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Keywords Design management, Procurement, Auditing
Abstract Building cost planning was originally developed in the framework of traditional procurement methods with conventional documentation, tendering and administration processes. With the advent of alternative forms of procurement with more fluid approaches to design stages and documentation, the need for sound cost planning does not appear to diminish. As a process established on solid theoretical foundations, cost planning should be robust enough to adapt and flourish in a variety of procurement environments. However, little documentation and analysis of transformed and adapted forms of cost planning appear to have been made. This case study of a design-construct company in Melbourne, Australia, presents and explores a contemporary form of building cost planning integrated into a design cost management approach adopted by a construction company experienced in alternative forms of procurement. The article traces this process on a design-construct project from inception to the end of the design development stage and tender. Whilst the fundamental framework of cost planning remains intact, the focus and detail in each of the stages are guided by the company's priority for greater financial control over the cost and value implications of design and other decisions. This recently established working model of design cost management in this company has been designed to deliver added value to the client through a better balance of time, cost and quality in each project.
Introduction
The basic principles of cost planning (or design cost management) have been described by many authors over the last 50 years (Ministry of Public Building and Works, 1968; Bathurst and Butler, 1983; Seeley, 1996; Ferry et al., 1999). In more recent years these authors have been joined by luminaries including Morton and Jaggar (1995), Flanagan and Tate (1997), Smith (1998), Smith and Love (2000) and most recently by Jaggar et al. (2002) who have pioneered the process of building design cost management using project simulations from the Internet-based building cost information service. All these authors stress the basic principles of cost planning as:
* to establish a frame of reference for the process (set a realistic budget and cost targets for various parts of the project);
* to evelop a method of checking that this budget and the cost targets are being maintained (elemental cost...