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19 Background This chapter describes the Guidebook framework used to present information contained in Chapters 5, 6, and 7. Each chapter covers a different phase of the project development processâplanning, programming and preliminary design, and final design, respectively. And each phase has unique requirements for cost estimation practice and cost estimation management. Although there is overlap and redundancy in the information presented, the overlap and redundancy is necessary to meet the needs of state highway agency person- nel involved in each of the project development phases. The structure and format of Chapters 5, 6, and 7 is the same; how- ever, the content varies depending on the project phase, the project information and data available, and the purpose of cost estimates prepared during that phase. Strategy, Method, and Tool Integration Chapters 5, 6, and 7 use strategies to address the causes of estimation problems. In support of each strategy, methods and tools are described that can be used to deal with specific estimation difficulties. As is illustrated in Figure 4.1, the strategies and cost escalation factors influence the choice of methods, and the project phase and the project complexity influence the choice of tools. An example of this interaction is shown in Figure 4.2. In this exam- ple, poor estimation could be an agencywide problem for many projects. The Guidebook can be used to identify multiple meth- ods and tools to address this problem. If poor estimation is a project-specific problem, then a particular method and tool may help solve this problem, such as the estimation checklist tool. Although the organization of the Guidebook enables the user to proceed directly from the problem to an appropri- ate tool, this approach does not serve the primary purpose of the Guidebook, which is to encourage users to explore several methods and tools to address a problem. Based on data collected through interviews with state high- way agencies and the literature search, over 30 methods and over 90 tool applications are included in the Guidebook. Implementation of the methods and tools varies depending on the project phase. Structure and Layout of Content Chapters 5, 6, and 7 are structured as described in Table 4.1. Each chapter begins with a flow chart discussing the general steps for cost estimation practice and cost estimation manage- ment. The number of steps varies depending on the project phase. Common symbols are used to describe the information in these flow charts (see Table 4.2). In each of the project phase chapters, a cost escalation fac- tor and strategy relationship matrix is provided. These rela- tionship matrixes are identical in format to the presentation in Table 3.2. The difference between the phase chapter matrixes and the matrix shown in Table 3.2 is that the cost escalation factors presented in the phase chapters are specific to the project phase being considered. Thus, these matrixes are customized to a specific project phase situation. The methods and tools are summarized in a table for each strategy by relevance to cost estimation management and cost estimation practice. Guidance is provided through a common descriptive structure for each proposed method. For each of the methods presented, the structure provides the following situational knowledge: ⢠Why: Why use the steps in the cost estimation and/or esti- mation management process (i.e., flow chart)? ⢠Project complexity: How is use of the method impacted by project complexity? ⢠Tips for success: What makes the use of the method successful? ⢠Tools: How is the method applied? This question will be addressed in Appendix A. C H A P T E R 4 Guidebook Framework
20 Figure 4.1. Illustration of strategy, method, and tool interaction. Co st E sc al at io n Fa ct or s Cost Estimating and Cost Estimating Management Strategies Cost Estimating and Cost Estimating Management Methods Project Development Phases Project Complexity Cost Estimating and Cost Estimating Management Tools â â â Figure 4.2. Strategy, method, and tool example. Table 4.1. Chapter structure. Sections Content Guide for Project Phase ⢠Cost estimation practice and cost estimation management flow chart for project phase ⢠Relationship matrix between cost escalation factors and strategies for project phase Strategies (1 through 8) ⢠Methods and tools for implementation to address cost escalation ⢠Application of methods for relevant strategies ⢠Tools to implement methods
Each chapter discusses the eight strategies as applicable to that phase together with identified methods that are applica- ble to each strategy. Subsequently, the tools for each method are listed with the method. Tools often support multiple methods. The methods are sorted alphabetically and num- bered with an alphanumeric numbering system for methods within the same alphabet heading. As a consequence, tools are referenced by an alphanumeric codeâfor example, Tool B1.1 is Tool 1 under Method B1. All tools are found in Appendix A (i.e., the Tool Appendix). Tool Appendix The Tool Appendix describes all the tools referenced for each method in Chapters 5, 6, and 7. The common informa- tional structure for describing each tool is the following: ⢠What is the tool? ⢠What is the tool used for and why is the tool used? ⢠What does the tool do or create? ⢠When should the tool be used? ⢠What are examples or applications of the tool? ⢠What tips will lead to successful use of the tool? ⢠Where can the user find more information to support devel- opment of a specific tool? A table of contents is provided at the beginning of Appen- dix A to guide the user to the location of the tool description in the appendix. The table of contents is arranged by the method name sorted alphabetically with an alphabet-serial number coding pattern. The tools are then listed alphabeti- cally under each method with a serial number suffix to the method code (e.g., B1.1 is Tool 1 under Method B1, and C2.3 is Tool 3 under Method C2). Summary A common framework is used in Chapters 5, 6, and 7 to describe cost estimation practice and cost estimation man- agement methods. This framework is structured around fac- tors that can lead to cost escalation and the strategies that address these factors. 21 Table 4.2. Flow chart symbols and significance. Symbol ⢠Denotes all inputs into the estimation process, from both internal and external sources. The input can be information such as plans, designs, milestones, and scope from various disciplines (planners, designers, etc.). ⢠Denotes all action/process steps in the flow charts such as preparation of estimates, review of estimates, and risk analysis. ⢠Denotes the documents resulting from the preceding action step(s). They can be different types of estimates, such as the baseline estimate or the state transportation improvement plan estimate. ⢠Denotes a milestone in the system, which can relate to a significant point in development. The milestone may require meeting criteria for further actions or repeating the preceding steps. ⢠Denotes a decision where a binary verdict automatically directs the process to continue on either of the available options based on requirements. This can be a simple gate with a go or no-go decision. ⢠Denotes the input from an established database. ⢠Represents the different phases of project development. This symbol is placed on the right side of each flow chart. Significance Input Step Document Milestone Decision Ph as e Database
