© Nottingham University Press

icccbe 2010 Proceedings of the International Conference on 

Computing in Civil and Building Engineering 
W Tizani (Editor)

Exploration of drivers and barriers to life cycle costing (LCC) in

construction projects: professional quantity surveyors assessment

T Chiurugwi, C Udeaja & K Hogg

School of the Built Environment, Northumbria University, Newcastle Upon Tyne, UK
W Nel
External Facilitator - Construction Cost Consultant, UK

Abstract
The construction industry in the UK is facing unprecedented and demanding uncertainty, rising
inflation with poor economic trends, reduction in purchasing power, budget limitations, increased
competition, etc. At the same time, there is an increasing interest in reducing cost in an organization,
especially in projects. This has created an awareness and interest in the total cost of projects, from
conception to decommissioning, given that cost in use can amount to more than two thirds of total
project costs. A common tool used to carry out comprehensive assessment of costs in the different
phases of a project is life cycle costing (LCC). LCC is becoming more important as more private
organizations invest in private finance initiatives (PFI) and private public partnership (PPP), the UK
refurbishes its aging building stock, and sustainable construction becomes topical. Quantity surveying
(QS) professionals need to be informed of the LCC impacts of constructed assets so that they can
encourage key stakeholders to make more sustainable choices and informed decision in procuring,
operating, and disposing them.
No research has been carried out on LCC use by professional quantity surveyors yet even though it is
clear that they will play an important role in its application to the construction industry. The research
described here investigated professional quantity surveyors’ views and application of LCC, explored
why they do not use it frequently, and came up with suggestions of how their use of LCC can be
improved. The results suggest that there is limited understanding of LCC among professional quantity
surveyors. This limits their application of LCC tools and principles in the construction industry. The
professional surveyors’ clients seem to be the main promoters of LCC use when it is used but this is
limited by the surveyor’s lack of appreciation of LCC benefits to the industry. To promote greater use
of LCC, it is suggested that quantity surveyors be trained in the practicalities of LCC and how to use
standardised LCC methods. Other barriers identified, including lack of procurement or contract award
incentives are concluded to be centred on Client requirements and the quantity surveyor’s LCC skills
and knowledge. It is suggested that future work explores the development of external or internal short
courses on LCC principles and applications for quantity surveyors and other stakeholders in the
industry.

Keywords: life cycle costing, construction projects, quantity surveying, drivers, barriers

