Why Getting the Next Project ‘Right’ is Better Than ‘Perfect’
August 24, 2022
“Insanity is doing the same thing over and over and expecting different results.”
The number of times I have heard this quote is difficult for this estimator to quantify, and with such popularity it is easy to conclude that we believe it to still be true. Why then, do we keep approaching capital project relationships, between owner and contractor, the same way over and over – with the same lack of transparency?
Most will point to the consistent trust issues between parties. The way we write contracts, the way we work with one another. The culture is that of worry that our data will be used against us on a claim, causing companies to be protective of transparency. But what if — and hear me out here — what if the actual issue was that plans, budgets and schedules were wrong to begin with?
Accepting What is Possible
Let’s face it, construction today is very different from what we knew 20 or even 10 years ago. Supply chains, labor shortages, inflation; any number of external factors can be pointed to as a “reason” for a project going awry. This doesn’t even mention the increased level of project complexity. But if we are being honest with ourselves, these are not new issues to the industry. In fact, you likely have a database of information covering past projects where these issues arose.
Yet here we sit, working through preconstruction estimates and schedules like this project is going to be that project. The one where we knew every productivity rate from the start. The one where we knew exactly how long that procurement lead time would be. The one where everything is going to be, you guessed it, perfect! Look at that past costs sheet you’re referencing right now and tell me those aren’t your “ideal” rates, lacking consideration of likely risks.
I get it. I’ve been there.
But this is where the fun begins. We are at a critical point in the technology journey for capital projects where, for the first time, we are able to take a macro look at the historical data. If you are ready to accept the change, there is no longer a need to keep a side spreadsheet of “relevant” rates.
Acting on Lessons Learned
If we circle back to our so-called insanity of repetition, traditionally during preconstruction, an estimating team would pull together a small collection of relevant past cost reports and select a few production rates. Relevant, though, was in the eye of the beholder. If you have a robust historical database full of productions at the line item level, why not use them all?
The estimating technology of today surfaces complete benchmarking historicals for every past project, not just the good or relevant ones. This provides immediate insight not just to your historical average, but to the outliers as well. Why was Project X so far off estimate? Is there a logical reason or did something go wrong? In either case, there is vital information from that data point (and many others) that form a more certain budget estimate.
What a world it would be if budgets were the only difficulty. Every bit as important, and sometimes more depending on the owner, is the time it will take to complete the project. Again, a scheduling team is going to lean into their experience with the activity, work type or region to make a case for durations. Often forced to work backward from a required end date, scheduling groups look for the most logical sequence of activities to achieve the desired result.
What if, though, the schedule inherently knew your as-built history for activities of that type? Much like the ability to reference every production rate you’ve accomplished, you also receive a data mining of your historical schedules that suggests the subnet of activities, suggests the sequencing, suggests the durations. Then your scheduling team isn’t starting from scratch and looking for a possible plan. Instead, they are presented a plan to massage and align with the parameters of the new project.
And the icing on the cake? Utilizing all this cost and schedule data to suggest and predict the risks that your project may face. You know, those “reasons” that projects go awry that were discarded as “that won’t happen on this job.” The external factors that we don’t have control over, or, at least, we didn’t have in the past.
Certainty from the Start
Trust and transparency remain issues in the industry not because the owners believe the contractors are “out to get them,” but more so because neither party truly understands how to fully quantify what the risks are from the start. A successful project, one that is done on time and on budget, is a win for both parties. And both parties understand this, which is why it is time for better transparency.
The integrated construction technology platforms of today push past the side-spreadsheets and siloed processes, making it no longer about who has the best guess on what production or duration is relevant. Now artificial intelligence presents the most logical scenario first, along with predicted opportunities and threats, allowing teams to make the most informed decision for the project. Collaborating, in real-time, with a plethora of past scenarios at our fingertips is how we together achieve project certainty.
It is time for the construction industry to break through the insanity. It is time to stop cherry-picking your best productions and scenarios because this next project is going to be that project. Open up the data, take a deep look inside, and begin with a plan, a budget and a schedule that were not perfect, but RIGHT from the start.
Ready to take a deeper dive? InEight can help get your projects where they need to go and help you create a solution that matches your needs while leveraging your teams’ existing strengths. Let us show you how.