From Tool-Making to Tool-Using – And Back: Rationales for Adoption and Use of LCC

Abstract

Abstract. Real estate-and property owners' rationales behind the adoption of Life Cycle Costing (LCC) respectively how LCC is actually used in renovation projects, is investigated through empirical data from a questionnaire survey sent to managers in Swedish real estate organisations. The study shows a positive attitude towards LCC. It is perceived to as a flexible and multi-functional tool with a familiar monetary format. Nevertheless, the study also reveals simplistic and undeveloped views of how to use LCC. While much research has focused on developing sophisticated LCC tools, the findings indicate that practitioners' interest in these refinements seems limited. The importance of understanding that LCC is used in a context of multiple and partly competing institutional logics of renovation is emphasised. The paper contributes to a more informed research in development of LCC tools as well as better informed LCC use among real estate and property owners.

Sustainable Building Renovation: Proposals for a Research Agenda

“…There are only a few examples of broader cross-sectional research studies-for instance, by use of questionnaire surveys. One example is the study by Gluch et al [14] mentioned in Section 2.4.…”

“…Payback time is often the most important parameter when considering energy investments, but is a simplified method, while calculations based on life cycle costing (LCC) by the application of net present value can give more precise results [5]. There has recently been an empirical study based on a comprehensive questionnaire survey among real estate and property owners about how LCC is used in practice in Sweden [14]. The authors state that renovation is an area for which LCC is particularly applicable.…”

Life Cycle Costing: Understanding How It Is Practised and Its Relationship to Life Cycle Management—A Case Study

“…There is an abundance of LCC methods. These are usually developed by researchers based on desktop research and/or a single case study and then prescribed to industry [6]. Therefore, they tend to be case or industry specific [7].…”

“…Despite this abundance of tailored, case-specific methods, LCC is not widely used [8,9]. When it is used, it is not to the level of sophistication described in published literature because practitioners tailor the LCC methods down further [6,7]. Although some research, mostly concerning buildings, has been conducted on the barriers to using LCC e.g., [6,9,10], few researchers have engaged in investigating what drives this need for tailoring upon tailoring [6,11].…”

“…Despite being a part of the LCM toolkit, LCC was not developed for LCM or sustainability purposes [19,20]. When it is used with an explicit aim of decreasing environmental impacts or as part of LCM, then practitioners do not necessarily follow the prescribed methods such as environmental LCC [6,21]. It is unclear how tailored versions of LCC affect the outcome of LCM.…”