1 Introduction
The construction industry operates in an increasingly uncertain business environment, characterized
by increasing competitiveness; resource scarcity; sustainability requirements; and demand for value
for money by its stakeholders (Swaffield and McDonald, 2008; TRADA Technology, 2008). The built
environment has wide-reaching economic and environmental implications: it is responsible for half of
all CO2 emissions, half of water consumption, one third of landfill waste, and one quarter of raw
materials used in the UK (Woodward, 1997; Clift, 2003; BERR, 2008). As a result, there is mounting
public interest and legislative requirement for sustainable construction, linked to the need to conserve
resources (Pasquire and Swaffield, 2002). There is growing pressure on those that design, produce and
operate constructed assets to predict and manage the assets’ whole life performance; it is no longer
enough to only consider initial capital cost (Woodward, 1997; Clift, 2003; Flanagan and Jewel, 2005).
There has been, therefore, a shift from addressing buildings ‘as built’ to ‘in operation’ (Pasquire and
Swaffield, 2002; Clift, 2003; Kirkham, 2007; TRADA Technology, 2008). Various life cycle
approaches are employed to assess asset performance for the entire life cycle, from conception to
decommissioning (Pasquire and Swaffield, 2002; Clift, 2003; Pelzeter, 2007).
Life cycle costing (LCC) is the commonest economic evaluation technique which assesses the cost
of an asset, or its parts, throughout its life cycle while fulfilling its performance requirements (BSI,
2008a; Swaffield and McDonald, 2008). Life cycle costs include acquisition, maintenance, operating
and disposal costs of an asset (Flanagan et al., 1989; BSI, 2008b; Swaffield and McDonald, 2008).
The long held notion that the cost in use of constructed assets can be several times higher than initial
capital cost is ever more relevant today with increasing use of private finance initiatives (PFI) and
private public partnerships (PPP) (Flanagan and Jewel, 2005). Life cycle costing would seem like a
necessity to these projects (Swaffield and McDonald, 2008). LCC is used to evaluate constructed
assets, their component parts, or materials based on their initial and consequential costs to achieve
better value for money at pre-construction, construction, and occupancy stages (Pasquire and
Swaffield, 2002; Davis Langdon, 2007; Office of Government Commerce, 2007). It is often used to
justify more expensive alternative investments by demonstrating their lower consequential cost
(Pelzeter, 2007) or to provide a picture of an asset’s cost-is-use for transparency, planning, general
awareness, comparison, cost-benefit analyses, and contractual requirement purposes (Pasquire and
Swaffield, 2002; Davis Langdon, 2007; Pelzeter, 2007). These uses and benefits are desirable to
various users including public sector owner/occupiers, commercial investors/developers, private
sector occupiers and Public Private Partnership (PPP) contractors. Other terms have emerged to
describe the combination of initial and consequential costs throughout the life-span of an asset, e.g.
whole life costs (WLC) (cost, benefits, and other financial externalities throughout the entire existence
of an asset, beyond the economic life), through life costing, total ownership costs, etc. (Sterner, 2000;
Pelzeter, 2007).
Despite the benefits of using LCC and its application in procuring many other products, LCC is
not widely used in procuring constructed assets (Christensen et al., 2005; TRADA Technology, 2008).
Surveys of LCC use by contactor’s quantity surveyors on PFI projects (Swaffield and McDonald,
2008), real estate professionals in Germany (Pelzeter, (2006) cited by Pelzeter (2007)) and a wider
range of stakeholders in the construction industry in Sweden (Sterner, 2000) and the UK (Clift and
Bourke, 1999) have been carried out. The findings reveal that there is a general appreciation of the
benefits of LCC use but its greater application is crippled by various obstacles. As a result, LCC is
used in a simplified format, or not at all, in the construction industry (Swaffield and McDonald, 2008).
The barriers to greater use are thought to include lack of clarity on LCC principles and applications;
lack of simple, standard methodology; lack of fiscal encouragement; lack of reliable data; absence of
procurement and contract award incentives; and uncertainty of cost and lifespan (Pelzeter, 2007;
Swaffield and McDonald, 2008; TRADA Technology, 2008). A number of remedial actions have
been proposed and some have been implemented although, as reflected by Swaffield and McDonald
(2008), LCC is still under-utilised. The remedial actions include establishment of the Whole Life Cost
Forum (Whole Life Cost Forum, 1999), assembling benchmarking cost and time data for use in LCC
(El-Haram et al., 2002), making LCC a mandatory tender requirement in PPP/PFI procurement
(Swaffield and McDonald, 2008), and development of standardised LCC methodology, e.g. the ISO
15686-5 and the UK LCC supplement to it (BSI, 2008a).
The Latham (1994) and Egan (1997) reports recommended LCC as a way through which the
construction industry could deliver improved value for money (Pasquire and Swaffield, 2002). As the
main promoter of LCC in the UK, the government considers value for money as “the optimum
combination of whole-life cost and quality to meet the user's requirement.” (OGC, 2007, p.4).
Professional quantity surveyors will play an important role in the application of this technique and
may have to evolve their practice to make LCC a routine activity. Comparable changes led to
increased use of value management/engineering in the construction industry which, like LCC, is
borrowed from the manufacturing sector (Ashworth and Hogg, 2000; Male, 2002; Christensen et al.,
2005; Pelzeter, 2007).
The research described here investigated how professional quantity surveyors view and apply LCC,
explored why they do not use it frequently, and came up with suggestions of how LCC use by
professional quantity surveyors can be improved.

