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How to Rebuild Construction Estimates From the Ground Up

Anyone who has done home renovation knows how difficult it can be to get a reliable cost estimate, given the numerous variables involved with even basic projects.

For government agencies that are building, repairing or enhancing thousands of facilities annually, the challenge is magnified exponentially. Engineers must account for differences in regional costs for labor and materials, plus factors such as weather and crew sizes.

“At the end of the day, they’re doing a project, and they want to know that this project is going to cost X,” said Martin Izzi, Director of Product Management at Gordian, which provides secure software products and support services to the federal government and construction industry. “Over the years, government agencies have had a tremendous problem homing in on X.”

To transform the process of getting to X, Gordian recommends a three-pronged approach to managing risk: reliable data, secure technology and expert services.

Dig Deep Into Data

The gold standard for construction cost data is Gordian’s RSMeans data. Originally developed in the 1940s by a civil engineer named Robert Snow Means, the database now contains cost information for more than 92,000 line items, which cost engineers are constantly validating and refining.

“The foundational dataset serves as a strong standard, so that agencies can ensure their budgets are reputable and defendable,” Izzi said, noting that Congress will probe this when reviewing funding and budget requests for large agency projects.

Put Technology on the Job

Given the large volume of variables to be considered, manually producing reliable estimates is daunting. Gordian has developed algorithms that take the grunt work out of calculating costs — and can project expenses as long as three years out.

Advances in machine learning are making it possible to develop even more reliable project estimates and future cost predictions, Izzi said. The ability to apply predictive analysis for forecasting future project costs is critical in government, given the long procurement cycles and budget processes, he said. These forward- thinking capabilities are combined with Gordian’s trusted dataset in their cloud-based estimating solution, RSMeans Data Online.

Call in the Experts

In some cases, however, agencies need more than rich data and good software. They need experts who bring contextual understanding to a project, looking at the larger organizational factors that shape projects — such as an agency’s governance model, work processes and funding strategy.

With that understanding, Gordian’s experts can recommend the appropriate data, tools and, in some cases, professional services that could help the project succeed, Izzi said.

Don’t Forget Security

With cyber threats increasing, software security is imperative for federal operations involving facilities and personnel data. Federal and Department of Defense facilities estimates are considered moderately sensitive data, as they involve information on military bases and agency facilities.

The RSMeans Data Online cloud platform has been authorized under the Federal Risk and Authorization Management Program (FedRAMP), providing federal users assurance that their sensitive project data is protected.

This article appears in our Guide, “Unpacking Digital Transformation.” To read more about how agencies are getting the most out of their modernization and transformation efforts, download the guide.

Image by Mikael Blomkvist on pexels.com

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