Executive ReportS

5 Reasons Why Construction Estimators are Leaving Excel

Most of us with any history in the construction industry know that Excel, in spite of its drawbacks, has long been a mainstay of project estimating. In fact, for many contractors, Excel spreadsheet estimating represented a significant step up from more rudimentary pencil-and-paper calculations—a faster, better way to record and manipulate estimate inputs, with a more accurate result.

Yet, as those same contractors can tell you, Excel has its flaws and limitations as a construction estimating tool, primarily because it wasn’t built with the needs of a specific industry in mind. And while the generic quality of Excel makes it relatively easy for most people to use, it’s also less than ideal for the kind of detailed—and often specialized—estimating tasks contractors want and need.

Construction-specific estimating software resolved a lot of issues for estimators and project management teams; more powerful automation features and integration with back-office applications save time, improve accuracy and reliably produce better results. And then there’s the cloud, a technology development that has revolutionized the way the construction industry works. In today’s hyper-connected, always-on world, a cloudbased estimating platform gives construction teams unprecedented levels of access, mobility and productivity. Contractors in the cloud, research shows, have a significant competitive advantage over those that aren’t—and the gap will only continue to widen.

In this Executive Report, we’ll identify five important reasons you should consider replacing Excel with a construction-specific estimating tool—and explain how leaving Excel behind can help your company achieve new levels of growth and profitability.

I hope you find it of value.

Jeff Gerardi

President & CEO

Reason #1: Accuracy

EXCEL CALCULATIONS CAN BE FLAWED

A winning bid—and ultimately, a profitable job—begins with an estimate that’s error-free and reliable. Yet as any construction professional can tell you, that’s often easier said than done. Why? Because formulas can be flawed, costs can be miscalculated and user alterations-intentional or otherwise—can wreak havoc with your numbers long before the final bid is submitted.

Winning construction companies have the solution: replace pencil-and-paper and spreadsheet calculations with software created specifically for construction estimating. That way, calculations for materials, labor, equipment, taxes, mark ups, bonds, insurance and other costs are generated automatically, leaving no room for human error. Estimating software also offers the kind of visibility and control other approaches lack. Estimates can be summarized by cost type—material, labor, sub—or any level of grouping, including user-defined groups by phase, area or location. Data remains consistent, accurate and reliable no matter how you look at it. And there’s another benefit: having full confidence in the data means you spend less time chasing outliers and deciding which numbers to trust in disparate spreadsheets. When time is money—and it always is—that matters.

Finally, construction-specific estimating software helps ensure that information is completely current, offering continuous upgrades and enhancements that keep track of changing industry and market conditions automatically—including pricing updates on labor and materials. That’s important protection for your profit margins and your bottom line; in today’s competitive business climate, there’s simply no room for estimating errors or surprises.

KEY TAKEAWAYS

Excel allows users to build formulas that can be altered, either deliberately or by mistake.
Unlike Excel, construction estimating software can summarize data by cost type—material, labor, sub—for instant clarity.
Estimating software offers continuous upgrades and enhancements that reflect current construction industry conditions.

Reason #1: Collaboration

EXCEL DOESN’T LET PEOPLE WORK TOGETHER

Now more than ever, it’s essential that your employees work as “one team,” from the outset of a project until the very last numbers come in. That means having a level of connectivity and collaboration among stakeholders that Excel wasn’t designed to provide.

The good ne ws? Software specifically created for construction estimating and hosted on a cloud platform breaks down the barriers and facilitates stakeholder communication, giving teams a new ability to share information in real-time and collaborate on key decisions and “go forward” plans.

Even better, it ’s scalable. With a centralized repository of project data, a cloud-based estimating platform can accommodate an unlimited number of users simultaneously—and offers new levels of project visibility to everyone involved. That means that estimators, project managers, field teams and accounting personnel will be on the same page throughout the life of each project, without the risk of undetected discrepancies and data errors.

Cloud-based construction estimating is ideal for remote users, too. Accessible from mobile devices anytime and anywhere, cloud estimating platforms give an increasingly mobile workforce a new ability to connect, communicate, collaborate and contribute.

KEY TAKEAWAYS

Excel was not designed as a collaborative tool, limiting users’ ability to share information.
Excel can’t scale up or down, with the ability to accommodate an unlimited number of users.
Excel can’t provide the 24/7/365 accessibility offered by cloud-based estimating systems.

Reason #3: Integration

EXCEL DOESN’T EASILY INTEGRATE WITH OTHER APPLICATIONS

As we’ve seen, real productivity happens when teams connect and collaborate, but Excel has limited multi-user features. Custom programming can fix some of the issues, but that can be expensive, and customizing Excel at the user level makes it difficult, if not impossible, to maintain a standardized, company-wide approach for multiple estimators. It’s easy to see that if your estimates are inconsistent in terms of content or format, that can spell trouble on the back end for accounting and project management teams.