2 Procedure of data gathering and analysis

A questionnaire was designed in Microsoft Office Excel® and distributed electronically by email to
professional quantity surveyors working for consultancy practices of varying sizes in the UK. The
questionnaire was divided into four sections each exploring different parts of the research question: 1.
Background information- information about the respondent’s organization and LCC and quantity
surveying experience; 2. Perception of LCC- the individual’s understanding of LCC and how they
viewed its contribution to the construction industry; 3. Extent of LCC use in practice- the respondent’s
and his/her organization’s use of LCC; and 4. Barriers and drivers to greater LCC use- the barriers
and drivers influencing LCC use, and what the respondent thought could be done to improve LCC
use.
The questionnaire was sent out to professional quantity surveyors; the researchers’ work
colleagues and students enrolled on a part-time, professional postgraduate quantity surveying course.
The list from which the sample was randomly drawn allowed the inclusion of quantity surveyors of
varied levels of experience, belonging to firms of varying sizes. The snowball sampling technique was
employed in order to capture responses related to organizational culture accurately. The target sample
size was 30, deemed optimal in balancing the demands for data gathering and the quality of the survey
data: keeping the sampling and non-sampling errors at acceptable levels. Therefore, the questionnaire
was sent to 30 primary respondents, anticipating a 50% response rate and at least 1 successful referral
per primary respondent. The final sample size for the survey comprised of 34 respondents, responding
between June and August 2009, from 11 different quantity surveying practices. That is, a response
rate of 37% for the primary respondents.
The questionnaire responses were assigned numerical codes and the data analysed using
descriptive statistics methods in SPSS® version 15. Correlations between variables were tested using
Pearson’s Correlation (2-tailed) in SPSS®.

3 Results
3.1 General background
There was a fairly even spread in the respondents’ years of quantity surveying experience, size of
organisation and previous involvement in carrying out LCC (Table 1). The survey results were
therefore expected to be indicative of how professional quantity surveyors view and apply LCC and
what can be done to encourage its greater use. As expected, most respondents belonged to larger
companies and more than half had not been previously involved in LCC. The lack of significant
correlation between previous LCC use and the respondents’ amount of quantity surveying experience
or size of their organisation may be one reason behind limited LCC use; inexperienced practitioners
have no one to learn from.

Table 1. The research sample: number of respondents categorized according to their background.
Direct LCC Size of Organization (employees)
involvement <151 151-400 >400 Total
Yes Years of <6 0 1 3 4
QS 6-10 3 0 2 5
Experience >10 0 0 2 2
Total 3 1 7 11
No Years of <6 2 4 6 12
QS 6-10 2 2 2 6
Experience >10 3 0 2 5
Total 7 6 10 23

3.2 Perception of LCC

Appreciation and use of LCC: About half of the respondents rated their understanding of LCC as
good or satisfactory (Table 2). This did not however translate to, or derive from, greater use of LCC
as just 32% had been directly involved in LCC in the past. Direct involvement in LCC however
significantly correlated (p<0.01) with respondents’ improved understanding of LCC. This bears
witness to the notion that greater use is the best teacher for techniques like LCC, as practitioners use
the tool more, they will feel more confident to recommend it to their clients, leading to even greater
use.
Table 2. Survey respondents’ understanding of LCC related to whether they have been directly involved in
LCC, n=34.
Understanding of LCC
Good Satisfactory Limited Total
Direct LCC involvement Yes 9% 20% 3% 32%
No 3% 21% 44% 68%
Total 12% 41% 47% 100%

Experiences of LCC use: More than half of the respondents said they had experienced situations in
which LCC had had a positive impact on a project they were working on (Table 3). This was despite
the fact that a significant proportion had never been directly involved in LCC (68%) or had limited
understanding of LCC (47%). There was, however, significant correlation (p<0.05) between
respondents’ perception of the benefits of LCC and their perceived level of understanding of it. This
finding emphasizes the importance of the practitioner’s experience in promoting greater LCC use.

