Criticial determinants of construction tendering costs: Quantity surveyors' standpoint

Identification of cost-determinant variables and evaluation of their degree of influence play an essential role in building reliable cost models and enhance the competitive edge of quantity surveyors as well as contracting organisations. Sixty-seven variables affecting pre-tender construction cost estimates are identified through literature and interviews. These factors are grouped into six categories and a comparison analysis of their impact is conducted. Priority ranking of cost-influencing factors is carried out using a questionnaire survey commissioned amongst quantity surveyors based in the UK. Findings of this survey indicate that there is a strong agreement between quantity surveyors in ranking cost-influencing factors of construction projects. Comparisons between the outcomes of this research and other related studies are presented.

Enabling older people to stay at home: The costs of substituting and supplementing care with assistive technology

A wide-ranging multiprofessional research project explored issues relating to the introduction of assistive technology into the existing homes of older people in order to provide them with the opportunity to remain at home. The financial relationship between assistive technology and packages of formal care was also explored. The costs of residential care and those of a number of packages containing differing quantities of assistive technology, formal care and informal care were compared. The analyses provide a strong financial case for substituting and/or supplementing formal care with assistive technology, even for individuals with quite disabling conditions. Although needs and hence the cost of provision rise with an increasing level of disability, the savings in care costs accrue quickly. The consideration of a variety of users with different needs and informal care provision, and occupying a very wide range of housing, leads to the conclusion that in comparison with traditional care packages, at worst, incorporating significant amounts of assistive technology into care packages is cost neutral, but that with careful specification of assistive technology major savings are feasible.

The impact of procurement method on costs of procurement

Collaborative working methods offer the hope of reduced waste, lower tendering costs and improved outputs. The costs of tendering may be influenced by the introduction of different working methods. Transaction cost economics appears to offer an analytical framework for studying the costs of tendering, but it is more to do with providing explanations at the institutional/industry level, not at the level of individual projects. Surveys and interviews were carried out with small samples in UK. The data show that that while tendering costs are not necessarily higher in collaborative working arrangements, there is no correlation between costs of tendering and the way the work is organized. Practitioners perceive that the benefits of working in collaborative procurement routes far outweigh the costs. Tendering practices can be improved to avoid waste, and the suggested improvements include restricting selective tendering lists to 23 bidders, letting bidders know who they are competing with, reimbursing tendering costs for aborted projects and ensuring that timely and comprehensive information is provided to bidders.

Developing a system for assessing the costs associated with different procurement routes in the construction industry

In developing techniques for monitoring the costs associated with different procurement routes, the central task is disentangling the various project costs incurred by organizations taking part in construction projects. While all firms are familiar with the need to analyse their own costs, it is unusual to apply the same kind of analysis to projects. The purpose of this research is to examine the claims that new, ways of working such as strategic alliancing and partnering bring positive business benefits. This requires that costs associated with marketing, estimating, pricing, negotiation of terms, monitoring of performance and enforcement of contract are collected for a cross-section of projects under differing arrangements, and from those in the supply, chain from clients to consultants, contractors, subcontractors and suppliers. Collaboration with industrial partners forms the basis for developing a research instrument, bused on time sheets, which will be relevant for all those taking part in the work. The signs are that costs associated with,with tendering are highly variable, 1-15%, depending upon what precisely, is taken into account. The research to date reveals that there are mechanisms for measuring the costs of transactions and these will generate useful data for subsequent analysis.

Comparative costs of the commercial process in different construction procurement methods

The commercial process in construction projects is an expensive and highly variable overhead. Collaborative working practices carry many benefits, which are widely disseminated, but little information is available about their costs. Transaction Cost Economics is a theoretical framework that seeks explanations for why there are firms and how the boundaries of firms are defined through the “make-or-buy” decision. However, it is not a framework that offers explanations for the relative costs of procuring construction projects in different ways. The idea that different methods of procurement will have characteristically different costs is tested by way of a survey. The relevance of transaction cost economics to the study of commercial costs in procurement is doubtful. The survey shows that collaborative working methods cost neither more nor less than traditional methods. But the benefits of collaboration mean that there is a great deal of enthusiasm for collaboration rather than competition.

Exposing the myth of the 1:5:200 ratio relating initial cost, maintenance and staffing costs of office buildings

In an attempt to focus clients' minds on the importance of considering the construction and maintenance costs of a commercial office building (both as a factor in staff productivity and as a fraction of lifetime staff costs) there is an often-quoted ratio of costs of 1:5:200, where for every one pound spent on construction cost, five are spent on maintenance and building operating costs and 200 on staffing and business operating costs. This seems to stem from a paper published by the Royal Academy of Engineering, in which no data is given and no derivation or defence of the ratio appears. The accompanying belief that higher quality design and construction increases staff productivity, and simultaneously reduces maintenance costs, how ever laudable, appears unsupported by research, and carries all the hallmarks of an "urban myth". In tracking down data about real buildings, a more realistic ratio appears to depend on a huge variety of variables, as well as the definition of the number of "lifetime" years. The ill-defined origins of the original ratio (1:5:200) describing these variables have made replication impossible. However, by using published sources of data, we have found that for three office buildings, a more realistic ratio is 1:0.4:12. As there is nothing in the public domain about what comprised the original research that gave rise to 1:5:200, it is not possible to make a true comparison between these new calculations and the originals. Clients and construction professionals stand to be misled because the popularity and widespread use of the wrong ratio appears to be mis-informing important investment and policy decisions.

