Design Anything for $85
Here’s what happens in real life. An RFP arrives for a competitive design proposal. You think the project through properly and craft your best, most thoughtful approach. Then you assign the proper staff, total up all the tasks, look at the number and…’Hmmm, we won’t win the job with that number’.
So, you set about making your proposal worse. Replace the right staff with cheaper, less qualified staff; eliminate time to add new cost-saving technologies; cut out time to reduce construction and O&M costs; sign up the cheapest subs; assume the least possible time for every task; delete time for cost saving ideas; remove tasks that you know full-well will be required but weren’t specifically requested; and propose a “let the contractor figure it out” design, all while knowing whoever is paying for the project is gonna get hosed.
Design is only about 1% of a project’s total lifecycle cost. Just ONE percent. But unlike all other costs, design acts as a multiplier of the other 99%.
The optimal design effort is the one that generates >$1 of cost reduction per dollar spent. Optimal value. Lowest project cost. You had that. But by cutting value out, you increased the client’s cost of construction, equipment, O&M, and project financing, i.e. the other 99%. And BTW, shifted a ton of engineering and financial risk to your own firm.
If cheaper engineering really does save money, then why not charge $85 per design? One engineer, one sheet of paper, ½ hour. The fact is, once you go south of optimal, project cost increases. It’s really just a matter of degree.
“No Dave” you say, “It’s clearly the client’s fault”. “When price is a factor in the selection, it’s almost always the deciding factor. The client even refers to it as a bid! We’re forced to cut value to go low.”
First of all, whoever sent the RFP isn’t the client. They’re not writing a check. Second, they know intuitively that a cheap design will make the project more expensive. But they also know their boss, board or council, is going to ask, “Why aren’t we going with the cheapest engineer?” and they'll need to have the answer. You had the answer, but punted and never gave it to them.
It’s up to you to give the client’s current representatives the words they need to do what’s best for the actual paying client. One could argue that's the duty of a licensed engineer. Submitting a less-than-your-best engineering effort is kind of a professional cop-out. No? You should at lease present the value of a proper effort as an option!
A client worth working for will embrace ‘best value for the money’ engineering if you confidently provide the evidence and the words they need to make the case to others. Get good at making the case for value. The client and the world will thank you!
Happy Mother’s Day weekend!!!
Dave
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