Even more problematical is getting the right data to transfer correctly into your other back office systems. In many cases, estimate data may have more detail than a user may want to incorporate into scheduling, job costing or project management, leading to inaccurate calculations and unwanted complexity. And manual alterations— intentional or not-- can wreak havoc with estimate accuracy.

Software created specifically for construction estimating, on the other hand, offers direct integration with many popular construction accounting and project management software solutions, eliminating the need to manually enter estimate data into software on the back end. That’s good news for everyone, because it saves time and all but eliminates unintended errors.

KEY TAKEAWAYS

Excel doesn’t provide a standardized approach for multiple estimators, compromising consistency and accuracy.
Construction-specific estimating software automatically transfers front-end estimating data to back office systems.
Direct integration with accounting software virtually eliminates the risk of manual re-entry errors.

Reason #4: Scalability

EXCEL WON’T KEEP PACE WITH FUTURE GROWTH

For many construction firms, there comes a time when Excel simply isn’t big, or powerful, enough to tackle increased estimating volume or complexity. When growth is a business priority and for many contractors, it is– that can spell trouble for companies that hold on to the familiarity of Excel.

Construction-specific software solutions delivered via an online cloud platform is the solution, addressing the need for scalability, either up, in times of growth, or down, if demand and usage shrinks.

Let’s take a loo k at the first scenario, using small residential and remodel contractors as an example. Even with unlimited potential for market growth, maintaining a relevant a database and debugging Excel for multiple users can be a challenge that many are unable or unwilling to meet.

Large general contracting firms face their own issues by sticking with Excel. Those that experience a sudden increase in estimate demand-- or need to quickly add more estimators to the team find that Excel limits their ability to respond to new opportunities, or even properly manage estimates that have already been produced.

For companies of all sizes, a dependency on Excel often leads to lower productivity. First, there is the initial set up time for the Excel estimate template, and then you have to verify and test all of your formulas to make sure you have done it correctly, whereas with a commercially available product, that work is done for you. The bottom line? If you get to the point where you don’t have the time or manpower to maintain and verify the integrity of your data, then a different solution is the answer.

KEY TAKEAWAYS

Most contractors will outgrow Excel spreadsheets as the scale and complexity of their estimating projects increase.
Contractors that envision growth can benefit from data-based estimating software, both short and long-term.
Unlike Excel, construction estimating software can support sudden changes in estimating volume and user demand.

Reason #5: Support

EXCEL DOESN’T OFFER A DEDICATED TEAM

Without all the right pieces in place, no construction project can get off the ground, and that includes the construction estimating process. Unlike Excel, estimating software developed specifically for the construction trade typically is supported by a dedicated team of qualified technology and customer service professionals who stand behind their product—ready, willing and available to answer questions, troubleshoot potential issues and help optimize the value of your investment. Their collective understanding of the construction industry and estimating process is invaluable in helping estimators build and maintain a database that reflects specialized estimating requirements as well as changes in the industry itself.

A dedicated software support team can help your construction company save valuable time, too. Knowing that “time is money” for contractors, a fast response to client queries and service requests helps avoid unproductive system downtime and maintain a high level of business performance. Dedicated on boarding teams can even help streamline the transition from Excel. Why? Because they know how to import historical data from the Excel environment and help make the move to a standardized estimating system fast, seamless and trouble-free.

Just a s important, dedicated support teams are a step ahead of product updates and enhancements and are readily available to walk users through new features and functionality. That means your company stays at the peak of estimating productivity and can more easily maintain a competitive edge.

KEY TAKEAWAYS

A dedicated support team can quickly respond to questions and resolve technical issue.
On-demand support helps ensure a minimum of system downtime and uninterrupted productivity.
Support teams have extensive knowledge of estimating tasks and the construction industry as a whole.

Conclusion

Every year, the construction industry grows more competitive and technology-focused, demanding that contractors adopt innovative new tools and processes to maintain market advantage. As the limitations of Excel grow more obvious—and the business benefits of more advanced estimating tools are realized—it’s clear that it’s time for a change. Excel simply can’t provide the kind of estimating power, customization and connectivity that makes peak performance possible. For that reason, construction companies that cling to the familiarity of Excel may be jeopardizing their ability to compete effectively, work efficiently and maintain profitable client relationships.

In this Executive Report, we’ve seen that when every member of your team works together in the same system, project workflow accelerates, productivity increases, and profit margins improve. By adopting a more powerful automated construction estimating platform, especially one based in the cloud, construction companies of all sizes can better manage the complexities of today and position themselves for success in the future.

KEY TAKEAWAYS

A dedicated support team can quickly respond to questions and resolve technical issue.
On-demand support helps ensure a minimum of system downtime and uninterrupted productivity.
Support teams have extensive knowledge of estimating tasks and the construction industry as a whole.

About ProEst

ProEst provides advanced construction estimating capabilities for leading companies and public sector clients in the United States, Canada and Australia. Our cloud-based platform combines cost estimating, digital takeoffs and bid day analysis in a single powerful solution— a proven way to reduce costs, ensure accuracy and streamline pre-construction workflow.

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