Construction Costs
1.6 Construction Costs
Construction cost of a project usually is a dominant design concern. One reason is that if construction cost exceeds the owners or clients construction budget, the project may be canceled. Another reason is that some costs, such as interest on the investment, which occur after completion of the project often are proportional to the initial cost.
Hence, owners usually try to keep that cost low. Designing a project to minimize construction cost, however, may not be in the owners best interests. There are many other costs the owner incurs during the anticipated life of the project that should be taken into account. For example, after a project has been completed, the owner incurs operation and maintenance costs.
Such costs are a consequence of decisions made during project design. Often, postconstruction costs are permitted to be high so that initial costs can be kept within the owners construction budget; otherwise, the project will not be built. Life-cycle cost is the sumof initial, operating, and maintenance costs. Ideally, life-cycle cost should be minimized, rather than initial or construction cost, because this enables the owner to receive the greatest return on the investment in the project.
Nevertheless, a client usually establishes a construction budget independent of life-cycle cost. This often is necessary because the client does not have adequate capital for an optimum project and places too low a limit on construction cost. The client hopes to have suf?cient capital later to pay for the higher operating and maintenance costs or for replacement of undesirable, inef?cient components. Sometimes, the client establishes a low construction budget because the goal is a quick pro?t on early sale of the project, in which case the client has little or no concern with the projects future high operating and maintenance costs. For these reasons, construction cost frequently is a dominant concern in design.
1.7 Models
For convenience in evaluating the performance of a system and for comparison with alternative designs, designers may represent the system by a model that enables them to analyze the system and evaluate its performance. The model should be simple, consistent with the role for which it is selected, for practical reasons. The cost of formulating and using the model should be negligible compared with the cost of assembling and testing the actual system.
For every input to a system, there must be a known, corresponding input to themodel such that the models responses (output) to that input are determinable and correspond to the systems responses to its input. The correlation may be approximate but nevertheless should be close enough to serve the purposes for which the model is to be used. For example, for cost estimates during the conceptual phase of design, a cost model may be used that yields only reasonable guesses of construction costs. The cost model used in the
contract documents phase, however, should be accurate.
Models may be classi?ed as iconic, symbolic, or analog. The iconic type may be the actual system or a part of it or merely bear a physical resemblance to the actual system. The iconic model is often used for physical tests of a systems performance, such as load or wind-tunnel tests or adjustment of controls for air or water ?ow in the actual system. Symbolic models represent by symbols a systems input and output and are usually amenable to mathematical analysis of a system. They enable relationships to be generally, yet compactly, expressed, are less costly to develop and use than other types of models, and are easy to
manipulate.
Analog models are real systems but with physical properties different from those of the actual system. Examples include dial watches for measuring time, thermometers for measuring temperature (heat changes), dial gauges for measuring small movements, ?ow of electric current for measuring heat ?ow through a metal plate, and soap membranes for measuring torsion in an elastic shaft. Variables representing a systems input and properties may be considered independent variables, of two types:
1. Variables that the designers can control:
x1, x2, x3, …
2. Variables that are uncontrollable: y1, y2, y3, …
Variables representing system output, or performance, may be considered dependent variables: z1, z2, z3, … These variables are functions of the independent variables. The functions also contain parameters, whose values can be adjusted to calibrate the model to the behavior of the actual system.
Cost Models n As an example of the use of models in systems design, consider the following cost models:
C = Ap (1:1)
where C = construction cost of project
A = convenient parameter for a project, such as ?oor area (square feet) in a building, length (miles) of a highway, population (persons) served by a water-supply or
sewage system
p = unit construction cost, dollars per unit (square feet, miles, persons) This is a symbolic model applicable only in the early stages of design when systems and subsystems are speci?ed only in general form. Both A and p are estimated, usually on the basis of past experience with similar systems.
C = SAipi (1:2)
where Ai = convenient unit of measurement for ith system
pi = cost per unit for ith system
This symbolic model is suitable for estimating project construction cost in preliminary design stages after types of major systems have been selected. Equation (1.2) gives the cost as the sum of the cost of the major systems, to which should be added the estimated costs of other systems and contractors overhead and pro?t.
