Rethinking Project Definition in Terms of Target Costing

Glenn Ballard1

1Professor, Civil and Env. Engineering. Department, 215 McLaughlin Hall, Univ. of California, Berkeley, CA 94720-1712, Phone +1 510/530-1743, FAX 510/530-1920, ballard@ce.berkeley.edu

Abstract

That phase of projects that immediately precedes design has been called by a variety of names, including design briefing, programming, front end loading, and project definition. It is widely agreed that this project definition phase is often ill performed, resulting in the design and construction of facilities that do not satisfy their purchasers or users. A number of lean construction theorists, including this author, have made contributions to rethinking project definition as a phase within lean project delivery. Target costing is a methodology developed by manufacturers of consumer products to systematically improve product profitability, and is now being adapted for use in the delivery of construction projects. Target costing starts with setting a target cost, which is a very complex and difficult process in construction as compared to manufacturing. In this paper, project definition is revisited as the phase in which target costs are set. Both traditional and lean project definition models are reviewed, a philosophy and approach are presented and grounded in case studies, and a research agenda is put forward for project definition/setting target cost.

Keywords

Customer, customer value, design, design brief, design concept, design criteria, predesign, programming, project definition, target cost, value

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Reference

Ballard, G. 2006, 'Rethinking Project Definition in Terms of Target Costing' In:, 14th Annual Conference of the International Group for Lean Construction. Santiago, Chile, 1-. pp 77-89

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