Cost model
Cost models are used, for example, in software engineering and in industrial production to estimate expected costs. These estimates vorkalkulatorisch include expected costs in material used to machine time, labor costs in man-months and other costs to produce, which is necessary to produce a product or complete a project. The estimates are carried out as systematically as possible, for example on the basis of known operating accounts from past periods or completed projects, in order to provide the basis for pricing and for the production plan or for the project plan .
Action
Usually several approaches to modeling for a cost estimate for manufacturing new products are used side by side. Models for products and projects are aggregated from bottom to top (bottom-up) and deductive from top to bottom (top-down). Both approaches include typical systematic estimation errors.
With the top-down approach, the costs for a module are first estimated and these are then divided down among the individual components or functions. If estimated quantities are neglected or overestimated, the project will burden the profit or the cost model will burden the price to be charged.
In the bottom-up approach, empirical values for typical components or functions are evaluated and the amount estimated. The summary contains safety surcharges or unnecessary services, which in turn put a strain on the price and reduce earnings due to the risk of lost sales or project losses.
Single projects
It is often overlooked that a large number of plausible assumptions and the associated simplifications compared to reality are characteristic of a model. It is also neglected that estimates based on experience or surveys as well as measurements based on observations contain errors.
There is often the expectation that a particularly reliable result can be achieved by modeling with particular accuracy. This expectation is unfounded. Transparency is achieved through fast operational accounting, not through a precise calculation model. Therefore, a safe concept for good modeling is to repeatedly correct a model based on an observation of the actual cost incurred. However, this iterative procedure does not provide any help for pricing in individual projects.
Estimation procedure
There are a few basic procedures for estimating costs.
- With the analogy method, projects are estimated on the basis of empirical values. If a company has already implemented several projects in one environment, it already has experience and can use this to draw conclusions about future projects. However, this requires a knowledge base which only builds up over time.
- Algorithmic models , on the other hand, choose the approach of calculating an algorithm- supported calculation of the effort based on various parameters (project-specific, such as lines of code in combination with the number of available people) . Representatives from this area are, for example, the function point method or COCOMO .
- With the expert-based assessment , external persons are commissioned to estimate the effort based on the requirements and the available resources.
Management procedures
Latency times
The time interval between the incurrence of costs after operational accounting and intervention by management (latency) must be so short that an unplanned increase in costs can be prevented or dampened at an early stage through corrections in the project process. This requires an early warning system that not only knows the recorded costs, but also draws the necessary conclusions from them.
Risk reduction
Only after the project has been won at the contract price can it be seen which errors the cost model contains. In addition, the assumptions on which the model is based can be violated by the execution of the contract. If the cost of individual projects must always be estimated on the basis of requirements that change in the course of the project, before the project is won , the estimates must be corrected. In order to master the project systematically in terms of technology and costs, a pronounced risk management is required.
Individual evidence
- ↑ Improved cost estimate (PDF; 121 kB)
- ↑ Mathematical exactness ( Memento of the original from January 28, 2016 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice.
- ↑ Operational accounting
