Cost Estimation in Initial Stages of Product Development – An Ontological Approach

Abstract

Cost estimation in the early stages of the product development process is fraught with uncertainties. The conceptual design is characterized by the absence of data, the most critical being costs. Decisions based on incorrect assumptions impact a project significantly and can increase unexpected costs in the future. As there are no structured means of obtaining costs in the conceptual phase, the reuse of data from past projects is an alternative discussed in the literature. Knowledge management approaches suggest a search for data in successful earlier projects. The use of ontologies has been regarded as an approach to capturing either knowledge stored in database or tacit knowledge. The proposed solution, in the form of an expert system built upon an ontological model, seeks to estimate costs based on costs in previous projects as well as expert tacit knowledge. The model is demonstrated by queries with needed functions and requirements. The ontological model searches the necessary information and generates a cost estimation. The present research project follows the methodological framework Design Science Research, presenting an overhead crane as a case study. The proposed approach has great potential in other industrial contexts as well.