Many approaches exist for estimating – two of them being a theoretical approach versus a production history approach. One is based on what you think, the other on what you know. These terms may not be familiar to you, but the difference in execution may be.
Scott Jennings and Patrick Mullen gave a very frank presentation on what runs through the contractor’s mind in his/her creation of a bid, formulation of a changer order, and preparation of a claim. Both cost and time.
Scott Jennings and Patrick Mullen gave a very frank presentation on what runs through the contractor’s mind in his/her creation of a bid, formulation of a change order, and preparation of a claim. Both cost and time.
Create a static bid item in all of your bids to serve as a checklist for indirect costs – both jobsite and corporate indirects!
An effective meeting is one wherein the attendees are “with” the facilitator the entire time and can and do follow along. Here are some suggested tactics.
Contractors that deal with tough projects, tough clients, and/or tough contracts need to be in a mindset of always being claim-ready. Here’s the start to being claim-ready.
Charles Leonard performed a study which resulted in the Leonard curves. These curves may be a helpful tool to quantify your labor productivity loss due to cumulative impacts on your project.
If you’ve been running the accounts receivable and accounts payable out of a brown paper bag and want to go “legit”, here are the first steps.
Jet grout has been, and continues to be, a successful means of ground improvement. It can serve many purposes – two of the most common are structural support and groundwater control.
On February 20, 2021 a Boeing 777 airplane lost an engine during flight over Colorado. The engine failure was catastrophic and could have resulted in hundreds of deaths. The plane landed safely back in Denver. This failure highlights the greatness of engineers.
A college degree sometimes seems overrated as it isn’t necessarily a measure of intelligence, nor a guarantee of success. A pigskin on the wall says more than “I know engineering” or “I know business”. It says, “I can finish things.”
When an owner determines the method of award is that the low bid wins, they shouldn’t expect contingency in a contractor’s bid. Here’s what they should expect.
The categorization of costs incurred in a changed condition scenario is critical in dispute resolution. Account for costs by issue and sub-issue by creating buckets of costs. Do it early!
The word “incidental” is common to the construction industry and it can be damning if you’re not careful. Understand what you’re committing to when you enter that unit price in the bid proposal when it requires “all incidental costs be included”.
Contractors experience all sorts of delays. This article covers what, arguably, may be the four most common types: inexcusable, excusable, compensable, and concurrent delays.
Starting a construction business has its unique requirements. These plus the norms will get you up and running at your new construction business.
Our nation’s infrastructure bears on many types of foundations. Generally speaking, they can be classified into two different types: shallow or deep foundations.
Many challenges in a project can be flushed out in the pre-bid phase with clear and concise questioning to the Owner. Consider these questions as a part of your bidding procedure.
When making regular payments throughout the lifespan of a construction project, there are two main ways a general contractor or owner can achieve a significant level of financial protection: the joint check and/or the lien release.
Caring about your employees is human and it’s good for business. Combine the two to create solid and long-lasting relationships plus a healthy business. Send your employees to the doctor. Regularly.
Setting of bid prices on a unit price bid can have significant effects on the financial performance of a project. Set your unit prices in your proposals to have positive impact. Be strategic.
Letters in the construction industry, during the course of a project, usually are reserved for contentious issues or to satisfy notification requirements. Here are six of the most important and common ingredients in these letters.
Any noise beyond liquid simply flowing in a pipe is likely not a good thing. Two potentially dangerous noises in pipes/pumping systems are water hammer and cavitation.
Construction contracts are almost always measured in some sort of day: a working day or a calendar day. In analysis and project communication, kill the doubt for the reader and always define the type of day in every use of the word “day”.
A common mistake in estimating is the cost of an overtime manhour. Overtime is generally not one and one-half times the straight time rate. It’s usually closer to 1.30.
Construction often times does not go per plan. These unexpected variances in the plan can make or break a job. How you treat these “fires” can define your effectiveness as a manager. In construction there’s dozens, if not hundreds or thousands of things, that can go wrong...
Contract interpretation can be difficult for a construction professional. Contracts are comprised of thousands of words and hundreds of paragraphs. Consider “contract mapping” to help quickly guide you through a contract.
As a general contractor you can rely on your subcontractor’s bid on bid day as a binding agreement. But not in all states. Listen on to learn about protection granted by the Doctrine of Promissory Estoppel...
