and presents situations to the research.

Chapter Two will define an assessment of the literature pertaining to the topic.

Chapter Three will define the methodology applied in this research. It shows the strategy of the paper, performed research approach and the methods of data compilation applied.

Chapter Four will define the findings of the paper.

Chapter Five will define analysis of results.

Chapter 6 will define conclusion.

2 Literature Review

2.1 Contracting Approaches and Specifications

This chapter presents detailed discussions of the various contracting approaches for highway construction projects. The traditional method and the innovative approaches are presented, as well as the advantages and disadvantages of each.

2.2 Traditional Highway Construction Contracting

The traditional approach to contracting for highway construction projects has been design-bid-build, in which design is carried out independently of the construction process. Once the owner agency approves the design, the project proceeds to the actual construction phase. Under this approach, construction projects are awarded to the qualified bidder with the lowest total price, pay items are established on a unit-price basis, specifications are strictly focused on materials and method, and the role of the owner or agent is to inspect and maintain.

According to the evaluation report, public agencies have predominantly relied on competitive bidding to award highway construction contracts. This process involves using detailed plans from the design phase, providing specifications and estimates for the work involved, soliciting of bids through public advertisement, and awarding the contract to the lowest responsible responsive bidder. Authority to construct the project is obtained by the agency from appropriate public entities prior to bid advertisement. This may involve permits from environmental agencies and water management authorities, agreements with railroad and utility companies, and maintenance agreements with local jurisdictions. All necessary right-of-way and construction easements are determined and acquired prior to contract advertisement by the public agency.

The basic intent of this approach is to minimize issue to the contractor by defining all requirements of the project and eliminating most unknown conditions. Any errors and omissions in the plans or unforeseen work is the responsibility of the agency. Quality is sought through prescriptive plans and specifications coupled with construction oversight and inspection by the public agency. Competitive bidding among contractors controls cost. The traditional lowest-responsive-bidder system is used throughout the country. Most contractors are comfortable with the procedure and understand its issues and rewards and consider it equitable.

2.3 Limitations

Although design-bid-build has been the primary contracting method for the highway industry for quite some time, some limitations of the traditional method have been identified. These limitations include the following:

The system is slow and does not favor a life cycle cost approach to projects

The associated issues in terms of quality and maintenance are not the responsibility of the contractor, since the specifications are usually prescriptive and under the control of the public agency.

Innovation is often stifled; prescriptive specifications and low-bid pricing result in no reward for the design and construction innovations. Some innovative ideas necessitate changes in laws and regulations and are therefore difficult to implement.

There is little, if any, opportunity for contractor input into design and construction methods, and quality is often an issue of dispute.

The traditional system requires that the highway department have a large staff to conduct all of its necessary functions of highway design and construction. These include preliminary design, design review, environmental clearance, construction management, quality control and regular maintenance.

2.4 Need For Alternative Contracting Approaches

The need for alternative contracting methods to address some of the disadvantages or limitations of traditional contracting methods is recognized. The following are major potential reasons for using innovative contracting methods.

2.4.1 Reducing Construction Time

A major incentive for the use of innovative contracting methods is reducing construction time. One of the challenges that face is the growing congestion on roadways. According to a recent study, the volume of roadways where travel is congested has grown from 34 percent to 58 percent in the last 20 years. The need to accelerate construction is becoming an important issue, especially in areas of high traffic congestion; the time overruns typically experienced in low-bid contracting have to be ameliorated. The use of alternative contracting procedures and specifications to reduce construction time therefore becomes a major consideration.

2.4.2 Reducing Construction Cost

A major problem with the traditional method is the considerable cost and time overruns experienced over the allocated budget and schedule. For example, Tehran experienced a 12.4 percent cost overrun and a 30.7 percent time overrun on the 375 traditional low-bid contracts in 1997-98. It is recognized that some cost and time overruns are unavoidable, such as those due to unanticipated events. However, overruns due to design plan or project management problems are avoidable because they could have reasonably been foreseen and prevented.

2.4.3 Applying Improved Technology and Techniques

A departure from the traditional contracting approach is needed to take advantage of advances in technology and techniques relating to construction materials, equipment, and methods. New and improved highway construction materials that result in long-lasting pavement can be implemented with innovative contracting mechanisms. The implementation of research results in both construction materials and methods can be fully realized only through the use of specifications and contracting methods that depart from the traditional methods. These innovative techniques and materials improve quality and reduce the duration of the construction project, and normally result in lower life-cycle costs.

