Guidance for Cost Estimation and Management for Highway Projects During Planning, Programming, and Preconstruction (2007) / Chapter Skim
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Pages 88-93
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From page 88... ...
Project cost estimation practice and project cost estimation management should be viewed as interdependent processes that span the entire planning and development process. Chapter 3 of this Guidebook presented eight strategies that were developed by observing and synthesizing practices from highway agencies around the country: • Management strategy -- Manage the estimation process and costs through all stages of project development; • Scope and schedule strategy -- Formulate definitive processes for controlling project scope and schedule changes; • Off-prism strategy -- Use proactive methods for engaging external participants and assessing the macroenvironmental conditions that can influence project costs; • Risk strategy -- Identify risks, quantify their impact on cost, and take actions to mitigate the impact of risks as the project scope is developed; • Delivery and procurement strategy -- Apply appropriate delivery methods to better manage cost because project delivery influences both project risk and cost; • Document quality strategy -- Promote cost estimate accuracy and consistency through improved project documents; • Estimate quality strategy -- Use qualified personnel and uniform approaches to achieve improved estimate consistency and accuracy; and • Integrity strategy -- Ensure that checks and balances are in place to maintain estimate accuracy and to minimize the impact of outside pressures that can cause optimistic biases in estimates.
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From page 89... ...
External partners included the FHWA, local governments, MPOs, counties, cities, and local governments. Conduct Agencywide Workshop To launch this effort, an agencywide workshop on the subject of cost estimation practice and cost estimation management can be very useful in identifying problems and understanding the roles of the many disciplines within the state highway agency structure that support efforts to accurately estimate project cost.
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From page 90... ...
It is imperative that policies and procedures specifically address the issue of cost estimation and cost management across the entire planning and project development process. The following list of items should be considered in the development of cost estimation and estimation management policies and procedures.
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From page 91... ...
Develop Education and Training Cost estimation education and training are a critical component in achieving consistent and accurate estimates. Engineers at all phases of project development should be educated about the pitfalls of project cost escalation and the strategies, methods, and tools available to address the issue.
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From page 92... ...
Some of the tools presented in Appendix A were developed through national initiatives sponsored by AASHTO or the NCHRP, but the majority of tools were developed within individual agencies. State highway agencies should strive to continuously develop and improve on their suite of cost estimation practice and cost estimation management tools.
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From page 93... ...
However, to repeatedly achieve accurate and consistent cost estimates, agencies should adopt a systematic approach to cost estimation practice and cost estimation management that addresses cost escalation factors across the entire planning and project development process spectrum. Cost Management Strategy (Strategies)
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