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Chapter 1: Designing and Implementing a Computerised Bill of Quantity System for Engineering Projects – Introduction.

1.1 Introduction.

In general, building contracts are awarded through competitive bidding. Contractors will be invited to submit proposals to the owner, who typically selects the lowest bid to construct the project.

Before proceeding, both the owner and the contractor must determine the construction cost of the proposed project. This is accomplished via a construction cost estimate.

Although the actual final cost of construction will not be known until the project is completed, conceptual estimates can provide a solid starting point for the owner and contractor.

The owner will be able to anticipate a range of final costs in advance, ensuring the lowest construction costs and budgeting the necessary funds ahead of time. Adding an acceptable contingency proportion to the overall expected cost mitigates such risk.

To win the contract, the contractor’s bid price must be low enough to compete with other bidders yet still high enough to cover his risks and generate a profit. As a result, cost estimates are extremely important throughout the project life cycle, particularly during the conceptual and feasibility phases.

The preparation of any type of cost estimate is dependent on the estimator’s experience, the tools utilised, the time invested, and the available information.

Typically, the development of an estimate begins by dividing down the project into components, then subtracting the quantities of the elements of each package and then pricing them collectively.


Finally, by adding all the prices, the direct building cost is calculated. This process is lengthy and intricate, but the most complicated aspect is the quantity take off.

As a result, computers are thought to be good cost-estimating instruments. due to their ability to do complex calculations and store large amounts of data for later use. Any decision regarding the construction of a project that has been or will be executed is based on one type of estimate: preliminary estimates.

Because of their moderate level of accuracy, the owner, quantity surveyor, and contractor regard them as the first choice estimates because they are inexpensive and quick to generate.

The owner utilises them to determine whether a project is viable and to analyse contractor bids, while the architect designs within the owner’s budget and considers alternatives, and the contractor determines whether bidding on a project is profitable or not.

As a result, the proposed methodology focuses on preliminary building cost estimates, with a computer serving as a readily available tool for estimators.


1.2 Background of the study

Computers are becoming increasingly prevalent in all facets of daily life. The cheaper computer gear available today has fueled the surge of using computers.

Although the transition has been slower than others, the construction industry is gradually adapting to the advancements in information technology.

As a result, professional architects, engineers, and surveyors had computerised their work, and contractors had begun to employ computers in their normal business operations.

According to a survey conducted by Mohd Hisham Ariffin (2002), Construction Industry Development Board (CIDB) G7-graded contractors were heavily reliant on computers for administrative tasks while having a mediocre reliance on computers for technical tasks such as scheduling, technical calculation, budgeting, estimating, and so on.

Construction companies used computers mostly for accounting purposes in the beginning. With advancements in micro-computing, improved knowledge of computer capabilities, and the creation of user-friendly software, computers have been employed in everyday construction to make quick and precise judgements.

The method of estimating pre-tender prices has been devised manually. The computer can be used in conjunction with any estimating method to quickly retrieve cost data or to calculate an estimated estimate. The advantage of employing a computer is that an estimate, no matter how comprehensive, can be updated quickly and efficiently to reflect modifications that may be required in a revised design.

Computers’ potential in construction estimating has evolved from their usage as an adding machine to an integrated process involving computer-aided design (CAD), estimating software, job costing software, and project scheduling systems.

However, the actual use of computers for estimation varies by industry. Some organisations employ computers for all initiatives, with a high level of sophistication.

There are a number of estimating software programmes available. Some merely perform the mathematics of the estimation process, while others integrate it with other aspects of the construction process.

Regardless of how sophisticated the programme is, the estimator must comprehend the calculating procedures and assumptions utilised in it. Before making an estimate, the estimator should have had sufficient training and understand all assumptions.

Computer estimating still requires measuring dimensions and compiling resources. This information can then be entered into the computer to calculate the labour, equipment, and material expenses that will be utilised to create the estimate.

To accomplish this type of function, the computer must be configured to go through the necessary procedures and have suitable unit costs stored in it.

To generate a cost estimate, an estimator must first organise a significant amount of information and then perform multiple computations. The estimator can utilise the computer to organise, store, and retrieve data, as well as do the numerous calculations required to create an estimate. It can be a useful tool for reducing preparation time and improving cost estimating accuracy.

Several computer databases can be created to automate and standardise the estimate process. A historical cost database can be created using the cost records of previously completed projects by the company.

Information from the historical cost database can be used to develop estimates for future projects. As fresh information is collected from ongoing projects, the historical cost database can be updated.

The emergence of relatively powerful and cost-effective computer technology has made computer-aided estimation a reality. The number of estimating products has expanded dramatically with the introduction of an interactive computing system to the market.

Accompanying the emergence of estimating software, advances in database management systems have had a significant impact on the development of computer-aided estimating software.

As a result, it can be concluded that the introduction of computer technology into estimating practice is a significant event in the evolution of the traditional estimating method by shortening estimate preparation time, reducing the amount of paperwork required for conventional data storage, and improving documentation quality.

These advantages allow the estimator to focus more on decision making throughout the estimation process while leaving all data processing responsibilities to the automated system (Charoenngam, 1996).


1.3 Problem Statement

In general, present estimating programmes are unable to fully satisfy their customers. The available software is underutilised due to its inefficiency in terms of difficulty and cost, as well as the fact that the programme does not match the company’s estimation style (Charoenngam, 1996).

There is a significant learning curve for practicing estimators to run the system, particularly for small businesses (Lowe, 1994).

Most estimating packages concentrate on programme manipulation and provide too many unimportant optional features rather than focusing on core estimate preparation. Estimating methods and approaches vary by region, country, location, and company (Lowe 1994).

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