What's the plan this year?
It's extremely hard to stick to a plan; there are so many ways to get distracted and thrown off course, and it is just easier to move forward without following any rules or guidelines. Like driving around without a map and not stopping to ask for directions. Maybe it’s a “guy thing.” It’s probably why our wives always keep asking us, “Why don’t you just buy a map?”
In my January 2006 column, “Planning a Year of Successful Estimating,” I discussed the importance of developing a strategy and plan for your estimating department, setting goals, analyzing the previous year’s failures and successes, and preparing your team for the year ahead. Did you follow my recommendations and develop a plan? Did you stick to it? And if not, why?
For those of you who developed a plan (and hopefully followed it), now is the time to analyze it again. You need to find out if it was successfully executed and whether or not it was productive. Did your plan help your team bid more jobs? Did you win more? Lose more? Why did your plan help you win? Why did it cause you to lose? On the jobs you won and have built, did your profit margins increase? If so, was your plan a leading factor? If you don’t analyze your plan on what you have done and where it has led you, you won’t really know if it was successful.
So what’s your plan for this year?
If you thought 2006 was a busy year, strap yourself in because 2007 is going to be crazy. You may need to modify your plan to adjust for a busier season.
It looks to be a very promising year for the electrical construction industry. We are seeing several exciting trends blossom into common standards. Solar projects are definitely on the rise and are getting bigger. Smart homes are all the rage and carry more special systems than most fancy commercial buildings. Green construction requirements are popping up on more projects. All this means more intricate designs on lighting control and HVAC systems as well as switchgear and power monitoring systems.
We are also, finally, starting to see the 2004 MasterFormat appear more frequently. You know—the one the architects and engineers decided will make our lives easier? The one that changed Division 16 to 26; left 15 through 20, 24 and 25, 29 and 30 empty for the future. And 21 just wasn’t used, I guess, or they forgot about it.
Are you ready to attack these new markets? Do you know how to estimate these projects? Is your database ready? Will you or your estimators need any special training? If you don’t start planning and preparing for this future now, six months will fly by, and you will have missed half a year of winning opportunities. You will also be too busy to change direction and miss out on the second half of the year’s opportunities.
Your plan and your clients
Another area of your plan to analyze is your client base. Who has been good for the company, and who has been bad? Sometimes you bid jobs to whomever is on the bidding GC’s list because you have to. But if you could choose, who would be the best ones? This list of your best clients should be in your plan, and you should act on it by aggressively marketing them. As for the bad ones, how can you make them better clients? If you can’t work with them, stop bidding jobs to them. This, too, should be in your plan.
Of course, this is typically an owner’s area of analysis, and they should make any decisions on taking action. But estimators can assist by communicating their bidding experiences with their bosses. Let them know which contractors helped them during the bid process and which ones made them work way too much—for nothing. Which ones have provided truthful feedback on how your numbers compared to the competition?
As it is important to choose the right market to bid jobs in, choosing the right clients to bid to is equally important, if not more so. Put that in your plan and, well, you get the idea.
Looking back, the past year of estimating is just a blur. A couple hundred jobs estimated; their folders filed away in some overstuffed storage box. Each of them gone, forgotten forever—at least until a re-bid is announced. So what do we do now? Why we start all over again, of course. Only a couple hundred more jobs ahead of us now. So onward young estimator soldiers, into the battle we go again. But hopefully, this year, we’ll have a solid plan to keep us from getting lost. ECSHOOK is the president and chief estimator for his estimating company, TakeOff 16 Inc. He has worked in the electrical construction industry for more than 18 years. Reach him at 707.776.0800 or by e-mail at sfs@TakeOff16.com.