I’ve previously written about job walks as they relate to the nuts and bolts of putting an estimate together.  Job walks can provide information about much more than just the project.  Observant estimators can learn about their competition, the market, the design team, the client, and industry trends. Beyond observation, estimators can sometimes change the relationships between the Owner,  Architect, and Contractor (OAC), by shedding light on what is fact, what is fiction, and what is unknown.

The job walk provides a unique opportunity where critical personnel are in attendance, and obligated to speak freely.  Getting a straight answer on the record can be as simple as asking the right question during the walk.  Sometimes an evasive reply will tell you more about the project risk than any quantity take-off would reveal.  Estimating is about controlling risk which requires sound judgement based on observation.  Job walks are where estimators can observe all the moving parts that the human element brings to the project.

Sizing up the client and the competition

I’ve never been to a job walk without hearing; “So are you guy’s keeping busy?” . Job walks are an estimators only opportunity to talk to their competitors. Like a new arrival at a dog park, there’s a lot of sniffing going on.

Dave regrets his decision to pop in at the job walk…

Everyone wants to know how their competitor is doing without revealing their own situation. Most are quick to list jobs or clients that sound high-profile whether or not they’re hurting for work. These pithy exchanges between competitors are largely useless beyond occasionally learning who won a recent bid. There is however, much to be learned from talking to everyone else! General Contractors (GCs) could learn more about their competitors and clients through subcontractors than anyone else. Subcontractors have much to learn from talking to other trades. Troublesome clients, GCs, and design teams are difficult for every trade. Job walks are where their reputation spreads.

GCs who fail to size up the client during the job walk are turning a blind eye to a major factor in the jobs success. Un-funded clients are wasting your time and consuming your political capital with subs. Hard-bidding GC’s who are serious about winning are quick to drop out at the first sign of client insolvency.

Clients with a long history of construction projects might signal greater knowledge and appreciation for the bidders concerns. However there are some clients who have extensive experience with only a few GCs in negotiated agreements. Their expectations may not align with competitive hard-bidding. Knowing what the client is expecting, and what they’re not can be useful information for preparing your proposal. Take this opportunity to note any disparities between the clients expectations and their design. Bear in mind that you must appeal to what the client values most. For some clients, form may be more valuable than functional.

Professional networking.

Job walks also offer a unique opportunity for industry professionals to meet face to face. Establishing a rapport with design professionals can help to influence how future communications will be handled. Text based communication is susceptible to reader bias which can affect how the message is interpreted.

Perhaps the Architect doesn’t see the problem from your perspective

Social cues help a great deal in conveying the intended message. Often unique problems arise that can benefit from a collaborative approach. Design teams standing on ceremony with communication, delay and disrupt problem solving.   The goal here isn’t to be friends, it’s to be professional colleagues. Like anybody else, design teams appreciate it when you complement their work. Specifically, how they solve complex problems.

Often business cards are exchanged, some go onto your contacts list, others your dartboard. Don’t forget that design-build opportunities may have you looking to hire your own design professionals. This is where you’re going to meet them.

Sheet of gold

Many job walks will feature a sign-in sheet for attendance. Ostensibly it’s for the client to determine who walked the job and who didn’t. Typically, the Architect will transmit copies of the sign-in sheet along with the meeting minutes of the walk to everyone who signs in. This is a potential gold-mine of information to an estimator because it is a detailed list of GC’s , subcontractors (subs), vendors, engineers, architects, and clients. A competitor might have sent several employees to walk a job because they expect to win. Conversely a competitor who sent a wide-eyed intern to the job walk might signal that this bid is a low priority for them.

Above: The unattended intern is known to win bids by accident.

GCs who make their project managers (PM) bid their own projects will tend to have lower hit rates than firms who use dedicated estimators. Over time, it is possible to track bid results to learn more about your competitors abilities.

Subcontractors who walked the job might be in short supply. The sign-in sheet may provide a GC with a previously unknown subcontractor. GC’s find their hit rate decays in hard times in direct proportion to their ability to attract market leading subcontractors. If you don’t know who they are, you’re losing work and/or profit.

The subcontractors’ gateway to better clients

Subcontractors should strive to attend job walks even if they later decide not to pursue the bid. GC’s can be exceedingly bureaucratic and insular with subs they don’t know. However they won’t hesitate to review your competitive proposal on bid day. When subcontractors attend job walks for projects they’ll be especially good at, they’re able to jump to a new GC’s attention in the best possible situation. Winning profitable work at market-leading prices is the estimators goal. With good follow-through, the subcontractor is able to show the GC who they are, and what they’re good at. This increases the odds that the GC will invite them to similar work in the future.

In my experience, GC’s aren’t very curious to know what their subs are good at . The perspective is mostly whether the sub is “worthy” of their opportunities, rather than whether this sub could open up new opportunities via market-leading pricing. Most pre-qualification paths lead to invitations to bid small / low risk projects. The GC doesn’t want to risk hiring an unknown on a big job so they start new subs off small. The problem with this approach is that it only works for subs who are well-suited to the small work. For all other subs, they’re forced to underbid the work to get their foot in the door with the GC.

Few subs can afford to keep losing money on the hope that they’ll eventually be invited to something worthwhile. What’s worse, is that proving themselves to be successful at undersized work, tends to stagnate their progress “up the ladder” with the GC. Sub requests for bigger opportunities fall on deaf ears. This is because most GC’s view risk control as doing exactly the same thing they did on their last successful project.

