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  • Predictive Analytics for Improved Cost Management  
Impact > by Functional Area

Parametric Estimating Supports Organization-Wide Objectives

Integrate Benefits into Multiple Aspects of Project Estimating

PRICE® Systems expertise in cost estimating software provides benefits for every cost-related function, including the ability to improve coordination and value throughout the organization by virtue of the PRICE® Estimating Systems Integration Framework. PRICE Predictive Cost Analytics software clients report 30% to 60% reductions in both the proposal cycle time and costs to develop estimates.

Estimating

PRICE cost estimating software capabilities help estimators respond to initial demands and analysis of alternatives (AoAs), more quickly and easily.

 

Parametric estimating helps acquisition-side estimators:
  • Provide an independent cost estimate as a means of comparing budgets and contractor estimates, and weigh the impacts of potential change orders quickly, before requesting changes

  • Build product breakdown structures for systems of systems (SoS) estimating in a single framework, and simplify performing AoAs and estimates to complete (ETCs)

  • Provide a framework for collaboration and sharing results, throughout the program and its supply chain

  • Improve Program Affordability Management through a life cycle approach, to minimize risk and cost and to deliver better value, by improving the efficiency and effectiveness of project selection, control, and delivery

Supply-side estimators leverage parametric estimating to:
  • Accelerate evaluation of bid/no-bid scenarios

  • Increase estimate credibility, while reducing proposal cycle time and costs to develop estimates

  • Simplify the ability to respond to, or recommend, alternative design and program execution options

Business Management

Executives and business development personnel can support business case analysis and overall organizational objectives with streamlined early stage estimation that provides greater confidence in strategic budget investment decisions.

Acquisition-side executives can:
  • Increase visibility of cost drivers across the organization

  • Restore affordability and improve the credibility of funding efforts with a repeatable methodology for defensible analysis of costs, schedule, scope and benefits.

  • Gain negotiating power and enhance source selection by isolating variables in competitive proposals and highlighting exceptions in supplier estimates

  • Improve life cycle cost estimating and use Total Ownership Costs to support financial strategies for budget control and procurement, and to calculate appropriate budget reserves

  • Evaluate budget priorities, associated costs, and tradeoffs of different project variables, in advance, to maximize buying power

  • Select and plan projects with supporting business case analysis by comparing projects on benefits and values as well as expected costs

Supply-side executives can:
  • Improve bid/no/bid decision-making and improve project win rates with insights for more competitive bidding

  • Compare outside-source proposal costs for “make-or-buy” decisions
  • Incorporate corporate historical information to improve credibility and insight according to actual experience

  • Improve customer trust and confidence with solid estimating documentation and results

  • Ghost the competition and support price-to-win decisions by using industry-wide cost data to conduct competitive assessments and calculating what competitors are likely to bid

  • Improve profitability and top-line and bottom-line growth, by having a better idea of breakdown costs and protecting against hidden costs.

Engineering

Having the ability to evaluate financial impacts as a factor in early design considerations—as PRICE® TruePlanning® and PRICE® Cost Models provide—makes engineering decisions more efficient for both buyers and sellers.

Both supply-side and acquisition-side engineers can:
  • Compare top-down and bottom-up estimates, quickly

  • Simplify realistic design trade studies and analysis of alternatives (AoAs) so that affordable solutions can be found quickly.

  • Compare the impacts of changing multiple variables—build time, weight, new technology implementations, etc.

  • Project future costs of presently /currently immature technologies, by defining engineering complexity, engineering skills, and scope of design efforts

Program Management

PRICE TruePlanning’s life cycle approach to program affordability management helps improve the efficiency of project selection, control, and delivery over the long term, while minimizing risk and cost. It also provides a frame of reference for collaboration and sharing results throughout the program and throughout the supply chain.

Acquisition-side program managers can:
  • Use parametric estimating to build cost estimates quickly and easily

  • Build credible models that fortify budget requests, enabling them to withstand scrutiny

  • Use independent cost estimates to evaluate budgets and contractor estimates

  • Build product breakdown structures for SoS estimating in a single framework

  • Evaluate analysis of alternatives (AoAs) to weigh impacts of potential change orders, quickly, before requesting changes

  • Use fast “Should Cost” and what-if analysis to save time and money for resource and planning management

  • Provide a basis for program maintenance activities over the long term

Supply-side program managers can:
  • Reduce proposal cycle time and costs while increasing reliability of estimates

  • Provide a frame of reference between top down and bottom up estimates

  • Deliver estimates-to-complete (ETCs) quickly