Project Cost Risk Research Articles

Digital Application of Construction Project Cost Risk Control and Management Based on BIM Technology

Abstract The core objective of this study is to explore the application of BIM technology in the whole process of cost management of construction projects and to assess the project risk. The study covers the key stages of project planning, design, transaction and construction, and focuses on analyzing the cost management process of investment decision, design estimate, transaction and construction. Through questionnaire surveys and expert interviews with 72 valid samples, this study collects data on green building and analyzes the quality of the risk assessment data. Through questionnaire survey and expert interviews with 72 good samples, this study collects data on green building and analyzes the quality of the risk assessment data. In establishing the BIM-based project cost risk model, the study analyzes the management elements of BIM and IPD in detail, including the quantification of technical and management components. three case projects show that the application of BIM and IPD technologies in different projects has different focuses, and produces other management effects. for example, the number of engineering changes (e.g., the number of changes to the project) exhibited by the project B For example, the number of project changes (NCO) is 35, the cost change rate (COP) is 0.93%, the duration change rate (DCP) is −10.25%, and the number of contract negotiations (NRFI) is 6. The risk evaluation model is applied in a mixed-use project in Xiamen, China, and the results of the simulation experiments show that the method is effective in realizing the risk assessment of the construction project, and the clustered nature of the output features is good. The average value of the risk fuzzy variable is 0.576, and the minimum value is 0.192.

Retracted: Design of Project Cost Risk Management System Based on Improved Fuzzy Rule Weight Algorithm

Retracted: Design of Project Cost Risk Management System Based on Improved Fuzzy Rule Weight Algorithm

Features of the innovation construction materials design at the current stage of the industry development

Introduction. The problem of the development, mass production and introduction of the innovation construction materials is especially relevant in the conditions, when whole economy of Russia is aimed at the innovative development and import substitution as well.
 
 Materials and methods. The system approach, the method of scientific synthesis, methods of statistic and comparative analysis, the historical method were used during this research. Works of domestic and foreign scientists, regulatory legal acts and strategic documents in the field of production of construction materials, sources from periodicals, data of Federal State Statistics Service, statistical bases of foreign countries, data of the Committee of the Russian Union of builders on the development of the construction materials industry, National consolidation of builders (NOSTROY), Rating Agency of the Construction Complex (RACC), as well as some information, provided by producers of construction materials, acted as the materials for the research.
 
 Results. The author studied the nature of the innovation construction materials, defining the specifics of their development and introduction, such as experimental nature, availability of numerous options of the product, high project cost, long term and high project risk. The term “product design” is considered in the confined and extended sense. It is proved, that design is not limited to detailed design when developing the innovation construction material. Some elements of design have to take place at other stages of the product development as well.
 
 Conclusions. A new paradigm of the innovation construction materials design, considering the matter comprehensively (in terms of achievement of the necessary, improved properties of new material, demand the market, profit maximizations from its production and introduction, reliability, environmental friendliness, etc.) is required in modern conditions. As the result of the research the author developed the cross-disciplinary hierarchical structure of the innovation construction material design, uniting many tasks relating to the functions of management, marketing, research and design, production, finance and covering all the phases of the construction materials development.

BIM-augmented reality integrated approach to risk management

Despite the acknowledged promises of adopting technologies such as BIM and AR, research addressing the challenges and opportunities of such synergies in cost and schedule risk management is still limited. This paper contributes to the literature by presenting an integrated, proactive BIM-Augmented Reality (AR) risk management system enabling an online inspection of project cost and schedule risks. This system records the actual risk data (e.g., risk type and likelihood) using AR on commercial smartphones, runs an online Risk Failure Mode and Effects Analysis (RFMEA), and updates the project's BIM model to provide informed risk-related solutions. A case study is provided to demonstrate the implementation of the proposed system in a real project. Despite the challenges cited in the post-implementation survey (e.g., system ergonomics and synchronizations of automated/non-automated subsystems), 67% of the users acknowledged the improvement in cost and schedule risk management owing to enhancement in communication, timeliness, and risk perception.