“We have learned a lesson” Translation: We are reverting to an earlier approach.

GC estimators embody this thinking when their sub invite list is stagnant for years on end.

Doug’s routine used to make his friends laugh, now it’s kinda sad…

This approach works until the market tightens. When market leading pricing becomes the going rate, these GC’s are quickly out of work and they have only themselves to blame.

Keep your nose to the grindstone and you’ll only see stone, steel, and sparks.

I encourage subcontractors to stay on the bid-list for GCs who have a reputation for bidding everything. These GC’s will send an endless barrage of invitations to bid regardless of how rarely you respond. These GC’s’ are “bid mills” that rely on volume to make up for accuracy. There is no reasonable expectation of loyalty, exclusivity, or commitment.

By quickly scanning their invites, you might pick out opportunities to attend job walks to meet their competition. This is one way that professionals can help to improve their market in the course of doing their job.

The buried hook can snag you

Design teams know that unknown, unexpected, and concealed problems are a costly part of work in the real world. The construction contract is where responsibility for these conditions become the burden of the awarded contractor.   To ensure this liability rests solely on the GCs shoulders, it’s commonplace for construction documents (CDs) to include verbiage requiring all bidders to make a site visit. Some CD’s include a buried note stipulating that submission of a bid constitutes binding acceptance of all existing conditions.

Estimating:To look for stuff everyone needs in a place nobody would consider.

Sadly, these CD requirements are enforced whether the client allowed a job walk or not. The news only gets worse for subcontractors  who are often invited to bid only AFTER the GC walked the job. Some GC’s won’t commit to bidding a job until after the job walk. These firms inevitably struggle to attract top subcontractors because everything is blind, last-minute bidding for the subs.

The less time and money the client spent on their design team, the more likely it is that the plans will make existing conditions, your problem to solve. Incomplete drawings, short deadlines, and accountability-dodging design teams are common with the very worst clients in every market. Bid these jobs knowing that they will never get better than they look on bid day.

” Number two takes the lead…”

Come take a look because there won’t be any change orders…

If it were possible to visit a project and identify absolutely every unexpected, or concealed condition, why does the design team require bidders to see it for themselves? It’s a simple fact that construction involves risk. Relying upon competitive bidders who are tendering proposals for free to deliver risk-free bids to the client is entirely inappropriate. If the design team needs to hire consultants to investigate existing conditions, they should do so before the bid. Competitive hard bids are not design-assist invitations, no matter how much the Architect hopes otherwise.

GCs may encourage their subs to attend job walks however it remains the GCs responsibility to control the project risk. This means carefully written inclusions, exclusions, clarifications, and stipulations in the proposal to the client. Allowances or contingency amounts can be clearly identified and accounted for.

Hard bidders are not design consultants

Be advised that some design teams don’t take the time to look up existing materials to specify in their plans. “Field Verify”, or “Match Existing”, are entirely inappropriate notes for installed items. Bidders aren’t generally allowed to disassemble existing assemblies in an occupied space during a job walk. Even if they were, operating equipment may present such danger that investigation is impossible without utility shut-down.

Above: Artistic rendering of a utility shutdown from the clients perspective

GCs should compose an RFI including a photo of the assembly in question explaining that field verification was not allowed / possible. Directing subcontractors to price a reasonably similar product is a way for GC’s to still bid the job while the design team considers the question.

Tame the beast before you’re chained to it.

Some engineering consultants include requirements to bring all assemblies up to a given standard, regardless of whether the installed work is in the contract area or not. Imagine disassembling the refrigerated section of an operating grocery store to verify that every connection was made properly! These unreasonable requirements are often cited during change order disputes to provide leverage against the contractor. Having an RFI on record helps to illustrate the bidders good faith efforts and sheds some light on what’s really going on.

With the architect is in attendance, this is a great time to respectfully point out why their consultants requirement can’t be met. Many architects are unaware of what is in the consultants “fine print”. Some consultants will have pages of legalese specifications absolving them of responsibility for problems they create. Estimators must be keenly aware that winning a job with such engineering specifications, means that they may be contractually responsible for engineering mistakes. Assuming the relevant subcontractor will absorb that responsibility is unfair, and unethical. GCs should keep in mind that engineering disasters won’t be corrected by bankrupting a subcontractor.

Never be in such a rush to win a job that your firm is responsible for an engineering disaster. All of the very worst engineering consultants I’ve ever encountered had extensive legalese in their specifications. It’s hard to say if they are incompetent because they face no threat of litigation, or if they were obliged to hire a lawyer to defend their substandard work in the past.

Engineers rarely meet with their lawyers because of good engineering…

Any firm that refuses to accept responsibility for their own work is a risk generator to a GC contractually bound to them, whether they are a design consultant, a vendor, or a subcontractor. The market is improved by starving irresponsible professionals of work. Sometimes, the estimators most powerful option is to walk away from a bad deal.

Pre-walk prep

The best way to ensure you get the most out of a job walk is to begin your estimate beforehand. Review the specifications, especially the general conditions. Look for the basic contract requirements that design teams always bury. Specification requirements for; taxes, wage rates, bonding, and liquidated damages are so convoluted it’s no wonder that these are the first questions asked at the job walk. Request for proposal (RFP) documents may not have identified the start and end dates for the project. Often RFP’s include overly optimistic construction start dates, coupled with rigidly enforced end dates. Asking about the state of permitting during the job walk gives GCs an insight into how much time they’ll really have for construction. If there are permitting delays, the client needs to know how that affects their deadlines, and their costs.  This is a great opportunity to prepare the client for clarifications, qualifications, and exclusions you’ll be putting on your proposal based on what you’ve learned.

