Structuring Estimates to Reduce Risk

September 23, 2015

Structuring estimates to reduce risk

The way you use estimate structures can have a big impact on risk within your business.

An unstructured estimate can essentially be a “black box” making it very hard for others to cross-check. It is hard to find individual line items, to check that items have not been included twice etc. It also makes it difficult for a second estimator to carry on where another has left off - collaborative working is practically impossible.

On the other hand, an estimate that is clearly structured is easy to follow, easy to cross-check and easy to collaborate over. It also makes it much easier to go back over it to compare estimated costs with actual costs once jobs are finished.

  • Make sure your estimates follow a clear and logical structure
  • Select a structure that gives a clear top-level view of the project, and allows quick, logical access to line-items and detailed costs
  • Use software package functions to copy estimating structures
  • Consider job substructures – do they reflect how you are going to manage the job?
  • Share ideas on how to improve clarity

Take a look at our other blogs about how to manage last minute changes to your estimates and playing to your team’s strengths or find out ways to reduce risk throughout the estimating process, download our recent white paper Reducing Risk in Estimating.

 

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