Archive for the ‘Estimating’ Category
Building information modeling (BIM) has been around for about 40 years now. Yes! You read that right – 40 years. Though in the 1970s when the concept was developed, BIM (as we know it today) wasn’t really implemented until the late 1980s. So I guess we can say, it has been a little slow taking hold. However, as time has zipped on and technology has improved, BIM implementation has rapidly increased.
Building information modeling started as a production of 3D design models to help catch architectural system variances and clashes. Since then, it has become an effective tool in project management and ever more prominent in job cost estimating.
Traditionally, estimators begin their process by doing manual take-offs or digitizing architectural construction drawings. Or possibly, they may be importing CAD plans into an estimating software package. The thing about these processes is that they all have higher risk of error by way of unknowingly incurring an omission or duplication. This has the potential to logarithmically propagate cost errors throughout the estimating process.
Using a BIM solution can significantly reduce (though not completely deny) human error. As the project experiences changes, as they always do, the model can be updated. If properly configured, the BIM should update the takeoffs, schedule, and costing data for the project as the changes occur.
After the BIM is established, pricing information is the next critical set of data which needs to be considered. Estimators can extract the quantities provided by the building information modeling solution and output the information via linking it to a product such as Sage 300 CRE. From here, an estimator may generate estimates based on historical data.
Some of the most critical tasks in estimating are having accurate and current takeoff information, and applying that to accurate pricing and scheduling data. BIM solutions can help to make the quantification tasks easier and more accurate. The integration of this data into an estimating solution can mean that estimators are more accurate and can spend their time and knowledge doing higher value activities.
For those who joined us on April 4th, both customer and partners, we sure had a great time talking tech-y and BYOD all day at the fabulous Doubletree resort in Scottsdale!
A GREAT SUCCESS for CPFS – LAI collected 46 Cell Phones for Soldiers! Each phone valued at $5 translates into 2.5 hours of calling time for our military personnel. That means we collectively donated 115 hours to our troops! Ledgerwood Associates matched each phone donation with a half an hour of FREE consulting time!
Keynote speaker, Joe Granneman, had the audience in a state of highly entertained shock as he shared stories of security gaps in super-powers like Google and Facebook, and how easy it is to crack 7-character passwords in under four seconds (make sure yours is at least 8 characters, and no “dictionary” words)! That information alone may have saved thousands of dollars in potential fraud!!
Our friends Diane Haines and Todd Juhnke from Sage Construction & Real Estate put on an amusing skit (complete with a fake marriage) on the frustrations of timecards between the field and office, and how Sage Construction Anywhere will allow you to watch more football! How many software solutions can claim that?!
After lunch by the pool, attendees split up into two afternoon sessions with a choice of four different tracks. SMEs from Sage, TimberScan, Trapp Online, Piracle, True Wireless, Hard Dollar, and Ledgerwood Associates spent quality time demonstrating integration strategies, hardware, and mobile solutions. CFMA was there too, to answer questions and talk about their great organization (LAI is a member)!
Everyone regrouped for Ed Ledgerwood’s closing remarks, and mingled for the last time during Happy Hour on the patio! Check out pictures of Technology Day on our FB Tech Day album.
Yes, this is our last plug for the annual Technology Day event this week - April 4th, and we are very excited to see everyone! Have you registered yet? If not…
…so you can join us at the beautiful Double Tree Resort in Scottsdale Arizona. Bring your smartphone, tablets and other devices and plug-in to the future of construction technology.
Keynote speaker Joseph Granneman, CIO of Rockford Orthopedic, will kick things off with a presentation focused on information security and compliance.
Representing Sage, our co-hosts, Todd Juhnke, Regional Sales Manager-Construction and Real-Estate Division, and Diane Haines, Sr. Director, Product Management, Construction & Real Estate will be presenting the powerful cloud based construction technology solution – Sage Construction Anywhere.
There will then be afternoon sessions with multiple tracks for learning about specific topics. Head over to the registration page to learn more about all of the Tech Day Tracks.
And make sure you bring your old cell phones too! Ledgerwood Associates will be collecting them for Cell Phones For Soldiers, a non-profit dedicated to helping our troops stay in contact with their families here at home.
Don’t miss out on all of the fun and information this year. We look forward to seeing and talking to you all!
There’s currently a paradigm shift in confidence regarding the state of the construction industry, in my humble opinion. With the subtle rise in construction starts, there seems to be reticent optimism in the air. Do you believe we will experience another meteoric rise in residential and commercial building, or did the recession ‘school’ us to tread with extreme caution? Perhaps something in between: fits and starts based on regional markets, littered with economic (and political) road bumps? It almost feels like we need to hedge our business forecasts!
And how should we owners and employees navigate this bumpy road? Having buckled down beyond our bootstraps, how will we fill gaps in resources and infrastructure to cope with the next microburst of building starts?
Of the few big builders that survived the last five years, flexibility was a key factor, according to Builder Magazine1. Citing a “less is more,” policy (so tired of THAT one!), sustainable and energy-efficiency building features, modular solutions, etc., – I found the common denominator for all of these surviving businesses was a solution wrapped around technology.
So, what role will technology play in the future of construction? Sage says “100% of construction companies have employees in the field” and Nielsen2 reports that 46% percent of Americans own a smartphone (with 62% in the 25-34 age bracket) – how can companies manage devices to their advantage? Will software efficiencies replace headcount? How stable and secure is the cloud?
The answer to these and other emerging issues will be the center of Technology Day at Ledgerwood Associates. We’ve gathered vendors, customers, and Subject Matter Experts (SMEs) to bandy this about for a full day. Based upon your role in technology (accounting, PM, owner, estimator) and the type of construction you perform (residential, trades, real estate management) – we are offering a FREE day of discovery and revelations!
Bring Your Own Device (BYOD), bring your questions, bring your mama (not really, she’s busy) – but SHOW UP on April 4th for a great networking/brain-dump session at the Doubletree resort in beautiful Scottsdale. We invited the Sage Construction Anywhere experts; we have a device-agnostic broker, and a special keynote speaker who will lead a discussion on the risks and benefits of cloud hosting!
Joanie Hollabaugh, Sr. Director of Marketing
Here’s a funny video illustrating a common problem
No matter how careful a company is, the possibility of errors always exists when working with spreadsheets. From the wrong address in the wrong field, to simple formatting or equation errors, these common mistakes can happen to anyone.
As we discover in the video above from HardDollar, these mistakes can lead to catastrophe. While it’s true that
most spreadsheet errors will not typically lead to the same tragic events, the
possibility does exist.
What problems with spreadsheets are you willing to confess to?
Underestimating a project or losing bids by overestimating can seriously erode profits. Too often these problems are caused by errors in spreadsheets. A 2004 PricewaterhouseCoopers study shows that up to 91 percent of sophisticated spreadsheets contain errors. A 2007 study concludes the error rate is 94%.
That sounds about right considering how often I find errors in my own spreadsheets. We’d all like to be error free. Knowing the sources of spreadsheet errors may be helpful in eliminating them.
Ten common errors or problems with estimating spreadsheets:
- Hardcoding your values in the spreadsheet formulas resulting in right this month and wrong forever
- Adding rows or columns that don’t get included in the range of the sum, subtotal and average functions
- Losing unsaved changes due to interruptions
- Data entry errors such as skipped entries or transposed numbers
- Saving “what if” changes over the Excel worksheet you want to keep
- Formula errors like parentheses errors in a mathematical formula; formulas pasted over with constants; or formulas no longer calculating properly when you delete an item
- A bad query copied into a spreadsheet
- A bad sort that destroys the integrity of a row
- Old spreadsheet errors copied over and over again
- Maintaining a number of templates for specific types of projects, which multiplies the risks of data entry errors, omissions, transposed numbers, and outdated pricing
One way to reduce the number of spreadsheet errors is to limit access to files or locking certain cells. You may also want to implement quality-control procedures for catching data entry errors in spreadsheets, including input controls, validation, and cross-footing.
An example of an input control is reconciling the data entered into the spreadsheet to the source records. A common sense suggestion is to separate the data entry and formula areas on a spreadsheet.
Finally, it’s a good idea to have the logic of the formulas within the spreadsheet inspected by someone other than the user or developer of the spreadsheet.
Call Ledgerwood Associates today for a free consultation on how to improve your estimating speed and accuracy. 877-918-8301
INCONSISTENCY: Our estimators take great pride in their work and like to do things their own way. Unfortunately, when everyone is using different tools and methods for estimating, it makes final review and the ability to reuse historical estimates for new projects we’re bidding difficult – not to mention risky.
LOSS OF EXPERTISE, KNOWLEDGE: If we were to lose an estimator, the loss of their expertise and knowledge would put us at a considerable risk because we have no method for capturing and documenting what they know and use in their estimating processes.
Adopting a construction-specific estimating tool will streamline and automate the entire process and also help to build historical information that can be used again and again in future estimates.
By having all your estimators using the same tool, you will have consistency across your estimating team.
What is your experience with estimators using their own preferred tools?
For additional information about this and other topics visit www.ledgerwoodassociatesusa.com
“We are having a hard time winning bids that result in profitable jobs. We can win short-term business by low-balling it, but we cannot survive this way.”
Here’s a great discussion of the issue from Sage CRE.
ERRORS, LOSS OF PROFIT: The cost data that our estimators use is inconsistent and sometimes out of date. Too high and we miss the opportunity. Too low and we leave money on the table and run the risk of being awarded the job with no chance for profitability.
INCONSISTENCY: Our estimators take great pride in their work and like to do things their own way. Unfortunately, when everyone is using different tools and methods for estimating, it makes final review and the ability to reuse historical estimates for new projects we’re bidding difficult-not to mention risky.
REPUTATION: Relationship building is key in the construction industry. If we continually low ball bids to get work in the door and rely on expensive change orders to make jobs profitable, we run the risk of tarnishing our reputation and jeopardize future opportunities. We recognize the shortcomings of doing estimating using a generic spreadsheet. We’re required to double check all our work and run the risk of making errors that would give us a bad reputation. Adopting a construction-specific estimating tool will streamline/automate the entire estimating process and also help build historical information that can be used again and again in future estimates.
Estimating databases come in a variety of flavors depending upon the user’s specific needs and trade. Select from a shell to build your own or choose from a number of “out-of-the-box,” databases requiring a minimal amount of refinement.
Integration of Sage Timberline Estimating with Sage Accounting (Specifically Job Cost) Timberline Office, Master Builder or Timberline Enterprise helps eliminate the need for duplicate data entry and helps track job profitability at all stages of the project. By having all of your estimators using the same tool and collectively building a database of costs and information that you can access for future estimates, your estimates will be accurate and ensure the projects you bid on will be profitable.
Hope this was helpful. I’ll have more on estimating next week.
Do you agree that low-balling bids will tarnish a contractor’s reputation and jeopardize future opportunities?
In a super-competitive construction environment companies must prepare more bids quickly and accurately to survive. Here’s how a smaller contractor improved their estimating to compete more effectively.
Estimating Speed and Accuracy Needed
With fierce competition, Coyote Development needed to improve bid accuracy and increase win rates. Coyote’s controller, owner, project managers and estimators were already working extra hours. Errors on spreadsheets took precious time to track down. Differences in their estimators’ methods and a lack of cost coding made it difficult to track historical performance.
Sage Timberline Estimating
In September, 2010 Coyote Development worked with Ledgerwood Associates to install Sage Timberline Estimating and Sage Timberline Office. Ledgerwood Associates was involved with every aspect of the set up and conversion, including Coyote’s jobs listing (100 jobs), account structure, and beginning balances. The owner and lead estimator were trained on using cost databases and how to transfer their estimates into job costing.
Rapid Bid Turnaround Gets Coyote a Key Contract
A senior Ledgerwood consultant showed Coyote’s estimators how they could produce estimates in less than half the time they were spending before; and Coyote’s bid-to-win ratio has improved. Coyote recently had 48 hours to bid on their portion of a large Las Vegas resort project.
Coyote put a bid together quickly and got the job. And, since they were right on the mark, they ended up with a good margin. Project managers were able to see where they stood all along the way and make adjustments quickly.
Coyote Development, a project oriented Arizona general contractor, builds a variety of government and commercial projects in Arizona, Nevada and the Southwest. Focusing on technology improvement and streamlining the bid process has helped Coyote put together a string of successful projects resulting in consistent growth in a difficult economy.
Would faster, more accurate estimating help you be more competitive?
You fear that your worst nightmare as an estimator is about to come true.
Management is siding with a small group of estimators who want to throw away your estimating software and standardize the production of all estimates using only spreadsheets. They believe that it’s an easier and cheaper solution. You know they are taking 2 steps backwards to get 1 doubtful step forward. How can you convince them that estimating software is better than using spreadsheets?
Here’s some ammunition to help you win the fight and win more bids:
Accuracy Minimizes Risk: Estimating software separates the database from the estimating functions. No more complicated, hard to remember formulas inside of your database. Forgetting to include a formula, item or decimal point on a bid can be a costly mistake. Estimating software standardizes the bid process across multiple estimators without forfeiting individual styles and flexibility.
A Knowledgebase to Share: A common database of materials, pricing and productivity rates can be shared and used by the entire company. You can build the intelligence of your most Senior Estimator into the estimating database and have less experienced estimators create the same fast and accurate bids by accessing that intelligence with the software.
Better Organization: Estimating software organizes the entire estimating function better than any spreadsheet can, making it easier to schedule, communicate and confirm all project details across your team. Data can be shared across estimating, job cost, and accounting functions – with no data re-entry.
Greater Speed: Takeoff time is slashed by 50% or more compared to spreadsheet methods. Built-in efficiency tools like smart assemblies, reports and markup tables can generate estimates faster and more accurately for getting more work with the same number of estimators. Final proposals and reports are produced in seconds.
If these reasons are not enough to convince skeptics that an estimating program is worth the investment in time and money, a simple return on investment model will reveal how inefficient spreadsheets can be when compared to using an estimating program.
If you need to dig a little deeper, send me a reply. I would be glad to help.
For more information on this topic contact Ledgerwood Associates, the #1 Sage Timberline Business Partner in the Southwest!