Cost Estimation Framework Research Articles

Informing additive manufacturing technology adoption: total cost and the impact of capacity utilisation

Informing Additive Manufacturing (AM) technology adoption decisions, this paper investigates the relationship between build volume capacity utilisation and efficient technology operation in an inter-process comparison of the costs of manufacturing a complex component used in the packaging industry. Confronting the reported costs of a conventional machining and welding pathway with an estimator of the costs incurred through an AM route utilising Direct Metal Laser Sintering (DMLS), we weave together four aspects: optimised capacity utilisation, ancillary process steps, the effect of build failure and design adaptation. Recognising that AM users can fill unused machine capacity with other, potentially unrelated, geometries, we posit a characteristic of ‘fungible’ build capacity. This aspect is integrated in the cost estimation framework through computational build volume packing, drawing on a basket of sample geometries. We show that the unit cost in mixed builds at full capacity is lower than in builds limited to a single type of geometry; in our study, this results in a mean unit cost overstatement of 157%. The estimated manufacturing cost savings from AM adoption range from 36 to 46%. Additionally, we indicate that operating cost savings resulting from design adaptation are likely to far outweigh the manufacturing cost advantage.

Estimation of Highway Project Cost using Probabilistic Technique

Accurate assessment of effort, time and resources for estimation of project cost is a challenging task for project managers. Several methodologies are commonly practiced around the globe for project cost estimation based on the project’s scope, type, and availability of resources. In developing countries like Pakistan most of the construction projects face delay and cost overrun, and construction industry continues to use traditional methodologies for preparation of project cost estimates. Present study developed a probabilistic framework for project cost estimation using Monte Carlo Simulation. A probabilistic model is proposed for estimation of total project cost using data on key risk factors that included (1) labour efficiencies, (2) machine efficiencies, (3) construction material wastages, and (4) construction items’ prices. Using data from completed highway projects, model validation results revealed that developed model has the ability to predict reliable future project cost.

Analysis of the Requirements of an Early Life-cycle Cost Estimation Tool: An Industrial Survey

Cost estimation is a critical issue for many companies concerning both offers generation and company strategic evaluations. In this paper, a framework for early cost estimation has been proposed to some firms for an assessment of its main features. The aim of the industrial survey is to promote a discussion on the needs and the expectations regarding cost estimation in order to obtain feedbacks to be addresses in the implementation of a software tool. Gather data has led to a ranking of the main characteristics the tool should have.

A framework to estimate the cost of No-Fault Found events

The article investigates a generic framework to estimate maintenance costs attributed to the No Fault Found (NFF) phenomenon. Such overhead costs are particularly difficult to quantify due to potentially serviceable equipment being returned for repair. Other factors, such as a reduction in the availability of the system, compromising reliability of high value assets, and logistical factors, can all contribute to the cost of resolving an unknown fault. Here we apply the soft systems methodology to capture the critical cost drivers of NFF across the supply chain and build a framework to estimate the cost of NFF. We use a multi-method design including an online survey, workshops and semi-structured interviews to study NFF related cost practices based on information from 12 key participants across 7 UK organisations. The study identifies the major NFF cost drivers across the supply chain (e.g. transportation), the OEM (e.g. inventory) and the customer (e.g. lost man hours). An agent based model is used to evaluate the impact of these cost drivers on the overall NFF cost. The analysis shows how the most appropriate drivers can be selected to represent the cumulative costs due to NFF events and their impacts across the supply network. From the academic perspective, the generic framework for NFF cost estimation demonstrates how qualitative and quantitative information can be used together to achieve maintenance objectives. From a practical perspective, by applying the framework on one component, an organisation has the liberty to analyse the cost of NFF for that particular unit only.

A hybrid cost estimation framework based on feature-oriented data mining approach

This paper presents an informatics framework to apply feature-based engineering concept for cost estimation supported with data mining algorithms. The purpose of this research work is to provide a practical procedure for more accurate cost estimation by using the commonly available manufacturing process data associated with ERP systems. The proposed method combines linear regression and data-mining techniques, leverages the unique strengths of the both, and creates a mechanism to discover cost features. The final estimation function takes the user’s confidence level over each member technique into consideration such that the application of the method can phase in gradually in reality by building up the data mining capability. A case study demonstrates the proposed framework and compares the results from empirical cost prediction and data mining. The case study results indicate that the combined method is flexible and promising for determining the costs of the example welding features. With the result comparison between the empirical prediction and five different data mining algorithms, the ANN algorithm shows to be the most accurate for welding operations.

