The CIVIL ENGINEERING HANDBOOK
The preparation of estimates represents one of the most important functions performed in any business enterprise. In the construction
industry, the quality of performance of this function is paramount to the success
of the parties engaged in the overall management of capital expenditures for
construction projects.
The estimating process, in some form, is used as soon as the
idea for a project is conceived. Estimates are prepared and updated continually
as the project scope and definition develops and, in many cases, throughout
construction of the project or facility.
The parties engaged in delivering the project continually ask
themselves “What will it cost?” To answer this question, some type of estimate
must be developed. Obviously, the precise answer to this question cannot be
determined until the project
is completed. Posing this type of question elicits
a finite Answer from the estimator. This answer, or estimate, represents only an
approximation or expected value for the cost.
The eventual accuracy of this
approximation depends on how closely the actual conditions and specific details
of the project match the expectations of the estimator.
Extreme care must be exercised by the estimator in the preparation of the estimate to subjectively weigh the potential variations in future conditions. The estimate should convey an assessment of the accuracy and risks.
Estimating is a complex process involving collection of available and pertinent information relating to the scope of a project, expected resource consumption, and future changes in resource costs. The process involves synthesis of this information through a mental process of visualization of the constructing process for the project. This visualization is mentally translated into an approximation of the final cost.
At the outset of a project, the estimate cannot be expected to
carry a high degree of accuracy, because little information is known. As the
design progresses, more information is known, and accuracy should improve.
Estimating at any stage of the project cycle involves
considerable effort to gather information. The estimator must collect and
review all of the detailed plans, specifications, available site data,
available resource data (labor, materials, and equipment), contract documents,
resource cost information, pertinent
government regulations, and applicable owner requirements.
Information gathering is a continual process by estimators due to the
uniqueness of each project and constant changes in the industry environment.
Unlike the production from a manufacturing facility, each
product of a construction firm represents a prototype. Considerable effort in
planning is required before a cost estimate can be established. Most of the
effort in establishing the estimate revolves around determining the approximation
of the cost to produce the one-time product.
The estimator must systematically convert information into a
forecast of the component and collective costs that will be incurred in
delivering the project or facility. This synthesis of information is accomplished
by mentally building the project from the ground up. Each step of the building
process should
be accounted for along with the necessary support activities and
embedded temporary work items required for completion.
The estimator must have some form of systematic approach to
ensure that all cost items have been incorporated and that none have been
duplicated. Later in this chapter is a discussion of alternate systematic
approaches that are used.
The quality of an estimate depends on the qualifications and
abilities of the estimator. In general, an estimator must demonstrate the
following capabilities and qualifications:
- Extensive knowledge of construction
- Knowledge of construction materials and methods
- Knowledge of construction practices and contracts
- Ability to read and write construction documents
- Ability to sketch construction details
- Ability to communicate graphically and verbally
- Strong background in business and economics
- Ability to visualize work items
- Broad background in design and code requirements