A Mathematical Model and Two Fuzzy Approaches Based on Credibility and Expected Interval for Project Cost-Quality-Risk Trade-Off Problem in Time-Constrained Conditions

To successfully finalize projects and attain their determined purposes, it is indispensable to control all success criteria of a project. The time–cost trade-off (TCT) is known as a prevalent and efficient approach applied when the planned finish date of a project is not admitted by stakeholders, and consequently, the project duration must be decreased. This paper proposes a new mathematical model under fuzzy uncertainty to deal with the project cost–risk–quality trade-off problem (CRQT) under time constraints. Because of the unique nature of projects and their uncertain circumstances, applying crisp values for some project parameters does not seem appropriate. Hence, this paper employs fuzzy sets to resolve these weaknesses. In this study, two approaches are presented to handle proposed fuzzy multi-objective mathematical model. First, fuzzy credibility theory and then goal attainment method are used. Secondly, the model is solved by a fuzzy method based on expected interval and value and augmented ɛ-constraint method. A project from the literature review is adopted and solved by the presented methodology. The results demonstrate the accuracy and efficiency of the two proposed approaches for the introduced practical problem.

Novel approach to noise mitigation: a case study demonstrating a collaborative approach between noise consultant and noise solution supplier for economical and practical implementation

Noise is a nuisance that needs to be addressed. With noise-related government ordinances becoming better defined and more stringently enforced, owners are being forced to address acoustical performance issues far more frequently then ever before. The acoustical design process has a long history of fragmentation, as there is minimal collaborative design that tends to occur between consultants and implementers (i.e., noise control suppliers and installers). Furthermore, the acoustical design process is often rushed through reactive planning and/or lack of budget. Both issues can result in downstream performance issues and unforeseen project cost risk. Combining the expertise of both the consultant and the supplier, has proven to dramatically reduce both cost risk and scheduling risk to owners and project stakeholders when sound attenuation is required. This paper demonstrates the benefits of a collaborative relationship between noise consultants and vendors through a case study. The outcome of this approach will show a positive result for all parties involved: owner, consultant, and vendor. The client benefits from the cost savings, schedule compression, and limited impacts to facility operations. The acoustic consultant gains the ability to complete more thorough analysis. The acoustic vendors can capitalize on mitigating project risk and streamlining the final solution.

Brief Analysis of Project Cost and Project Cost Risk Management

Brief Analysis of Project Cost and Project Cost Risk Management

BIM Engineering Cost Budgeting Method based on Social Network Analysis Method

Engineering cost budgeting is crucial to the healthy development of the engineering and construction industry. To solve the problem of large deviations in budget results from using traditional methods of cost budgeting based on evaluation results or drawing conversions, the BIM engineering cost budgeting method based on social network analysis method is studied in this paper. On the basis of analyzing cost budgeting requirements and determining modeling economic criteria, the social network analysis method is used to analyze the project cost risks. According to the project quantity list, professional BIM software is used to budget the project cost. Case verification proves the feasibility of this budgeting method as the budget deviation is reduced by about 78% compared with the traditional method. The result of the paper has a more ideal practical application effect and positive significance for optimizing the traditional cost budgeting methods

Design of Project Cost Risk Management System Based on Improved Fuzzy Rule Weight Algorithm

Aiming at the low accuracy of index weight calculation and risk type identification in traditional cost risk management systems, this paper proposes a project cost risk management system based on an improved fuzzy rule weight algorithm. We analyzed the types of project cost risks, adopted a three-tier technical architecture to design the system frame structure and functional organization structure of the cost risk management system, and adopted the B/S architecture for network structure deployment. In the software part, an improved fuzzy rule weight algorithm is used to calculate the weight of project cost risk indicators, thereby improving the effectiveness of risk management. Experimental results show that the designed system works well, can accurately calculate the weights of risk indicators, and can effectively identify multiple risk types.

Dependence Modeling for Large-scale Project Cost and Time Risk Assessment: Additive Risk Factor Approaches

High-dimensional dependence modeling remains a crucial challenge in quantitative project cost and time risk analysis. Building a complete and mathematically consistent correlation matrix becomes unrealistically restrictive as the number of uncertain performance units in a project (i.e., activity times and costs) increases, regardless of using empirical data or with subjective judgment. This article presents a pair of additive factor dependence models that provide analytic solutions to the generation of a complete and mathematically consistent correlation matrix. The additive risk factor (ARF) models account for multiple risk factors in two classes (i.e., extra-marginal and intramarginal) while providing additional flexibility for a strategic tradeoff between the accuracy and the scalability to high-dimensional project risks. We extend the ARF models to present an analytic solution to the program evaluation and review technique (PERT) problem with correlated activity times. Numerical examples demonstrate the accuracy and computational efficiency of the ARF approaches. The ARF approaches and the ARF-PERT would serve as a quick and sensible alternative to large-scale Monte Carlo simulation, in particular during the early stage of the project life-cycle.

