Estimating large complex projects

Abstract

Managing large capital construction projects requires the coordination of a multitude of human, organizational, technical, and natural resources. Quite often, the engineering and construction complexities of such projects are overshadowed by economic, societal, and political challenges. The ramifications and effects, which result from differences between early project cost estimates and the bid price or the final project cost, are significant. Over the time span between the initiation of a project and the completion of construction many factors influence a project’s final costs. This time span is normally several years in duration but for highly complex and technologically challenging projects, project duration can easily exceed a decade. Over that period, changes to the project scope often occur. The subject here is a presentation of strategies that support realistic cost estimating. Through literature review and interviews with transportation agencies in the U.S. and internationally the authors developed a database of the factors that are the root causes of cost estimation problems.