About the only question that nobody will answer is taxes. “Whatever the authority having jurisdiction requires” is the gist of what you’ll get unless it’s a 100% tax-exempt project.

Job walks are often scheduled around client convenience. It’s terrifically common for them to be held right when other jobs are bidding, or whenever traffic is at its worst. Architects may not list the job address on every page of the plans. Ground-up projects might bid before zoning officials have designated an actual address for the site. These projects simply define the nearest street intersection to the site, even if it’s miles away.

Check the address online well before the job walk. In cities with a penchant for naming every road with a number, be especially cautious about trusting a single web search. One local city is so confusing that I’m forced to use three separate mapping sites to develop a consensus on which address is correct.

GPS: “You’ve reached the nexus of the universe, please standby for the rapture.”

If you’ve been given a zip code, use it instead of the city name in web searches. Many plans list the wrong city when the address is near a border.

Give plenty of time to get to the job walk. Job walks typically start promptly at an easy to access location like a building lobby before moving to an obscure conference room. If you’re late, you’ll be chasing all over the building trying to find them. Plan on presenting a business card, if not photo identification to whomever is hosting the job walk. Secure facilities and active job-sites will have further requirements like hard hats, safety glasses, etc.

A good host knows the most

If you’re inviting subs to your site walk, be sure to spell out your concerns, and identify trades who have a compelling reason to see existing conditions. If walking a job isn’t necessary, don’t waste the subs time by demanding attendance.

GC estimators may find their client is reluctant to arrange a job walk.  Delays in communication may add up while the deadline grows ever closer.  Job walks routinely turn up new questions that will need answers BEFORE THE BID.  Cowardice in communication has cost many estimators their winning bid. Waiting for permission to walk a vacant space is commonly caused by a building / property manager who’s simply not vested in their tenants bid process.  Reaching out to the property manager directly gives the GC a chance to alleviate their concerns about a noisy crowd of contractors disturbing the tenants.

Make sure you’ve arranged to have access to all requisite building systems. Often clients will forget to bring keys to the riser room, or the mechanical room. GCs hosting job walks should expect rapid-fire questions from the subs. Take extensive notes of what was said and publish a bid-directive for all of your bidders. There’s no sense in answering only the sub who showed up. Sometimes you’ll end up with a list of questions you’ll need to send as RFI’s to the architect. List all of those questions in the bid directive. Wherever possible, provide contingency subcontractor direction in case the RFI’s aren’t answered by the bid deadline. That reduces your workload and demonstrates accountable leadership to your subs.

Every job walk should leave you wiser for the effort. Look for information about the market as well as the job. Effective estimating relies on sound judgment based on all the information available. Be wary of what you say since competitors are listening . Lots of folks will stay mute out of caution, however silence is a poor proxy for competence. Controlling risk is about hitting a balance point between caution and calculation. The less you know, the more you’ve got to be cautious about.   Don’t be shy about asking questions that will improve your estimate.

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© Anton Takken 2015 all rights reserved

Nearly every type of construction estimate can benefit from a job walk. In its simplest form, a job walk is a field trip for the estimators so they can get the lay of the land. Sadly, much of this opportunity is squandered by folks posturing, preening, and trying to “sell” their client. Equally unfortunate are the squinting mutes who want nothing more than to get away from the outside world. Job walks are where a lot of winning and losing takes place. The only thing worse than missing a critical detail and losing the job, is to win because you didn’t cover the cost!

What matters most?

BEFORE the job walk, every estimator should have reviewed the plans to get a good handle on what is supposed to happen. If the entire job is not depicted on the plans, you’ll need to define how every building system gets tied into the project. This requires a good deal of curiosity and perseverance. Be very careful to stay oriented when walking through an existing building. It’s easy to get turned around in buildings that lack symmetry and consistency between levels.

Gotta watch your step…

An office remodel may seem simple until you notice they’re adding a break room in a space that never had one. Plumbing lines; water, sewer and gas, may need to run to the building mains, so you’ll need to know where they are! Engineering consultants routinely ignore the basic necessity of providing these critical locations on their plans. GC estimators should be using the job walk opportunity to define not only the locations of the necessary systems, but the lengths and routes necessary to make them feasible. Existing buildings often prevent straight-line “as the crow flies” runs of pipe, duct, or wire. Inaccessible ceilings, floors, fire rated walls, and height changes often require that a building system be routed around building features. Often when systems must take longer routes, the size of the line must be increased which can have a profound impact on pricing. Keep in mind that pathways must be sealed to the weather, and aesthetically acceptable to the design team where they are exposed.

Proprietary systems abound in modern buildings. HVAC Controls, Security, Audio/ Visual, Fire Alarm, Elevators, Photovoltaic (solar), Public Address, Nurse Call, Access Control, and so forth. Literally every system needs to be individually identified by brand, model, make, etc. This often means asking the client/ job walk guide, for access to these systems for closer inspection. Proprietary systems often have designated local vendors/installers. Fire alarm systems are infamous for having software “locks” which prevent any but the installing company from making any changes to the installed system. Get a bid from these firms, but don’t expect it to be reasonably priced! “Wire” doesn’t make it an electricians job, any more than “pipe” makes it a plumbers. GCs must be responsible to know what they’re looking at if they’re to estimate professionally.

