Automating the Pre-Construction Process
By Rick Dill
In the modern age of technology, it is surprising how many general
contractors are not automating their pre-construction process. Recent polls
show that 45% of commercial general contractors still send out bid
invitations and addenda notices using their own email program and fax
machine, and then track who is bidding in an Excel spreadsheet. Not so
surprisingly, we couldn’t find one general contractor that switched back to
the Stone Age (their old conventional methods) after migrating to an
automated bid invitation software system.
Most bid invitation systems are now cloud-based, meaning the software and
data are hosted and managed offsite, not on your own server. The older
generation is sometimes not as trusting to store their data on a server
outside their office. As a younger generation enters the construction
industry, more employees are willing and trusting to store their data on the
cloud. They are excited about the latest technology that is enabling
pre-construction tasks to be completed in a fraction of the time. Technology
can save time and money, help companies bid more jobs in less time and
perhaps with less employees. More general contractors are taking the leap
into the wonderful world of automation.
Bid Invitation Software Highlights
Some key benefits of an automated bid invitation system include:
Subcontractor database management to organize contacts efficiently.
Select and solicit subs by trade fast.
Send bid invitations via email or fax in one click.
Track who will or will not bid to make sure you have adequate coverage.
Send notices such as an Addendum in a fast and organized method.
Upload plans and bid documents for easy download by invited subs.
Automate the Prequalification process to reduce paperwork.
Of all the general contractors that were looking for a way to automate their
business, one of the top reasons was to manage their subcontractor database
more effectively and efficiently. Most had their subs in Excel, which is
difficult to share among other estimators in the office. By migrating to a
web-based centralized database of subs, all your employees and estimators
can have access to the most recent sub and vendor contact information. They
can write notes about subs that their fellow estimators can see. In addition
to organizing their subs into trades, they can assign subs into various
groups such as minority certification, geographic areas willing to work,
labor type (Union, Non-union), Qualified/Unqualified, and more. Assigning
subs into Groups can be helpful in narrowing down the list of subs to
invite, or to print special reports such as a “Good Faith Effort Report”
showing minority subs solicited for government projects.
Many systems allow subs to keep their contact information updated (some
allow subs to update their info automatically while other systems give the
GC control of what gets updated). Some systems allow new subs to sign up on
the GC’s website, thus eliminating the need for the GC to type in the sub’s
contact information, trades they perform and other data they want to track.
Which Subs to Invite
When using an automated bid invitation system, the sub selection process
is much more efficient than conventional methods because the GC can select
and send bid invitations to only those subs in the trades they need in just
a few clicks. It is also helpful to narrow down the list to those that are
more likely to bid on the project based on a certain geographic area for
example. Subs can get annoyed when invited to bid on projects outside their
geographic area they are willing to work.
Most GCs have told us that speed and ease-of-use of the sub selection
process are the most important factors. Some GCs want a system that allows
many choices and steps to help narrow down their list of subs, while others
think too many steps are cumbersome and complicated. There are many systems
available with more or less functionality. The user may or may not want to
sacrifice speed and ease-of-use in exchange for more functionality. Most
offer demonstrations that allow you to compare a few and decide what is most
important to your company.
Sending Bid Invitations
Most systems allow you to send via email or fax, or even both to certain
subs, all in one click. Faxes normally are sent through the software
provider’s fax server so you do not need a fax machine. Email is the
preferred sending method, but faxing – believe it or not – still has a
purpose! Emails change as employees change jobs. For example, we sometimes
help GCs update their failed emails as an added service we provide, actually
calling subs with failed emails to see if they have an updated email. We
were amazed to find how many subs wanted to switch to fax to make SURE they
received their bid invitations, knowing that their employees’ emails change
too often. Others create a generic email such as
“estimating@” to solve this problem.
Tracking Who is Bidding
Most systems allow subs to click a link in their email to respond “Yes”
or “No”, and also allow you to update their responses manually if they call
or fax back their response. It is helpful to track who will bid so that you
know if you have enough coverage (bidders) in each trade. It is also helpful
to know who is not bidding so that you don’t send them future notices for
the project. Subs get annoyed when they receive additional correspondence on
projects they don’t want to bid on, and may start to ignore your bid
invitations. Many systems also track who actually submitted a bid, and also
allow subs to upload their bids back to your system.
After an invitation, there are usually additional notices that need to
be sent. For example, it could be an Addendum, Amendment, Bid Date Change
Notice, RFI Response, etc. Most bid invitation software programs allow GCs
to send notices to only those that need them. For example, you may want to
send an Addendum to only Electrical subs that have responded “Yes” they are
bidding along with those that haven’t responded yet, but you rarely want to
send something to subs that said they won’t bidding.
Online Plan Room
Most systems allow you to post plans, specs and other bid documents for
your subs to download. Some GCs have their own FTP site or other site that
they use for this purpose. We have seen those GCs gradually migrate to the
integrated online plan rooms built into their Bid Invitation Software system
as they realize the benefits of having everything in one place for faster
and easier access by their subs and vendors. For example, when a sub
responds electronically (Yes or No to bid), it is more efficient for them to
view the plans on the same screen rather than have to go elsewhere. Most
systems offer support at the subcontractor level so you no longer need to
handle technical issues or questions about how to download.
Automate the Prequalification Process
Many GCs have a Prequalification form posted on their website for subs
to download, fill out, and send back. Portions of the form will be basic
company contact information. The GC then needs to compare the new company
information on the form with their existing information in their database,
which is time consuming. An automated form built into some Bid Invitation
Software systems allows your subs to update their company information
automatically (or upon your review and approval), as well as provide your
required information about certifications, labor type, references, bonding,
etc. The more robust systems allow your subs to upload documents such as
insurance certificates or financial reports which are automatically stored
in their record along with their completed Prequal form. Some systems allow
GCs to create custom forms that can be embedded into their website so that
subs can add themselves upon GC’s approval.
Strangely enough, many general contractors say they are too busy to
invest the time to automate their pre-construction process. The Paradox is
obvious…by investing a little time automating, they become much more
productive and less busy! Time is spent more efficiently which in turn
lowers overhead expenses. Estimators focus more time on important tasks in
the bidding process. Projects are bid more efficiently, perhaps with better
coverage management which allows for lower bids, thus increasing the number
of contracts won.
General contractors that are already using an automated bid invitation
software system may also benefit by taking a step back to research whether
their current system is meeting their needs. Is it time consuming and
cumbersome? Is there another system that can save them time and money?
Investing a little research time in other programs will help answer that
question and give them piece of mind. Many systems offer a trial version to
compare with their current system. And for those general contractors that
are still in the Stone Age, they will no doubt see the benefit once they
invest the time and take the leap into the 21st century of technology.
About the Author: Rick is the President of PipelineSuite© bid
invitation software which he founded in 2002. Rick is also a member of the
American Society of Professional Estimators, Orange County Chapter3. For
more information, visit www.PipelineSuite.com or you can contact Rick
directly at firstname.lastname@example.org .