LABOR - Effort expended by people for wages or salary. Generally classified as either direct or indirect. Direct labor is applied to meeting project objectives and is a principal element used in costing, pricing, and profit determination; indirect labor is a component of indirect cost, such as overhead or general and administrative costs. \[8\] (October 2006) LABOR BURDEN - Fringe benefits plus taxes and insurances the employer is required to pay by law based on labor payroll, on behalf of or for the benefit of labor. (In some countries, these include government retirement benefits, unemployment insurance tax, and worker's compensation). Syn.: PAYROLL BURDEN. (May 2012) LABOR COST – 1.LABOR COST, BARE LABOR - Gross direct wages paid to the worker. 2.LABOR COST, BURDENED LABOR - Gross direct wages paid to the worker, plus labor burden. 3.LABOR COST, ALL IN LABOR - Gross direct wages paid to the worker, plus labor burden, plus field indirects, plus general & administrative cost, plus profit. Syn.: WAGE RATE. (June 2007) LABOR EFFICIENCY VARIANCE - A cost variance can be broken into efficiency and rate variance elements. Efficiency is calculated as: (budgeted cost of work performed rate) X (budgeted cost of work performed hours - actual hours). See: COST VARIANCE; LABOR RATE VARIANCE. (October 2013) LABOR HOUR - A worker hour of effort. Syn.: WORKHOUR. (June 2007) LABOR NORM - Syn.: LABOR PRODUCTIVITY NORM. (January 2014) LABOR NORM PREAMBLE - A narrative to precisely describe the content (inclusion and exclusions), the normal conditions, the unit of measurement and method of measurement of an activity and its applicable labor norm. (January 2014) LABOR PRODUCTIVITY - A measure of production output relative to labor input. In economics, industrial engineering, and earned value management, quantity/work hour measures are common (higher values reflect higher productivity or efficiency). In cost estimating, inverse measures such as work hours/quantity or unit hours are common (where lower values reflect higher productivity or efficiency). Regardless of the measure used, labor productivity (or efficiency) is improved by increasing production for a given work hour or decreasing work hours for a given production. (June 2007) LABOR PRODUCTIVITY FACTOR - A value by which a labor productivity measure for a reference project or activity is multiplied to obtain an adjusted productivity measure for the same of similar project or activity under a different set of conditions. Proper factor use requires that the user ascertain the type of labor productivity measure it will be applied against (e.g., consider whether the labor productivity measure to be factored is expressed in the form of work hours/quantity or quantity/work hours). Syn.: PRODUCTIVITY FACTOR. (June 2007) LABOR PRODUCTIVITY NORM - A value set as the agreed reference or benchmark labor productivity for a specific activity under a specific set of stated conditions or qualifications. Syn.: LABOR NORM (January 2014) LABOR RATE - Labor cost expressed on a per unit of labor effort basis (e.g., labor costs/labor hour). See also: LABOR COST. (June 2007) LABOR RATE VARIANCE - A cost variance can be broken into efficiency and rate variance elements. Rate variance is calculated as: (budgeted cost of work performed hours) X (budgeted cost of work performed rate - actual cost of work performed rate). See: COST VARIANCE; LABOR EFFICIENCY VARIANCE. (October 2013) LADDER - In planning and scheduling, a sequence of parallel activities connected at their starts or finishes, or both. The start and finish of each succeeding activity are linked only to the start and finish of the preceding activity by lead and lag activities, which consume only time. (June 2007) LADDER ACTIVITY - A type of activity identified in network scheduling. An arrangement in which two or more series of activities progress concurrently but in lockstep because of dependent links between the same rungs of each ladder. (June 2007) LADDERING - A method of showing the logic relationship of a set of several parallel activities with the arrow technique. (November 1990) LAG - Time that an activity follows or is delayed from the start or finish of its predecessor(s). Sometimes called an offset. A lag may have a negative value tied to the finish of a previous activity, reflecting a fast track approach. However, the use of negative lags when building baseline schedule models is poor technique and often prohibited by specification. (June 2007) LAG DURATION - A duration by which a given task must be completed before the succeeding activity can begin. (June 2007) LAG RELATIONSHIP - The four basic types of lag relationships between the start and/or finish of a work item and the start and/or finish of another work item are: 1)Finish-to-start (FS); 2)Start-to-finish (SF); 3)Finish-to-finish (FF); and 4)Start-to-start (SS). See also: FINISH-TO-FINISH (FF); FINISH-TO-FINISH LAG; FINISH-TO-START (FS); FINISH-TO-START LAG; START-TO- FINISH (SF); START-TO-START (SS); START-TO-START LAG. (November 1990) LAG TIME - The amount of time delay between the completion of one task and the start of its successor task. (June 2007) LATE DATES - Calculated in the backward pass of time analysis, late dates are the latest dates on which an activity can