2.4.4 Deploying Contractor Innovation

The experiences and innovations by the construction industry can be implemented under innovative approaches. Specifications based on performance have been used as a solution to promote innovation by allowing the contractor to control the materials and methods used. Innovative contracting methods provide incentives to the contractor to accept more issue and responsibility for providing product performance within a shorter period of time for lower overall costs. These new methods and specifications are expected to reduce the public impact of highway construction projects by accelerating the project, improving the quality and generally reducing costs.

2.4.5 Reducing Impacts on the Public

Highway construction projects do have an impact on the public. Innovative contracting methods reduce construction time, which means shorter times driving through and around work zones enhancing safety and productivity. In addition, the use of technologies, materials, and techniques that reduce noise and other environmental impacts invariably reduce the public impacts of highway construction. Innovative contracting mechanisms offer the opportunity to reduce the negative impacts often associated with construction.

2.5 Segmental Productivities in the Highway Construction Industry

Since various fields of the construction industry have different characteristics in their construction and management methods, approaches for measuring productivity also need to vary from one field to another. Study shows the indexes representing the labour productivity growth on residential, non-residential, and highway construction, respectively. It indicates that substantial variations exist between the segmental productivity growth rates on highways and other construction sites.

Actually, research for a productivity study has been conducted on various projects in the construction industry. However, research on highway construction projects has been minimal. In this study, therefore, the main focus was to develop a systematic approach for measuring the changes of productivity of highway construction operations. This research study also investigated any events causing the loss of productivity.

2.6 General Characteristics of Highway Construction

A systematic approach may be developed by grasping the general characteristics of highway construction inclusively. The characteristics are described--without any priority-

-as follows:

Almost all highway construction projects are preceded under the unit price contract system because the work quantities for some items cannot be decided until those items are done, and also some items need to be added or changed by unexpected job site conditions. Thus, the actual quantities installed on a highway construction project are measured and documented corresponding to the various units given by its contract document. In order to measure productivity at the project level, it may require estimating a combined output value from these measured quantities with various units. This approach converted the quantities for different items to an equivalent of quantities of another standard item to estimate the combined output value. However, this approach was applied to evaluating productivity in a few activities only for similar types of work, such as installing different sizes or types of pipes, blocks, or wood forms. It may not be sufficient to estimate project productivity since some construction projects usually have many different types of work to be completed. The productivity measured on one or two types of work may not represent the entire project productivity. The more the items are included in the measurement, the better the productivity measured may represent the project status. Therefore, developing a systematic approach for measuring productivity on dissimilar types of work will be necessary to control the changes in productivity at the project level. In general, construction operations for highway projects consist of earthwork, drainage and drainage structures, underground utilities, bases and subbases, pavements, and traffic control devices. Basically, many operations are related to the underground works even though the contents of work vary depending on the project scope. Therefore, many factors reducing productivity are expected to arise from unpredictable underground conditions.

Also, highway construction operations require the use of a large amount of construction equipment. It is therefore important to select a proper machine for a specific operation and use it efficiently. If the machine is unavailable or in disrepair, it can cause a considerable loss of productivity. Moreover, disruptive events occurring during the construction process may lead to a fatal loss of project performance since the highway construction process usually moves on a linear-based schedule. Any disruption of a specific operation can cause the stoppage of other operations until the problem is solved.

2.7 Existing Approaches for Measuring Highway Construction Productivity

Thomas (1999) mentioned that one must understand productivity to improve labour productivity, and one must be able to measure labour productivity to understand labour productivity. This section, therefore, introduced some principles for measuring and comparing construction labour productivity. A few major terms and definitions used in these reports are explained below.

2.7.1 Terms and Definitions

Baseline productivity: Baseline productivity is defined as "the best and most consistent productivity for a particular project or database." This productivity can be obtained by selecting the baseline subset, which consists of 10% of the workdays having the highest production based on output. The value, which is the median of the productivity values in the baseline subset, is the baseline productivity.

Conversion factors: Conversion factors are used to convert actual quantities installed to an equivalent of quantities of another type or size standard item. These factors can be developed by considering how much more or less difficult an item is to install compared to the standard item. Consequently, they convert the productivity of all crews for the same standard item to compare to each other.

