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O P I N I O N
What went wrong? If you want to boost your project profits, analyze past failures, and use that knowledge to craft winning estimates.
W e have all had projects that for some reason did not meet our financial expectations. Overbudget projects happen for many reasons, including bidding on the wrong one to begin with, underestimating the number of hours needed to successfully complete the job, failing to allow for delays and problems, or just not knowing the client well enough to anticipate what they really wanted.
June Jewell
Not only does your firm lose the profit margin associated with budget overruns, but they can also have a negative impact on client relationships and cause stress for your teams as they try to minimize the losses. A great deal of value can be gained by analyzing past project failures to understand what went wrong, and designing safeguards, processes, and approvals to minimize the chances they happen again. The following are three of the most common issues with developing accurate estimates, and some structure and practices you can put in place to turn past project disasters into lessons that add protection for future jobs: 1)Understanding the client’s expectations. One of the most common problems in accurately
developing a project scope is estimating a project before having all the necessary information. This happens for many reasons including the estimators’ inexperience and lack of training, absence of a struc- tured approach to project estimating, and just mov- ing too fast – often at the client’s request. By evaluating the steps your team is following to cre- ate project estimates, and implementing a detailed and documented process to gather requirements, you can eliminate a lot of the guessing that occurs because not enough time and care is given to truly understand what the client’s expectations are. An estimating checklist can provide some guidance as to what questions need to be asked and the informa- tion needed to be collected to develop a sound scope.
See JUNE JEWELL, page 12
THE ZWEIG LETTER April 3, 2017, ISSUE 1194
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