The Developing Trend of Hiring Independent Consulting Estimators
THE DEVELOPING TREND OF HIRING INDEPENDENT CONSULTING ESTIMATORS
By Rifka Malik, CPESC, CPE
The trend of hiring independent consulting estimators is gaining momentum. While many construction companies are now subcontracting their estimating projects to independent firms, others choose to integrate the consulting estimator into their in-house teams. Naturally, there is much debate within the construction community as to which is the better option. There are undeniable benefits to each arrangement and just as many concerns. We will discuss the four C’s of concern that is the gateway to the much needed fifth C – Confidence.
- Cost
- Confidentiality
- Competence
- Commitment
COST
It is a common misconception that it is not a cost-conscious option to hire a consultant.Although a consultant’s hourly or lump sum fee may seem to be higher than an employee’s at first glance, one must account for all fringe costs associated with either scenario. Cost consultants usually get paid an agreed upon rate as a clean and straightforward cost, while an employee’s rate of pay is merely a fraction of their actual cost to their employer. For example, if an estimator gets paid a salary of $100,000 per year, he or she receives a gross rate of $50 per hour if divided over a 2000 hour work year. However, that is only a start. The employer will add payroll taxes, insurance, benefits, and perhaps bonuses.
Additionally, an employee gets paid for the week or year whether they spend all available hours working on your estimates or not. It is a commitment that is made by an employer at the time of hiring. A consultant gets paid only when they are working.
CONFIDENTIALITY
This must be the most common question I get as a consultant:
“How do I know I can trust you”?
For starters, how do you know you can trust your employee? Any answer that you can come up with, you can also potentially apply to the consultant.
There is no simple answer. But what I tell my clients is that I have a mortgage to pay, which is closely linked to my reputation in this business. I have been around for many years for a good reason. Frankly, that is the only answer that I can come up with that is irrefutable. Anything else I can say is questionable until you are convinced that I am telling the truth.And that takes time regardless of how the working relationship is structured.
Members of the CERT, the Consulting Estimators Round Table, must abide by a canon of ethics that they subscribe to as members.If there are specific business practices that are of particular concern to you, your best protection is to ask direct questions of the person that you are considering to trust. Frequently it boils down to the composition of a (personal) moral compass that stands behind every professional, whether acting as an employee or consultant.
COMPETENCE
While the competence and experience level of any professional can vary across the board from beginner to advanced level, this holds true for either structure. However, my experience has shown that typically a consulting estimator will need a significant level of competence and experience to open their doors and offer independent services to the AEC community.After all, they won’t have a direct supervisor to tell them where the bathroom is.
Another benefit of utilizing independent consultants is having access to specialty services on an as-needed basis. For example, if you typically engage in vertical construction, but occasionally need civil estimating or MEP estimating for given projects, you can split the scope of work amongst professionals that specialize in those areas.
Independent consulting estimators bring an open mind and creativity to the table that is unmatched. The best estimator is liable to develop tunnel vision, especially when working on similar projects every day. This phenomenon is quite common, as companies tend to gravitate towards projects that they excel at and develop a niche of sorts. A consultant that works with a variety of clients, even within a specialty segment, tends to get a much broader view of the trade. Also, since all clients have different needs, a consultant must always be very in tune with the detailed requirements for each job, significantly reducing the risk of tunnel vision.
COMMITMENT
This is another contentious one:
“How do I know that you will be there when I need you?”
The benefit of having a full-time employee is that this concern is a bit more controllable. You know that he or she will dedicate all of their time to your projects unless something goes wrong.With a consulting estimator, your project has to fit within their calendar.
That, however, does not solve your problem or eliminate this important dilemma. Are you guaranteed that your employee will not get sick right in the middle of your most crucial bid of the year? Are you assured that your employees will always be able to accept whatever workload you place on them?
There are many benefits that the consultant structure brings over and above the employee structure. Many consulting firms have multiple crews of professionals that are available to take on large and time-consuming projects that may be too much for your hired staff. Additionally, these companies are better able to compensate for temporary individual non-performance issues that may be catastrophic to a limited staff.
It is essential to consider the work ethic of the consultant that you are engaging with. Typically, when a consultant accepts a project with an agreed upon date of delivery, that is it. End of story.We are known to work 48-hour shifts to deliver on a promise. I don’t know of any employees that do that. I’m sure that there are some, but that is not anything that an employer can expect. When you hire a consultant, you are not involved in the time management. No uncomfortable requests have to be made. There is a set delivery time. How that happens is the consultant’s problem.
CONFIDENCE
This is where we land at the end of the day. Confidence is the cornerstone of every business relationship. Although it is difficult to achieve without the test of time, it is indeed attainable. Strong deliverables by a competent consultant over repeated assignments will undoubtedly carve out a comfortable and secure relationship.
Most importantly, every business owner needs to enter the debate and reach an intelligent conclusion. Sometimes the best avenue towards that is a trial run. As the construction industry develops, new and fresh ideas keep us ahead of the curve. Consulting estimators are certainly in that pathway.
About the Author:
Ms. Malik is the president of Sitework Estimating Services, Inc., and has spent the last 20 years in the construction industry, specializing in sitework. She is a Certified Professional in Erosion and Sediment Control (CPESC), a Certified Professional Estimator (CPE), and a board member of the CERT – Construction Estimators Round Table. Ms. Malik is an independent consulting estimator, a presenter of seminars and presentations to the AEC community, and has published construction related articles in relevant publications.