Cost Estimation Methods in Quality Management and Continuous Improvement: A Reflection of the Relationship

Cost Estimation Methods in Quality Management and Continuous Improvement: A Reflection of the Relationship

Brian J. Galli
DOI: 10.4018/IJSSMET.2021010103
OnDemand:
(Individual Articles)
Available
$37.50
No Current Special Offers
TOTAL SAVINGS: $37.50

Abstract

This paper investigated cost estimation methods and continuous improvement in terms of project management planning, as well as the factors that influenced these actions. Estimating the cost was one of the most imperative tasks to be done by the managers for a project. Key factors, such as cost, size, schedule, quality, people resources, maintenance costs, and complexity, were usually estimated in the beginning of project development. The techniques used for cost estimation included data composed from past projects that were combined with mathematical formulae to get the closest estimation. In regards to continuous improvement, the four-step quality model (PDCA cycle) was used as an ongoing effort to improve products or services. PDCA stands for plan, do, check, and act, which were the steps to successfully implement change. Notably, project management, when tasked with cost estimation and continuous improvement, was challenged to cope with evolving and situational alterations, which required a different set of skills.
Article Preview
Top

Introduction

There is a modest level of finesse required for project management because it skill and expertise to manage a team is needed. In-depth knowledge of technical tools, finite beginning and end points, and meeting or exceeding a customer’s needs and expectations must be understood (Duicu & Lepadatescu, 2011; Andersen, 2014; Milner, 2016; Galli, 2018c; Cova & Salle, 2005). Balancing project scope, time, cost, quality, stakeholders with different needs and expectations, and identifying requirements and expectations are the main foci for a project manager. Furthermore, applying knowledge, skill, tools, and techniques are required by the manager to meet project requirements.

The aim of project management is accomplishing project objectives, which include processes of planning, estimating, executing, budgeting, monitoring, controlling cost, and closing to deliver the project as expected. Creating an approximation of the costs of resources that are needed to complete project activities is the definition of project estimation. Also, aggregating the estimated cost of individual activities is project budgeting. The factors that create cost variances and control changes to the project budget are influenced by cost control. Furthermore, the project decisions on the cost of using, maintaining, supporting the project and results of the project have an effect that should be considered in the cost management process. Better decision-making in reduction of cost, execution time, improvement of quality, and performance of the project deliverables is provided by value engineering techniques combined with life-cycle costing. Since the ability to influence the cost is greatest at the early stages of a project, the definition of early scope is critical (PMI, 2004; Sharon, Weck, & Dori, 2013; Zwikael, & Smyrk, 2012; Galli, 2018b; Elloumi et al., 2017). Therefore, to ensure that the project reaches completion on time and on budget, regardless of an unstable and unclear environment, cost estimation and tracking is vital.

Table 1 details the relationship between project cost management processes and project phases.

Table 1.
Processes and phases of project cost management
IJSSMET.2021010103.g01

Segments of risk and uncertainties will always exist (even with a significant amount of preparation) throughout activities and tasks. Thus, a project could never be planned with complete accuracy. Also, these risks and uncertainties may even lead to an incompletion of a project.

A crucial element for competitiveness in this business is quality, so managing the quality of all the segments involved in project management is crucial. Time and budget in a project are not the only restrictions for quality, as it also includes specification and quality requirements (Adil, 2013; Shenhar & Levy, 2007; Papke-Shields & Boyer-Wright, 2017; Galli, 2018a; Memon & Meyer, 2017). Growth and continuous improvement of a project goes hand-in-hand with how the manager handles quality. There are processes in project quality management to ensure that the project will meet the requirements defined and planned and that there are quality planning processes, quality assurance, and quality control (PMD, 2008; Hartono, FN Wijaya, & M. Arini, 2014; David, David, & David, 2017; Eskerod & Blichfeldt, 2005). To guarantee that the expectations of the beneficiary are delivered, project quality management is required, consisting of identifying relevant quality levels for the project and how to meet them. Also, planned activities are implemented quality systems that are intended to ensure that the project will be within the parameters of quality planning. Project activities must be caused by monitoring and assessing their quality standards, and there should be ways to eliminate the causes that led to unsuccessful and continuous improvement (Nedelcu & Dumitrascu, 2010; Easton, & Rosenzweig, 2012; Arumugam, 2016; Burnes, 2014; Ibrahim, Abdallahamed, & Adam, 2018).

A method model of quality management systems in projects is seen in Figure 1.

Figure 1.

Project quality management (Nedelcu & Dumitrascu, 2010)

IJSSMET.2021010103.f01

Complete Article List

Search this Journal:
Reset
Volume 15: 1 Issue (2024)
Volume 14: 1 Issue (2023)
Volume 13: 6 Issues (2022): 2 Released, 4 Forthcoming
Volume 12: 6 Issues (2021)
Volume 11: 4 Issues (2020)
Volume 10: 4 Issues (2019)
Volume 9: 4 Issues (2018)
Volume 8: 4 Issues (2017)
Volume 7: 4 Issues (2016)
Volume 6: 4 Issues (2015)
Volume 5: 4 Issues (2014)
Volume 4: 4 Issues (2013)
Volume 3: 4 Issues (2012)
Volume 2: 4 Issues (2011)
Volume 1: 4 Issues (2010)
View Complete Journal Contents Listing