Table 3. Survey respondents’ understanding of LCC and previous direct involvement cross tabulated against
whether they have experienced situations in which LCC made a positive contribution to a project, n=34.
Understanding of LCC Direct LCC involvement
Good Satisfactory Limited Yes No
Positive LCC Agree 9% 32% 15% 29% 26%
experience Not sure 0% 6% 12% 3% 15%
Disagree 3% 3% 20% 0% 27%
Total 12% 41% 47% 32% 68%
 LCC as part of regular quantity surveying service: Although most of the respondents (65%)
thought LCC should form part of regular quantity surveying services, only a third said they thought
the quantity surveyor performs LCC intuitively (Table 4). This means that most quantity surveyors
think that the quality of their services could be improved if they carried out LCC. The correlation
between these two factors was however not significant.

Table 4. The number of respondents who thought that LCC should be part of a regular QS service cross
tabulated against those who thought that QSs perform LCC intuitively, n=34.
QSs perform LCC intuitively
Agree Not sure Disagree Total
LCC should be Agree 24% 9% 32% 65%
part of regular Not sure 8% 9% 15% 32%
QS service Disagree 0% 0% 3% 3%
Total 32% 18% 50% 100%

3.3 Extent of LCC use in practice

Pattern and extent of LCC use: There was a clear indication that when specific employees carry
out LCC in an organisation, this leads to LCC use on a higher proportion of projects (Table 5),
correlation between the two factors was significant at the 0.05 level. It is interesting that some
respondents were not sure if specific employees carried out LCC in their organisation. This probably
stems from their limited understanding of LCC and restricted use of LCC in the organisation or
projects they have worked on. Additionally, specific employees are more likely to carry out LCC in
larger organisations and respondents from larger organisations reported LCC use on a larger
proportion of projects than those from smaller ones.

Table 5. The interaction of the proportion of projects where LCC is used and the performance of LCC by
specific employees in an organization, n=34.
Specific employee performs LCC
Yes No Not sure Total
Proportion of None 9% 9% 8% 26%
projects where <5% 8% 12% 18% 38%
LCC is used 6-10% 18% 3% 0% 21%
11-50% 12% 0% 3% 15%
Total 47% 24% 29% 100%

LCC promotion in practice: The client, alone or together with the quantity surveyor, played a
major role in initiating LCC on the projects most of the respondents had worked on (Figure 1a). This
observation suggests that greater use of LCC will come from greater demand for its use by clients.
There however appears to be room for professional quantity surveyors to promote LCC more; after
all, they exist to advise their clients.
Cross tabulation of these responses with the organization sizes (data not shown) revealed that the
client initiated LCC more on projects that bigger organizations (>400 employees) worked on. There
was no observable pattern in the other factors. This could be explained by the fact that larger
organizations work for larger clients on big projects (e.g. PFI schemes) which require long term
approaches to cost. Alternatively, clients may only ask larger quantity surveying practices to carry out
LCC because they expect them to have the expertise do so. Interesting, no respondent cited the
Architect or Contractor as an initiator of LCC.
 (b)
My organisation's database

External database holders e.g

(a) Not sure BCIS
No one, it is part of the Product manufacturer's of
project delivery database
The client and the QS Research publications
The client
Testing institutions e.g. BRE
You, the QS
Experience in the use of
materials
0% 20% 40% 60%
0% 10% 20% 30% 40% 50%
% of all respondents
% of all respondents for each factor

Figure 1. (a) Responses to the question about who initiates LCC when it is used on a project, n=34. (b) The
source of data for predicting the service life of building components, n=34 for each factor.

