Improving Cost Estimates of Construction Projects Using【DOC精选】.docVIP

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Improving Cost Estimates of Construction Projects Using【DOC精选】.doc

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Improving Cost Estimates of Construction Projects Using Phased Cost Factors Li Liu1 and Kai Zhu2 Abstract: Central to cost-based competition is the capability to accurately predict the cost of delivering a project. Most literature on cost estimation focuses on specific estimation methods as generic techniques and little attention has been paid to the unique requirements at each project stage. This note attempts to identify the critical factors for effective estimation at various stages of typical construction projects. Drawing from organization control theory and cost estimating literature, this note develops a theoretical framework that identifies the critical factors for effective cost estimation during each project phase of a conventional construction project. The underlying logic is that as a cost estimating effort progresses, both task programmability and output measurability improve. As a result, control effort will shift from input-oriented control to a combination of output and behavior control. DOI: 10.1061(ASCE)0733-9364(2007)133:1(91) CE Database subject headings: Cost control; Estimation; Construction costs; Project management. Introduction Most construction contracts are fixed price contracts with incentives for cost saving and early completion as well as penalties for cost overrun and delays. Central to cost-based competition is the capability to accurately predict the cost of delivering a project. Overestimated cost could result in misjudgment for the feasibility of a project or loss of a contract to competitors. On the other hand, the contractor could incur significant losses from underestimated cost. As succinctly stated by Hicks (1992), “without an accurate cost estimate, nothing short of an act of God can be done to prevent a loss, regardless of management competence, finance strength of the contractor.” Typically, estimation of project effort needs to be made at various stages of a project. At the conceptual stage, a ballpark figure is needed to