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COSTING AREAS 165

planned cost may not be anywhere equal to what has been accomplished to date.
Also, EVA data can be used effectively for progress billing. Performance mea-
surement, measuring the value of work accomplishment, and EVA are covered in
detail in Section 8.

Costing Areas

Something that I used to hear about a lot (but less so, recently) is cost engineer-
ing. There are a lot of practices that are associated with cost engineering that are
not within the purview of this text. Still, there is an abundance of things that can
impact upon the cost of doing the defined work. Part of the function of cost man-
agement is to identify and evaluate all the options that can bring costs down or
(the downside) blow up your budget. Here are just a few.

• Risk and cost—We try to get off to a fast start. Sometimes it’s too fast. The
design criteria are not set. Or the sponsor isn’t sure what he wanted. Or
work on the task did not wait for the predecessor information. We may have
to start over. Time is important, but it’s not everything. These items could
hurt in the pocketbook.
Costs of doing it over.
Costs of changing design in midstream.
Trickle down effect on other parts of the job.

• Time and cost—Faster is sometimes cheaper. In Chapter 3.4, we discussed
how period costs could be reduced by expediting the project. Later in this
chapter, we discuss the potential cost efficiency of overtime.
Reduce period-based costs by shortening duration (includes: cranes,
safety barriers, foremen).
Overtime hours may cost less than standard time (burden costs are al-
ready factored into base rates).

• Reuse and cost—What is the value of invention as compared to efficiency?
Left in the hands of a designer, the objective is likely to be a new, fresh
product that raises the bar in technology or service. Left in the hands of the
cost manager, the focus might be on reusing as much “old stuff” as possible.
This reduces time, cost, and risk, but might not deliver the best solution.
These options need to be explored and evaluated and a balance made that
comes closest to satisfying all stakeholders and objectives.
Reuse code or boilerplate.
Reduced risk.
Reduced learning curve.
On the other hand, older may be less efficient.