3.4 Barriers and drivers to greater LCC use

Sources of life cycle data: Lack of reliable and suitable service life data is often cited as a reason
for under use of LCC. Although most respondents cited their organizations’ databases, manufacturers’
databases, and their own experience as the major sources of service life data for use in their day-to-
day analyses, the preferences were not very strong (Figure 1b). It was expected that respondents from
larger organization would use their internal databases more than the other sources but this was found
to be untrue (data not shown). Also, the most experienced respondents were not highly reliant on their
experience in using the products but rather used product manufacturers’ databases more than the less
experienced respondents.
Drivers to greater use of LCC: Most respondents cited two linked factors as possible drivers to
greater LCC use in the construction industry: incorporating LCC incentives in to procurement and
contract award and clarifying when and how to carry out LCC. These factors can both be put in place
through changes in procurement attitudes and requirements. The respondents’ choices also link back
to the major role played by the client in promoting LCC (3.3 above). Interestingly, only about 50% of
the respondents felt that clarifying the principles and assumptions of LCC will lead to greater use.
This is linked with the high levels of their confidence in their understanding of LCC mentioned earlier.

(a)
Incorporate LCC in procurement
and contract award

Fiscal measures to encourage clients’ (b)

use of LCC.
Formal QS
Display LCC indicators in home training
information packs
Clarify when to undertake LCC, to what RICS APC
level training
and what costs should be considered
Clarify principles and In-house
assumptions of LCC training

Address risk and External

uncertainty concerns training

0% 10% 20% 30% 40% 50% 60% 70% 80%

0% 10% 20% 30% 40% 50% 60% 70% 80%
% of all respondents for each factor
% of all respondents for each factor

Figure 2. (a) What should be done to encourage greater use of LCC in the construction industry, n=34 for each
factor. (b) Ways of encouraging an LCC-aligned way of thinking among QS professionals, n=34 for each factor.
 Promoting a LCC way of thinking: All the four possible ways of encouraging professional quantity
surveyors to think of LCC as part of their regular service put to the respondents were strongly
supported (Figure 2b). The fact that more than half of the responses to this question were from
respondents with less than 6 years of quantity surveying experience may reflect the reluctance of
experienced practitioners to learn new techniques. These findings indicate that there is a great scope
for promoting LCC training, formal education being the most popular in this survey.
Barriers to greater use of LCC: The respondents were asked to classify eleven factors that can
influence LCC use as barriers, possible barriers, or not barriers (Figure 3). All eleven factors were
marked as barriers by at least half of the respondents, except lack of standardized method of
performing LCC (Figure 3). This is an interesting finding given the extensive efforts that have been
expended in developing a standardized method for LCC (BSI, 2008b; BSI, 2008a) and can probably
be explained by the fact that only a third of the respondents (Table 2) had previously been directly
involved in LCC only one respondent appeared to be aware of the ISO LCC methodology (ISO
156868-5) published in 2008. Close to 70% of the respondents felt that clarifying the timing and detail
of LCC will lead to greater use of LCC but they did not realise that this can be addressed by having a
standardized method. The most popular barriers (marked as “a barrier” more than “may be a barrier”
or “not a barrier”) relate to lack of LCC skills and client interest in LCC. From this it can be deduced
that if client demand for LCC increases, the skills and other ingredients for successful LCC will be
made available. That is, the client is again put at the centre of promoting LCC use.

Lack of procurement and contract

award incentives to use LCC
Lack of fiscal measures that
encourage clients’ use of LCC
Lack of a standard method of life
cycle costing

LCC skills are unavailable

The results are difficult to interpret and
not directly useful No comment
Difficulty of obtaining the appropriate, Not a barrier
relevant, and reliable information and data.
May be a barrier
There is insufficient time to carry it out. Barrier
Separation of capital/acquisition and
running costs of most projects.

Clients are unwilling to pay for it.

Clients do not request it.

Incompatibility with client's intangible or

non-financial objectives and needs.

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

% of all respondents for each factor
Figure 3. Respondents’ assessment of the commonly cited barriers to wider use of LCC in the construction,
n=34 for each factor.

