Posted: November 1, 2019
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It’s not a surprise to learn that accountants love spreadsheets. They like them so much that finance executives who once threatened to replace the popular software Excel were greeted with the refrain: “You’ll have to pry Excel from our cold, dead hands.”
Maybe not to the same extent, but many construction pros are almost as devoted to spreadsheets. They are so attached that they often hand down complex spreadsheets from one estimator to another. In many cases, errors just get repeated over and over until someone notices that the data—like a price multiplier—is way off.
Spreadsheets Still Going Strong
Each year, JBKnowledge uses its ConTech Report to dive into how construction businesses are using tech tools to complete day-to-day workflows. The report’s goal is to look at how all tech is used to minimize risk and maximize efficiency—including spreadsheets.
In 2018, the report still found a heavy reliance on spreadsheets for estimating—even though use was down slightly—from 71% to 63.2%. The survey also found contractors using spreadsheets even less for accounting—falling from 58.7% to 51%. Also, project management dropped from 46.1% to 45.6 percent; and bid management from 43.3% to 39.7%.
All of this begs the question: why are construction firms using both spreadsheets and estimating software? Some of it can be attributed to workflow software that falls short. Many contractors struggle with integrated solutions with 29.1% reporting “none” as the number of software tools they use that integrate. As a result, 51.8% report having to manually transfer data and 44.3% are using spreadsheets when transferring data without integrated tools.
Manual Errors Prove Costly
Let’s face it, keeping pace with change orders and addendums using paper plans is difficult. If you’re keying data into Excel and cutting and pasting across spreadsheets, you’re also more likely to miscalculate labor and materials, which could prove costly.
Not to mention, experts say nearly 94% of spreadsheets contain errors—plus there is the issue of version control. With digital drawings uploaded into applications, an estimator can see that every door and window has been counted and the materials quantified.
For many estimators, spreadsheets are just an extension of doing things the old-fashioned way with paper and pen. In a recent ConstructionPros article, David Knapp explained why he has been spreading the word about the benefits of using digital estimating tools.
After changing companies, Knapp convinced his new bosses to invest in On-Screen Takeoff. He explains how the estimators there were still using blueprints: “These 18-by-30-inch sheets cost 50 cents apiece. When I introduced OST to the company, they began to see all the waste – from the paper and ink to the time and cost – that using paper creates.”
After founding DK Rebar, Knapp has continued to use OST to keep his bids and drawings organized and streamlined. “If my customer is in the field and needs to make some last-minute changes, they can make the changes in the software and notify me to make the appropriate changes to the estimate,” said Knapp. “By using this process, I can make the changes and have the new estimate complete in 10 minutes. This is so much better than calling in changes and trying to describe them over the phone.”
Spreadsheets and Construction Culture
With most jobs running 80% over budget and 20% over schedule, it is unclear why spreadsheets are such a ubiquitous part of the construction culture. Whatever the reason, most would agree that duplicate work is a risky proposition in terms of accuracy and efficiency. Having to triple-check your work to make sure all spreadsheet formulas are correct can be inefficient and not very sustainable.
As to productivity and profitability, a business could end up winning the low bid and losing money if labor and materials are miscalculated. Don’t forget that spreadsheets offer no version control, which can result in substantial re-work. While spreadsheets may have the lowest bar for ease-of-use, they also make it more difficult to consolidate data input.
Spreadsheets Alone are Not Professional Bids
Even while many in the field embrace everything from drones to wearable tech, cost estimators back in the office are often saddled with a mix of manual and digital workflows. Spreadsheets may be a step up from paper and colored pencils, but they do not reflect the latest and greatest tech tools available.
As a result, manual estimates based on old data, unclear notes, and keystroke errors are not adding up to profitable projects. To avoid bidding too low or too high, some contractors use integrated tools like On-Screen Takeoff and Quick Bid. If you’re ready to reduce your dependency on error-prone spreadsheets, sign up now for a free demo of Quick Bid.
Not sure where to start? Don’t miss our free white paper on how to boost construction productivity with integrated estimating tools. Download our Contractor’s Suite white paper now.