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SYSTEM AND METHOD FOR ESTIMATING
CONSTRUCTION PROJECT COSTS AND
SCHEDULES BASED ON HISTORICAL DATA
FIELD OF THE INVENTION
This invention relates to information management, to improve the flow of a project, with the simplicity and reliability of estimating time, scheduling, and costs, which are essential in all types of industry, especially in construction.
BACKGROUND—DISCUSSION OF PRIOR ART
With many technological advances in construction, the industry has experienced a virtual explosion of cost overruns and claims totaling in the billions of dollars. This is due to the fact the common methods used to estimate the average construction project today is: 1) With generic information supplied by an outside source, in cost data manuals or on digital computer media. 2) In insubstantial experience records mainly geared for job costing controls, with neither one conveying lucid and relevant estimating insight to the events. The outside data sources are popular because of the diversity of items covered, and they are organized to get to the total dollar amount, as fast as possible. Their convenience tends to diminish the significance of historical record keeping. Experience records are the best guide but, time fades memories and paper records are cumbersome to maintain and search. Paper and pen have been supplemented with computerized spreadsheets or database assembly programs, attempting to simplify the itemizing and calculations required. Most software companies attempt to organizing and present relevant estimating data but they fail. They fail to provide a simple solid basis for judgment. They fail to organize in a simple format the detailed knowledge needed to produce a distinct, competitive bid, or fine tuned schedule. Human knowledge and judgment are the basic ingredients in all estimating methods. Applying knowledge correctly requires details to support judgments, and the judgments determine the accuracy of the results.
First of all, the prices and duration times supplied by a 3rd party source are based on certain variables, conditions, and details not experienced or known by the average estimator. This minimal knowledge, when used incorrectly, can cause devastating errors in timing and pricing. Additionally, the data manuals require an up-front, clear definition of every aspect of the project including size, power, heating, cooling, type of construction, special construction needs, unique problems, site location, and the anticipation of unknown areas of risk during the project. This detail generates vast uncertainties and potential omissions in the estimating process because the estimate is not based on the estimator's own direct knowledge or detailed records. If for example, estimators from separate companies were all given the same 3rd party faulty data to bid on the same job, their bids would all be very close because they used the same 3rd party data, but not accurate or truly competitive.
The Quantity Take Off (QTO) method has been traditionally used to identify and estimate detailed work. It involves, for example, counting every two-by-four stud required for each wall as well as the number and size of the nails that will be used to secure each stud. Unit Cost (UC) estimating manuals supply the estimator with a total cost per definable unit, e.g. lineal foot, that can be quickly multiplied to determine the cost of the task, with a minimal description of details. The computer has allowed QTO and UC to take a step further, by grouping items into assemblies. Instead of
counting all the studs and nails required to construct a wall, the assembly has defined all the material items needed to construct a unit. The units can then be duplicated or divided by the number of units needed e.g. a 10 foot long wall would
5 use 10 units to calculate the material necessary to construct the wall. The power of an assembly can be seen from nested assemblies, or sub assemblies. For example, a bathroom could be the primary assembly, made up with the sub assemblies of, framing, fixtures, and finishes. By choosing a bathroom unit, all the sub assembly items and calculations are selected also. To keep up with changes in costs of these units, the manual and software vendors periodically supply local area modification indexes, or cost adjustment factors. These assembly units have streamlined the construction cost estimating process. But the accuracy of the cost/time nec
15 essary to complete the tasks are the media publisher's total responsibility. The records and knowledge of the actual work are unobtainable. A work crew may be slower but cost less, or faster and cost less than the generic information supplied by the 3rd parties. If the estimator wants to "tighten
20 up" the estimate, to make the bid more competitive, they must scrutinize their records for some basis or they must take an unsupported judgment risk.
Job Cost accounting and Estimating have been separate disciplines. Job Costing computer programs produce job
25 cost totals useful for controlling the job under construction by the amount of money expended on each phase or milestone. As a byproduct, the Job Cost system also tracks man hours expended by milestone to monitor their cost. Man hours is available to the estimator in job cost milestone
30 reports, in the job cost program. Some software products have partially merged the two disciplines to make available the total cost of a milestone in the estimating system, but costs change so quickly they cannot be relied upon as a stable guide for future biding, only ballpark estimating. Job
35 cost units are inherently unstable because of changes in the costs of the components that make up the unit, e.g. material, taxes, overhead, inflation, labor. All of these costs can change within weeks. Therefore, any knowledge gain from the historical cost information is unstable also. A task
40 completed many years ago will still take the same amount of time to complete today, but it will not cost the same because of all the associated volatile variables that are lumped together. A portion of the information gathered can be stable for many years. That information is: items and man hours,
45 but they may or may not be apparently correlated to each other, to make the history of them useful in the future. In essence, man hours and items, have not been properly refined or filtered from the raw material, specifically for the estimator.
50 To prepare a schedule the estimator must be able to answer the question: "How long will these tasks take?" Duration misjudgments are one of the greatest risks, if not the greatest risk, in the construction industry. The skill of estimating the duration times comes from the estimator's
55 judgment, coupled with his ability to root out the correct man hours from the 3rd. party information or job cost history reports. The more detailed records and direct knowledge the estimator has of the task, the greater the accuracy of the estimate. Correctly judging the duration times from 3rd.
60 party information, or vague detached reports is: tedious, time consuming, error prone, and closer to an art form, than a disciplined science. Once the estimator has determined the amount of time needed to complete the tasks they must construct a schedule for the job, placing the tasks in the
65 correct sequence with network links to the other tasks.
