The Research On Cost Control Mechanism Of Large-Scale Engineering Projects Based On The Three Gorges Project

As a symbol of large-scale engineering Project in China, the Three Gorges Damhas attracted attention for its giant scale and technological complexity in the world. Ithas succeeded in avoiding the vicious circle of endless investment and Marathon-likelength has provided a benchmark and example for the cost control of the otherlarge-scale engineering projects. It is significant to have a research on the success ofthe Three Gorges Dam Project and generalize some experiences from its managementtheory and pattern would benefit the improvement of the management level andinvestment effectiveness of other large-scale projects.Based on the research findings achieved by the forerunners and thecomprehensive references to theories in the fields of Cybernetics, InformationScience, Neo-Institutional Economics, Life Cycle of Engineering Project and appliesthe methods of a well combination of qualitative and quantitative researches,theoretical analysis and empirical study. Through the case study of the successfulexperiences of cost control of the Three Gorges Project, this dissertation makesstudies in the following fields on cost control mechanism of large-scale engineeringprojects.Firstly, this research summarized and generalized the successful experiences ofcost control in the Three Gorges Project from the perspectives of systems science,neo-institutional economics and life cycle theory of engineering project. In theprocess of the construction of Three Gorges Project, a cost control system is wellestablished with the whole process covered. At the implementation stage, an effectivecost control mode of Static Control but Dynamic Management adopted, "Five Aspectsin One Comprehensive Balance" is established whereas "Five" refers to function, cost,safety, quality and progress. All the above experiences show that a managementsystem of clear levels and responsibilities and scientific and standardized projectmanagement are above all.Secondly, a cost control mechanism of large-scale engineering project isestablished in accordance with the practicing experiences, systems science and thematerialization process for large-scale engineering projects, which is composed oftwo cost control systems and an institutional establishment system. The first part is a process-based control system, and the other is a factors-based control system. Theformer functions as a main system in charge of the process control for the cost controlmechanism and the latter functions as an auxiliary body is with the responsibility forthe comprehensive control of the key influencing factors. The third one supports theother two systems.All large-scale engineering projects should be carried out by some certainroutines and procedures, and all sections in the process should be logically linked.Therefore it's reasonable to follow the principle control the cost that the cost controlof large-scale engineering project should be carried in a sequential order so that allparts and bodies within the system could be well arranged as a full life cycle and awhole process. In the Third Part this research reviews the whole-process cost controlmethod by the Three Gorges Project, studies its process-based control system,analyzes and content, characteristics, process and method for its cost control systemat all stages for the whole process, and tackles the possibility of innovativeness interms of funds and cost control, management and technology.The large-scale engineering project itself is a complex system, and the project'smanagement is also an artificial system with multiple objectives, participants andinfluencing factors. In the fourth part this dissertation studies the factor-based controlsystem, analyzes the interrelationship between different factors and their impact onthe project investment. Furthermore, in this part a Conceptual Model of Cost Controlwith Five Factors Integrated is constructed in combination with the cost controlconcept of Five Factors in One Comprehensive Control.At last, this research discusses the impact of institutional arrangement on thecost control mechanism on the basis of an analysis of the institutional environmentand arrangement on the Three Gorges Project. This research also proposes in this partsome suggestions on how to establish an institutional arrangement for the cost controlmechanism of large-scale engineering project.