start and finish without delaying a successor activity. (June 2007) LATE EVENT DATE - Calculated from backward pass, it is the latest date an event can occur. (June 2007) LATE FINISH (LF) - The latest date or time an activity may finish as calculated by the backward pass. (June 2007) LATE START (LS) - The latest date or time an activity may start so the project may be completed on time as calculated during the backward pass. (June 2007) LATENT CONDITION - A concealed, hidden, or dormant condition that cannot be observed by a reasonable inspection. (November 1990) LATEST EVENT TIME (LET) - The latest time an event may occur without increasing the project's scheduled completion date. (November 1990) LATE START - The latest time at which an activity can start without lengthening the project. (November 1990) LATEST REVISED ESTIMATE - In earned value, the sum of the actual incurred costs plus the latest estimate-to- complete for a work package or summary item as currently reviewed and revised, or both (including applicable overhead where direct costs are specified). (June 2007) LATIN HYPERCUBE METHOD - A stratified random sampling technique similar to the Monte Carlo method, which converges with fewer samples. See also: MONTE CARLO SIMULATION. (December 2011) LAWS AND REGULATIONS - Laws, rules, regulations, ordinances, codes and/or orders. (November 1990) LEAD - Time that an activity precedes the start of its successor(s). Lead is the opposite of Lag. (June 2007) LEAD DURATION/LEAD TIME - A duration or time by which a given task must be started before the succeeding activity can begin. (June 2007) LEARNING CURVE - A graphic representation of the progress in production effectiveness as time passes. Learning curves are useful planning tools, particularly in the project-oriented industries where new products and workers are phased in rather frequently. The basis for the learning curve calculation is the fact that workers will be able to perform work more quickly after they get used to performing it. (June 2007) LESSONS LEARNED - A project team's learning, usually defined during close out. Should be limited to capturing/identifying work process improvements. A ‘finding’ that established policies or procedures were not followed is not a valid lessons learned. (June 2007) LETTER OF CREDIT - A vehicle that is used in lieu of retention and is purchased by the contractor from a bank for a predetermined amount of credit that the owner may draw against in the event of default in acceptance criteria by the contractor. Also applies when an owner establishes a line of credit in a foreign country to provide for payment to suppliers of contractors for goods and services supplied. (November 1990) LEVEL FINISH/SCHEDULE (FS) - The date when the activity is scheduled to be completed using the resource allocation process. (June 2007) LEVEL FLOAT - The difference between the level finish and the late finish date. (June 2007) LEVELIZED FIXED-CHARGE RATE - The ratio of uniform annual revenue requirements to the initial investment, expressed as a percent. (November 1990) LEVEL OF DETAIL - All projects need to determine the level of detail requirements for estimates, accounting reports, cost reports, scheduling reports, and types of schedules. The level of detail is generally constrained by the level of scope definition. Determining the level of detail should consider requirements to execute the project and meet historical data requirements. (June 2007) LEVEL OF EFFORT (LOE) – (1)Support effort (e.g., supervision) that does not readily lend itself to measurement of discrete accomplishment. It is generally characterized by a uniform rate of activity over a specific period of time. (2)An earned value technique used to estimate progress of work that is generally not measurable. Support effort (e.g. management, security, project controls) that does not lend itself to measurement of discrete accomplishment. LOE work is characterized by a planned and sometimes level of support over a specific period of time. Performance is claimed by the passage of time and may not accurately reflect the amount of work that is actually accomplished. (November 2014) LEVEL START/SCHEDULE (SS) - The date the activity is scheduled to begin using the resource allocation process. This date is equal to or later in time than early start. (November 1990) LEVELING - Syn.: RESOURCE LEVELING; RESOURCE OPTIMIZATION. (June 2007) LEVELS OF SCHEDULES - The level of schedule is differentiated by the degree of detail in the schedules. The three main levels of scheduling are the following: Management Summary, Project Level, and Control Level. 1.LEVELS OF SCHEDULES, MANAGEMENT SUMMARY SCHEDULE (LEVEL 1 SCHEDULE) - The level of schedule containing the least amount of detail, typically including major functions, milestone objectives, master schedules, and bar chart summaries of project status. Used by management and the client to monitor all aspects of the project. It is a roll up of the project level schedule (level 2). 