Level: Intermediate
TCM Section(s)
7.3. Cost Estimating and Budgeting
3.3. Investment Decision Making
Venue: 2024 AACE International Conference & Expo
Abstract: Continuous estimating is a dynamic approach employed for target costing in collaborative contracts, where project costs are estimated iteratively during validation and design phases, providing enough detail to guide the design toward meeting target costs. Unlike conventional estimating, which determines costs at specific design milestones, continuous estimating offers ongoing capital cost data for the entire project based on the latest scope and design changes. These estimates serve various purposes, including validating owner’s allowable costs, screening design options, setting target costs, and implementing design-to-target cost or target value design. Continuous estimating promotes collaboration, enhances visibility and transparency in the estimating process, and supports the effective implementation of collaborative contracts.
The challenges in implementing effective continuous conceptual estimating in collaborative contracts include building a trust-based and collaborative environment among stakeholders. Additionally, there's a need to shift the traditional estimating mindset to agile and collaborative methodologies. Gaining access to high-quality historical data is also crucial, along with a sufficient understanding of the cost estimate relationships with the technical parameters of the project, which is essential for developing conceptual models.
This paper outlines a structured framework for the effective implementation of continuous estimating and presents challenges, lessons learned, and key success factors based on integrated project delivery (IPD) infrastructure projects in Canada.
TCM Section(s)
7.3. Cost Estimating and Budgeting
3.3. Investment Decision Making
Venue: 2024 AACE International Conference & Expo
Abstract: Continuous estimating is a dynamic approach employed for target costing in collaborative contracts, where project costs are estimated iteratively during validation and design phases, providing enough detail to guide the design toward meeting target costs. Unlike conventional estimating, which determines costs at specific design milestones, continuous estimating offers ongoing capital cost data for the entire project based on the latest scope and design changes. These estimates serve various purposes, including validating owner’s allowable costs, screening design options, setting target costs, and implementing design-to-target cost or target value design. Continuous estimating promotes collaboration, enhances visibility and transparency in the estimating process, and supports the effective implementation of collaborative contracts.
The challenges in implementing effective continuous conceptual estimating in collaborative contracts include building a trust-based and collaborative environment among stakeholders. Additionally, there's a need to shift the traditional estimating mindset to agile and collaborative methodologies. Gaining access to high-quality historical data is also crucial, along with a sufficient understanding of the cost estimate relationships with the technical parameters of the project, which is essential for developing conceptual models.
This paper outlines a structured framework for the effective implementation of continuous estimating and presents challenges, lessons learned, and key success factors based on integrated project delivery (IPD) infrastructure projects in Canada.