Disruptive Events: In a narrow sense, a disruption is one of the possible causes of productivity loss. This term could be restated as "interruption" because it refers to a work stoppage when the crew ceases to work. The other causes may include adverse weather, scheduled overtime, out-of-sequence work, and congestion, dilution of supervision, unavailable resources, and unmotivated workers. Halligan et al. (1994) divide disruptions into two categories: short duration and long duration. They mentioned that the effect disruptions can have on productivity may, in many cases, be the result of a failure to properly manage the unanticipated conditions (p. 53). On the other hand, a disruption in a broad sense is defined as the occurrence of an unplanned event that is known or has been reported in the literature to adversely affect crew productivity for a significant period of time. In this definition, disruptive events actually include all possible causes that have negative impacts on labour productivity. Even though the work may not be stopped, the labour productivity will be lower than the baseline productivity,

2.7.2 Estimation of Disruptive Events

In order to mitigate the impact of disruptive events in the construction process, one should be able to estimate prospectively either the scope or magnitude of disruption. In this section, the researcher reviewed existing methods for estimating disruptions since the disruptive events form the basis of many project delays. The philosophy of these methods will provide the general ideas for developing models for analyzing and anticipating the impacts of disruptions in highway construction.

2.7.3 Existing Methods for Estimating Disruptions

Finke (1998) indicated that the construction industry has had a difficult time prospectively identifying, with accuracy, the impact of disruptions at the activity level. In his research, three existing methods for the estimation of disruptions were reviewed with their limits, and a proposed methodology, Disruption Distribution, was introduced even though it is not a complete, ready-to-use method. These four methods were briefly explained as follows:

2.7.4 Total cost claims

When a contractor attempts to recover its entire man-hour overrun on a given scope of work, the contractor may estimate the difference between its planned and actual man hours.

In order to be compensated, the contractor must show the following evidence:

• The impracticability of proving actual losses directly.

• The reasonableness of its bid.

• The reasonableness of its actual costs.

• Lack of responsibility for the added costs.

In addition, the contractor should prove if the following four prerequisites exist relating to loss of productivity claims:

• The planned productivity was reasonable.

• The actual productivity was reasonable.

• None of the productivities was non-compensable.

• Through no fault of the contractor, a more accurate accounting of the compensable losses of productivity is unavailable.

2.7.5 Measured Mile Comparisons

The measured mile method quantifies disruption with the difference between the impacted or disrupted productivity rates to a un impacted productivity rate. Finke (1998) indicated that this application also relies on actual man-hour records so that it can be used only after the work is performed.

2.7.6 Factor-based methods

The disruption in factor-based methods is calculated by multiplying a pool of man hours by some factors or set of factors. The types of methods differ according to the kinds of man-hours and factors adopted. The pools of man-hours may represent either the changed work or the unchanged but presumably disrupted work. The factors may represent attempts to characterize the changed work, the presumably disrupted work, the project as a whole, or specific disruptive working conditions. However, the factor-based methods cannot produce the estimated results at the specific activity level. In other words, a contractor cannot have a rational basis for rescheduling work to mitigate a disruption on the activity schedule. Moreover, these types of methods do not realistically model the activity interactions which cause disruption.

2.7.7 Disruption Distribution

Finke (1998) proposed a new methodology, Disruption Distribution, for identifying either the scope or magnitude of change-caused disruption at the activity level. This method uses two types of factors to measure the disruptive impact of a change order:

The qualitative sensitivity factors and quantitative sensitivity factors

• Qualitative sensitivity factors: These factors are equal either to 1 or 0 and indicate if a fair amount of activities share the same location, time of performance, resource type, or supervisor.

• Quantitative sensitivity factors: These factors are greater than or equal to 0 and represent the degree to which changes or disruption in one activity will disrupt another activity.

Multiplying these two factors by the number of man-hours and added to the working conditions that these factors represent quantify disruption.

2.8 Existing Methods for Assessing the Effect of Delaying Events

This research study focuses on the impact of disruptions on the productivity of highway construction operations. The study about the analysis methods for the impact of delay events on construction schedules, however, would be useful because disruptions and delay events have a common origin. Bordoli and Baldwin (1998) reviewed current existing methods for analyzing the impact of delays on construction works and proposed their own methodology for estimating the extent of an expected delay on the completion date for the works.

2.9 Issues

Unfortunately in issue management is not taken into account and if making, is in some kind of undertakings or businesses, such as insurance companies, fire stations, etc., but unfortunately not taken in other, as in the case construction companies, this translates into legal and financial problems that can be avoided if you have a good issue management. With respect to Highway construction projects, large or small they are, issues represent a very important part which has to be studied in detail, to have an analysis and control of issues among others, so as to achieve a adequate issue management. That's why issue management focused on construction, is a branch and accounting, marketing, production, etc., is must study and analyze separately in any Highway construction project.

