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Firms Can Reduce Human Errors On Sub Par Estimates

By Eugene Peterson

If you have been struggling for profitability, understanding the problem might just mean the difference between a company that wins or loses at the game of business.  As I have studied this industry-wide problem closely over the years, my conclusion is that most of the money is lost in one of four places:  1) The hand-off between sales/estimating and production. The problem usually takes the form of inaccurate or incomplete information on plans, specifications and selections.  2) Project managers, superintendents, foremen and/or lead carpenters that give work away to try to keep/make the customer happy, and they are not accountable for bringing the job in at a specific budget.  3) Doing work without a budget, a job schedule and without appropriate follow-up job costing practices or procedures.  4) The sales person/estimator does not understand the complexity of the job or task and underbids it.  Unfortunately, this column is not long enough to list the remedies. However, if you identify a specific problem and would like some outside help, email me at eugene@adviseandconsult.net with the problem, include your phone number, and I will call back and spend 15 to 30 minutes with you – no charge.  If done right, this can be a very powerful teambuilding experience.

 

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