Flexibility Cost and its Application for Construction Projects
Flexibility Cost and its Application for Construction Projects

Summary/Abstract: The paper aims to develop a methodology for valuing flexibility by developing a mathematicalformula for predicting future saving of cost. The work aims to evaluate flexibility in the initial designphase of projects taking examples of construction projects. Flexibility is becoming a more widelyaccepted aspect of project management. Although contingency theory in project management states thatthe unknowns are controllable, complexity theory believes that the best way to handle the unknownswould be to have a flexible approach rather than rigidity. Designing a flexible system is a method ofmanaging uncertainty. Two case studies were considered in this research to validate the mathematicalformula. This research explains three case studies of an educational institution 28 years old for explainingthe concept and giving benefits of flexible design for modification / renovation work of building.Flexibility becomes inevitable for environment where the environment is dynamic. For a ready adaptationto market fluctuations it would be good to impose the condition that the building, along with itsinstallations should be suitable for several uses. Flexibility in the initial design phase is modelled in orderto know the advantage in future. The comparison between the extra cost of flexibility in the initial designphase and the discount that can be achieved in future due to this premium will help the developers inmaking strategic decisions. Prior research work contains various characteristics of flexible buildingstructures but no attempt has been made to compare between the extra cost of flexibility in the initialdesign phase and the discount that can be achieved in future due to flexible building structures.

• Details
• Contents