There are differences in an hour: a manhour, a crew hour, a 50-minute hour. And an hour’s not a day, so there is another calculation for a manday. Here is a quick explanation of these estimating terms...
Construction changes are generally handled in a similar way in most contracts. As a contractor you can develop good habits and controls to ensure you capture time and cost impacts.
Just three random important things for contractors that didn’t make up an article all on their own: the legality of audio recording, running one man short, the golden rule of bid forms.
There are very few “court-accepted” ways a contractor can quantify his or her loss as a result of labor productivity, or lack thereof. MCAA’s (Mechanical Contractors Association of America, Inc.) document PD 2 Factors Affecting Labor Productivity is one of the most widely used methods in practice.
Let’s run through an example. Let’s do an example so you see some of the challenges. Let’s take one cost code in your budget – let’s look at roadway subgrade. Below we have the budget for this cost. You can see the cost code is “1001” and there are five cost components of this cost code: labor, equipment, consumable material, permanent material, and subcontractor cost. This can be viewed in the columns from “Cost Code” to “Budget($)”.
Executive summary. An accurate job cost projection is vital to Company survival. And it’s not too complicated if you know the budget, the timing of your costs, and can do a little bit of estimating. It’s NOT about blindly relying on quantities completed!
Field overhead carries different names with different contractors and owners. Discussed here is what field overhead is, and why it’s important for owners to understand.
A construction claim is a dispute in the Work as it was contemplated in the original construction documents. However, a large percentage of what drives a claim is not the Contract. It’s the people. It’s personalities.
If you are interested in communicating information to your audience, and you want your audience to absorb and remember what you’re saying, communicate effectively. Communicate using vocabulary, tempo, brevity, and body language that your client understands and wants. It’s not about you. It’s about them. They need to get it. You already do.
Each day we hand contracts down to our subs or we are signing contracts down from Owners or General Contractors. Know some of the basics of what to look for here.
In this webinar we discussed small/medium business cybersecurity and best practices, especially during COVID-19. It is always a good time to check-in on the security of your network, computers, and websites. And now with your employees, and data, working remotely, cybersecurity is critical.
Construction estimating isn’t wholly about the numbers. It involves a “feel” in its execution. This is why many say estimating is an art and a science.
Most traditional bond rates have two variables in their cost: the contract value and the time threshold. Do not forget to include both in time extension negotiations.
Many video conferencing softwares are in existence. Which one suits you best? Which ones are easiest to use? Here’s one users’ opinions.
Most Project Owners are convinced that Contractors thrive on change orders. The truth is that most would prefer to have none. Read below a sort of open letter to Owners.
Extra work on a construction project must be delivered at fair and reasonable prices. Owners should know they have this right in their Contract, and Contractors should know the owners have this right too.
Whether in a bid situation or a change order negotiation, there is a way to boost your profit on paper by not “job costing” your equipment. Let’s talk depreciation.
Scott Jennings, P.E. facilitated a live 2-hour webinar and Q&A with attorney Scott Batterman, Esq. of Clay Chapman Iwamura Pulice & Nervell, Attorneys at Law from Honolulu, Hawaii to address one of the hottest topics now in the construction industry: Force Majeure due to COVID-19
This is the audio only. For full presentation and resources, please visit: http://sjcivil.net/fm2020resources/
Field experience is necessary to be a best of class construction and engineering professional. Can you or your employee relate to today’s article? Can you write your own article with similar anecdotes to these below? If you cannot, schedule some time in the field.
The management structure of sizable projects usually involves four major parties: the owner, the construction manager, the designer, and the contractor. Here’s how project management is structured and what the parties’ responsibilities are in two common project delivery methods.
Ensure that before you sign a change order, all of the necessary components of your negotiation are included. Here’s what to look for in a change order before you sign it. And don’t forget – you don’t have to sign it.
As a construction professional in the field, when information conflicts between plans and specifications, you should immediately seek the order of precedence section of your contract for guidance.
There’s almost nothing more important than notifying your client, in accordance with the Contract, of a time and/or cost impact. Learn how to do it here.
In a construction matter, the quality of evidence can be as important as the evidence itself. Using contemporaneous information can be invaluable in your legal matter against an opposing party.
Whether bidding a job together in one shared document, or running comparison estimates, the setup in a joint venture effort is critical to success. Consider establishing the following before starting your estimating effort. And, be consistent. Be consistent.