Study on Risk Management and Control of Power Transmission and Transformation Project in Power Grid

The thesis conducts research on the risk management and control of power grid infrastructure engineering cost, integrates domestic and foreign research on risk management and control related concepts, combines the characteristics of power grid infrastructure engineering, and establishes power grid transmission and transformation through literature analysis, questionnaire survey, entropy weight method and TOPSIS method. Finally, according to the key risk points determined by the empirical analysis, combined with the current status of the power grid infrastructure project cost risk management, a series of targeted measures and suggestions are proposed for the project cost management. The thesis evaluates the impact of the cost risk factors at all stages of the entire life cycle of the power grid infrastructure project, which can provide a useful reference for the establishment and improvement of the power grid transmission and transformation project cost risk management and control system, and has certain practical significance and reference value. Finally, the paper summarizes and prospects the full text. With the gradual deepening of theoretical research and the increasingly perfect engineering cost risk control system, the results of this research will have greater practical value.

Analysis of construction project cost risk in bidding documents preparation phase

Construction projects usually involve high investments. Hence, the project cost risk analysis during the project bids phase is important. In fact, the costs of construction projects nearly always exceed the planned scenario. This research presents the cost risk analysis method during the project bids phase with the input parameter as the uncertainty variable. The uncertainty variable distribution in this research built on the historical data set of 130 projects invested in the period of 2015-2019. The research has shown that the input parameters as the uncertainty variables are the causes affecting the risks encountered when the contractor executes the project. Moreover, this research also has shown that the Monte Carlo simulation and sensitivity analysis is the tool to detect and risk management.

Project Cost Risk Identification and Construction Performance Indicators of High-rise Building in DKI Jakarta (Case Study: PT. X)

According to Skyscraper Center, a website for world’s tall builidings database Indonesia ranked 7th globally for most –have tall buildings country. As for the city category Jakarta itself ranked 10th globally with 407 buildings.A High-rise building project has its own uniqueness such as involves many disciplines and complexities also high risk of uncertainty. Cost factor is one of the biggest risk which is the contractor should consider the most. The most responsible people, the contractor required to understand and have an ability how to manage many aspects such as cost risk to achieve the project goals: the optimum cost performance, quality and schedule which were budgeted and agreed upon. This research aimed to identify the risk of project cost and construction performance indicators.The stages of methodology of this research as followed, studied the relevant issues, identified the research’s concern, prepared the research’s instruments, analyzed the research’s concern and discussed the results. The quantitative method applied in this research. Primary and secondary source of data used in this research.

Integration of Cost and Work Breakdown Structures in the Management of Construction Projects

Scope management allows project managers to react when a project underperforms regarding schedule, budget, and/or quality at the execution stage. Scope management can also minimize project changes and budget omissions, as well as improve the accuracy of project cost estimates and risk responses. For scope management to be effective, though, it needs to rely on a robust work breakdown structure (WBS). A robust WBS hierarchically and faithfully reflects all project tasks and work packages so that projects are easier to manage. If done properly, the WBS also allows meeting the project objectives while delivering the project on time, on budget, and with the required quality. This paper analyzes whether the integration of a cost breakdown structure (CBS) can lead to the generation of more robust WBSs in construction projects. Over the last years, some international organizations have standardized and harmonized different cost classification systems (e.g., ISO 12006-2, ISO 81346-12, OmniClass, CoClass, UniClass). These cost databases have also been introduced into building information modeling (BIM) frameworks. We hypothesize that in BIM environments, if these CBSs are used to generate the project WBS, several advantages are gained such as sharper project definition. This enhanced project definition reduces project contradictions at both planning and execution stages, anticipates potential schedule and budget deviations, improves resource allocation, and overall it allows a better response to potential project risks. The hypothesis that the use of CBSs can generate more robust WBSs is tested by the response analysis of a questionnaire survey distributed among construction practitioners and project managers. By means of structural equation modeling (SEM), the correlation (agreement) and perception differences between two 250-respondent subsamples (technical project staff vs. project management staff) are also discussed. Results of this research support the use of CBSs by construction professionals as a basis to generate WBSs for enhanced project management (PM).

Adequate Quantification of Project Cost Risks

Literature on project management contains an abundancy of references to abnormally high project cost overruns as well as bitter complaints that modern risk quantification methods could not accurately predict project cost outcomes in many cases. This article provides a) an explanation of abnormally high project cost overruns, b) a link of risk quantification with ‘project team's quality' (team's strengths and weaknesses) and bias, c) an explanation why all currently used risk quantification Monte Carlo methodologies are relevant to ‘strong teams' only, d) introduction of a new non-linear probabilistic (Monte Carlo) methodology to define adequate cost contingencies for projects managed by ‘weak teams', e) a practical case of the non-linear (Monte Carlo) probabilistic modeling, and f) rough calibration of non-linear probabilistic (Monte Carlo) models that could be practically used for rule-of-thumb estimating of project cost outcomes.