Estimates, schedules, or projects, produced using the methods just described, clearly lack a high degree of efficiency and reliability, because the estimator is lacking the intimate detailed knowledge and definite records to quickly, simply and accurately derive the duration times coupled to materials. The raw data is available to the estimator, but the time required to input, extract, and format the information to 5 set up a new job, and then run that job, makes the information unavailing. It is so much work to get anything useful out of the data, that the risk/reward ratio favors the risk.
An analogy for running a business this way would be: having only a paddle to steer a boat with a storm looming on 1° the horizon. Whether a storm hits or not, it takes a lot of work to stay the course. To continue the analogy my invention takes the industry from paddles to a rudder with power steering. By defining a stable base, building from that point creates a guide to steer the entire object quickly, :5 simply and accurately. That pivotal point is: a Block of information: encapsulated, and communicated knowledge. Simply, modular information that can be easily: collected, stored, identified, transferred, anatomized, multiplied or divided. These knowledge Blocks produces a stable judg- 20 ment base, from specifically aligned modular information.
United States patents of interest include: U.S. Pat. No. 4,700,318, Ockman graphically depicts structures, or elements of structures, by shading or coloring them to show the portions of the project that are completed, ahead, or behind, 25 schedule. U.S. Pat. No. 4,782,448, Milstein uses a computer with a digitizing ruler as an aid in contract estimating. He is concerned with the building construction trades where there is the necessity to provide accurate estimates of the cost of constructions for use in competitive bidding. In estimating, he takes into account the costs of a vast multitude of structural, plumbing, electrical, heating and other types of purchased equipment and components. Racine in U.S. Pat. No. 4,578,768 describes a computer aided system used in construction, planning, land survey, real estate and many other industries. Burns in U.S. Pat. No. 5,189,606 describes a totally integrated construction cost estimating, analysis, and reporting system that focus on estimating the complete life cycle cost of facilities such as airfields or facilities associated with major weapons programs. Tsushima in U.S. Pat. No. 4,852,001 describes a job scheduling method for resource leveling, or workload balancing.
It is therefore an object of the invention to provide a rudder for autonomous managerial steering. An improved system for industry with the means to simplify the management process. Easily supplying the estimator with accurate, detailed, refined, meaningful information to analyze as the 5Q primary data source, to quickly, simply and accurately produce a truly distinctive competitive bid, and fine tuned schedule. With 3rd party estimating data needed only as back up information.
It is a further object of this invention to provide such a 55 system and method that detailed information shall be linked together conveying knowledge, using historically retrieved blocks of data (historical data blocks) that are independent of any one project.
It is a further object of this invention to provide such a go system and method that duration times can be captured and recorded specifically for reference in future estimating, and scheduling.
It is a further object of this invention to provide such a system and method that the detailed information shall 65 include the total items/units placed, by using Blocks of such data to calculate future quantity totals and costs.
It is a further object of this invention to provide such a system and method that with accurate duration times, to produce a schedule automatically and in conjunction with the estimate.
It is a further object of this invention to provide such a system and method that with accurate duration times, goals can be set for employees to beat, for profit sharing, and greatly improving efficiency.
It is a further object of this invention to provide such a system and method that will merge the information of estimating, job costing, scheduling, specifications detailing.
The invention results from the realization that a truly accurate, reliable and automated estimating technique can be effected by capturing independent focused Blocks of data intimately linked to all associated parts of a task. Man hours and materials collected and recorded in these focused Blocks can be reorganized and restacked to accurately project the course of a future job. There are many ways to identify the actual hours spent on a job. The estimator could have the computer system prepare tickets per task to be allocated to the employees as time cards. The employees could take a ticket to do a task entering the time on the ticket only when the task was completed, to produce payroll and the task times. The supervisor on the job could specifically assign resources to a job and record the total as the job is completed. The critical link is that actual man hours must be accurate and directly linked to a defined quantity of material items and units, producing an extremely accurate intrinsic historical record of that event, a focused Building Block. These data Blocks can then be entered into the computer database with cross referenced names, ready to be restacked in different orders, divided, or multiplied as necessary to fill the units required for the next similar job.
One object adding much utility to the defined Block is a stored photograph or image of the completed task and information including the "hours per unit" it took to complete the task. The stored image preferably depicts actual details involved in the work directly linked to the items and the amount of time required to complete the work. This picture could be a photograph of the work, to be scanned into digital form later, or produced by a video or still digital camera, or other actual illustrative means, preferably at the job site. The next time a similar job needs to be estimated, this picture will aid the judgment of the estimator in choosing which job is closest to the job he is estimating now. This picture will represent a Building Block of data and must have a direct link to the total man hours spent and the total units placed plus any stand by time. Man hours then can be divided by the number of actual units placed plus any standby time to obtain an accurate unit duration.
Another object aiding the estimating process is a direct link to the actual job material list details. The total number of materials used can be divided into the totals units placed, to produce a material item count per unit for the next estimate. When the next estimate for a defined unit is needed, purchase orders can be easily detailed and calculated with the total materials necessary to complete the specified number of units.
Another object, scheduling is simultaneously taken care of during the estimating process. As the estimator measures the plans, selects the closest Block and totals the number of units required for the current job, the duration times are also proportionally adjusted. The proportioned duration times can automatically be transferred into a pre defined master interdependent network scheduling templet, or map. The estimator may intervene and manually adjust the total or