Do you often need a professional engineer to facilitate the construction at your projects? Here’s how to pick your engineer and to guarantee the quickest turnaround of the product you need.
Maintaining employment is a factor of your performance, but for construction and engineering firms it is largely dependent on a firm’s ability to bring in project after project. Who’s responsible for bringing in these projects? The answer lies below.
You’re probably reading this from America or Canada. Ever wonder what the infrastructure and construction means and methods are like in a smaller less developed country like Laos? [For those who haven’t tapped into Google yet to find out where Laos is, it’s a landlocked country adjacent to Vietnam (to the west) in Southeast Asia.]
A cubic yard is not a cubic yard when it comes to earthwork estimating and field operations. Know the difference to best estimate productions and to negotiate pricing in the field.
Takeoff is a primary function in the estimation of construction costs. A good takeoff includes more than is plainly seen on the drawings. Here is discussed the definition and purpose of takeoff along with what makes a takeoff good.
In a best case scenario, a construction claim will make the contractor financially whole again on the matter. In a worst case scenario, the contractor goes out of business. Most claims conclude somewhere in between with all parties unhappy.
Advice for life in general, and professional life, is often gleaned by the sharing of lessons and anecdotes. Here are some lessons to apply to both home and work.
The reader is introduced to the process of contractor estimating from initial project evaluation through the call for bond, the takeoff, the actual estimating of a civil project, an even the turn in of the bid...
A constructability review can significantly and positively impact a project. But what is it and what are the third-party reviewers looking for in their review? Here we look just at the drawings/plan review (not the specification and contract review).
Contractors are often brought into a project in the design phase to minimize cost. Here are some guidelines on infrastructure project cost cutting measures from a Contractor’s viewpoint – it’s advice to a design team.
Once the project starts, it is the Contractor’s project management team’s responsibility to update the client on a regular, usually weekly, basis. This is done graphically using a lookahead schedule in bar chart format (also known as a Gantt Chart). Here we discuss the contents and reliability of the lookahead schedule.
What are the “necessities” for software and apps for your construction business? Here’s a look at what’s out there – software and/or apps that are in use by successful firms to accomplish necessary functions in your business.
What do I need? If you’re doing more than a million dollars in sales a year in heavy/civil construction, I’d say you need the following tools in your construction software toolbox...
How many RFIs (requests for information) are too many on a construction project? Is it time, is it possible, to tie the number of RFIs on a job to the cost impact suffered by a contractor?
Time for any business is critical, perhaps more so in construction than many other industries. The role of time and its effect on a contractor are discussed here.
Discussed here, by a contractor, is arguably the #1 area of recommended improvement for infrastructure owners with fiduciary responsibility. The area in need of improvement: response time to construction issues.
In the construction industry, there are three main tools used for scheduling. Pros and cons of Microsoft Excel, Microsoft Project, and Primavera P6 are all briefly discussed.
Education of your staff or of your client can be effectively done using SJ Construction Consulting LLC’s (SJCC) Crew Cost Clicker. Don’t talk about the cost per hour of a crew, show it. Live.
Landing the work has enough challenges in meeting the scope, schedule, and cost requirements of the client. You’re defeating yourself if you can’t be polite and practice simple business etiquette.
If your client has been kind enough to consider doing business with you, don’t give him or her a reason to escort you out the door over something as simple as your behavior. Practice good business etiquette.
If you work for a public works construction contractor or you do construction management on public works jobs, Administration of Government Contracts by John Cibinic, Jr. and Ralph C. Nash, Jr. is the bible for governmental law. A very brief background from a construction professional, not a lawyer, is provided here on this key publication which should be on your bookshelf.
It’s important as a contractor, or even as an owner’s representative, to know a bit more than the basics of scheduling. Familiarity of some of the terms is helpful regardless of what side of the table you’re on: Contractor or Owner.
Construction equipment is always evolving in its attempt to increase safety and efficiency of construction. One newer technology is the use of “wings” on construction cranes. Learn more about the wings on the Manitowoc®Grove GMK6400 MegaWingLiftTM crane here. Our partial analysis showed a lifting capacity increase of up to 68%.
Several means exist in the way of gathering data from your operating fleet. Here are the basic ways and then a quick explanation of current technology.