2.3.1 A MBSE probabilistic framework for preliminary lifecycle costing of mechanical products

AbstractThe challenging economic context and competitive pressure forces industrial companies to attain the highest profitability of a program, with lifecycle cost (LCC) as one of the key parameters. Thus, industrial companies are constantly developing more efficient methods to estimate LCC as early as possible in the design process. This paper presents a new Model Based Systems Engineering (MBSE) probabilistic framework for lifecycle cost estimation during preliminary design. Divided in two modules computing respectively manufacturing and maintenance costs, the framework is based on a suite of statistical regression‐based models whose results are aggregated in order to provide the best probabilistic estimate of lifecycle cost. The framework has been tested on components from civil jet engines but can be applied to a large variety of mechanical products. The early results are satisfactory with predictive accuracy of lifecycle costs of new components representing a significant improvement over state‐of‐the‐art methods.

Integrating a fuzzy-logic decision support system with bridge information modelling and cost estimation at conceptual design stage of concrete box-girder bridges

Integrating 3D bridge information modelling (BrIM) with construction technologies had inspired many researchers for the past decade. In this study, research objectives are intended to demonstrate the viability of integrating a 3D computer-aided design (3D-CAD) model with a structural analysis application and bridge cost estimation framework without compromising interoperability matters. An integrated model that relates a fuzzy logic decision support system with cost estimation for concrete box-girder bridges is presented. Model development methodology comprises an integrated preliminary cost estimation system (IPCES), and complex quality functions and deployment of a multi-criteria decision making (MCDM) approach. An actual case project is used to validate and illustrate model corresponding estimating capabilities. The proposed model is engineered to enhance existing techniques implemented by bridge stakeholders and designers to prepare cost estimates at the conceptual design stage by taking into consideration box-girder bridge project site preparations, substructure, and superstructure. The proposed model is anticipated to be of major significance to designers and its contribution resides into the integration of BrIM technologies with cost estimation approaches.

A semi-automatic mold cost estimation framework based upon geometry similarity

The automation of cost estimation for manufacturing processes is a challenging task in computer-aided manufacturing. In this paper, we introduce a two-step analogy and mathematical approach to estimate the cost of injection molding. In the analogy step, data of molds are partitioned into homogeneous groups based on mold type and mold design. In the prediction step, regression models based upon geometry, topology, and other inherent shape properties are constructed within each group. The variables in the regression models within each group are extracted automatically from one orthographic two-dimensional (2D) image of the injection-molded part. Mean and variance estimates are calculated on a subset of relevant molds so that the risk of an inaccurate bid can be assessed on a subset of relevant molds.

Economic analysis of costs associated with a Respiratory Intensive Care Unit in a tertiary care teaching hospital in Northern India

Background:There is a paucity of cost analytical studies from resource constrained developing countries defining intensive care costs and their containment.Objective:Economic analysis of costs in a Respiratory Intensive Care Unit (RICU) of a tertiary care teaching hospital in northern India.Materials and Methods:A prospective study was conducted in 74 patients admitted in the RICU. Costs were segregated into fixed and variable costs. Total and categorized costs averaged per day and costs incurred on the first day of the RICU stay were calculated. Correlation of the costs was performed with the length of stay, length of mechanical ventilation, survival, and therapeutic intervention scoring system-28 (TISS-28).Results:The total cost per day was Indian rupees (INR) 10,364 (US $ 222). 46.4% of the total cost was borne by hospital and rest by patients. The mean cost represented 36.8% of the total cost and 69.8% of the variable cost. Expenditure on personnel salary constituted 37% of the total costs and 86% of the fixed cost. Length of stay in RICU was significantly higher in nonsurvivors (14.73 ± 13.6 days) vs. survivors (8.3 ± 7.8 days) (P < 0.05). The TISS-28 score points in survivors was 30.6 vs. nonsurvivors 69.2 per nurse (P < 0.05) correlating strongly with the total cost (r = 0.91).Conclusion:Although considerably less expensive than in economically developed countries, intensive care in India remains expensive relative to the cost of living. The cost block methodology provides a framework for cost estimation, aids resource allocation and allows international comparisons of economic models.

A Framework for Life Cycle Cost Estimation of a Product Family at the Early Stage of Product Development

A cost estimation method is required to estimate the life cycle cost of a product family at the early stage of product development in order to evaluate the product family design. There are difficulties with existing cost estimation techniques in estimating the life cycle cost for a product family at the early stage of product development. This paper proposes a framework that combines a knowledge based system and an activity based costing techniques in estimating the life cycle cost of a product family at the early stage of product development. The inputs of the framework are the product family structure and its sub function. The output of the framework is the life cycle cost of a product family that consists of all costs at each product family level and the costs of each product life cycle stage. The proposed framework provides a life cycle cost estimation tool for a product family at the early stage of product development using high level information as its input. The framework makes it possible to estimate the life cycle cost of various product family that use any types of product structure. It provides detailed information related to the activity and resource costs of both parts and products that can assist the designer in analyzing the cost of the product family design. In addition, it can reduce the required amount of information and time to construct the cost estimation system.

