391589
Estimating Methods
- Global (Approximate) Estimating
- Relies on a library of
archive costs for similar
projects related to its
overal capacity/size
- New project
cost=cost/capacty*New
project
capacity+inflation+market
trends
- The quality of
the database
will influence
the quality of
the estimate
- Data comming
from one
organisation is
best
- Data comming
from one
organisation is
best
- New project
cost=cost/capacty*New
project
capacity+inflation+market
trends
- Dangers
- What is the
cost of a
completed
project?
Does it
include:
- Final accounts sums
- Design and Engineering fees
- Finance costs
- Land
- Final accounts sums
- How is the
measurement
of the capacity
defined?
- How does linear
capacity of linear
projects (highways,
railways) allow for
interchanging?
- How does
associated
infrastructure
be allowed for
(access
roads, power
supply etc.)
- How does linear
capacity of linear
projects (highways,
railways) allow for
interchanging?
- Not
comparing
like with like
- Different
ground
condition
- Different site
locations (flat
terrain compared
to mountains)
- Different standards of
quality (motorway
compared to minor road)
- Different
ground
condition
- What is the
cost of a
completed
project?
Does it
include:
- Suitable at
conception and
feasibility
study stages
- Also called "single rate approximate estimating
- Relies on a library of
archive costs for similar
projects related to its
overal capacity/size
- Factorial Estimating
- Projects
which have
large element
of fixed plant
- Power
stations,
process
plants
- Fixed plant
costs can be
determined
from
suppliers at
early stage
- Ancillary
engineering work
is required as well
- Pipework, electrical
work, structural work
(foundations),
instrumentation, etc.
- Each of the ancillary items have a factor
associated with it, determined from
costs of historical projects
- The cost of
the ancillary
item is the
product of the
cost of the
main item
and its factor
- The cost of
the ancillary
item is the
product of the
cost of the
main item
and its factor
- Pipework, electrical
work, structural work
(foundations),
instrumentation, etc.
- Power
stations,
process
plants
- Reliability of
the Factors
can
significantly
influence the
overal
reliability of
the estimate
- Factors will be
built up from
extensive
experience of the
estimators
- Design changes can
result in factor changes
if factors are sensitive
to slight changes in
plant specification
- Factors will be
built up from
extensive
experience of the
estimators
- Estimate depends on the
reliability of the price of
the plant items. The
technique should not be
applied blindly to all areas
of the estimate.
- Estimators
should use
their own
judgement
- Estimators
should use
their own
judgement
- As technique is
based on current
costs from
suppliers, little
adjustment for
inflation is
needed.
- Projects
which have
large element
of fixed plant
- Labour-hours Estimating
- Suitable for
labour
intensive
operations
- Examples:
fabrication and
mechanical/electrical
installarions
- Examples:
fabrication and
mechanical/electrical
installarions
- Assumes
that most
operations do
not vary in
their method
from project
to project
- Requires the total
labour-hours to be
estimated for an
operation and are
then costed at
current labour rates
(all-in-rates)
- Final Cost
obtained by
adding
allowances
for materials
and plant
- Final Cost
obtained by
adding
allowances
for materials
and plant
- Usually high material
element for civil engineering
works, which is why
operational estimating is
preferred, which requires the
use of a programme of
method statement
- Suitable for
labour
intensive
operations
- Unit Rate Estimating
- Has similarity to
global method. In
global-apply a
rate to a project's
capacity.
Here-produce
estimate built-up
from rates applied
to individual items
- Requires the
existence of
""Bill-of-quantities"
- Extension of
labour-hours
estimating.Cost and
output rates are
applied to each major
resource-plant,
material and labour.
- Cost
determined
by
multiplying
rate by
quantity
- Rates usually come from:
- Historical rates
based on
productivity data
from similar
projects
- Rates based on
data given in
price books (e.g.
Spon's)
- Rates built-up
from analysis
of labour,
plant, materials
for each item
and costed at
current rates
- Taken from
estimator's
"personal"manual
- Historical rates
based on
productivity data
from similar
projects
- Most
appropriate
form repetitive
work where the
allocation of
costs to items
of work is well
defined
- Standard method of
measurements (CESSM or
SMM) define quite well the
scope of most items of work in
such projects and therefore the
estimator has no confusion as
to what should be included
- Standard method of
measurements (CESSM or
SMM) define quite well the
scope of most items of work in
such projects and therefore the
estimator has no confusion as
to what should be included
- Poor Estimates of
productivity will lead to
poor estimates even if
the all-in rates for
labour and plant and
the rates for materials
are correct
- This technique is not likely
to be successful in locations
where few similar projects
have been completed in the
past
- Technique success depends
on the experience of the
estimator and the quality of the
historical rates for productivity
- Technique success depends
on the experience of the
estimator and the quality of the
historical rates for productivity
- Problems with
Unit-rate
estimating
- It does not take into
account the programme.
Assumes all resources will
be available at all times.
Cannot take into account
the way in which the
activities are to be carried
out.
- Although it covers all
three physical
resources and has
taken into account
productivity rates, it
may not provide the
whole picture and
may hide associated
costs
- Materials: Assumes
they can be offloaded
at the moment they
are delivered and at
the place they are
needed. This may not
always be the case
- No account taken
fro traveling
between locations
on site
- Materials: Assumes
they can be offloaded
at the moment they
are delivered and at
the place they are
needed. This may not
always be the case
- Does not
account for
plant
idleness
- Although it covers all
three physical
resources and has
taken into account
productivity rates, it
may not provide the
whole picture and
may hide associated
costs
- The precision and detail
of the individual rates can
lead to misplaced
confidence in the figures.
It cannot be assumed that
previous work was of the
same nature, carried out
in the same conditions
with the same duration.
- It does not take into
account the programme.
Assumes all resources will
be available at all times.
Cannot take into account
the way in which the
activities are to be carried
out.
- Has similarity to
global method. In
global-apply a
rate to a project's
capacity.
Here-produce
estimate built-up
from rates applied
to individual items
- Operational Estimating
- Takes into account
programme and
method statement
- Ideal for civil
engineering
operations
which are
unique to the
project in
consideration
- Disadvantage
- To be
effective it
requires a
programme
and method
statement
- To be
effective it
requires a
programme
and method
statement
- Advantages
- Allow for idle time
which is common in
plant dominated
work
- Allow for
operations
with
significant
uncertainties
and risks
- Helps at
identifying
sources and
risks of delay
for individual
operations
- Although time
consuming,
organisations
carrying out this
technique will soon
accumulate a library
of operational data
which will allow an
appreciation of the
best way in which
to carry out work
- Allow for idle time
which is common in
plant dominated
work
- Estimators may
still need to fill in a
rate and an
amount for items
in a bill of
quantities
- Takes into account
programme and
method statement
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