2.LEVELS OF SCHEDULES, PROJECT LEVEL SCHEDULE (LEVEL 2 SCHEDULE) - An activity- and deliverable-centered schedule containing a middle amount of detail in time-scaled network diagrams or bar charts. It integrates the project’s engineering, procurement, and construction activities by network logic, identifies critical path and key project dates, and provides measurement of accomplishments against established objectives. The CPM (critical path method) scheduling technique is used to develop the project level schedule. The status of the detail activities summarizes to the management summary schedule (level 1 schedule). 3.LEVELS OF SCHEDULES, CONTROL LEVEL SCHEDULE (LEVEL 3 SCHEDULE) - Represents detail and individual work tasks, which summarize at the project level II activities and deliverables. Clearly, shows work by discipline or responsibility, and usually presented in bar chart or tabular form. Maintained by each discipline/contractor in the engineering phase and by superintendents and contractors in the construction phase. Immediate term schedules, also referred to as weekly work schedules, and should provide enough detail to manage work at the foreman level. (June 2007) LEVERAGE (TRADING ON EQUITY) - The use of borrowed funds or preferred stock in the intent of employing these "senior" funds at a rate of return higher than their cost in order to increase the return upon the investment of the residual owners. (November 1990) LIFE – 1.LIFE, PHYSICAL - That period of time after which a machine or facility can no longer be repaired in order to perform its design function properly. 2.LIFE, SERVICE - The period of time that a machine or facility will satisfactorily perform its function without a major overhaul. See also: ECONOMIC LIFE (CYCLE); STUDY PERIOD; VENTURE LIFE. (November 1990) LIFE CYCLE - The stages, or phases that occur during the lifetime of an object or endeavor. A life cycle presumes a beginning and an end with each end implying a new beginning. In life cycle cost or investment analysis, the life cycle is the length of time over which an investment is analyzed (i.e., study period). The following are typical life cycles: 1.LIFE CYCLE, ASSET LIFE CYCLE - The stages, or phases of asset existence during the life of an asset. Asset life cycle stages typically include ideation, creation, operation, modification, and termination. Syn.: ECONOMIC LIFE (CYCLE). 2.LIFE CYCLE, PRODUCT LIFE CYCLE − Complete history of a product through its concept, definition, production, operation, and obsolescence or disposal phases. The distinction between product life cycle and project life cycle is that the latter does not include the last two phases. 3.LIFE CYCLE, PROJECT LIFE CYCLE - The stages or phases of project progress during the life of a project. Project life cycle stages typically include ideation, planning, execution, and closure. Syn.: PROJECT LIFE. (June 2007) See also: LIFE; STUDY PERIOD. \[1\] LIFE CYCLE COST (LCC) METHOD - A technique of economic evaluation that sums over a given study period the costs of initial investment (less resale value), replacements, operations (including energy use), and maintenance and repair of an investment decision (expressed in present or annual value terms). \[1\] (November 1990) LIFE CYCLE COSTING - Consideration of all costs when designing a project’s product, including costs from concept, through implementation and startup, to dismantling. It is typically used for making decisions between alternatives. (June 2007) LIFE CYCLE VALUE ANALYSIS (LCVA) - A methodology that analyzes the impacts on valuation of a project or asset over their life cycle and identifies opportunities for improved outcomes. (December 2011) LIFO (LAST IN, FIRST OUT) - A method of determining the cost of inventory used in a product. In this method, the costs of material are transferred to the product in reverse chronological order. LIFO is used to describe the movement of goods. See also: FIFO (FIRST IN, FIRST OUT). (November 1990) LIMIT (LOT SIZE INVENTORY MANAGEMENT INTERPOLATION TECHNIQUE) - A technique for looking at the lot sizes for groups of products to determine what effect economic lot sizes will have on the total inventory and total setup costs. (November 1990) LINE OF BALANCE (LOB) - A graphical display of scheduled units versus actual units over a given set of critical schedule control points on a particular day. The line of balance technique is oriented towards the control of production activities. (June 2007) LINE OF CREDIT - Generally an informal understanding between the borrower and the bank as to the maximum amount of credit that the bank will provide the borrower at any one time. (November 1990) LINEAR PROGRAMMING - Mathematical techniques for solving a general class of optimization problems through minimization (or maximization) of a linear function subject to linear constraints. For example, in blending aviation fuel, many grades of commercial gasoline may be available. Prices and octane ratings, as well as upper limits on capacities of input materials which can be used to produce various grades of fuel are given. The problem is to blend the various commercial gasolines in such a way that: 1) Cost will be minimized (profit will be maximized); 2) A specified optimum octane rating will be met; and 3) The need for additional storage capacity will be avoided. (November 1990) LINEAR RESPONSIBILITY CHART - A special type of matrix in which the rows list the series of functions, activities, or tasks in some logic sequence, such as the project life cycle, and the