Brussels, 31 May 2005
Demanding consumers, and increased price competition, have emphasised the importance of cost estimation and profitability analysis to the early stages of product development. Manufacturers would also benefit from their suppliers, often small and medium-sized enterprises (SMEs), providing them with transparent, timely and accurate cost estimations.
Cost engineering is a methodology helping companies with cost estimates, cost control, business planning and project management, as well as scheduling and profitability analysis of projects and processes. An EU funded project, launched in July 2004, called 'Virtual Cost Engineering Studio' (V-CES) is currently developing cost engineering software aimed at SMEs.
Funded as a Specific Support Action under the Sixth Framework Programme (FP6), the project's objective is to develop a virtual cost engineering service to answer to the needs of both SMEs and original equipment manufacturers (OEMs) in three industry sectors: automotive, aerospace and electronic equipment. The project consortium includes three industrial partners from these sectors: Centro Ricerche FIAT, PRICE Systems, and DAS GmbH.
Virtual Cost Engineering Studio aims to offer companies a package of services, including an Internet tool that would assist companies in producing timely and accurate cost estimates. The project thus aims to make product development a more creative, collaborative and resource efficient process.
Including partners from Italy, Germany and the UK, the project also plans to develop training material on cost engineering techniques and establish a European virtual cost engineering community - a kind of best practice centre - for the purposes of exchange of experience and best practices.
Furthermore, over the course of the project's two-year span, the partners are working to develop a public database of engineering and cost information. This database will provide companies and cost engineers with relevant data for labour, material and equipment cost estimation.
The project estimates that the Virtual Cost Engineering Studio services will reduce by 25 per cent the time needed for carrying out accurate cost estimations. This would allow companies to improve their competitiveness and may even lead to an increase in company profits.
In addition, thanks to quicker, accurate cost estimates, the V-CES services should facilitate and improve the situation of OEMs and suppliers by reducing the time needed to negotiate contracts with their clients. The project has a budget of just under 900,000 euro, and is coordinated by the IZET Innovationszentrum Itzehoe, a German microtechnology cluster in the Hamburg region.
For further information on the V-CESZ project, please consult the following web address:
For further information on other projects funded under FP6, please consult: