For construction projects of any size, accurate estimates are essential to protect profits, control risks and mitigate against blown deadlines. The estimation process is something of a tightrope. Too high an estimate could cost the company bids. Too low, and the profit margin disappears. It’s a process that has evolved with technology, and today, companies can deliver more accurate estimates faster than ever, which means more competitive bidding, fewer cost overruns and improved collaboration.
“We have cut the costs involved in generating an estimate by 50 percent and increased efficiency of the estimating process by at least 75 percent,” Chris Rowe, president of Echo Pacific Construction told ConstructionWorkZone.
When it comes to determining project costs, calculators and pencils ruled the day until spreadsheet software came along. It was an improvement over the strictly analog methods of the past, but it was still a static document subject to being outdated or incorrect. It was still reliant on blueprints or other 2D drawings, requiring workers to huddle around a paper or hastily scanned image on a single computer screen.
Modern Day Estimations
Today’s estimates can be instantly shared among all stakeholders using cloud-based project software, available to view on any screen, anywhere, even on their mobile devices. A single digital copy of a blueprint is of limited use across a large team, but bringing the entire estimating process under a unified platform makes it a living collaborative document.
With many project drawings and plans having made the move to digital, estimators can highlight errors or changes, and make notations immediately visible to the entire team. This allows for better internal review and reduces the chance for errors. It also lets a single estimator do the work it used to take a team to complete, with greater accuracy.
“We are able to give our clients very accurate project funding requirements,” Rowe said. “Not only can we show them an initial budget, but we can project expenses by month. This gives our firm a competitive edge because we are delivering more value to our clients.”
New Tech Brings New Opportunities
Advances in 3D modeling technology, along with better estimating software, give project principles the ability to take a view of a project in its component parts, making it easier to identify potential cost savings, safety risks, or to catch mistakes on the model before they’re reproduced in real life.
These collaborative digital models allow design changes to be simulated on the fly, showing real-time updates to cost, scheduling and labor calculations resulting from the changes. The software can even draw upon the company’s own best practices and historical pricing data to determine what the pricing impact will be, saving time on manually looking up details on previous similar projects.
There’s a data component to estimation today that simply wasn’t possible a decade ago. Estimating software can also factor external variables into its calculations that might impact a project, like weather conditions and material costs fluctuations. Rather than relying solely on the estimator’s knowledge of such price swings, the most current available data is the source.
Staying Competitive and Up to Date
Estimation tools can be seamlessly integrated with other construction software to add even more visibility to the process. The estimating programs can be linked with scheduling applications, using the data pulled to generate the best possible schedules for a given job, ensuring the workers with the right skills are committed to the right projects. As the estimate changes, so does the schedule, and vice versa. With interconnected software tools that respond to changes and automatically update across the board, managing labor costs and avoiding shortfalls becomes much easier.
Staying competitive in today’s market requires a deeper understanding of the project, and the ability to stay current and adjust as the plans inevitably change. Spreadsheets got us part of the way there, but it’s not enough anymore. A suite of integrated software programs allows companies to improve collaboration and better leverage their data to deliver more accurate bids and estimates.
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