“How to win bid work without sacrificing quality.”
Some believe the competitive bid process is a great strategy for minimizing cost on a project. After all, there’s nothing like competition to force prices down – especially in tough economic times. The more bidders the better!
Others blame competitive bidding for many quality problems on the jobsite. They believe that since “the low bidder gets the work” regardless of his ability or enthusiasm for the job, the odds of getting poor work on a job go up as the bidding becomes more competitive.
The truth is that is that they are all partly wrong and partly right. Here’s why:
Competitive bidding can indeed produce lean prices, and it does not necessarily lead to quality problems.But to be successful the process must be managed responsibly by all concerned. Otherwise, distortions occur, the process fails, and it can generate a long string of problems and unnecessary cost.
Contractors must ask lots of questions to clarify details that are ambiguous in the plans. This serves everyone, since it levels the competitive playing field and assures the architect and owner that potential sources of disagreement during construction have been eliminated.
Architects and owners must enforce the rules included in the plans. Stipulations such as the requirement to use certain approved vendors, materials or methods must be iron-clad for all. This, too, levels the field and prevents future problems. It also avoids situations in which contractors who bid in good faith are penalized for following the plan.
Success also hinges on the contractor’s management of sub-contractors. Every construction company claims to have “smooth relationships” with subcontractors. But that’s not enough to ensure a smooth-running job. A successful contractor must actively engage subcontractors with a management style that is proactive, flexible and continuous.
In a hard-bid world, you can’t always work with the subcontractor who is your first choice. When a weak or unmotivated craftsman walks onto your job, you have to assess his weaknesses immediately and apply the right combination of supervision and support to help him succeed. You have to make your standards for quality crystal clear from the start. And often you have to approve his work in stages to make sure it’s all done right.
That’s not easy when so many components of the project demand your attention at once. But that’s the difference between a leader and a passive observer.
Competitive bidding and top project quality are not mutually exclusive.Consider this paradox:
Heath has been enormously successful in winning bid work for many years. In fact, over the last 3 years, our average bid position is less than 2.5. That means we win more than half of the work we compete for.
Yet Heath has also built a reputation throughout the Front Range for superior quality!
How can both be true if the hard-bid process inevitably leads to quality problems?
1. We estimate proactively, apply a preliminary constructability analysis, ask many questions, and do everything we can to eliminate ambiguity in project plans.
2. On the job, we help subcontractors succeed with a combination of clear standards for top quality and aggressive support that is tailored to their needs.
It works.
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Chris Claflin
Chief Estimator
Employee Owner |
