Walk the job to see your world

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.

Walk the job to see your world

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.

Walk the job to see your world

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.

Walk the job to see your world

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.

Walk the job to see your world

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.

Walk the job to see your world

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.

Walk the job to see your world

” 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.

Walk the job to see your world

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.

Walk the job to see your world

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.

Walk the job to see your world

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

 

About Anton Takken

I chose to focus on estimating for a few reasons. Chief among them was that it's a position that's hard to fill in most companies. Job security and advancement is easier as a result. Unique to this job is a higher vantage point over the company and its place in the market. Bids are generally over in a few weeks which keeps things from getting boring. The reasons few of my colleagues pursue estimating comes down to a few misconceptions. The first is that it's the builders version of accounting - perceived as a lonely and quiet life among the charts and plans. The second is that it's not engaged in the construction process. Lots of the appeal of the construction industry is the sense that individual effort brought a plan into reality. The teamwork and camaraderie present among tradesman seems conspicuously absent at the estimators desk. Finally, I think the last reason is that it's daunting to be responsible for setting the price of something that's never been done. The good news for folks in estimating is that it's much more social than advertised. An estimator's phone is constantly ringing. Taking the opportunity to build relationships with the bidders creates a positive atmosphere and encourages everyone to do their best. It can be too much of a good thing which is why it's common to arrive at their voicemail when you're calling with a question. A strong rapport with the bidders can be invaluable. Subcontractors have much more exposure to what's going on in the market and they're often eager to share their knowledge. Learning from these experts is a priceless opportunity that's often overlooked. More on this in a bit. I decided to start this blog because I noticed that estimating has applications in many arenas. Over the last few years I've helped estimate in fields ranging from software development to blacksmithing! The more I thought about it, the more I realized that it's not about knowing what everything costs, it's about knowing how to figure that out. I believe the very first step to knowledge is to seek it, the second is to retain it, and the third is to pass it on. I hope to share some insights into how estimating is done and hopefully have some fun doing it. My experience is mostly commercial construction, but I'll try to make everything as generally applicable as I can. There are many aspects of business that all markets share yet it's remarkable that one of the most consistent is the failure to recognize that estimating is the very first step to a successful project. So if you're frustrated that work isn't profitable, or exasperated that there's never enough time to get the job done, this blog will be worth your time. Feel free to email me at: estimatorsplaybook@gmail.com View all posts by Anton Takken

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