A cost estimation framework to support increased value recovery from end-of-life vehicles

The imminent introduction of the European Directive relating to the recovery and recycling of two million end-of-life (EoL) vehicles per annum has resulted in significant developments and changes within the UK vehicle recovery chain. The economic ramifications of this conformance have left many EoL stakeholders in a uniquely different market, based on contract negotiations, investment and very challenging targets. The archaic and reactive nature of the recovery industry has meant that the demands of being part of the extended enterprise have never been present, and as such waste reduction and value improvement have never been major industry concerns. With the introduction of this legislation comes an increased need for the recovery chain to understand the economics of its own operations, to better support any investment or processing decisions within the new market. This paper provides an overview to the stakeholders and their relationships within the UK recovery chain, and discusses the development of an EoL vehicle costing framework based on the current direct and indirect costs and revenues affecting vehicle retirement, to facilitate increased value recovery to an array of EoL operators. Each of the costing techniques adopted or developed within the framework are then further discussed, before the intended industrial applications of the framework are highlighted.

Toward an activity-based costing system for product families and product platforms in the early stages of development

As the marketplace has been changing so rapidly, it has been a key issue for companies to best meet customers’ diverse demands by providing a variety of products in a cost-effective and timely manner. In the meantime, an increasing variety of capability and functionality of products has made it more difficult for companies that develop only one product at a time to maintain competitive production cost and reclaim market share. By designing a product family based on a robust product platform, overall production cost can be more competitive than competitors selling one product at a time while delivering highly differentiated products. In order to design cost-effective product families and product platforms, a production cost estimation framework was presented in order that relevant costs are collected, estimated, and analysed. Since the framework is quite broad, this paper is dedicated to refining the estimation framework in a practical way by developing an activity-based costing (ABC) system in which activity costs are mapped to individual parts in the product family, which is called cost modularization, and the activity costs affected by product family design decisions are restructured to make the costs relevant to these decisions. A case study involving a family of power tools is used to demonstrate the proposed use of the ABC system.

Generalized Functional Models for Drilling Cost Estimation

Summary A new approach to drilling cost estimation is presented that establishes a general framework for cost estimation using a formalized systems perspective. A generalized functional approach is developed that combines regression-based techniques, as used in the Joint Association Survey (JAS), with the multidimensional attributes of drilling, as incorporated in the Mechanical Risk Index (MRI), Directional Difficulty Index (DDI), and Difficulty Index (DFI) models. A generalized methodology for framing the drilling cost estimation problem is presented and illustrated using a stylized example.

Development of a production cost estimation framework to support product family design

The main task of a product family designer is to decide the right components/design variables to share among products to maintain economies of scale with minimum sacrifice in the performance of each product in the family. The decisions are usually based on several criteria, but production cost is of primary concern. Estimating the production cost of a family of products involves both estimating the production cost of each product in the family and the costs incurred by common and variant components/design variables in the family. To estimate these costs consistently and accurately, we propose a production cost estimation framework to support product family design based on activity-based costing (ABC), which consists of three stages: (1) allocation, (2) estimation, and (3) analysis. In the allocation stage, the production activities and resources needed to produce the entire products in a family are identified and classified with an activity table, a resource table, and a production flow. To help allocate product data for production, a product family structure is represented by a hierarchical classification of products that form the product family. In the estimation stage, production costs are estimated with cost estimation methods selected based on the type of information available. In the analysis stage, components/design variables possible for product family design are investigated with resource sharing methods through activity analysis. As an example, the proposed framework is applied to estimate the production cost of a family of cordless power screwdrivers that share different components within the family.

A generic framework for cost estimation and cost control in product design

Traditionally, cost estimation was performed after the design process, though most opportunities of cost reduction have already passed. Therefore, it is advantageous to be able to estimate the product costs early in the product development cycle. By changing the way cost estimation is dealt with, it is possible to utilise all opportunities of cost reduction. To be able to control the product costs, it is necessary to estimate the costs adequately and to store the cost data in a generic way. A generic framework is developed to establish these requirements. The framework, which is the basis for the control of the production costs, takes into account design, process planning and production planning aspects.

Developing an integrated framework for feature-based early manufacturing cost estimation

The major objective of concurrent engineering is to consider the related downstream manufacturing during the design stage. Estimating manufacturing cost during the early design stage is one area that has been given little attention by researchers. However, if the product manufacturing cost can be estimated during the design stage, designers can modify a design to achieve proper performance as well as a reasonable cost at an early stage of the product development process.