Engineering Economic Analysis

EngineeringCosts 37

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FIGURE 2-4 Cumulative life-cycle costs committed and dollars spent.

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FIGURE 2-5 Life-cycle design change costs and ease of change.

life cycle-nearly 70-90% of all costs are set during the design phases. At the same time,

as the figure shows, only 10-30% of cumulative life-cycle costs have been spent.

Figure 2-5 reinforces these concepts by illustrating that downstream product changes'

are more costly and that upstream changes are easier (and less costly) to make. When

planners try to save money at an early design stage, the result is often a poor design, calling

for change orders during construction and prototype development. These changes, in turn,

are more costly than working out a better design would have been.

From Figures 2-4 and 2-5 we see that the time to consider all life-cycle effects, and make

design changes, is during the needs and conceptual/preliminary design phases-before a

lot of dollars are committed. Some of the life-cycle effects that engineers should consider

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