To fully understand the concept of issue in operating activities constructive, people must consider the issue, always implies the possibility of loss, damage or injury. Once he realized this, it is necessary to create an area issue management, which is responsible for analyzing, controlling, measuring and treatment of issues in the highway construction company.

Issues associated particularly with the highway construction industry, are associated with damage to the various groups or entities which are connected, and which can handle with the above techniques.


The damage is in the construction industry may result in:

• Failure to stay within budget

• Failure to stay within the delivery time specified in the project contract

• Failure to maintain satisfactory technical standards required in the Product Quality

Issue Controls

Just like other areas of business, the issues and financial consequences can be removed or transferred to other contractually.

Eliminated, Reduced Or Controlled:

The design requirements can be altered, methods and materials construction may vary, and companies can do more market research, can provide more training to staff and can provide more oversight as last resort, they can also reject jobs that represent great issues company.

2.9.1 Contractually transferred to others, or insured:

Issues can be transferred in several ways, either from the client to contractor or insurer, contractor or subcontractor of the insurer or designers to the insurer. Retained and financial provisions for damages caused could occur in the self-financing. The degree of control and issues management should, as always, be appropriate for the issue size.

2.9.2 Different Perspectives of Issues

The more common concern in each of the parts project involving a construction is to maximize revenue, since otherwise; these parties would suffer significant economic impact. The different perspectives of issue depends on the parties involved, such as the customer perspective, the insurer and the contractor or manufacturer, however for our research purposes only mentioned the latter perspective. The contractor is concerned everything related to the construction contract, ie the End Time, the cost of the project, the rate of return, ie see the issues of such how they are related to maintaining cash flow and short-term maximize profits for the builder.

2.9.3 Considerations of issue for the customer

The issue retention by a customer can make a depending extension existing terms in the contract between the client and third parties involved in the Project. Contractual relationships may vary from contract to contract. The type of contract, the acceptance of the conventional way, and any correction made to it can affect the location of issue between the parties. The client can select, therefore, the contract and the terms established more contractual issue effectively so that it is favourable to their interests.

2.9.4 Identification of Technical Issues

A technical assessment of issues can help highlight areas of issue of a project, including those to which the customer must take delivery.

2.9.5 Normal issues

There are issues normally associated with building along the work civil engineering, including those associated with protection, observe safety site, low quality material, poor workmanship, poor operation and maintenance plant, theft, fire, etc. These issues are generally issue for the contractor: compensation and / or insurance may be required by the construction contract for damage or loss, plant, equipment, thirds injuries, and property damage or loss. It may be necessary supervision by an insurance consultant for the required insurance, necessary to cover issues that may be out of contract.

2.9.6 Choosing the Type of Contract

Each type of contract contains different types of issue between the parties. Possible therefore select the most suitable for the customer's requirements, and if necessary, make corrections to make it more effective.

2.9.7 Dealing with Issues in Contracts

Formulation of Contracts

Careful analysis procedure for a contract, must carry select the proper allocation of responsibilities, types of contracts and tender procedures a project. To proceed with the preparation of the contract identification requires specific issues, decisions on how issue should be shared between the parties, and the definition of issue in the design of the contract documents. The major challenge of this task is to decide the equitable distribution of issues. Traditionally issues in construction projects are assigned as follows:

• Client to designer and contractor.

• Contractor to subcontractor.

• Client, designer, contractor and subcontractors to insurers.

• Contractor and subcontractor fasteners.

2.9.8 Determination of Issue Premiums to be added to Budget

To identify residual issues that a contractor may not transfer or may be considered to be secured externally, have to be evaluated properly and make an adjustment to the amount budgeted. Traditionally the cost estimate is based on data available for the actual costs in previous contracts and experience, and thus implicitly includes an assessment of the cost of issue. The current budget price is often the choosing the best estimated cost plus (or minus) an adjustment percentage, which takes into account commercial aspects, as the state of the market and therefore want the contractor job opportunities payback, etc. this approach usually does not include a detailed issue assessment, especially because of the limitations of time to develop a budget. However, in some circumstances, if time permits, a detailed analysis Issue may be justifiable.

2.10 Summary

In this literature review, the researcher discussed the need for a productivity study in the highway construction industry, reviewed some principles of the existing methods that can be applied to appraise and measure productivity on highway construction projects, and developed a list of unsolved questions that should be answered in this research study.