Some products have very long warranty periods. Roofing systems are often warranted for 10 years but only if a certified installer does the modifications. This means that every new plumbing, electrical, and HVAC penetration must be done with that roofing installer or the existing roof warranty is voided. Ask the client to look it up if they don’t know.

Don’t forget the basics

Deck height is an absolutely critical bit of information that design teams never reveal. Bear in mind that absolute precision isn’t necessary for most of the bidders. If the deck is sloped (most roof decks are) take an average, or a minimum measurement. Subcontractors (subs) need to know how much room there is above ceiling grids, it’s better to know within a few inches, than to guess within a few feet.

The Golden Rule of critical plan dimensions

Roughly plot the course each building system must take to connect to the existing building. If there are natural “choke points” where all building systems must share a chase, passage, or hallway, make note of the approximate dimensions. Rough calculations of each building system should give a sense of whether there’s a problem getting everything through. Remember that discovering a problem now means the solution is profoundly less expensive than later on.   Publishing a request for information (RFI) on the problem may lead to an addendum response obliging all contractors to the same solution. This keeps the conscientious bidder in the running against less attentive competition.

Moving past existing openings, it’s time to address opening new ones. It’s amazing how often a job walk is held and nobody bothers to inquire as to the structural composition of the existing floor(s). Post-tensioned slabs, slab on deck, slab on grade, twin-tee, there are many different ways to make a floor. It’s critical to inform your subcontractors on what you’re dealing with. Structural floors typically require imaging before cutting, drilling, or coring to avoid damage to embedded reinforcements. X-ray, ground penetrating radar, and sonar are some of the options available for imaging. They each excel in specific applications so it’s important to know ahead of time.

Some imaging technology is pretty specialized…

Savvy GC’s have learned that imaging firms have very high mobilization (cost to show up) charges. Rather than have each bidder include their own imaging which multiplies this cost, the GC hires the imaging firm and simply requests that the bidders include their requisite number of penetrations on their proposals.

Opening holes in walls can require the services of dedicated demolition firms however it’s critical to address temporary supports known as shoring, rigging , cribbing, etc. The demolition firm may include these supports for the duration of their own work, but not the entire project. GC estimators may need to ask these bidding firms for additional costs to leave the temporary supports in for longer. Very often this cost is a separate mobilization for the demolition firm. In more extreme cases, the temporary supports may be rented from a specialty third-party vendor. In this case, it may behoove the GC to contract directly with the temporary support vendor as needed.

Site logistics

Construction is loud, dirty, work that involves moving large amounts of cumbersome materials. Demolished materials need a path out of the working area, and new materials need a path into the working area. Working in and around finished areas requires protection, encapsulation, and cleaning. Some clients are easier to work around than others. Is there a place for a construction dumpster? Is there a material lay-down area so that trucks may unload in a timely manner? Is there anywhere for the workers to park? If the work is above ground level, is there a freight elevator? If there is crane access for rooftop work?  If a crane is necessary, how long must it be to “pick” the equipment?

Ground-up construction may be just as difficult in different ways. For example, storm-water management is an increasing concern for cities looking to protect their natural resources. Digging a hole at a geographic low point means you’ll be pumping any existing ground water until you’ve got the final systems in place. In other situations, you’ll face hard-rock excavating, mud jacking, piles, caissons, etc.

I’ve visited sites that were depicted as a shallow hole in the existing civil plan, that were in reality a considerable hill! The last lot to be built in a development is often the handiest spot for excavators to dump extra fill. Design teams may spend several months developing the plans, much can change between their site visit and yours. Existing-to-remain structures might have been weather-damaged, vandalized, or pilfered by the time you’re walking the job. Take photos to prove what was there when you walked, in case something changes before you’re allowed to begin.

“As you can see, the sign is still there.  We… we’re afraid to get any closer…”

Even fairly straightforward ground-up projects involve the simple question of whether you’re importing or exporting dirt. The civil engineer will never share the answer, so the GC must figure it out before the walk. Many jobs blow their budget on trucking dirt around. Savvy estimators have been known to offer solutions like spreading unwanted dirt fill over the entire site rather than hauling it off.   Alternately, they might sell clean fill to needy nearby sites.

Helping everybody, benefits the GC the most.

GCs should consider problems that will be shared by several trades. One consistent issue is vertical. Several trades will need access to walls, ceilings, and roofs. Masons will always have their own scaffolding. It’s generally understood that trades may share their scaffolding so long as they are considerate, and brief. On building interiors, there are often vertical features which involve many trades. In these cases, it may be most reasonable for the GC to furnish a scaffold system for all the trades to use at lower total expense.

Safety is a loudly trumpeted aspect of ongoing construction but it’s virtually never mentioned during job walks. If a site has minimal accessibility, and requires long walks through narrow corridors, how can emergency responders be expected to save an injured worker? Secure facilities like military bases, or prisons may actively block 911 calls from inside their perimeter. I helped to carry an injured co-worker out of a prison remodel because the prisons medical staff had no direct path to our site. Even if they had access, they were too obese to climb stairs and ladders to reach the victim.

