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08 MANAGING PROJECT COST ESTIMATING & BUDGETING

Posted Sat, 2016-06-25 18:58 by Rafael Davila
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  • This module misses to mention that current and preferred practice in USA construction contracts is not to depend on CPM activities for billing or the more complex task of cost control. 
  • The cost control practice in the USA is similar to the UK practice where a mere fraction of contractors use CPM based cost control as well as unit costing linked/independent of CPM activities. Keeping detailed cost control cost money, to most USA construction contractors it makes no sense to use the utterly granular method of CPM Activity based costing, it makes no sense to use the CPM Activity based costing when it is impractical to apply the method under multiple CPM required software and the contractor financial system.
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  • The reality is that only a very small fraction of USA construction contractors have a formal cost control system and those who do use their financial software but not their CPM schedules to do so. In the USA it is common for different contracts to require different CPM software and different billing and financial periods. Not all integrate with the contractors financial system, therefore such integration does not makes sense to many USA Construction Contractors. 
  • The GPC should use an approach that can accomodate for more options and provide unbiased guidance as to the options. Let the contractor make his choice among the options and do not promote a single solution as if one size fits all.