An approach to improving cost estimating

Abstract

The estimation of standard job times and costs within large, multiproduct manufacturing organizations can be a troublesome business. Conventional estimating methods, whilst capable of high levels of accuracy and consistency, do not easily cope with the complexity and variety present in such an environment, particularly where the manufacturing quantities of individual products are small.

This article reviews the use of regression analysis for the determination of estimating models which help to improve the effectiveness of the estimating function.

Work carried out within a major U.K. crane manufacturer, designed to produce multiple linear regression models for the estimation of assembly times for heavy, custom designed cranes, is described.