C = SAjpj (1:3)
where Aj = convenient unit ofmeasurement for jth subsystem
pj = cost per unit for jth subsystem
This symbolic model may be used in the design development phase and later after components of the major systems have been selected and greater accuracy of the cost estimate is feasible. Equation (1.3) gives the construction cost as the sum of thecosts of all the subsystems, to which should be added contractors overhead and pro?t.
For more information on cost estimating, see Art. 4.7.
1.8 Optimization
The objective of systems design is to select the best system for a given set of conditions; this process is known as optimization. When more than one property of the system is to be optimized or when there is a single characteristic to be optimized but it is nonquanti?able, an optimum solution may or may not exist. If it does exist, it may have to be found by trial and error with a model or by methods such as those described in Art. 1.10. When one characteristic, such as construction cost, of a system is to be optimized, the criterion
may be expressed as Optimize zr = fr(x1, x2, x3, … , y1, y2, y3, … ) (1:4)
where zr = dependent variable to be maximized or minimized
x = controllable variable, identi?ed by subscript
y = uncontrollable variable, identi?ed by subscript
fr = objective function
Generally, however, there are restrictions on the
values of the independent variables. These restric-
tions may be expressed as
f1(x1, x2, x3, … , y1, y2, y3, … ) 0
f2(x1, x2, x3, … , y1, y2, y3, … ) 0
fn(x1, x2, x3, … , y1, y2, y3, … ) 0 (1:5)
Simultaneous solution of Eqs. (1.4) and (1.5) yields the optimum values of the variables. The solution may be obtained by use of such techniques as calculus, linear programming, or dynamic programming, depending on the nature of the variables and the characteristics of the equations.
Direct application of Eqs. (1.4) and (1.5) to a whole civil engineering project, its systems and its larger subsystems, usually is impractical because of the large number of variables and the complexity of their relationships. Hence, optimization generallyhas to be attained differently, usually by such methods as suboptimization or simulation.
Simulation Systems with large numbers of variables may sometimes be optimized by a process called simulation, which involves trial and error with the actual system or a model. In simulation, the properties of the system or model are adjusted with a speci?c input or range of inputs to the system, and outputs or performance are measured until an optimum result is obtained.
When the variables are quanti?able and models are used, the solution usually can be expedited by use of computers. The actual system may be used when it is available and accessible, and changes in it will have little or no effect on construction costs. For example, after installation of air ducts in a building, an air conditioning system may be operated for a variety of conditions to determine the optimum damper position for control of air ?ow for each condition.
Suboptimization This is a trial-and-error process inwhich designers try to optimize a system by ?rst optimizing its subsystems. Suboptimization is suitable when components in?uence each other in series.
Consider, for example, a structural system for a building consisting only of roof, columns, and footings. The roof has a known load (input), exclusive of its own weight. Design of the roof affects the columns and footings because its output equals the loads on the columns. Design of the columns affects only the footings because the column output equals the loads on the footings. Design of the footings, however, has no effect on any of the other structural components. Therefore, the structural components are in series, and they
may be designed by suboptimization to obtain the minimum construction cost or least weight of the system.
Suboptimization of the system may be achieved by ?rst optimizing the footings, for example, designing the lowest-cost footings. Next, the design of both the columns and the footings should be optimized. (Optimization of the columns alone will not yield an optimum structural system because of the effect of the column weight on the footings.) Finally, roof, columns, and footings together should be optimized. (Optimization of the roof alone will not yield an optimum structuralsystem because of the effect of its weight on columns and footings. A low-cost roof may be very heavy, requiring costly columns and footings. Cost
of a lightweight roof, however,may be so high as to offset any savings fromless expensive columns and footings. An alternative roofmay provide optimum results.)
1.9 Systems Design
Procedure
Article 1.2 de?nes systems and explains that systems design comprises a rational, orderly series of steps which leads to the best decision for a given set of conditions. Article 1.2 also lists the basic components of the procedure as analysis, syn- thesis, appraisal, and feedback. Following is amore formal de?nition:
Systems design is the application of the scienti?c method to selection and assembly of components to form the optimum system to attain speci?ed goals and objectives while subject to given constraints or restrictions.
