Studying ‘cost as information’ to account for construction improvements

Abstract

Contractors throughout the construction supply chain develop and use cost information. By treating ‘cost as information’, insights are generated into how cost information is created and flows from work carried out to a client cost. A case study of a main contractor’s supply chain involved semi-structured interviews, workshops and document reviews. We considered whether contractors’ current costing practices used for the purpose of pricing and cost control could support decision-making about improvements through the supply chain. The results show that firms recognize that current costing practices do not provide a good representation of work carried out. Cost information that is useful in a narrative that seeks to improve site operations is either not created or hidden in layers of assumptions and lost as it does not cross the boundaries between organizations. This implies that the implementation of current practices of costing in building information modelling will not increase the effectiveness of modelling construction costs for the purpose of improvements. However, cost information that is useful in decision-making about improvements could be created. This could be achieved but requires a systemic change, where new representations of cost are tied to work processes used within more stable procurement relationships.