Do you know how your estimated pipeline looks each quarter? Are you sure you'll hit the forecast you developed? Can you answer these questions confidently without depending on reports or phone consultations? Unfortunately, it isn't uncommon for the answers to be "no." Don't worry; you're not alone. Estimate pipeline visibility is challenging for companies throughout the construction industry.
This becomes a challenge because many managers believe staying on track with estimates is as easy as knowing which one is a win or loss. However, what they fail to do is put necessary protocols and processes in place, so communication, bids, and all other components making up the estimate are visible throughout the pipeline.
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What Is Top-Down Estimating?
When construction managers use top-down estimating, they're defining the project tasks. In other words, managers are using the final deliverable or goal and then breaking that down into bullet-point planning packages. As a result, those packages experience further refining and break into critical details before team members receive them.
Suppose a project manager has a big-picture idea of how the project contributes to the organization; top-down estimating works the best. The main reason is that there's a proper understanding of the project's details. In addition, top-down estimating is beneficial because it's quick for project managers to define significant tasks. Then, the project team takes those tasks and refines and reviews them to help improve the visibility of your pipeline.
How does it relate to cost-estimating?
The top-down approach to estimating relates to cost-estimating in that you're using this method to determine budgets and evaluating the resources necessary for the project. That way, you can develop a cost estimate alongside a rough estimate for the project's timeline. In addition, top-down estimating helps you understand what you need for contractors, team members, and budgetary guidelines when you don't have the full scope of the project.
Do takeoffs help with top-down estimating?
If you have the blueprint, then using takeoffs helps with top-down estimating because you're creating digital takeoffs in a shorter time, right from those plans. Even though top-down estimating doesn't take as long as cost estimating, using this approach for digital takeoffs reduces the amount of time you're typically spending on this task.
Tips to Improve Visibility of Estimate Pipeline
According to HubSpot Research, the more visibility and control you have in your estimate pipeline, the more sales and revenue you'll achieve. That's why construction companies need to have maximum visibility. They can accomplish that goal through well-informed decision-making. Let's look at how decisions involving excellent communication helps improve the visibility of your estimate pipeline.
The implementation of CRM (Customer Relationship Management) allows you to communicate effectively throughout the decision-making process. Using this technology, construction managers can easily manage the interactions occurring in their company.
That communication includes existing and potential customers. It's easy to use this approach, as you'll be using dedicated cloud-based management tools. That way, when you're facing multiple data sets, you'll stay organized. Every department of your construction company experiences an impact on the outcome of your business's sales. So, you must manage communication effectively.
How Data Integration Plays a Critical Role
Data integration plays a critical role in ensuring all parties involved in the estimating process are receiving the same information, thus reducing mistakes or miscommunications. You can achieve this goal through the seamless integration of valuable data sets with other business tools, including Procore.
Taking this approach helps you unlock additional capabilities available in your estimation software. Using the data that your estimate pipeline generates helps support the decisions you and your team make. Your decisions won’t be based on guesses, but on data.
Use of Reporting
The use of reporting helps you create high-value pieces of information for well-informed decision-making. This effort helps when you're in the estimation process by allowing you to create data-driven and professional reports. In doing so, you'll be driving better decisions through all critical findings that typically don't stand out when using regular reporting.
Improving the visibility of your estimate pipeline also involves evaluating it at least once monthly. That review should include meeting weekly with team members and stakeholders to determine where processes are stagnating and how to identify real opportunities within your pipeline. Make sure you're collaborating with team members to keep every department in the loop.
Now that you know the importance of top-down estimating and how to improve the visibility of your estimate pipeline, it's time to get to work. ProEst is a proactive approach to helping construction managers understand tips to improve the visibility of your estimate pipeline so your business can flourish with an increase in profit.