Projects often experience delays for which the Contractor is awarded additional time. The determination of the per day reimbursement to the Contractor for this time is fraught with protracted analysis and negotiation. Owners should consider the time related overhead bid item for instant resolution.
One of the top complaints of construction employers is the collection of completed timecards – in a timely manner that is. Here is a suggestion for improvement you probably haven’t heard.
Converting from one unit of measure to another is critical for any position of management in a construction company. Using the internet is one way of doing it but knowing the simple process of fraction multiplication and the value of the number “1” gets it done too. Unit conversion is nothing more than taking a unit and multiplying it by “1” as many times as it takes to get a result in units you desire.
BI stands for business intelligence. It is the process by which information from all of your company’s different computer systems (estimating, job costing, accounting, operations, et cetera) is displayed on one screen. You may not need it, but you better understand it – it’s coming.
There are several trucking freight terms that a buyer should know. They’re important to know when contracting the transportation of your goods as well as when it’s time to pay the bill.
One of the most basic properties of a beam is its section modulus. How does the section modulus, S, come into play in structural design? And, why should I care?
Many construction companies run their operations with too little specificity; costs ought to be reviewed on an activity-by-activity basis. Learn what, why and how to set up a good cost code structure.
A recent article by the American Bar Association caught my eye. It was entitled “When is it okay for a lawyer to lie?” I could probably end the article right here. I’ll keep going. [QR]
Contemplating a law career. Yup, I get it, you know someone who watched television like the rest of us and you became a lawyer because of Perry Mason, Law & Order,or Boston Legal. Don’t get me wrong, I loved A Few Good Men.
Contractors usually are mandated to attend a pre-construction meeting with the Owner. There’s no reason not to also have an internal pre-construction meeting.
The importance of the daily report cannot be overstated. Knowing why to write them and what to put in the report is critical for defense of yourself, and offense against another party.
One of contractors’ most reliable defenses, the Spearin Doctrine, has been upheld in a Missouri Court. Certainly, for Missourians, this is a good thing, and to the extent, others may be able to reference this case or use a similar approach in claims, is a win for the construction industry.
Training is an investment in your company. In your people. And anyone who has had a business knows that the fanciest equipment and tools are still only as good at the workers who use them. Invest in making better workers.
Once the decision is made to engage a consultant, choosing the firm to assist you can be one of the biggest challenges. Consider asking key questions to flush out the quality and value of the service.
Construction claims are an unfortunate part of the construction process in today’s world. When you have a claim, know the order of hierarchy in your presentation of the data for maximum remuneration from the client.
Is there a process in your company that you’d like to have developed into a simple app, or made accessible via the web? Sometimes, with the right framework in place, developing these processes for you can be done quickly and for reasonable cost.
A claim is made because a contractor has lost money and/or time on a project. The method is chosen by the contractor to substantiate these costs can vary. Some popular methods of calculating cost are presented.
A constructability review of a plan set can greatly benefit the project. On the surface, it looks like it benefits primarily the Owner, but the benefits to the design team and contractor can also be significant. All project parties should encourage this service on their projects.
Construction equipment is a necessary tool to perform many types of construction work. How to acquire the equipment has a significant effect on the financial aspect of a company. There are many options which should be considered when temporarily or permanently acquiring a piece of gear.
Construction companies have inventories that should be managed to improve efficiency and, in turn, improve the bottom line. Consider a mobile solution or at least one that gets away from the clipboard.
Landing the work has enough challenges in meeting the scope, schedule, and cost requirements of the client. You’re defeating yourself if you can’t be polite and practice simple business etiquette.
The purpose of a change order is to add work to an existing contract. Ideally this work is added with mutually agreeable terms in scope, time, and cost. These terms often cannot be agreed upon and contractors feel coerced into signing the document.
Consider not signing the change order.
There’s an adage, fast/cheap/good, pick any two. This relates to the Project Management Triple Constraint. It also has other names like Iron Triangle and Project Triangle.
Do two things today to improve your company: (1) check to make sure you are current on your 940 and 941 taxes and (2) make sure you’re reviewing your fuel bill.
Possibly the leading cause of contractor claim denials – lack of proper notice – just got a little bit easier for contractors thanks to the U.S. Armed Services Board of Contract Appeals’ conclusion that a request for information (RFI) can satisfy a notice requirement under F.A.R. (Federal Acquisition Regulation).