Abstract
Conceptual cost estimates are often made at the beginning of the project when project scope is not yet well defined. Hence, predicting the conceptual costs on time, with high accuracy, presents a considerable challenge. One potential solution is to more effectively utilize historical data via integration with predictive analytical models. In this project, a decision support system was developed which predicts conceptual costs of construction projects and supports decision-making for long-term capital planning in public universities. The prototype system was developed based on historical data for roofing projects at the University of Alabama. We collected this historical data via a web-based data entry form subsystem. The developed system uses ridge regression models to train historical data. This system has a user-friendly interface and supports what-if analysis, allowing the user to see multiple scenarios of the estimation. The system also encompasses capabilities to forecast the effects of inflation on multi-year projects. Subsequent validation has demonstrated improvement in the resulting accuracy of the conceptual estimates.
Highlights
Cost estimation is needed to support the decisions regarding funding, developing budget requests and evaluating resource requirements (GAO, 2009)
A bid estimate is submitted to the owner, either for competitive bidding or negotiation, and consists of direct construction costs including field supervision, plus a markup to cover general overhead and profits
When data are stored in a single system, such as MS SharePoint, it enables the system’s user to extract and analyze for essential information
Summary
Cost estimation is needed to support the decisions regarding funding, developing budget requests and evaluating resource requirements (GAO, 2009). As suggested by Hendrickson and Au (2008), as well as Schmid (2012), a typical project often encompasses three major estimation types: design estimates, bid estimates and control estimates. The design estimate is typically initiated by the owner and developed by designers. It is used in the scope definition, selection of design alternatives, and to keep the owners informed of forecast costs (Peurifoy & Oberlender, 2014). A bid estimate is submitted to the owner, either for competitive bidding or negotiation, and consists of direct construction costs including field supervision, plus a markup to cover general overhead and profits. After selecting the successful contractor, the bid becomes the contractor’s budget and the baseline for managing their resources through the control phase
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