Take a moment and consider how weather will affect the safety of the site during construction. Exposed excavations and torrential rainfall can be a dangerous mix. Snow removal can consume a lot of time and limit productivity.

Feasibility

Lots of job walks have curmudgeons with clipboards harrumphing at “this dang-fool design that can’t be done”. More often than not, it’s a minor problem, an unfamiliar approach, or it just looks wrong when viewed out of context. Job walks should not be a critique of aesthetics, that’s not what the build team is for. The job walk is an opportunity to “build it in your head” while considering the existing conditions. Many times I’ve spotted something unconventional in the plans that made sense only in the context of existing conditions. Plans never say “we went with this expensive thing because we discovered it was cheaper than re-working an entire system to comply with building code“. Be careful about criticizing the design teams judgment because they generally have a lot more information than you do. Lots of GC’s toss out value engineering suggestions before they fully understand the real problem.

Very often the architect will attend the job walk which gives the prepared GC an opportunity to respectfully ask about expensive items. If there’s design flexibility, you’ll gain a pricing advantage without causing the architect to lose face. Specialty material reps may have misinformed or misled the architect into thinking their product was the most cost-effective option.

True show-stopper problems discovered at the job walk should be brought to their attention.   Buildings may be so old that there are no drawings of as-built or existing conditions. A simple interior remodel plan may be derailed when a structural flaw is discovered. GCs looking at these projects should be particularly careful to inspect any building systems that impact their project but are “not in contract” (NIC).

I once had a job walk for a project which revealed an NIC structural impediment to the contract design. It took six months of building department appeals for the architect to get an alternate arrangement approved. While it was inconvenient for the job to be put on hold for half a year, it cost us nothing. If this issue had come up the first few weeks of the job, that delay could have proven very costly to all the companies involved.

Phasing

Remodel projects may require phasing the work to accommodate the client. Most Architects shy away from drawing phasing plans, however there is typically a note or a specification requiring the GC to “coordinate phasing“. It’s during the job walk that you’ll learn what the client’s concept of phasing is. Some clients pick phasing lines based on their departmental layout rather than building features.   Phasing work can dramatically affect the price. Nailing the phasing plan down during the walk is a critical step to ensuring you are all bidding the same job. As the client is defining their phasing highlight a small printout of the floor plan accordingly to generate the phasing plan. Savvy GCs will send a copy of this plan as an RFI asking the Architect to confirm that it’s the desired phasing plan for all bidders.

Make a note of how many trades will be forced to do out of sequence work in order to allow phase turnover. These notes will become part of your scoping checklist heading into bid day. Making sure that your subcontractors are bidding the work as it will happen will cut out preventable change orders.

Photos

One area of profound improvement in job walks is that everyone has a camera and they are able to share photos with their bidders. Some folks are veritable shutter-bugs , who take dozens of photos as they walk around. It’s here that some good advice is in order. First and foremost, it’s critical to have some sense of scale in every photo. A zoomed in photo of a white wall may tell the drywall bidder that it was finished to level three but it doesn’t tell much else.

Stacey has a photo album of all the white walls she’s ever seen…

Very few job walkers bother to take “big-picture” shots that give a sense of how things are arranged. How high is the ceiling? If you can’t measure it, at least take a photo with a scalable object in it. A 7′-0″ door in a very tall demising wall gives bidders a means to determine how tall it is. A really simple trick is to open your tape measure to some convenient length and place it in the photograph.

Photos save tremendous amounts of time transcribing small written detail but they’re virtually never used that way. If there’s a proprietary system in the building, take a photo of its nameplate. It’s absolutely incredible how often a GC will say “Oh I took a photo of that panel”, only to reveal that they photographed it with the door closed! A painted metal box with the door closed might be anything from a high-end security system, to a first-aid kit. For goodness sake, open the door BEFORE you take a picture!

Building systems have a make and model in addition to physical attributes defining them. If there isn’t much to work with, take a photo with a section of your tape measure showing to provide scale.

Bear in mind that if you’ve got to write an RFI about something you discovered during your job walk. It may prove immensely helpful to have a photo on to which you can write notes to direct the Architects attention.

Necessary tools

It should be obvious that people should bring plans, pencils, business cards, clipboard, tape measures, flashlights, and a camera to a job walk. Yet many folks choose to bring full-sized printed plans causing them to forgo virtually everything else simply because they couldn’t carry it.

Full sized plans are enormous obstacles to paying attention as you’re walking around in a space that might be poorly lit, and strewn with trip-hazards. Half sized, or shrunk-to-fit 8.5×11 paper is a much better option for portability but you’ll lose legible detail in the exchange. The rise of tablet computers has allowed many professionals to shift to paperless plan reading which is very helpful.

Dedicated estimators should maintain a clipboard, or bag with all the normally needed job-walk tools at hand. Measuring wheels are incredibly useful tools that should be stowed in your trunk along with personal protective equipment (PPE) like reflective vests, safety glasses, steel toed boots, and hard hats. Laser or ultrasonic measuring devices allow rapid measurements across interior spaces. They are particularly helpful in taking floor to deck height measurements without disturbing occupants.

Ladders are very helpful in interior remodel projects, although occupied spaces will typically have one on hand in the maintenance room.

Basic questions everyone should ask

When will the job start? Request For Proposal (RFP) documents are often very optimistic about construction start dates and very rigid about construction end dates. Optimism won’t get permits issued on incomplete plans. Many design teams count on several rounds of building department review before the permit will be issued.

