How Better Cost Forecasting Improves Project and Program Planning
Latest from HDR’s Experts Talk Features Economists Sarah Henly-Thomas and Bruno Penet
Delivering transportation projects on time and on budget requires a strong understanding of project costs, particularly on complex, lengthy projects. With rapid cost increases in the construction and infrastructure industry in recent years, improved cost forecasting has become a key strategy for owners. Better planning based on data-driven techniques can help owners be more confident that their economic forecasts are accurate and realistic.
HDR’s Mid-Atlantic Economics Lead Sarah Henly-Thomas has helped multiple agencies develop improved construction cost indices and cost escalation rates. HDR Principal Economist Bruno Penet has more than 20 years of experience in the economic analysis of infrastructure projects in North America. He is an expert in demand/revenue forecasting and construction cost escalation for state governments.
In the latest from HDR’s Experts Talk interview series, the two discuss why cost forecasting is particularly important in today’s economic climate, explain ways in which better data can offer more benefits than flat rate contingencies, and reflect on how advances in technology hold promise for enhanced forecasting in the future.
“It’s important to understand that this sort of forecasting is not something you can do once and then hit an easy button and it'll automatically keep updating every three months,” Henly-Thomas said. “We’re often asked if we can set something like that up, but it doesn't really work that way.”
“The general framework and techniques behind cost forecasting that we are using have been around for a long time,” Penet said. “But the applications and software have evolved tremendously. They are much more sophisticated these days than they were 20 or even 10 years ago.”
HDR’s Experts Talk interview series shines a light on various aspects of transportation infrastructure design and delivery. Each subject matter expert offers unique expertise and insights about new and ongoing trends, emerging technologies and the human side of infrastructure.
Read the whole interview on cost forecasting and inflation management.
About HDR
HDR is a 100% employee-owned professional services firm. Founded over a century ago to bring electricity to a changing world, we are now a global company specializing in engineering, architecture, environmental and construction services. Our success in built and natural environments continues as we collaborate to solve our clients’ and communities’ most complex challenges.