Monitoring after Closure: A Case of the Horse Already Out of the Barn

In the past decade, a prolonged period of monitoring after the end of injection has become one of the expected phases of a CO2 storage project among regulators and stakeholders, especially in the US. However, several serious problems with developing this so called Post Injection Site Care (PISC) plan have not been addressed. It remains unclear how prolonged monitoring can be used to improve project performance after a large mass of CO2 has been injected. Requirements during initial permitting and continued during monitoring are designed to create high certainly that CO2 is isolated in the injection zone and will not impact underground sources of water (USDW). These requirements would seem to require assessment of long term stabilization of the plume prior to injecting the CO2. If high certainty of storage permanence cannot be adequately established prior to injection, injection should not be started or continued.Seeking solutions to reduce uncertainty such that long term storage is known to be effective prior to injection of large masses is recommended Such improvements would both lower leakage risk resulting from unplanned migration and lower project cost and cost overrun risk resulting from large uncertainty in future costs of monitoring.

Study on BIM-based construction project cost and schedule risk early warning

Due to the more complex structure, greater size, and longer constructing period, most construction projects are facing more and greater risks than before and need more effective methods and tools to manage risks. However, because of the complex mathematic formulas, the difficulty of collecting data, or low profit margin etc., professionals are finding that few risk management methods and tools are sufficient, and they typically rely on their experience in practical construction-project risk management. To solve these problems, we present Building Information Modeling (BIM) as a new technology and the future of the Architectural, Engineering and Construction (AEC) industry. This combined with Earned Value Analysis (EVA) for providing a BIM-based construction project cost and schedule risk early warning model (BIM-CPCSREWM) to better and effectively manage construction project risks. Herein we will present a background and a description of the proposed model, develop the system prototype of BIM-CPCSREWM, and utilize a practical medicine construction project to illustrate the model's validity.

Project cost risk analysis: A Bayesian networks approach for modeling dependencies between cost items

Uncertainty of cost items is an important aspect of complex projects. Cost uncertainty analysis aims to help decision makers to understand and model different factors affecting funding exposure and ultimately estimate the cost of project. The common practice in cost uncertainty analysis includes breaking the project into cost items and probabilistically capturing the uncertainty of each item. Dependencies between these items are important and if not considered properly may influence the accuracy of cost estimation. However these dependencies are seldom examined and there are theoretical and practical obstacles in modeling them.This paper proposes a quantitative assessment framework integrating the inference process of Bayesian networks (BN) to the traditional probabilistic risk analysis. BNs provide a framework for presenting causal relationships and enable probabilistic inference among a set of variables. The new approach explicitly quantifies uncertainty in project cost and also provides an appropriate method for modeling complex relationships in a project, such as common causal factors, formal use of experts' judgments, and learning from data to update previous beliefs and probabilities. The capabilities of the proposed approach are explained by a simple example.

Target-Setting Practice for Loans for Commercial Energy-Retrofit Projects

AbstractOvercoming the financial barriers to energy-efficiency (EE) investments requires efforts to explicitly evaluate energy-related risks during the commercial loan underwriting. To support such efforts, the objective of this paper is to suggest a novel target-setting practice that borrowers and lenders collaboratively can use during the early stages of an energy-retrofit project. The practice uses a simulation called energy retrofit loan analysis model (ERLAM) to determine the target-building performance and the allowable cost for design and construction. Using a case study of an energy-retrofit project, this paper demonstrates use of ERLAM by evaluating the effect of two identified energy-related uncertainties (project-cost risk and operational-practice risk) on the financial performance of the investment. This target-setting practice can help project parties gain greater understanding and early confidence in the feasible size and terms of a loan before moving to design development. As a result, the ...

Energy-Related Risk Management in Integrated Project Delivery

AbstractDeveloping energy-efficient commercial buildings requires the use of an energy-related risk management practice that can increase the chance of achieving intended lifecycle financial goals. This paper suggests a management practice that deals with such energy-related risk, namely, project cost risk and performance risk. A prerequisite to applying the suggested management practice is a high level of collaboration among different disciplines during design development as promoted, for example, when using integrated project delivery (IPD). As a case study to validate the management practice, this paper presents a California hospital project where the unique features of IPD helped the project team apply the management practice in the course of managing the energy-related uncertainties of an energy-efficiency measure. This paper illustrates the detailed design decision-making process of the team that used Target Value Design, a lean design management method. As a contribution to the body of knowledge, t...