Above:  Experiments in Architect accountability have been promising, however more research is needed.

Design teams rarely face a penalty for causing permit delay, however contractors face a very real schedule compression as the process drags on.

Specifications bury and confuse basic contractual information that affects your price. Bonding, Taxes, Liquidated Damages, Minority owned Business Enterprise (MBE) participation requirements, Leadership in Energy Efficient Design (LEED) requirements, are all critical questions to pose to the client/architect.

In many cases, just asking about an onerous requirement caused the client to strike it from the contract! Thousands of dollars worth of risk get waived aside simply because the client’s attention was drawn to it.

Tax questions dodge ball

Clients and Architects never want to answer tax questions. Tax-exempt, and partially tax-exempt status is very common with schools and government offices. Punctilious responses about consulting the specifications for requirements to adhere to tax law, never actually state where the taxes land on the job. Look it up and pose the question listing the actual percentages and the subtotals as they contribute to the final answer you came up with. For example;  

“Does this project have W% for City, X% for County, and Y% for State totaling Z.Z% for the job?”

Getting a straight answer on applicable taxes is the holy grail of job walk intelligence work. If they won’t answer, I’ve found that asking “Why is it a secret?” tends to illustrate how silly the situation is.

You can trust Architects to know silly when they see it. 

 Get loose ends on the record

The best thing about asking questions during the walk is how often they are incorporated into the Architects next addendum. Costly concealed requirements are revealed to all bidders, which holds everyone to the same standard.

RFPs may omit details that really matter to bidders. When will a decision be made on contract award? What criteria (beyond low price) drives award decisions? What does the client/design team have budgeted for the project? Is the project fully funded, or will financing be secured after the bid? Clients and design teams who are wasting the markets time are especially evasive about answering these questions. Bids are not free so estimators must put their efforts towards the most viable opportunities.

Best value. A real attribute, or a real liability?

RFP’s which stipulate that contract will be awarded based on best value should be carefully considered. Without a scoring rubric or a stated hierarchy of selection priorities, best value becomes a liability to the honest bidder. The competitive bid may be a feint intended to legitimize awarding the contract to cronies. Honest bidders should never lend their credibility to corruption.

Take the opportunity to ask the client to define how they’ll assess best value.   If necessary, ask how that assessment will be shared with the bidders. Transparency is a rare trait in clients, bid accordingly.

Some walks lead to walking away

Some jobs will be more risk than they’re worth. Designs that seem straightforward on paper might be missing existing conditions that profoundly change the challenges the build team will face. Estimating is about controlling risk within the confines of your purview. Sometimes factors will stack up to an untenable situation that’s just bad business. Low budget clients are often limited to low-end properties riddled with hazardous materials, or unsafe structures that were revealed at the job walk. Unless your firm is looking to make a charitable donation, there is little to recommend taking on this risk.

The construction market is balanced at one end with clients hiring the low risk contractor at one end, and contractors declining the high risk client at the other.

An estimator can learn about much more than just the existing conditions at a job walk. In my next blog post I’ll be illustrating how you can gain greater understanding of your local market by attending job walks regularly.

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© Anton Takken 2015 all rights reserved

Popular business methodologies evolve over time to meet the ever-changing landscape of a competitive market. Technology has allowed faster and easier communication than any time in the past. Much more work can be accomplished by fewer people which makes for better efficiency and profit.

Dedicated estimators are being replaced by Project Managers who are tasked with bidding their own work. The idea is that the overhead of a dedicated estimator is no long necessary because Project Managers can bid their next job while they’re wrapping up the last one. Estimators are vastly outnumbered by Project Managers, so splitting the work seems like it’d be easy. Plus communication breakdowns between estimating and project management are a thing of the past.

“I said I needed a Big Cat Scan, not a Big Cat CAT Scan…”

“Two for the price of one” Vs. “The cost of two for the price of one”

All of which requires that every Project Manager be just as capable as a dedicated Estimator while working as a Project Manager. Unfortunately, the working reality of these Project Managers (PM) is that they now have less time to do two jobs. Project closeout involves a great deal of administration effort to get the Operation and Maintenance (O&M) documentation, final lien releases, retainage, warranty, inspections, Certificate of Occupancy (CO), and so forth. I suspect it would be difficult to pick a more inopportune time to interrupt a Project Manager’s work than during the closeout period.

Meanwhile the Estimators work builds in intensity as bid day approaches. “Luck favors the prepared” is never more true than in the closing moments of a hard-bid. Bid day preparation requires time to investigate, to plan, to communicate, and to direct. Estimators are always working against a deadline. Despite the short deadlines, clients may take a considerable amount of time to award the contract. Winning a job doesn’t necessarily mean you’ll start right away. It’s very difficult to land a job that starts right when the last one ended. Some clients are very slow about providing bid results. The estimator must continue bidding in the mean time just in case they didn’t get the job.

A shortcut to a dead-end

We often simplify estimating to mean bidding which sounds like little more than a dollar amount on a proposal form. With that mindset, it’s understandable to think that a General Contractor (GC) arrives at their bid by simply adding up the low subcontractor (sub) proposals with a bit of overhead and profit thrown in to pay the bills. Some companies do “bid” exactly that way. I refer to this practice as “bid collecting” because the GC isn’t actually estimating anything. These GCs rely on trusted subs and blind luck to land profitable work. This doesn’t work, which is why clients don’t simply hire their own subcontractors. Without a doubt, this practice is tied to the high failure-rate of General Contractors.

