Cost Management

Cost Control is a key objective in Construction Management and Construction Scheduling. Not much of paperwork achieves this construction cost control. The actual control is achieved through the ultimate decision of the manager. The paperwork provides guidance on what control actions should be taken and therefore it is rather a cost information system.
The elements of a cost control system are:

• Observation
• Comparison of observation with some desired standard
• Corrective action to take if necessary.

A construction cost control system should be observed by the manager for  current cost levels, compare them with a standard plan, and institute corrective action to keep cost within acceptable bounds. 

Cost Control begins at the earliest stages of the Project and continues throughout the Planning and Design  period with additional progressive monitoring maintained for each major Construction Component as actual construction commences.

The initial Budget is broken down into major cost categories, i.e., Planning, Design, Site work, Foundations, Equipments, etc., to establish early Design and Construction guidelines for the entire Project Team. As design progresses, these categories are further segregated into Systems, system components,

Equipment items and any other individual area that can be isolated for estimating purposes. Quantity Labor and Material breakdowns are itemized, estimated and continually compared to the Budget guidelines. From rapid updating to total project costs, EDP equipment is utilized when the list of cost control items becomes significantly long. An example of how equipment components can be identified and recorded, utilizing EDP systems, is included herein.All Design phases involve comparison of like materials to satisfy a given requirement, in order to take advantage of optimum costing as part of the final selection, with emphasis also on durability and maintainability as well as appearances.