Clarification of the Essential of Life Cycle Cost upon Decision-Making Process: An Empirical Study in Building Projects

Authors: Ayedh Alqahtani, Andrew Whyte

Abstract:

Life Cycle Cost (LCC) is one of the goals and key pillars of the construction management science because it comprises many of the functions and processes necessary, which assist organisations and agencies to achieve their goals. It has therefore become important to design and control assets during their whole life cycle, from the design and planning phase through to disposal phase. LCCA is aimed to improve the decision making system in the ownership of assets by taking into account all the cost elements including to the asset throughout its life. Current application of LCC approach is impractical during misunderstanding of the advantages of LCC. This main objective of this research is to show a different relationship between capital cost and long-term running costs. One hundred and thirty eight actual building projects in United Kingdom (UK) were used in order to achieve and measure the above-mentioned objective of the study. The result shown that LCC is one of the most significant tools should be considered on the decision making process.

Keywords: Building projects, Capital cost, Life cycle cost, Maintenance costs, Operation costs.

Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1097066

References:

[1] I.A. Kabbani, Decision Support Life-cycle Analysis System in Building Design, Architecture, University of Colorado at Boulder, Colorado, 1993, pp. 11.
[2] J. Emblemsvag, Life-cycle Costing: Using Activity-based Costing and Monte Carlo Methods to Manage Future Costs and Risk, John Wiley & Sons, New Jersey, 2003, pp.2.
[3] J.C. Raymond, S. Eva, Reconciling theory and practice of life-cycle costing, Building Research and Information, 28 (2000) 368-375.
[4] H.A. Boussabaine, R.J. Kirkham, Whole life-cycle costing : risk and risk responses, Blackwell Publishing, Malden, 2007.
[5] A. Pelzeter, Building optimisation with life cycle costs - the influence of calculation methods, Journal of Facilities Management, 5 (2007) 115-128.
[6] W.J. Fabrycky, B.S. Blanchard, Life-cycle cost and economic analysis, Prentice Hall1991.
[7] R. Flanagan, Life cycle costing for construction / prepared by Roger Flanagan, George Norman with J. David Furbur, London : Published on behalf of the Royal Institution of Chartered Surveyors by Surveyors Publications, London, 1983.
[8] A. Ashworth, Life-Cycle Costing: A Practice Tool?, Cost Engineering, 31 (1989) 8-8.
[9] A. Al-Hajj, Simple Cost-significant Models for Total Life-cycle Costing in Buildings, University of Dundee1991.
[10] F.C. Jelen, J.H. Black, A.A.o.C. Engineers, Cost and optimization engineering, McGraw-Hill1983.
[11] H.N. Ahuja, M.A. Walsh, Successful methods in cost engineering, Wiley1983.
[12] B.S. Dhillon, Life Cycle Costing for Engineers, Taylor & Francis2009.
[13] P. Barrett, C.A. Stanley, Better Construction Briefing, Wiley1999.
[14] R. Evans, R. Haryott, N. Haste, N. Jones, The Long Term Costs of Owing and Using Buildings, The Royal Academy of Engineering, London, 1998.
[15] A. Khanduri, C. Bedard, S. Alkass, Life cycle costing of office buildings at the preliminary design stage, Proceedings of the 5th International Conference on Civil and Structural Engineering Computing, Civil-Comp Press, Edinburgh, 1993, pp. 1-8.
[16] J. Dell'Isola, J. Kirk, Life cycle costing for design professionals McGraw-Hill, New York, 1981.