Firms who don’t estimate are losing money by missing opportunities they can’t see. Imagine just barely losing a bid. It seems like you’re doing things correctly and that you’ll get it next time. Now imagine if the job in question had a fairly small amount of work for one sub who was extremely overpriced. The next bid might have more scope for that sub, and if everything remains the same, you’ll lose by a larger margin. Without an estimate to compare the subs against, you’d never know what’s costing you the wins. Many “teams” in this industry have a player (or two) who’s causing the losses.

One of these things is not like the others…

Estimating is about controlling risk. If you’re not controlling the risk, the market responds accordingly. Subs may play on the GCs’ lack of foresight to lay groundwork for future change orders. Competitors may strategically price themselves out of a risky project, leaving nature to take its course on the foolhardy.

Going down and picking up speed

By far, the most common result of bid-collecting is losing. GCs who don’t estimate tend to have a much lower hit-rate on competitive bids. Low hit-rates are typically answered with a higher volume of bidding. Losing faster is the result. In the endless search to lower overhead, these firms often have secretaries and interns “beating the bushes” to nag subcontractors into bidding ever more projects that rarely lead to contract. Every loss withers the markets faith that the GC is a real contender.

GCs who don’t estimate tend to view bidding as a function of odds, much like gambling. As a result, they don’t consider bid results important. If they didn’t win, they (wrongly) assume their odds are better for victory next time. Subs can’t get any meaningful bid results from these GCs because many of them literally throw their bid file away whenever they lose! This is just like gamblers at the racetrack, tossing their betting slips after a loss.

Subs bidding these GCs fall into two camps; the loyal and the blind. No matter how optimistic, eventually the cost of wasted bids factors into the subs calculations. Since there’s no reason to believe a bid will lead to work, the sub’s main concern shifts to providing a price quickly, so their estimator can move on to work with more potential. Unfortunately spending less time with the plans means more is unknown which raises the risk to the sub. Higher risk is met with higher prices. Pricing themselves out of the running is how “loyal” subs communicate their perspective of the situation.

Blind subs are those who simply don’t see what’s going on. Whether it’s because they lack experience, or opportunity, blind subs will chase every opportunity laid in front of them. Sadly a bid-collecting GC can run up an impressive number of losses that pull the blind bidders further from profitability. Eventually these subs “see the light” as overhead costs become all-consuming.

Bidding PM’s who are on a long losing streak can become desperate. GCs who don’t estimate are among the most likely to bid-shop. Bid-collectors often view subcontract amounts as a series of ongoing negotiations.  Bid shopping is dishonest and unethical. Dishonesty is a remarkably consistent character flaw. Jobs that start with bid shopping typically end with; broken promises, sharp dealing, and unpaid invoices.

Milling gravel with the grain

Some GCs have exponentially increased the number of projects they bid by having all of their PMs bidding, all the time. Often the PMs are chasing a mixture of hard-bidding and negotiated projects where they are the only GC. This creates a client-CG relationship where one PM heads up that account. It’s here that some interesting dynamics come into play because the PM must maintain market-leading pricing if they are to retain the negotiated agreement.

Market-leading pricing is the going rate as established by competitive bidding for work done by market-leading professionals. The very best subs will be attracted to the very best GCs who will be unbeatable on competitive bids. A PM who squanders market-leading sub bids by consistently losing, will struggle to attract their attention again.

A PM with a heavy workload may lack the incentive to win a project they’re bidding. However few PM’s are given the latitude to decline a bid opportunity.

Freedom to walk away from bad opportunities makes you a potent contender

Bidding PM’s in this situation are stuck “going through the motions” until they’ve garnered a reputation for wasting sub’s time.

Many PMs pressed into estimating lack an extensive background in bidding which leaves them ill-equipped to define market prices for standard commodities. Bid-collecting firms often treat conceptual plans like “real” estimates which they expect their subs to competitively price. Such firms often heavily invest their PMs time in “helping” design teams with conceptual pricing in the hopes they will be on a short bid list when the design is complete.

Space plans… the unpaid frontier

Unfortunately, there are unscrupulous design firms who specialize in “space plans” for the purpose of lease negotiations. They rely on “free” conceptual estimates to provide market pricing to their clients. They know that none of their designs ever lead to a construction contract. There’s no actual opportunity for the GCs bidding. The GCs are simply an unpaid consultant to a design firm. The total cost to the subcontractor market is incredible. In some cases a GC can cost a subcontractor so much in wasted estimating time, that the rare win fails to make their efforts worthwhile. The only answer is to starve this terrible practice at every level.

Less to see, but more to know.

Contrary to popular assumption, conceptual bidding is more difficult than hard bidding. Missing detail can’t simply be ignored, so the estimator is tasked with filling in the missing bits, then pricing them. Conceptual estimates are often allowed a fraction of the typical hard bid time because “there’s less to price”. These are things you quickly learn by estimating, that you may never realize by bid collecting.

Economizing on estimating is still possible however it’s through knowledge, not throughput. So much of estimating is distilled into the dollar amount on the proposal. A well-done estimate is as much a price as it is a team of well-coordinated professionals, a schedule, and a plan. Bidding affords an opportunity for skilled professionals to excel in their field, and profit from their abilities. A bid list is not a simple roster of subs you know, but a pool of talent poised to make the project come together better than anyone else.

