With the accelerated time frame in which projects go from idea to final certification of occupancy, the effects of accurate estimating practices have become more critical than ever. Gone are the days of three week bid review, pricing time frames, months between substantial drawing updates and subsequent revisions. This accelerated time frame places all parties at additional risk particularly when it comes to the estimation and pricing of the building as critical design elements become extremely difficult and costly to rework while the process of design progresses. The critical estimate thus becomes the conceptual level estimate. This estimate starts with the least amount of information and yet sets the budget and expectations for the entire process. Considerable amount of experience is required to accurately see and price items which have not yet been anticipated or shared with the project team. Furthermore, the responsibility of communicating costs, design interpretation and constructability falls directly on the estimating team.
Traditional estimating practices start with general square footage, building shape, number of floors, project program, location and similar or like projects. Entire databases are developed and employed by contractors and subcontractors to assist with this high level budgeting exercise. Unfortunately, with forty plus trades working on a project, there is little information for each firm to start from, and the gaps that must be filled by the lead estimator can be enormous. With lack of project knowledge, pricing becomes more conservative in early stages. All of the unknowns can add up to budget issues which may force scope and programming changes that may not be warranted.
The bulk of project understanding stems from the dissemination of information. Current estimating practices rely on overlay software to approximate size, shape and quantification of construction assemblies, particularly in the conceptual phase. With limited visual aid and limited information comes limited collaboration at the most critical stage of establishing budget expectations. Many projects have experienced these fluctuations in pricing from early concept to final drawings and much time is spent on reconciling that which was unknown to maintain client relationships and trust. Critical design decisions are made at this early juncture and the ability to reverse course loses traction with the design team as the project progresses based on early concepts and understanding.
Similar to EMR rates, bonding capacity and workforce, trade partners should be assessed based on their ability to conceptually estimate projects accurately. The ability to provide accurate pricing and communicate design interpretations is paramount to building the conceptual estimate and establishing a level of trust between all team members. Firms clearly displaying abilities to present timely information from models, estimates and schedules should be sought out by general contractors and developers as trade partners to the project.
The willingness of a firm to provide pre construction support in an attempt to successfully bid and contract/build a project should be an accurate indicator as to whether that firm truly believes in partnering on projects. The current economic recovery should further distinguish firms based on the quality of the personnel they have been able to retain throughout the recession and recovery. Partner minded firms tend to place value in high level resources and personnel which produce long term results and key industry relationships. These partners should be employing technology that promotes collaboration and transparency. Construction management firms should be eager to partner with major trade partners as well. The resource crunch for a qualified workforce can better be managed as worker resource needs can be viewed further ahead in the project design phase, hopefully spurring proactive recruitment, hiring, and training prior to contract negotiations. It is in these forward thinking relationships that projects will have the best chances for success both in maintaining owner budget and project delivery schedule.
Collaborative Software Solutions
The construction software market has been making progress in developing software solutions that facilitate multi user access. Design collaborative software should not just exist within the design firms. Subcontractors, general contractors, and developers should be well versed in modelling programs as the basis for communicating design approach, cost, sequence, and constructability review. “We do BIM” as a mantra needs to be replaced with estimators that can successfully build, manipulate, and communicate modelling basics for projects qualified by their area of expertise. Line item pricing can and should be developed to not only expose cost, but sequence, duration, and assembly information. In the collaborative estimate model, all trade costs, constructability, and sequencing can be reviewed to better reconcile design programming and client needs. Specification and plan review can be quarterbacked by the lead estimator and designers with trade partner involvement to accurately update and coordinate documentation to meet evolving technology, products, trade practice, and tolerance issues prior to the development of bid level project specifications. This team based approach should help break down barriers between designers and builders to assist both in meeting their clients ultimate needs. As with all industries, the future recruitment of top level talent should be a priority in a firm’s future growth plans and sustainability.
As the generational shift kicks into high gear with the continued retirement of the baby boomer generation, much effort should be placed on revising operating procedures to meet the evolving workforce and software capabilities. Senior level management should be focused on building systems of check and balances based on this new collaborative environment for the next generation to lead their respective firms into the upcoming decades. Early adaptation to collaborative software within the construction industry should also aid in recruiting and retaining top millennial employees that have been fully educated in a collaborative learning environment.
About the Author:
Grady Lonigan is currently the Director for Swinerton’s Self Perform Concrete Team in Southern California and partner at Lonigan & Associates LLC Consulting firm. He has over 20 years experience in the construction industry working in both the general contracting and subcontracting sides of the industry. During his career he has led estimating efforts for projects ranging from resorts, water treatment plants, class A office buildings, parking garages and airport renovation including being the lead concrete estimator for the San Diego Airport Consolidated Rental Car Facility (CONRAC). He has collaboratively worked in design build, construction management at risk, hard bid, job order contract, joint venture efforts, subcontracting and for self performing general contractors. His team regularly communicates their needs of modelling software capabilities with two of the leading software firms.