What are the most rewarding and challenging aspects of working as a cost engineer?

Cost Engineer is a techno-commercial role which has ability to influence bottom line of a company. In my 9 years of cross-industry experience, I can certainly say that "Making an Impact" on company's profitability by reducing total cost of ownership is the most rewarding aspect of this role. Think of it, you are making the technology/product affordable for your end customer. Moreover, cost engineering is a life-skill which makes you vigilant in your own spending as well. Like any other job, cost engineering role has its own challenges. Major challenge is creating a cross-functional balance between engineering, supply chain & quality while controlling the cost.

Save the cost in product as well as without affecting the quality parameters. The right point works from design stages to outcome of product. Actually cost engineer not working for particular domain. Working for multiple domains in organisation. The task, challenges and commitment is very enormous. The above point is very essential.

Cost engineering in its purest application is a blend of art and science. The art of working with designers and architects, understanding their aims and desires then reading between the lines to explore what’s not explicitly defined. The science of taking scope and translating that in to activities which consume resources. It’s the consumption of resources that generates the cost and carbon associated with our projects

I’m not cost engineer but have done numerous cost estimation within my own discipline in pipeline engineering. Deriving the cost estimate, you need strong background in the technical to identify any related or foreseeable risk during project execution in later stage, which need to be translated into contingency. Avoiding multiple and redundant contingencies requires technical judgment. I may be affected by other discipline work as well, so strong knowledge in multidiscipline is also required. We need to work with data, either historical as well as keeping up with industry trends, and external geopolitical issue. It is satisfying when your estimate match the actual completed project cost.

Being a cost engineer enables you to play in diverse arena of Technical, Commercial, Analytical and Soft skills for effective cost down activities. The key skills one should have is better understanding of material,manufacturing process,interpreting technical drawings/assemblies and once you mix and apply this art to arrive at the specific cost with all sorts of logical and detailed calculations helps sourcing and engineering to better fact based negotiate and finally achieving the cost savings target.

Based on my experience with working on this domain for more than 9 years impacts and value created as follows. 1.Inflation analysis working on to validate the cost when you have lot of trouble on material, labour and capacity fluctuations that impact your cost of product. 2.Validate the initial prototype considering cost effective without compromising functionality and quality. 3.Providing accurate details on what should be the cost of product that help supply chain source cost efficient sourcing and negotiation with suppliers and prevent cost overruns. 4.support on decision making on make vs buy. All of this create a huge impact and value to the organisation.

When to claim contingency as profit, the methodology used to claim it, and the authority to draw it down. Certainly a top level skill.

Costing format based on the area you deal upon. Understand areas of cost variations, though costing is based on actual prevailing price. Competitive depends and reasonable depends on experience on the present job. Simple mistake can ruin order by quoting high or low. Matters attached to details and team work achieve best

To overcome complexity and a fair estimate (95% accurate ) need to follow ZBC with fixed norms and a costing tool which will simplify the process . Tool like what is offered by Cost Masters deskills the whole process . The tool has different modules based on the process used for the child parts You need only technical domain experts having process knowledge to give inputs to the tool. Plus it speeds up the process also.

In my experience, sometimes I had worked on complex assemblies which have lot of child parts. The accuracy of cost of all the child parts is sometimes difficult. Internal customer (e.g. buyer) is not happy due to the large gaps arising in the supplier's offer and calculation done. It is iterative process and takes lot of time and energy. This affects morale of the costing people working.

Actually I disagree this. I've never seen my co-workers as "competitors", rather I rely on them to bounce ideas off of, and to get different perspectives on changing problems. Helping others and cooperating with teammates should ultimately lead to a better outcome.

The most rewarding aspect of working as a cost engineer is likely the satisfaction of optimizing project budgets and resource allocation, ultimately contributing to the financial success of a project or organization. Additionally, it can be fulfilling to see your cost estimates and projections align with actual project outcomes. On the challenging side, cost engineers often face the difficulty of balancing cost constraints with project goals. Keeping up with changing market conditions, cost trends, and evolving technologies can also be demanding. Moreover, communicating complex cost data effectively to stakeholders and managing cost overruns can be challenging aspects of the role.