In the construction industry, many studies have been presented about productivity. These studies have generated various methodologies for measuring and estimating productivity. However, those methodologies may not be applied to all sectors of the construction industry. The highway construction industry could be one of the sectors that have few data available for estimating productivity. Specifically, there is no effort made to measure an overall productivity on a highway construction project. The analysis is not enough for the loss of productivity caused by disruptions (for example, lack of resources, rework, or poor management). The main purpose of this research is therefore to develop the methodology for estimating project productivity and analyzing the changes of the project productivity when disruptions occur within the highway construction process. In order to achieve this goal, the following four basic subtasks are assigned: 1) understanding highway construction processes; 2) investigating measuring methods for project productivity of highway construction operations; 3) developing a model for analyzing the variation of project productivity; and 4) analyzing the effect of various disruptions on highway construction productivity. The researcher established these subtasks based upon the unanswered questions from the literature review.

3 Methodology

3.1 Introduction

Data collected in systematic manner, it should be analysed through proper analytical tools & it was interpreted in order to find out the answer for research objectives. This is being identified as research methodology.

3.2 Research Design

Research design is the sketch of projected research progression comprises of a structure of records collection, classification, measurements, analysis and presentation for this type of study. It is mostly a period as well as a capital supportive technique of working out a research dilemma to ease the compilation diversity of statistics and to give details for the uneven associations by means of suitable methods (Vineeta, 2011).

3.2.1 Quantitative Research

This is the type of research in which the respondent is interrogated to respond by answering planned questions and a favoured format, for instance, Yes or No. This sort of research is manipulated to obtain a definite answer which could be presented with accurate evaluation. The methods to conduct this kind of information collection include Personal interview, mail or telephone interview. On the basis of these interviews, researcher concluded the results of this research.

3.2.2 Qualitative Research

Qualitative research follows a shapeless and unrestricted answer from the respondent. To assemble the information for Qualitative type of research could be prepared by Interview.

3.3 Secondary Data

Secondary data is a form of data that has been composed by others for an entirely unusual or little similar to the research problem. Research also incorporated that some research questions can be responded only by secondary data but there are probable issues as those data were composed for a special function and can be prejudiced.

3.4 Primary Data

Data that has been composed by the researchers themselves to respond their specified research questions are called Primary Data (Chaves, and Gorski, 2001). Significance of primary data anticipates when secondary source is not of high-quality adequate to answer the research question.

The major issue in empirical study on religious aspects in Bangladesh is possibly the lack of enough information about these aspects. Quantitative literatures will completely apply religious demographics (whose consistency can be questioned) which define just a small-and probably theoretically less exciting-selection of the related aspects. Conversely, case studies will give in-depth knowledge but are comparable to other literatures defined a shortage of comparable study concepts, questions, and signs and are therefore not practical for suitable generalizations.

3.5 Data Collection

The data type will be varied according to the style of the variables. Author will use quantitative data. This will be easy just for little number of variables and data consistencies should be asked in different issues, particularly as regards data on policies of government (Chaves, and Gorski, 2001). A second type of data will contain qualitative reviews supported from other sources. This practice will also contain interviews. In all instances author will resort to qualitative reviews which will be affected through the replying of a comprehensive questionnaire and so will be ensued in different values Variables will be normally dichotomized, either through qualitative observation-for example, the absence or presence of religious systems. Author will review whether an issue demonstrated a theoretically anticipated value.

3.6 Review Literature

The literature review will be carried out to find established benchmarking methodology and other researches done in benchmarking for highway project delivery methods.

3.7 Develop Benchmarking Study Variables

After the literature review, the input and output variables affecting highway project performance will be identified. The input variables will be categorized according to the work item areas and the output variables are associated with cost, schedule, change orders, safety, and quality.

3.8 Data Collection

The data for this research will be collected by questionnaires, phone interviews and internet searches related to these highways projects. A follow-up phone interview will be carried out for each of these projects to verify the data received from the questionnaires.

3.9 Data Analysis

The data analysis will be performed by using Statistical Package for Social Science (SPSS) software. The difference of means of output variables for highway projects will be determined by comparing their mean and median. The association between input and output variable will be determined by the help of the descriptive statistics of output variables. The data will be analyzed and presented in various graphs and box plots. Descriptive statistics of input variables will be presented in bar charts. The output variables data will be also shown in the bar charts.