Project control estimate

Definitive estimate (project control estimate). "The data needed for this type of estimate are more detailed than those for a preliminary estimate and inclnde the preparation of specifications and drawings. The probable accuracy is -10 to -1-15 percent. 

Definitive estimate (project control estimate) based on almost complete data but before completion of drawings and specifications probable accuracy of estimate within 10 percent. 

Project controls - estimating, scheduling, and cost control. Occasionally the Owner would also perform ... 

If the evaluation is positive at this stage, a project control estimate is then prepared. Final flow sheets, site analyses, equipment specifications, and any architectural and engineering sketches are employed to prepare this estimate. The accuracy of this estimate is about 10% probable error. A project control estimate can serve as the basis for a corporate appropriation, forjudging contractor bids, and for determining construction expenses. Due to increased intricacy and precision, the cost for preparing such as estimate for the process can approach 150,000. 

Definitive (also known as Project Control) Estimate... 

The accuracy of a fixed capital estimate tends to be a function of the design effort involved. As the project definition is refined, the estimates evolve from the various preliminary phases, ie, order of magnitude, predesign, factor estimates, etc, into the more detailed estimates used for budget authorization, project control, and contracts. At the same time, the uncertainty in the estimate decreases from 50% to as Htfle as 5%. 

Project Control Having made a good estimate of the capital cost and the expected construc tion time, it is essential to introduce an effective system for controlling expenditure of time and money during construction. Good capital-cost control can cut down expenditures even when the definitive estimate is not veiy accurate. It is most important for management to receive early warnings if overruns in expenditure or time are likely to occur. 

The engineer estimating the operating labor must visualize the plant operation, degree of automation, and the labor climate for the project being estimated. For most hydrocarbon processing plants, each control room should have at least one operator with no outside duties. For very large control rooms, more than one such operator may be needed. 

By 1992, the free-world catalyst market could reach four billion dollars and the United States projection is estimated to be two billion (18). It is difficult to estimate how much of an impact improved methods for engineering improved mechanical and physical properties will have on these figures, but we can expect that all catalysts will be checked to meet the specifications of the user and the quality control program of the producer. 

The best contribution that the project manager can make to project control in this stage is to develop a viable execution plan based on maximal use of competitive lump sum contracts, a realistic schedule, and an accurate cost estimate. 

Prepare, when necessary, semi-detailed estimates (for small projects) suitable for appropriation and/or further project control. 

This procedure presents a quick and reasonably accurate method to estimate the cost of the instrumentation account at various levels of engineering development with sufficient details for subsequent cost tracking and project control. 

Base hours are all the home office hours required to perform all the engineering, procurement, subcontracting, project management, estimating, and cost control for a normal case plant. They are computed as follows with the aid of Tables 19.26, 19.27, 19.28, and 19.31. 

The cost impact of the productivity should be shown in the estimates as a line item with the field indirects account. This approach will permit a more consistent analysis of the materials-to-labor ratios and provide better project control by specifically identifying a potentially important source of abnormal project costs. 

The first edition of this book was published as Managing the Chemical Construction Project Planning, Estimating, and Control of Chemical Construction Projects, by Pablo F. Navarette... 

Whether the formal step approach, or the trending approach with snapshots is used, it is essential that a control estimate be created to be used during construction to control the cost of the constructed project. The result of shortchanging the estimating and cost control effort are a noncurrent cost reality and unhappy surprises as to final cost and schedule. 

The control estimate is a final confirmation of the cost of the project (Fig. 12). It is a detailed pricing ofthe project from takeoffs of quantities and, in most cases, will reflect local bids for materials and construction labor. By the time this estimate is made, the project cost has been decided and this is done to form a control basis for the project as it proceeds through construction. 

The control estimate has been replaced by a procedure called trending, or estimate tracking, which is continuous cost estimate tracking leading directly into cost control as the project s appropriation is spent. It is a much more time-responsive way of controlling costs on the project and a snapshot of the trended estimate can be published as the control estimate at any appropriate time. It is helpful in today s world, where immediate... 

For example, a hazard with a TREC of 11 would be expected to produce approximately 5,000,000 in losses over the life of the project. Controls that reduce the TREC to 9 would then be expected to save an estimated 4,950,000 ( 5,000,000- 50,000). 

Project control for cost, performance and schedule Appropriate transition points and reviews Configuration management and documentation Performance compared to baseline Earned value recognition The estimation and allocation of resources Risks and alternatives... 

Stage Gate SG2 forms the most important strategic milestone in the integrated life cycle becanse it determines the finther comse of the project. The developed design specification, the re-worked plans and the updated effort and cost estimates allow management to re-evaluate the project and to decide upon its future. If the decision is to continue the project, the activities of System Safety Assessment (SSA) and of system development are triggered. Those activities are monitored by project control. 

---