Yes this is a self-awarded title. Reflecting on this every company has an estimating philosophy. I have recently started aligning myself with companies that have a similar estimating philosophy. I can bring significant improvements to a company’s estimating workflow if we agree on goals. My philosophy could be summed up it would be this:

  1. Focus on estimating. Companies win a fairly small amount of the bids that go out the door so more you bid the more you win. To that end find ways to speed up while maintaining accuracy the estimating process. Minor costs can be lumped together while major material costs are listed in detail.
  2. Separate the budget process from the estimating one. If a bid is won then the estimate is copied and conformed to a budget. Don’t saddle the estimator with having a conformed budget at the time of estimate!
  3. Crew configeration should mirror what occurs in the field.
  4. Crew work calendar out in the field should be duplicated in the estimate. Estimating with 8 hour shifts and all crews work six 10 hour shifts to catch up is just creating cost errors. Model in the estimate as close as possible what crews are working in the field.
  5. Equipment including company equipment should be setup as a monthly rent with EOE set to “calculation” mode to approximate fuel usage.
  6. Production should always be in something that can be measured for a time period. No guessing number of shifts but actually use a production factor like units per shift.
  7. Do not have “hidden margin”. Have costs as costs and then margin will be a concrete number (and one number) and not something a company just tweaks with no real stragedy.
  8. Separate company overhead from margin. When companies go in with a aggregate margin and overhead percentage they are actually combining apples and oranges. They are two very different percentages. I have no issue with not putting margin on company overhead.

Here is an example: A company wants to have an exact takeoff and costing in an estimate of 2″ PVC fittings even to a point of distinguishing between T’s and couplers. Not a major cost. Or they have a large valve broken out by each component. I probably am not the right fit for that company to improve their HeavyBid setup. My philosophy is to get an approximate number of small fittings and just group them all together with an average cost. Labor and Equipment costs will far exceed the minor cost of small PVC fittings. Focus on major costs and not burden estimators with detail not needed for an accurate estimate.

When a company calls wanting help I am starting to first determine if they align with my philosophy and then we can proceed with improving their HeavyBid setup. Some I will turn down and that is not saying that their approach is wrong, rather it is the reality that I am not the consultant that will bring them up to the level they want their HeavyBid to be at.

So I suggest determine what your philosophy is for your estimating team and work towards aligning the philosophy with the reality of your entire estimating workflow.