Industry Practices for Estimating, Controlling, and Managing Key Indirect Construction Costs at the Project Level

A primary purpose of this on-going research sponsored by the Construction Industry Institute (CII) is to develop a strategic set of industry practices for estimation, control and management of indirect construction costs (IDCC) at the project level. Researchers conducted structured interviews with 56 subject matter experts to investigate and map widely adopted and novel practices, specifically addressing certain "key" groups of IDCC. The rich findings from these interviews have been aggregated into an instructional guidebook which includes empirical consideration checklists, comprehensive process flowcharts and practical tools. Eighty-nine percent of interviewees reported that project success can be improved through better handling of IDCC. This research seeks to fill this performance gap by enabling owners and contractor to easily adopt the recommended practices into standard operating procedures. To establish a shared vocabulary for IDCC, this paper summarizes literature pertaining to IDCC and proposes a two-part operational definition comprised of a lexical definition and a categorization framework. The findings are outlined from a contractor's perspective and focus on costs most commonly incurred by construction companies at the project level. This paper presents a partial consideration checklist and a process flowchart for major construction equipment. Lastly, this paper describes the on-going validation methodology.