Identifying Estimator Errors

One of the main goals in estimating is accuracy. Therefore, mistakes must be minimized. A major mistake could be fatal to a project’s profitability. When dealing with mistakes in the estimating process, the estimator must work at minimizing them and developing a good process to identify and correct them.

The very nature of the estimating process is fertile ground for making mistakes. With so many factors that can affect the accuracy and quality of the estimate, the estimator must be vigilant.

Estimating requires the ability to quantify a project’s materials, labor risks, and all project costs in a very short time. There can be added stress when an employee is managing and estimating multiple projects.

We all make mistakes because we are human. Here are five common mistakes estimators tend to make:

1. Poor interpretation. The contract documents provide the estimator with the ability to properly estimate a project. From the drawings, the estimator can accurately “quantify” a project. In today’s world of engineering, not all drawings are 100% complete for construction. Architects and engineers issue drawings that are sometimes only 50% complete. This can be challenging for the contractor. The specifications provide product details and how to install the materials. The estimator must properly understand area classifications as well as code requirements of the Authority Having Jurisdiction and the National Electrical Code. The contractor’s work will be judged by the contract documents. Care must be taken in making assumptions of the engineer’s intent. Interpreting intent can be costly. When the risks are too great, clarification must be sought from the architect and/or the engineer.
2. Bad judgment. When we make a judgment, it is typically based on careful thought. Our thoughts are influenced by our experience in the trade. Therefore, our judgment improves with historical data. The best judgments are made on facts, not gut feeling, which has little place in the world of quality estimating. Analyzing previous projects and several types of installations will provide the estimator with the ability to make the best judgments. Labor reporting from the field will provide accurate historical data for making judgments related to the current project.
3. Manual calculations. Estimating software, spreadsheets, and calculators are tools that perform calculations. Performing calculations “in your head” is a sure way to make a mistake. Manual calculations must be avoided. Most estimating software programs provide features for determining the bid price within the software. The contractor should be careful using estimating software in conjunction with an Excel spreadsheet. This creates an environment for human mistakes. Estimators should use the best features of software to minimize mistakes. Quality software provides the ability to complete an estimate from beginning to end.
4. Not using software as designed. Computers allow an individual to work efficiently. I began estimating manually with pencil and paper in the mid-1980s. In those days, we used the NECA Labor Manual for labor units and a National Pricing Service book for material prices. Today, this has been simplified with estimating software. When I transitioned to computerized estimating, I wanted the estimating software to “think like a manual estimator.” This is unwise. The estimator MUST allow the best features of estimating software to change his or her methodology in the estimating process. Using software as designed, you will increase your efficiency and minimize mistakes. Transposing labor and material totals from estimating software to an Excel spreadsheet to summarize an estimate is counterproductive and risky. Mastering the functions of estimating software will provide the best outcomes. Every software feature has an intended purpose and should be used accordingly.
5. Omissions. An omission is something neglected or left undone. This could be a missing quotation, a general or specific drawing note not addressed, or a missed drawing not quantified. Every estimator should have an estimating sequence that is followed to ensure that the estimate is complete. Constant procedures will produce constant results. The unchecked estimate will prove detrimental to the quality of the estimate.

So your goal should be to avoid these mistakes as much as possible. But how do you go about doing so? Here are six tips to help you avoid making those mistakes.

1. Use a “Request for Information” for clarity. Contractors are installers, not engineers. Therefore, ask the architect or electrical engineer for clarification when in doubt of the project’s document's intent. The reason we have questions is that we do not know. So, when you are unsure, ask a question.
2. Master your estimating software. Learn every feature that your estimating software provides. Seek training and find an online lesson to help.
3. Avoid distractions. Minimizing distractions is essential. A closed office door is better than an open one. Background music may be relaxing, but talk radio and constant news stories can occupy one’s mind. On bid day, put a “Do Not Disturb” sign on your office door.
4. Focus on the task at hand. Multitasking is somewhat of a misnomer. You can only give your full concentration to one task at a time. Trying to do two things at the same time is not the best practice. Confucius said, “The man who chases two rabbits catches neither.” This is good advice.
5. Take a break. Taking a break allows your mind to relax and refresh. Keeping your nose to the proverbial grindstone can be counterproductive to your efficiency. Working long periods without taking a break can create brain fog.
6. Have an estimating sequence.  An estimator should have a systematic sequence for preparing estimates. The use of standardized estimating procedures is essential for speed, accuracy, and consistency. Consistent procedures will produce consistent results. Here are some benefits estimators can expect from using an estimating sequence:

• Increased confidence in their work.
• Increased speed and greater estimating departmental production
• Increased organization
• Increased estimating accuracy
• Reduced estimating omissions
• Confidence during the bid summarization

This sequence checklist will greatly minimize mistakes.

Owning mistakes is necessary for learning to identify and correct them. Mistakes must be corrected sooner, rather than later. Major mistakes as well as minor mistakes have a culminating effect on the estimate. Identify the mistake, minimize the impact, and improve your processes/practices for prevention in future estimates.

Don Kiper is an independent electrical estimating trainer and consultant based in Niagara Falls, N.Y. He can be reached at [email protected].