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COST ESTIMATING IN PROJECT MANAGEMENT

BY: SUGIONO, PhD

Typical summary layout of a project cost estimate

Project cost estimate arranged by the work breakdown structure

Useful format for general cost estimating

Format for estimating the costs of materials and bought-out equipment on larger projects

General purpose format for indicating the price of a small project

ESTIMATING MANUFACTURING COSTS

ESTIMATING PROJECT LABOUR COSTS


These six grades were found to be sufficient even for large capital projects involving engineering, purchasing and construction: Grade 1 company directors, divisional managers and professional staff of consultant rank Grade 2 departmental managers and the chief engineers of specialist engineering groups Grade 3 project engineers and senior engineers in all the specialist engineering disciplines Grade 4 engineers in all the specialist disciplines Grade 5 drawing office group leaders and checkers Grade 6 draughtsmen and women plus all clerical and general administrative staff except managers.

PERSONAL ESTIMATING CHARACTERISTICS Optimistic estimators A typical multiplication factor is 1.5; in other words it is often necessary to add about 50 per cent to the original estimates Pessimistic estimators ESTIMATES FOR MATERIAL AND EQUIPMENT COSTS total expected cost, including all charges and taxes payable in transporting the materials to the project location; total lead time, which is the time expected to elapse between issuing the purchase order and receiving the consignment (failure to get materials on time is a common cause of delays and late project completion)

GENERAL INTRODUCTION TO PROJECT PLANNING

External factors

Project planning environment

MUSEUM PROJECT: A CASE EXAMPLE

Diary planning

Museum project: Gannt chart