by Don Kiper
The connection between estimating and project management is inseparable. The project manager would be out of a job without the estimator. Both a quality estimator and quality project manager are necessary for the company to make a profit. Hopefully, that is the goal.
Blame and accolades are also part of electrical contracting. The “Blame Game” has been on the earth since the beginning of time. Someone said, “if you could buy people for what they are worth and sell them for what they think they are worth, you would be a billionaire.” Who knows, maybe a trillionaire.
In my electrical contracting experience, when a project made money, it was because the project manager was outstanding. If the project lost money, it was because of a bad estimate and the estimator was to blame. The fact is, both may share blame for the loss or both may be given credit for a successful project.
The project manager must be given a project to manage that was properly estimated. How are we to determine who shares in the blame and who shares in the praise? The estimator must be accurate, and the project manager must be efficient. Accuracy, as well as efficiency, should be measured.
As an estimator, I have metrics or benchmarks by which an estimate is analyzed to determine if an estimate is accurate and correct. Here are some of the metrics that I look at: Labor hours per square foot; Labor hours per device in all systems – ie: lighting, branch, fire alarm; Average length of conduit & wire or cable per device in all systems; System with the largest percentage of labor; Accurate material pricing; Competitive quoted complete packages; Total percentage of quoted packages of the total project costs; Material items with the largest total costs; Schedule verses the crew size to determine supervision costs.
Of course, these metrics will vary from one project to another, especially between commercial projects and correctional facilities.
Just as an estimator has metrics to analyze accuracy, the project manager must have metrics to determine efficiency.
Here are some metrics for the project manager: Time – How are we doing with the project schedule? Costs – Is the project under budget or the estimate? Percentage complete vs. percentage of total costs? Resources – How much time, staff, equipment are we using? Are we committing too much in management without a return? Is there unused rental equipment on the project that should be returned? Scope – Is there scope creep or seep? The project must be kept within the limits of the estimate. Creep is uncontrolled changes. Seep is allowed extras without charge.Performance – Are we meeting estimated labor units, including labor factors, such as loss time, overtime, multi-story effect? This includes performance of the GC.
Risks – Are the project risks being managed? Quality – How is our quality? Are electricians correcting and fixing unacceptable work due to poor planning and management?
At the end of the project, we should compare the estimator’s accuracy to the project manager’s efficiency, then we can truly know who is to be praised and who should shoulder blame.
But the real prize is not in blaming and not in praising. It should be to arrive at solutions that both enhance the accuracy of estimating and the efficiency of project managing.
When employees stop placing blame and start seeking profit making solutions, only then will you arrive at the true spirit of successful contracting.
Remember, estimating is expensive, poor estimating is costly, but quality estimating is profitable.