What is Wrong with Life Cycle Costing?

Oct. 6, 2011 - PRLog -- Interview by Helen Winsor, Construction IQ

Given the opportunity to speak to Dutch Life Cycle Cost expert, Jaap Bakker, senior specialist at the Dutch Ministry of Infrastructure and the Environment, we asked around among the bridge engineering community to find out what they thought were the challenges inherent in working with life cycle costs. Based on the responses we received, we put together a couple of questions to put to Jaap Bakker.
Construction IQ: First of all, life cycle costing management is reliant on reliable data, and the models will invariably remain sub-optimal, or fail, if measurements are not precise. However, collecting such data is very costly. What is the way out of this dilemma, in your view?

J Bakker: Yes, well, I think it really depends on what you want to do, because I think in the most important decision points, you really don’t need this exact data. It really depends on the level of your life cycles analysis. For instance, when you make your big decisions, in the early stage of construction, for instance, will I build a bridge or a tunnel, when you want to compare those decisions, the life cycle costs are really a lot different. And nowadays, it’s hardly taken into account what the life cycle cost affects are. So if you’re actually able to use those kinds of numbers, even if they’re rough, they can still have a big influence on your decision.

Also during your procurement, whether you choose for a steel bridge or a concrete bridge, the expectation costs are really different. So even if you have rough figures, it will still be something you can work on. You must also realise that once you start working with life cycle cost, people also start to reflect on it, so you will learn together. So it should not be a reason not to start with life cycle costing because you don’t have the figures. It will grow once you start using it.

Construction IQ: Thank you, Jaap, some great insight there, as I’m sure our audience will agree. Now, assets may be built at different times and by different ages. How do you reconcile a diverse asset portfolio for overall life cycle costs, Jaap?

For the transcript and mp3 in full please click here

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Jaap Bakker will be delivering a presentation at the Bridges Europe Summit 2011, due to take place from 14th – 17th November at the HUSA President Park Hotel, Brussels, Belgium. For further information about the Agenda, please visit: www.bridgeseurope.com or contact our enquiries team on enquire@iqpc.co.uk or call 0800 652 2363.