The scienti?c method, which is incorporated into the de?nitions of value engineering and
systems design, consists of the following steps:
1. Collecting data and observations of natural phenomena
2. Formulating a hypothesis capable of predicting future observations
3. Testing the hypothesis to verify the accuracy of its predictions and abandoning or improving the hypothesis if it is inaccurate Systems design should provide answers to the
following questions:
1. What does the client or owner actually want the project to accomplish (goals, objectives, and associated criteria)?
2. What conditions exist, or will exist after construction, that are beyond the designers
control?
3. What requirements for the project or conditions affecting system performance does design control (constraints and associated standards)?
4. What performance requirements and time and cost criteria can the client and designers use to appraise system performance?
Collection of information necessary for design of the project starts at the inception of design and may continue through the contract documents phase. Data collection is an essential part of systems design, but because it is continuous through out design, it is not listed in the following as one of the basic steps.
To illustrate, the systems design procedure is resolved into nine basic steps in Fig. 1.1. Because value analysis is applied in steps 5 and 6, steps 4 through 8 covering synthesis, analysis, and appraisal may be repeated several times. Each iteration should bring the design closer to the optimum.
To prepare for step 1, the designers should draw up a project program, or list of the clients
requirements, and information on existing conditions that will affect project design. In steps 1 and 2, the designers use the available information to de?ne goals, objectives, and constraints to be satis?ed by the system (see Arts. 1.4 and l.5).
Synthesis n In step 3, the designers must conceive at least one system that satis?es the
objectives and constraints. To do so, they rely on their past experience, knowledge, imagination, and creative skills and advice from consultants, including value engineers, construction experts, and experienced operators of the type of facilities to be designed.
In addition, the designers should develop alternative systems that may be more cost-effective and can be built quicker. To save design time in obtaining an optimum system, the designers should investigate alternative systems in a logical sequence for potential for achieving optimum results. As an example, the following is a possible sequence for a building:
1. Selection of a pre-engineered building, a system that is prefabricated in a factory. Such a system is likely to be low cost because of the use of mass-production techniques and factory wages, which usually are lower than those for ?eld personnel. Also, the quality of materials and constructionmay be better than for custom-built structures because of assembly under controlled conditions and close supervision.
2. Design of a pre-engineered building (if the client needs several of the same type of structure).
3. Assembling a building with prefabricated components or systems. This type of construc-
tion is similar to that used for pre-engineered buildings except that the components pre-
assembled are much smaller parts of the building system.
4. Speci?cation of as many prefabricated and standard components as feasible. Standard
components are off-the-shelf items, readily available from building supply companies.
5. Repetition of the same component as many times as possible. This may permit mass
production of some nonstandard components. Also, repetitionmay speed construction because ?eld personnel will work faster as they become familiar with components.
6. Design of components for erection so that building trades will be employed continuously
on the site. Work that compels one trade to wait for completion of work by another trade delays construction and is costly.
Modeling In step 4, the designers should represent the system by a simple model of
acceptable accuracy. In this step, the designers should determine or estimate the values of the independent variables representing properties of the system and its components. The model should then be applied to determine optimum system performance (dependent variables) and corresponding values of controllable variables (see Arts. 1.7 and 1.8). For example, if desired system performance is minimum construction cost, the model should be used to estimate this cost and to select components and construction methods for
the system that will yield this optimum result.
Appraisal In step 5 of systems design, the designers should evaluate the results obtained in step 4. The designers should verify that construction and life-cycle costs will be acceptable to the client and that the proposed system satis?es all objectives and constraints.
Value Analysis and Decision During the preceding steps, value analysis may have been applied to parts of the project (see Art. 1.10). In step 6, however, value analysis should be applied to thewhole system. This process may result in changes only to parts of the system, producing a new system, or several alternatives to the original design may be proposed.
In steps 7 and 8, therefore, the new systems, or at least those with good prospects for being the optimum, should be modeled and evaluated. During and after this process, completely different alternatives may be conceived. As a result, steps 4 through 8 should be repeated for the new concepts. Finally, in step 9, the best of the systems studied
should be selected.
Fig. 1.1 Basic steps in systems design in addition to collection of necessary information.
By : E-book Standard Handbook for Civil Engineers
