Project Cost Estimation Techniques

Introduction

In this short course you will Learn to accurately estimate project cost. If your project costs routinely go over budget, your credibility as a project manager is jeopardized. The key to avoiding budget overruns is having accurate cost estimates at the beginning of your project.

This short course will help you understand cost estimating and give you some practical cost-estimating techniques and processes. You’ll experiment with different estimating techniques so you can identify which method works best for you and when to use each.

Objectives

– Apply techniques used in Project estimating, from the conceptual stage to the final detailed estimate.

– Synthesize innovative incentive arrangements to get the best results from the contract.

– Prepare lump-sum, unit-price, cost plus, and time-and-materials estimates and contracts.

– Apply proper risk analysis to effectively mitigate risks at minimal costs, and to determine appropriate contingencies for residual risks.

– Comprehend the different types of contracts based on the distribution of risk between contracting parties.

Course Outline

Day 1

Cost Estimating Fundamentals

– Basic Project Management definitions.

– Cost Selection techniques.

– Typical project terminology & setting up for success.

– Project cost management, Cost Control.

– Resource & Cost Allocation.

– Comprehending project management inputs to cost estimation.

Day 2

Pricing, Contracts and Risk

– Project management inputs to cost budgeting.

– Resource Requirements.

– Direct & Indirect Project Costs.

– Probability and Standard Deviation Formulae.

– Contract types according to risk distribution.

– Fixed Price Contracts, Cost-Plus Contracts.

Day 3

Approximate & Detailed Estimating Methods

– Material Estimating.

– Civil/Construction Estimating.

– Labour estimating, Detailed estimating with labour crews.

– Procurement Management.

– Risk distribution in contracting.

– Project risk profiles.

Day 4

Developing the Project Budget & Cost Control

– Risk Identification, Analysis & Management.

– Qualitative Risk Analysis.

– Quantitative Risk Analysis.

– Risk & Probability Matrix.

– Risk Response Strategy.

– Cash Flow management.

Day 5

Advanced Estimating Methods

– Building Information Modelling (BIM).

– Cost Estimating Relationships (CER).

– Computer Estimating.

– Control Charts.