The 2021 annual meeting of IPA’s Cost Engineering Committee (CEC 2021) was held virtually over a 3-week period starting with the keynote address, held Monday, September 27, 2021. The sessions wrapped up on Wednesday, October 13. The CEC is a subcommittee of the Industry Benchmarking Consortium (IBC). CEC companies commit to confidentially sharing their detailed cost data. Participants in the annual meeting usually include key personnel from the cost engineering, project control, or related owner functions.
The objective of CEC is to improve business results by improving the cost engineering function. CEC member companies accomplish this objective by:
- Developing industry cost and schedule metrics to assist in early estimate development and estimate validation
- Sponsoring research focused on cost engineering areas of interest
- Providing a forum for sharing and networking
The primary focus of CEC 2021 was to highlight the vast array of metrics and tools provided as part of the CEC metrics package. We conducted a few sessions to describe the data and methods and shared case studies to help our member companies make effective use of the CEC materials in their estimating and scheduling processes. In addition to presenting detailed cost and schedule metrics for the member companies, CEC 2021 included the following presentations:
Keynote Address: The Roles of the Cost Engineer—Ever-Evolving, Never Easier
This keynote address was given by IPA Founder and CEO Edward Merrow on the ever-evolving roles of the owner cost engineer. Merrow outlined the new and expanding tasks that have emerged for the owner cost engineer, including responding to a supply chain made unpredictable by the COVID-19 pandemic and evaluating new cost estimating software for accuracy and usability.
Schedule Risk: What Is Wrong with Monte Carlo Simulation?
IPA Research Analyst Yang Zhou shared IPA’s findings on a study that examined data from the native project schedules captured in IPA’s Capital Projects Database in more detail. The objective of the study was to evaluate the efficacy of Monte Carlo analyses—a common simulation tool used to assess schedule risk. The study also aimed to:
- Share norms on phase and work package level slip
- Develop realistic norms for feeding triangular distributions used in typical Monte Carlo schedule risk analysis
- Share rough guidelines on slip distributions that can be used to validate Monte Carlo outputs
How The Capital Projects Industry Is Reacting to COVID-19
IPA Deputy Director of Research Jason Walker presented the latest survey findings on the observed and expected effects on project supply chains as a result of the COVID-19 pandemic and oil price drop on individual projects and portfolios. IPA has gathered survey data on the effects the pandemic has had on Industry since March 2020 and reported on this information on a quarterly basis. The latest information shows how companies have adjusted over time and gives a snapshot of where we are after 18 months.
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