Design To Cost Metrics Can Help Increase Project Value While Reducing Cost

January 5, 2009 · Filed Under Estimating, General  - 0 Comment(s)

An interesting paperBy Quentin Redman and George Stratton in the Fall 2008 SCEA Journal discussed implementation of Design To Cost. Quentin covered some of this at the 2008 SEER Users Conference in his paper.

They Define Design to Cost as:

Design To Cost (DTC):DTC is engineering oriented and attempts to solve the mystery “Given the budget and performance requirements what do I design and build”

They contrast this with Cost As An Independent Variable (CAIV): CAIV is architectural in nature and answers the question “given a fixed budget how much performance can I get when I need it with the maximum acceptable risk”

They discuss how at Raytheon they lend CAIV and DTC under the heading affordability.

They also identify their core design to cost metric: DTC = CurrentCostEstimate / DTCTarget

I have the highest respect for organizations that use estimates as part of the project management process. This is a key part of project management.


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