Cost-benefit analysis keeps projects on courseEducation | 17 Dec 2019
As Hong Kong has, in recent years, been rocked by cost overrun and late delivery of a number of major infrastructural projects, project cost-benefit analysis has emerged as an effective antidote to the problem.
To further enhance management professionals’ knowledge of project cost-benefit analysis for the benefit of the local community, the School of Professional Education and Executive Development of The Hong Kong Polytechnic University (PolyU SPEED), in collaboration with The Hong Kong Institute of Surveyors (HKIS), held a workshop recently on “Project Cost Benefit Analysis – New Perspectives”. Dr. Alexia Nalewaik, Adjunct Professorial Lecturer of American University, was invited to be the speaker.
The workshop focused on project cost-benefit analysis, which covers both quantitative and qualitative aspects. As a subset of Project Economics, cost-benefit analysis is a methodology for determining the feasibility, usually profitability or necessity, of an economic investment. The nature of the approach implies that there will be a decision or recommendation made at the end of the analysis. The concept also implies that there are alternatives being considered even if that alternative is simply to not undertake the project. The core concepts of cost engineering and project management, ethics and bias, stakeholders, and risks need to be understood and established before any qualitative or quantitative evaluation of the project can be performed. As Dr. Nalewaik emphasizes, there is much more to project cost-benefit analysis than just economic theory.
The workshop was presented in an easy-to-understand format with straightforward mathematics. In addition to engineering and construction projects, the workshop was also relevant to social sciences projects and events. Key topics covered included stakeholders, risks, ethics, bias, and political applications for multi-perspective cost-benefit analysis; the workshop also looked beyond the project selection phase to possible scenarios when a selected project does not deliver.
“Bias often occurs as owners or the one who pays is the centre of attention,” says Dr. Sandy Tang, Programme Leader of Bachelor of Science (Honours) in Surveying. “Cost-benefit analysis can help individuals make decisions on a comprehensive basis, taking all stakeholders into consideration and avoiding bias.”
This workshop was not only useful to project owners, project team members, and management professionals but also to the public. “Cost-benefit analysis is not just crucial to project management; it also helps to enhance lifestyles,” stresses Dr. Nalewaik, who has over 25 years of experience in project control and management, “It is a universal decision-making tool.”
For those interested to know more, PolyU SPEED is offering the Bachelor of Science (Honours) in Surveying programme to equip students with fundamental knowledge and skills in the inter-disciplinary professions of land, property and construction for their employability and lifelong learning. Professionals can also stay tuned to PolyU SPEED, which often invites local and global industry experts to hold inspiring workshops.