Not every Request for Proposal (RFP) is a great opportunity, and not every client is an asset. The odds of winning profitable work can be changed by knowledgeable assessment of the market. Reduce estimating costs by picking a target and hitting what you’re aiming at.

What could go wrong?

PMs bidding their own work are vulnerable to new paradigms that didn’t exist with dedicated estimators. For example, subcontractors are now aware of which PM will be running the job. This means the subs can factor the PMs’ reputation into their bid. PMs who can’t win a competitive bid may find themselves with plenty of spare time to consider how their legacy led to unemployment.

Deadline dueling

Adding to this problem, the PMs of a single GC may not coordinate their bid deadlines which forces subcontractors to choose which opportunities they can bid, and which they must decline. As mentioned above, conceptual estimates masquerading as real opportunities, may leave the real jobs shorthanded.

Stymied subcontractors

With each PM bidding their own work, there is less consistency in how estimates are conducted. New and talented subcontractors may struggle to get in front of a firm when each PM has their own subcontractor list. Making the situation worse, PMs stop bidding when they’ve won work so they only update their subcontractor list sporadically.

Current events

Projects can keep a PM busy for months or even years which means they can experience huge lags in their knowledge of current market conditions. A great deal can change in a local market over the course of a few months. Seasonal rushes can generate shortages in labor or material can have huge impacts on market value. Most RFPs allow less than 30 days from invite to deadline. That’s not a lot of time to bid the job, to say nothing of catching up on half a years’ worth of market changes.

Critical consistency

Clients with lots of projects like retail chains may be put off by the inconsistency in GC pricing as several of their PMs bid nearly identical work. Few GCs can afford to lose profitable work due to estimating deficiencies.

Bid blender

Some clients will negotiate an agreement with the GC to assist from conceptual drawings on to actual construction. The early conceptual efforts are “on the record” and the GC must show how design decisions impact the project budget on an ongoing basis. Mixed in with the typical time-wasters, these conceptual estimates may fail to garner the attention they deserve. PMs who are bid-collecting may fail to recognize trade-overlap issues, incomplete design implications, and unstated client intent. All of the conceptual design risk lies on the PM conducting the bidding. Subs bidding to such a PM often pad their numbers because they know the PMs estimating mistakes will eventually become their problems to solve.

Pro tip: Peek through the window before answering every knock on the door.

Pre-con padding

PMs seeking to shift their pre-construction responsibilities to subcontractors, often find their clients budgets are consistently blown. Subs are loath to give up their padding because design-assist projects are often interpreted by clients to mean change orders are impossible. Subs know the PM will expect extras they won’t be able to pay for. Preserving the relationship, or simply escaping a bad job requires extra money in the bid. This is the risk of working for a GC that doesn’t estimate.

Sadly I’ve borne witness to projects that were run this way. The client overpaid for work that wasn’t well-organized or executed. The subs ended up eating so many estimating oversights that the work wasn’t profitable for anyone. Absolutely everything about what was wrong with the job had its origins in a half-baked pre-construction effort. Whatever labor savings the GC made in having the PM bid the work was paltry compared to the losses everyone took on the job. That PM hasn’t won a competitive project since then, because subs can’t afford to repeat the experience.

Just as estimating is reduced to “bidding”, so too is a PMs’ performance reduced to statistics like revenue and profits. In hard times, companies often take to comparing their PMs’ numbers. Skillful PMs whose leadership prevented costly delays, mistakes, or changes aren’t accurately reflected in these comparisons. Sadly, a dishonest PM knows they can boost their numbers by cheating the client or the subs. PMs who are better managers than estimators are suddenly struggling to retain their job when the estimator is sacked to save money. Low-cost, high-volume, bidding often leads to unprofitable work that looks good on the books …until the job is nearly done. “We’ll make it up on the next one” is the answer until the “next one” turns out to be just as bad. If nothing changes in execution, then nothing will change in outcome.

Winning profitable work is the first half of a successful project. Building the work safely and profitably is the other half. Cutting a boat in half makes it sink, therefore downsizing should be building a smaller boat. That means professionalism in estimating, no matter who’s doing it.

Ghost bidding

Some of the best firms in the market have their Project Managers involved in the bidding. In most cases, these firms have a dedicated estimator “ghost writing” the estimate. This collaborative effort allows the estimator to split their time among a greater number of projects, without leaving PMs entirely on their own. In the case of negotiated agreement projects, this approach is particularly successful in getting the job started quickly since the PM already knows what’s going on.

Estimators working in this situation must excel at collaborating with, and managing PMs. Few of these estimators communicate directly with clients or subs, so their role becomes increasingly hard to see from outside the company. It’s definitely making some PMs better at estimating, but it remains to be seen if construction estimating is improving overall for the effort.

View from the field

Generally speaking, firms with PMs bidding their own work are losing far more often than those with dedicated estimators. When PMs do finally land a job, the work is often less profitable to the subs than comparable work.   PMs heading up design-build or design-assist projects tend to blow their budgets far more often than estimators. Lots of otherwise excellent PM’s are struggling to find work because they lack estimating skills. Without mentors, and training, the future is bleak for the bidding PM.

Estimators should seize the opportunity to land steady and profitable work against unskilled competition. There’s nothing cheaper than the wages of an excellent estimator.

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© Anton Takken 2015 all rights reserved