How do you view the engineering/architecture firms you work with? Are the firms’ services just another expense necessary to complete your projects? Or, do you consider the consultants partners that help to take your facility to the next level?
I ask this question because it unfortunately seems that manufacturers today are moving increasingly closer to perceiving consulting engineers or architects as just another cost of completing projects. In procurement officers’ minds, A/E services are a commodity that is interchangeable with internet bidding. This is shortsighted.
When owners procure A/E services by developing a tight scope, it leads to competitive bids on just that—the exact scope laid out in the RFP. But when scopes are bid exact language, the ability of the engineers and/or architects working on your project to serve as collaborators and advisors becomes limited. Think of it like this:
Say you had to undergo an operation for a brain tumor. You wouldn’t create a scope of work for brain surgeons to bid on and go with the lowest bidder, would you? Further, you wouldn’t hinder the doctor’s ability to use their experience and expertise to do what is in the best interest of your health, right? And what would happen if you did create a strict scope and the surgeon discovered work that was outside of those parameters once the surgery was underway?
Yet in the manufacturing sector, the safety of employees, production of a new process, and safeguarding of costs of any construction project are routinely put in the hands of the lowest bidder.
Here’s how this often plays out. Let’s say an owner plans to spend 10% of a project cost up front on engineering. During the consultant selection, there’s a cost variance of 25% between two firms. The variance in overall project cost is thus 2.5%. The procurement officer ends up selecting the firm charging the least. As the project proceeds, the consultant misses several interferences because, in order to be the lowest bidder and cover their costs, they had to place strict time constraints on the project, inhibiting the QA/QC process.
Further, the construction scope was not fully developed in partnership with the owner. Even at 10% of construction cost, the owner is now paying an additional 9% of the project fee on construction items that are not bid.
What has happened here is they’ve stepped over dollars to pick up pennies. At R.E. Warner, we see this happening more and more often. Instead of spending the extra money on a partner during design, companies are routinely opting to save 10-15% on engineering, not realizing the price paid later on in increased construction costs.
On the other hand, manufacturers could hire an A/E consultant on as a partner. In this scenario, they may spend roughly 10% of the project cost up front on engineering, but work with a partner focused on creating drawings and documents that can save money during the 90% budget phase of the project. Even better – the consultant may catch a process improvement that can be implemented during design to make the facility more efficient.
A strong in-house engineering group can help prevent the quality issues discussed above by developing a strong scope and managing the consulting engineer’s work. However, it has been shown the best ideas come from collaboration. As with any project, the more the team collaborates and considers changes during the design phase, the better the final outcome.When the consulting engineer is in place from the beginning of a project, they can work with the entire in-house engineering group to identify the direction in which the project is headed and prevent excess time spent on options that are not viable.
In addition to leading to overall project savings, these efficiencies can actually reduce the engineering fee. At R.E. Warner we see ourselves as a client’s partner. Most of our team members pursued engineering because of a passion for problem solving. Our favorite projects are those where we can serve as a partner, helping our clients achieve bigger picture objectives. We urge our clients to let us become familiar with their facilities so we can focus our time on truly serving your needs, even those not yet recognized.
This article is by Matt Benovic, PE, SE, LEEP AP, Senior Project Manager. Matt has played a crucial role in delivering the engineering design for a wide variety of single and multi-discipline projects for several of our firm’s top 10 clients. He has demonstrated his ability to execute projects from inception through completion within scope, schedule and budget, even managing multiple projects concurrently. Recently, Matt was named an Engineering News-Record Midwest 2018 Top Young Professional.
Matt's structural engineering experience includes concrete, steel, masonry and timber design for commercial and industrial projects including equipment foundations, crane girders, premanufactured building foundations and seismic design. He has also designed drives, culverts and drainage systems. In additional to being a licensed Professional Engineer and LEED Accredited Professional, Matt is a licensed Structural Engineer. Obtaining the SE licensure signifies that an engineer is proficient in structural design as regulated by rigorous and increasingly complex design codes and standards set by the government and professional associations.