Parametric Cost Estimating Model for Conceptual Cost

Topics: Cost overrun, Statistics, Estimation theory Pages: 2 (354 words) Published: August 23, 2013
Parametric cost estimating model for conceptual cost estimating of building construction projects, Kan Phaobunjong, 2002

Conceptual Cost Estimation
Cost engineer
Historical data
Actual data
Project scope

Four essential inputs to conceptual cost estimating are project scope, information, estimating methodology, and an estimator.

Cost Methods (in order of complexity, information required, effort required, estimate accuracy)
Analogous
Unit method/Parametric
Assembly method

Expertise means possessing the ability, competency, experience, familiarity, knowledge, skills, and mastery in a specific field. The estimator’s ability to visualize the scope of work from incomplete scope definition is one of the most important factors in conceptual cost estimating.

History of Parametric Estimating
Before the development of parametric estimating, the quantitative method in conceptual cost estimating had been limited to performing the detailed quantity takeoff and pricing [Orczyk 1990]. Quantity takeoff involved a lot of data identification, computation, and documentation.

The development of the parametric cost estimating model generally involves the following six steps. [Black, 1984] 1)Problem definition
It encompasses the determination of the objectives and scope of the research study. 2)Data collection
Parametric estimating requires an extensive database, where historical records are extremely important. The design or engineering parameters that drive parametric cost estimates are developed from historical cost databases. Data collection can be regarded as the most crucial step. Without sufficient relevant data, the parametric estimating cannot be successfully implemented. 3)Data normalization

This process ensures that every individual record in the database is on the same base. 4)Parametric cost estimating model development
It involves the determination of interdependencies of the variables to be used in the model and the derivation...
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