4 Discussion
Value improvement in the construction industry is imperative and will benefit all stakeholders in the
industry; clients, contractors, consultants, and society as a whole (Ashworth and Hogg, 2000). A
number of novel techniques and practices that, if used properly, could lead to added value in design
and construction of built assets have been proposed (Latham, 1994; Egan, 1997; Ashworth and Hogg,
2000). Here we examined the use of one of these techniques, life cycle costing. While surveys of the
use of LCC in the construction industry abound, this is the first time a survey of professional quantity
surveyors has been carried out. The quantity surveyor is the professional primarily responsible for the
planning and management of project costs. Therefore if costing methods are to change to include life
cycle aspects, the quantity surveyor should take a lead in this cultural change.
It was found that there is a general lack of understanding of LCC principles among quantity
surveying practitioners. This is linked to low levels of direct involvement in LCC and, therefore, poor
perception of LCC benefits. This observation contradicts reports of greater LCC use by contractors’
quantity surveyors working on PFI projects (Swaffield and McDonald, 2008) and could be a sign of
the ineffectiveness of the drivers to greater use of LCC (outside the PPP/PFI context) that have been
in place for more than ten years now (Clift and Bourke, 1999). The lack of appreciation of LCC
translates to poor demand for LCC from construction clients because no one promotes it to them. This
conclusion is supported by the finding that when LCC is used, the client plays a leading role in
initiating its use and the commonest barriers to greater LCC identified in this study are client-centred.
The end result is a cycle of LCC rejection, akin to value management rejection, which leads to
perennial LCC under use (Hogg, 1999). Future work could look at how LCC perception among
construction clients can be improved.
This research showed that to promote greater LCC use by professional quantity surveyors, it is
necessary to enlighten both the quantity surveyors and their clients about its benefits and incorporate
it into procurement and contract award, as is the case with most PPP/PFI projects (Flanagan et al.,
1989; Davis Langdon, 2007; Swaffield and McDonald, 2008). Ways of encouraging an LCC way of
thinking among quantity surveyors proposed to the survey respondents (including formal education
and work-based training) were generally well received. However, LCC training should be diverted
from theoretical exercises delivered on most formal quantity surveying college and university
programs to a more hands-on approach, probably through in-house/external training workshops. This
will benefit the more experienced individuals who may not have the chance to go for formal
education. Future research could look at how this training may be organized and delivered.
Improved LCC understanding among quantity surveyors and clients will also address most of the
barriers identified in this survey. In particular, quantity surveyors need to be made aware of
standardized methods of LCC which will make carrying out LCC easier for them. Greater use of
standardized methods will also improve understanding, interpretation, and comparability of LCC
results in ways similar to those achieved for capital costs (Gluch and Baumann, 2004; BSI, 2008a;
TRADA Technology, 2008). This will in turn improve LCC use and make it easier to sell the idea to
reluctant clients. To address the problems associated with cost and service life data availability, there
seems to be need to direct efforts towards making product manufacturers databases more reliable as
they are the main data source. There is also need to encourage greater use of a varied range of sources
if there are signs that this will improve reliability (TRADA Technology, 2008). External databases,
like the BCIS running costs publication, appear to be underused. Further research may be necessary to
establish how their use may be improved.
As the client’s advisor on costs, and how to balance cost and value, the professional quantity
surveyor can act as the key driver towards greater use of life cycle costing since most of the barriers to
this relate to client attitudes to cost (Flanagan and Jewel, 2005). Given the tough economic conditions
the construction industry is operating in; the increasing ratio of refurbishment to new work (Wood,
2005); and higher demands for sustainable constructed assets (BERR, 2008), there is need to add
quality and value to cost consultancy services. This can be achieved through ensuring that the best
long-term solutions are adopted to achieve better value for the client (Pasquire and Swaffield, 2002).
Having said this, it is important to note that academics, contractors quantity surveyors, clients, M&E
engineers and facilities managers are also actively involved in research and development of new LCC
techniques in order to increase LCC use (Pelzeter, 2007; TRADA Technology, 2008). These
stakeholders play a major role in LCC through their input on issues like project finance, fitness of
purpose, and design option appraisal selection. These stakeholder will need to be involved in
developing the drivers for greater LCC use (e.g. developing training programs) and combating the
barriers (e.g. addressing the lack of procurement incentives) to greater use of LCC in the built
environment highlighted by this research.

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