adjacent columns identify the positions, titles or people involved. At the intersection of each adjacent column and its line item is placed a distinguishing symbol representing the level or type of responsibility involved by that person. (June 2007) LINEAR SCHEDULING METHOD (LSM) - Scheduling method that may be used on horizontal projects (pipelines, highways, etc.) Highly repetitive tasks make up the majority of the work. LSM schedules use ‘velocity’ diagrams representing each activity. LSM scheduling is not widely used. (June 2007) LINK - A dependency between tasks that specifies when a task begins or ends relative to another task. (June 2007) LINKED BAR CHART - A bar chart drawn to show dependency links between activities/tasks. (June 2007) LINKED PROJECTS - Multiple related projects connected at interface points. Often depicted by use of a bar chart showing dependency links between activities on different projects. (June 2007) LINKING PROCEDURE - A procedure by which a ‘new’ series of indexes is connected to an ‘old’ series in a given link period, generally because of a change in baskets. Actually, indexes of the new series with link period as time base are multiplied by the old index for the link period as the given period. (November 1990) LIQUIDATED DAMAGES - Syn.: DAMAGES, LIQUIDATED. (June 2007) LMESO - Syn.: COST ESTIMATE RESOURCE (December 2011) LOAD FACTOR – (1)A ratio that applies to physical plant or equipment average load/maximum demand, usually expressed as a percentage. It is equivalent to percent of capacity operation if facilities just accommodate the maximum demand. (2)The ratio of average load to maximum load. (November 1990) LOAD LEVELING - The technique of averaging, to a workable number, the amount or number of people working on a given project or in a given area of a project at a particular point in time. Load leveling is a benefit of most scheduling techniques and is necessary to insure a stable use of resources. Syn.: WORK POWER LEVELING. (November 1990) LOCAL COST - The cost of local labor, equipment taxes, insurance, equipment, and construction materials incorporated in a construction project, with local currencies. This includes the finishing of imported goods using local labor and materials, the cost of transforming imported raw or semi-finished products using local labor and plant facilities, and the marketing of locally produced products. (June 2007) LOCATION FACTOR - An instantaneous (current - has no escalation or currency exchange projection) overall total project factor for translating the summation of all project cost elements of a defined construction project scope of work, from one geographical location to another. Location factors include given costs, freights, duties, taxes, field indirects, project administration, and engineering and design. Location factors do not include the cost of land, scope/design differences for local codes and conditions, and the cost for various operating philosophies. (June 2007) LOGIC - Relationship describing the interdependency of starts and finishes between activities or events. Every activity should have a predecessor (except for the initial activity or event), and every activity should have a successor (except for the ending activity or event). Activity logic is determined by need to meet competing constraints defined by contract requirements, physical capabilities of trades performing work, safety concerns, resource allocations, and preferential activity relationships. (June 2007) LOGIC, DYNAMIC (CONDITIONAL) - A logic structure which allows for changes in schedule logic depending on the occurrence of risk events or conditions (typically includes conditional branching.) See also: CONDITIONAL BRANCHING; LOGIC, STATIC (FIXED); LOGIC DIAGRAM; NETWORK. (January 2014) LOGIC, HARD – (1)Mandatory logic. (2)Clearly understood work scope allows one to define work activities and logic with precision. The opposite of soft logic. (June 2007) LOGIC, SOFT - Activity(ies) and logic that with current knowledge cannot be modeled in detail. As design and construction evolves, soft logic is transformed into detailed or hard logic, with activities being split into component parts and logic ties refined. See also: DISCRETIONARY DEPENDENCY. (June 2007) LOGIC, STATIC (FIXED) - A logic structure which does not allow for changes in schedule logic depending on the occurrence of risk events or conditions (typically excludes conditional branching). See also: CONDITIONAL BRANCHING; LOGIC, DYNAMIC (CONDITIONAL); LOGIC DIAGRAM; NETWORK. (January 2014) LOGIC CONSTRAINT - A restraint inserted in an activity of arrow (AOA) network, which defines dependent relationships between two activities. (June 2007) LOGIC DIAGRAM - Graphic diagram of a network schedule showing the relationships between a particular activity and its predecessors and successors. Syn.: LOGIC NETWORK DIAGRAM; NETWORK DIAGRAM. See also: NETWORK. (June 2007) LOGIC NETWORK - Syn.: NETWORK (June 2007) LOGIC NETWORK DIAGRAM - Syn.: LOGIC DIAGRAM; NETWORK DIAGRAM. (June 2007) LOGIC RESTRAINT – (1)A dummy, which defines the dependency of one part of the network on another part of it. (2)A dummy arrow or constraint connection that is used as a logical connector but that does not represent actual work items. It is