Professional Engineering Cost

TOTAL PROJECT COST:
Prepared by: KYLE JANICA T. MANTE

BSCE 5A
PROFESSIONAL ENGINEERING COST
A civil engineer is often engaged to make a

study and to render a planning report on the
contemplated project including alternative solutions,
layouts, and locations along with initial estimates of
the probable project cost. This may involve
alternative or phase implementation schemes which
add flexibility to the project.
Introduction
Cost is one of the three fundamental attributes
associated with performing an activity or the
acquisition of an asset. These are price (cost) ,
features (performance) , and availability
(schedule). The need to understand and quantify the
attributes of cost spawned the engineering discipline
of cost engineering.
WHAT IS COST ENGINEERING?
Cost engineering is the application of scientific
principles and techniques to problems of estimation, cost
control, business planning and management science,
profitability analysis, project management, as well as
planning and scheduling.
It is the practice of managing the costs involved on a
construction project. This includes activities such as cost
control, budgeting, forecasting, estimating, investment
appraisal and risk analysis.
AACE International
Constitution and Bylaws which states:
Article I-Section 2―The Association is dedicated to the tenets of furthering the
concepts of total cost management and cost engineering. Total Cost Management (TCM) is the
effective application of professional and technical expertise to plan and control resources, costs,
profitability and risk. Simply stated, it is a systematic approach to managing cost throughout the
life cycle of any enterprise, program, facility, project, product or service. This is accomplished
through the application of cost engineering and cost management principles, proven
methodologies and the latest technology in support of the management process.
Article I-Section 3―Total cost management is that area of engineering practice where
engineering judgment and experience are used in the application of scientific principles and
techniques to problems of business and program planning; cost estimating; economic and
financial analysis; cost engineering; program and project management; planning and
scheduling; and cost and schedule performance measurement and change control.
Cost Engineers/Estimators: Who Are
They and What Do They Do?
Construction cost estimators can be contractually hired in
many different ways. They may be employed by the owner's
representative/project manager, employed by the construction
manager, employed as a member of a professional design team, or
separately hired by the owner. They estimate building costs through
all the stages of design and the construction of the project. On large
projects it is common for estimators to specialize in disciplines that
parallel design discipline specialization.
Cost engineers often specialize in one functional aspect of the
project process. They may have titles such as cost estimator,
parametric analyst, strategic planner, scheduler, cost/schedule
engineer, project manager, or project control leader.
They develop the cost information that business owners or
managers, professional design team members, and construction
contractors need to make budgetary and feasibility determinations.
From an Owner's perspective the cost estimate may be used to
determine the project scope or whether the project should proceed.
The construction contractor's cost estimate will determine the
construction bid or whether the company will bid on the construction
contract.
Cost Elements for Cost Management
• Cost Estimating predicts the quantity and cost of resources needed to accomplish an
activity or create an asset.
• Cost Trending Cost trends are established from historical cost accounting information.
• Cost Forecasting Forecasts are much like estimates. An estimate is always for future
activities and assets, and establishes the Budget at Completion (BAC) for performance
baselines; whereas forecasts are predictions of the cost to complete or Estimate to Complete
(ETC) for cost elements in progress, or that have not started.
• Life-Cycle Costing Life-Cycle Costs (LCC) are associated with an asset, and they extend
the cost management information beyond the acquisition (creation) of the asset to the use
and disposal of the asset.
Professional Behavior Expected Of
The Cost Estimator
• Ethics: The practice of construction estimating is a highly technical and professional discipline. It also
involves abiding by certain standards of ethical conduct and moral judgment that go beyond the
technical aspects of the discipline.
• Integrity: Estimators are expected to use standards of confidentiality in a manner at least equal to that
of other professional societies. The estimator shall keep in strictest confidence information received
from outside sources.
• Judgment: Judgment is a skill obtained by estimators through proper training and extensive
experience. Estimators should always use sound judgment and common sense when preparing
estimates.
• Attitude: Estimators should approach each estimate with a professional attitude and examine in
thorough detail all areas of the work. They will set aside specific times each day for entry of estimate
quantities and data without interruption.
• Thoroughness: An estimator will allow enough time to research and become familiar with the
background and details of the project and then promptly complete the quantity survey. They will review
the various aspects of the project with the other disciplines involved.
Rererences:
• https://www.wbdg.org/design-disciplines/cost-estimating
• https://prezi.com/xp715r6rbava/section-5-total-project-cost/
• https://global.oup.com/us/companion.websites/9780199339273/student/interactive/ecce/engi
neeringcosts/
• https://en.wikipedia.org/wiki/Cost_engineering
• http://web.aacei.org/docs/default-source/toc/toc_SK6.pdf
• https://www.ownerteamconsult.com/wp-content/uploads/2017/02/Insight-Article-014-Cost-
Engineering-1.pdf

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TOTAL PROJECT COST:

Prepared by: KYLE JANICA T. MANTE

A civil engineer is often engaged to make a

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