Adapting the homes of older people: A case study of costs and savings

Meeting the demand for independent living from the increasing number of older people presents a major challenge for society, government and the building industry. Older people's experience of disabling conditions can be affected by the design and layout of their accommodation. Adaptations and assistive technology (AT) are a major way of addressing this gap between functional capacity and the built environment. The degree of adaptability and the differences in the average cost of adaptation of different types of property are large and there is major variation within property type. Based on a series of user profiles, it was found that a comprehensive package of adaptations and AT is likely to result in significant economies arising from a reduction in the need for formal care services. This finding is sensitive to assumptions about how long an individual would use the adaptations and AT, as well as to the input of informal care and the nature of their accommodation. The present study, which focused on social housing, has implications for how practitioners specify ways of meeting individual needs as well as providing a case to support the substantial increase in demand for specialist adaptation work.

Life cycle GHG assessment of fossil fuel power plants with carbon capture and storage

The evaluation of life cycle greenhouse gas emissions from power generation with carbon capture and storage (CCS) is a critical factor in energy and policy analysis. The current paper examines life cycle emissions from three types of fossil-fuel-based power plants, namely supercritical pulverized coal (super-PC), natural gas combined cycle (NGCC) and integrated gasification combined cycle (IGCC), with and without CCS. Results show that, for a 90% CO2 capture efficiency, life cycle GHG emissions are reduced by 75-84% depending on what technology is used. With GHG emissions less than 170 g/kWh, IGCC technology is found to be favorable to NGCC with CCS. Sensitivity analysis reveals that, for coal power plants, varying the CO2 capture efficiency and the coal transport distance has a more pronounced effect on life cycle GHG emissions than changing the length of CO2 transport pipeline. Finally, it is concluded from the current study that while the global warming potential is reduced when MEA-based CO2 capture is employed, the increase in other air pollutants such as NOx and NH3 leads to higher eutrophication and acidification potentials.

Intelligent wireless web services: context-aware computing in construction-logistics supply chain

The construction industry has incurred a considerable amount of waste as a result of poor logistics supply chain network management. Therefore, managing logistics in the construction industry is critical. An effective logistic system ensures delivery of the right products and services to the right players at the right time while minimising costs and rewarding all sectors based on value added to the supply chain. This paper reports on an on-going research study on the concept of context-aware services delivery in the construction project supply chain logistics. As part of the emerging wireless technologies, an Intelligent Wireless Web (IWW) using context-aware computing capability represents the next generation ICT application to construction-logistics management. This intelligent system has the potential of serving and improving the construction logistics through access to context-specific data, information and services. Existing mobile communication deployments in the construction industry rely on static modes of information delivery and do not take into account the worker’s changing context and dynamic project conditions. The major problems in these applications are lack of context-specificity in the distribution of information, services and other project resources, and lack of cohesion with the existing desktop based ICT infrastructure. The research works focus on identifying the context dimension such as user context, environmental context and project context, selection of technologies to capture context-parameters such wireless sensors and RFID, selection of supporting technologies such as wireless communication, Semantic Web, Web Services, agents, etc. The process of integration of Context-Aware Computing and Web-Services to facilitate the creation of intelligent collaboration environment for managing construction logistics will take into account all the necessary critical parameters such as storage, transportation, distribution, assembly, etc. within off and on-site project.

Introducing assistive technology into the existing homes of older people: Feasibility, acceptability, costs and outcomes

We examined how far, and at what cost, the housing stock could be modified to accommodate the assistive technology (AT) necessary to enable older people to remain in their own homes. A multidisciplinary team devised seven hypothetical user profiles for 10 case study areas, with five local authorities and five housing associations in England and Wales. Each profile was considered at two times, five years apart, with the users' functional abilities deteriorating in between. In addition, in-depth interviews were carried out with a sample of 67 older people in the case study areas about their use and experience of a wide range of AT. The interviews showed the need to listen to older people and that they welcomed AT when it addressed a perceived need. The results showed that the extent of adaptation required of buildings to accommodate a user's needs varied greatly. It was also found that there was confusion about the terminology of AT, including the idea of the 'smart house'. The study shows that the adaptability of the housing depends on a range of factors and costs.

EOQ, JIT and fixed costs in the Ready-mixed concrete industry

The successful implementation of just-in-time (JIT) purchasing policy in many industries has prompted many companies that still use the economic order quantity (EOQ) purchasing policy to ponder if they should switch to the JIT purchasing policy. Despite existing studies that directly compare the costs between the EOQ and JIT purchasing systems, this decision is, however, still difficult to be made, especially when price discount has to be considered. JIT purchasing may not always be successful even though plants that adopted JIT operations have experienced or can take advantage of physical space reduction. Hence, the objective of this study is to expand on a classical EOQ with a price discount model to derive the EOQ–JIT cost indifference point. The objective was tested and achieved through a survey and case study conducted in the ready-mixed concrete industry in Singapore.

A model for comparative analysis of inventory costs of JIT and EOQ purchasing in the ready mixed concrete industry

A model for comparing the inventory costs of purchasing under the economic order quantity (EOQ) system and the just-in-time (JIT) order purchasing system in existing literature concluded that JIT purchasing was virtually always the preferable inventory ordering system especially at high level of annual demand. By expanding the classical EOQ model, this paper shows that it is possible for the EOQ system to be more cost effective than the JIT system once the inventory demand approaches the EOQ-JIT cost indifference point. The case study conducted in the ready-mixed concrete industry in Singapore supported this proposition.