usually represented by a dotted line and is sometimes called a dummy because it does not represent work. It is an indispensable part of the network concept when using the arrow diagramming method of CPM scheduling. (June 2007) LOGIC SEQUENCING - The arranging of project activities in to a self-evident or reasoned and progressive series. (June 2007) LONG LEAD ITEMS - Those components of a system or piece of equipment for which the times to design and fabricate are the longest and for which an early commitment of funds may be desirable or necessary in order to meet the earliest possible date of system completion. (June 2007) LONG LEAD PROCUREMENT - Early procurement of material or parts to accommodate early use or long procurement spans. Contractors may choose to seek buyer-approved pre-award commitments of funds to meet long lead requirements. (June 2007) LONGEST PATH (LP) - Longest continuous path of activities through a project, which controls project early completion. It is possible for otherwise defined critical path activities to not be on the longest path and longest path activities to not show calculated critical float. The longest path analysis is unaffected by activity calendars. The longest path is determined by the string of activities, relationships, and lags that push the project to its latest, early finish date. The longest path is calculated by first performing a CPM ‘forward pass’ to determine driving relationships and the project’s latest, early finish date. The activity (or activities) with the latest, early finish dates are then identified and all predecessor driving relationships traced back to the project start date. These activities constitute the project's longest path. The longest path depends upon relationships driving the timing of activity starts, thus use of constraints and resource leveling can interrupt and invalidate longest path analysis. Use of interruptible activities can also result in false longest path indications. For complete accuracy, longest path analysis should take place absent of constraints, resource leveling, and/or interruptible activities. (June 2007) LONGEST PATH VALUE - A numerical calculation assigned to every activity in a CPM schedule that determines how near that activity is to being considered a member of the longest path. It is expressed in the same time units as the total float for that activity. A longest path float value of zero would indicate that the activity is on the longest path. (March 2010) LOOK-AHEAD SCHEDULE - A short period (two or three weeks) schedule, typically presented in bar chart format showing what needs to be accomplished to keep the project on schedule. Look-ahead schedules are often discussed at weekly project meetings to coordinate and control the following week’s work. (June 2007) LOOP/LOGIC LOOP - A circular sequence of dependency links between activities in a network. Creates an error in network logic resulting from successor activities also being a predecessor to the activity in question. Also known as circular logic. Logic loops can be very frustrating and time consuming to eliminate in complex network schedules. (June 2007) LOSS OF PRODUCTIVITY/EFFICIENCY - Syn.: INEFFICIENCY; LOST PRODUCTIVITY. (June 2007) LOST PRODUCTIVITY - Syn.: INEFFICIENCY; LOSS OF PRODUCTIVITY/EFFICIENCY. (June 2007) LOT BATCH - A definite quantity of some product manufactured under conditions of production that are considered uniform. (November 1990) LOT SIZE - The number of units in the lot. (November 1990) LOWEST MANAGEMENT LEVEL (LML) - A term used in the dynamic baseline model hierarchy in which a project may be positioned and is the control point for a project. It represents the level at which the project must be managed on an on-going basis in order to deal effectively with the dynamic issues below the LSB. a)For a production project the LML is the supervisor level. A supervisor is the lowest management level with sufficient capacity and authority to deal effectively with a dynamic procedures baseline. b)For a construction project the LML is the manager level. A manager is the lowest management level with sufficient capacity and authority to deal effectively with a dynamic construction baseline. c)For a development project the LML is the director level. A director is the lowest management level with sufficient capacity and authority to deal effectively with a dynamic requirements baseline. d)For an evolution project the LML is the owner level. The project owner is the lowest management level with sufficient capacity and authority to deal effectively with a dynamic objectives baseline. (June 2007) LOWEST STATIC BASELINE (LSB) - Using the flow down of organizational objectives from corporate values to project objectives to functional requirements to product design, the LSB is the lowest level that is relatively fixed for a given project in the hierarchy and is therefore readily "baseline-able". A term used in the dynamic baseline model hierarchy in which a project may be positioned. A project can only be expected to meet its LSB, and therefore success or failure should only realistically be measured relative to that baseline. (June 2007) LUMP-SUM - The complete in-place cost of a system, a subsystem, a particular item, or an entire project. (June 2007)