Part 3

Project management for built environment businesses — Project setup requirements

Welcome to part three of our series on project management. In this five-part series, we’re focusing on the key challenges architecture, engineering and construction design (AEC) businesses face when managing projects for the built environment.

Here we’re examining the importance of proper project set up for the successful management of both your projects and your business as a whole. We’ll explain what’s critical at the point of set up to give yourself a project win, and why it’s so important.

If you haven’t read the first in the series click here, and if you haven’t read the second in the series click here to get into them.

Scroll down to read the whitepaper in full or download a free PDF.

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What’s in the whitepaper?


Who sets up your projects? The three different types of people that set up AEC business and why they’re important 



When are your projects set up? The various times that a project might be set up in your project management system and why that timing has such a big impact 




Project information variations The problem of different project info in various places when it comes to your project setup, and what to do about it



The need for (project setup) speed Why project setup needs to be both fast and complex, and how to make it so


Just like any other sort of setup — think, blind date, or practical joke — project set up and how you do it, can be the difference between something wonderful and joyous, and an outcome that makes you never want to project again. Getting it right at the setup point is key to a great outcome.

The first two things we need to consider about setting up a project are, who is likely to do it (because the processes are different depending on who is actually setting it up, and I’ll explain that in just a sec), and, secondly, the internal practice process for recognizing proposals (as opposed to active jobs).

Who’s setting up your projects?

Depending on how your particular practice runs, there are three different sorts of people that may be responsible for setting up projects as they arise:

  • Project managers
  • Admin staff
  • Marketing staff

For number one, some practices are structured such that the project managers themselves create the job in your management system. They’ll do that at both a proposal stage, and also as an active job. The active projects typically come from a recurring customer — you’ve got a nice regular customer that walks in the door and says, “Hi Geoff, here’s the next job, ring me when you’ve got the drawings”, that kind of thing. So, project managers and directors, particularly directors who are project managers as well, will certainly be one of the groups of people who are creating projects.

Other practices have their administration people, or their office manager, as the only ones actually sitting down and creating the jobs (number two on our list). Often that administrator has to be given a form that’s filled out by the project manager, or the director, that says, ‘this is the name of the job, this is the address, these are the stages, these are the fees, etcetera’. In this scenario, in the time it took the project manager to write that form, they could have actually created the job. This makes that style of project setup one of the processes that, in consulting, we seek to cut out — it’s pretty obvious that it’s silly. (No judgement, but it is.)

In both cases (project creator one and two) the job could be proposal or active.

Now the third group of people possibly creating jobs (and sometimes this is a protocol that the whole practice runs by) are the staff in marketing — and they create the proposals. This is more common in larger companies, that actually have a distinct marketing team. What happens here is this — there are people who are doing the numbers, the fees and costs, and then the actual creation of the job gets passed to marketing. It could be a proposal, or it could be active, but it’s more likely going to be a proposal if it’s going through marketing, because there’s a ‘prospect’ and there’s a CRM process to be gone through.

In this instance marketing are typically working from a document that’s been created as the proposal, and part of that proposal is a breakdown of the fees and the stages, etc. Then, on the way through to issuing the proposal to the prospect, marketing create the job in the firm’s system, and usually makes the document attractive, standardized, and branded.

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When are they setting up your projects?

On top of that, some practices only create the job — as in, the job’s only given a job number — once it’s an active project. This means there are usually two sets of folders, one with their proposals, and one with their active jobs (and their associated job numbers).

Any of this sounding familiar?

So, as I’ve said, the active project folders have got a number. The proposals have just got an address and maybe they’re ordered by client name, or something like that.

Is it weird that many do it this way? Glad you asked, because it is. You get the sense that many AEC practices really, really want their job numbers to be sequential. That’s somehow become the norm and lots of companies are hung up on it. Why? Another great question. The answer is, I’ve got no idea — it actually doesn’t make a blind bit of difference. Not a scrap. Not a jot. But people get hung up on it, and it becomes a way of life, and some people are doing it because they just don’t have a process for transferring the information on a job from proposal to active.

It tends to be those that use this timing for project set up that respond very positively to a consultant demonstrating how we manage this in Synergy. When we show them that you’re able to simply change the status of the job (from ‘proposal’ to ‘active’) with a toggle switch, they respond with, ‘Oh geez, that’s really good, because now we can easily keep track of things like our win/loss ratios!’

Yes. Yes, you can.

Anyway, if you’ve got the ‘only a real job when it’s active’ methodology (because your projects may not actually exist in your management system when they’re in a proposal state) it has some obvious shortfalls for your business.

The biggest of these is a loss of important information that relates to your capacity planning. For example, in Synergy, we’ve built in capabilities to let you look six months ahead and say, ‘Well, if we win those proposals at the likelihood we’re expecting, we’re going to have to hire seven more people’. And let’s face it, that’s a nice thing to be able to say!

This is not the diversity you’re looking for — variation in set up info

Now, the whole idea of putting a proposal into your system and actually monitoring it as a job, is something quite foreign to a lot of people. Again, no judgement, that’s perfectly fine. However, as a result, there’s a lot of variation in how people initially set a project up.

There’s the difference that arises between the methods of individuals within a company who set up their projects, but there’s also a large difference between companies, and hence, a huge difference from project to project. Most markedly, that difference is visible in the amount of information entered at set up.

Let’s look at it like this — if you’ve got a proposal and you’re someone who wins one in 10 jobs you put in for, it’s fair enough to say, ‘Look, there’s only a 10 percent chance of us winning this, even though I’m very good at what I do [and you are, I know it!], I just don’t have a market presence in this sector — so it’s not really worth my while to put a lot of effort into the information that’s represented in my management system’. Yes, you’ll want to put in the time to do a proposal document because that’s what the prospective client sees, and therefore, it’s what gives you the best chance of getting the job. However, you may decide it’s not worth your while to put in the six stages, from concept design, schematic design, etcetera, and have them individually priced to come up with a project total price of $135,000. To address that, some people simply put in a single stage called ‘proposal’, they make it a fixed fee, and they make that $135,000.

Now, there are a lot of things missing from that. One is, you don’t have the labor requirements or when you think you’re going to need them. You do have a revenue projection, however it’s across the entire term of the job. It’s not actually split up by stage, because the stages are rarely worth the same amount of money.

There’s a loss of information from doing that, but if you’re someone who stands a 90 percent chance of what you’re doing being a waste of time, it’s difficult to convince you that what you really should do, is put in a whole lot of information including detailed budgets and so on. And this disables your ability to look ahead and make a lot of important suppositions.

All of these things tend to dictate the content that people are going to set up a project with. As you can imagine, if you’re only going to do a little bit of work in setting a project up, because you’re just going to put in a skeleton amount of data, then you don’t really have to bother too much with the quality of that information. All you’re typically looking for is a representation — you’ve got ‘X’ amount of money out on a proposal. As I said, some people even with Synergy, still don’t want to put a proposal in there, because they only want the active jobs in there, which is just a mindset, but it’s one that creates distinct challenges.

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Quick and complex — your project setup needs

To try and help people equip themselves with the most information possible at any point in time, you have to make it quick to build complex structures in project setup. That’s the whole idea behind project templates. People can have any number of different project templates — they can have a template that’s for a particular market niche, and a particular size of project in that market. You could have aged care medium sized project, aged care large projects, aged care small projects, and have them all set up ready to rock ‘n’ roll.

Your templates are set up to give you the framework to actually go and price that job, so you don’t have to sit and think about which labor you need at certain stages, or what stages you’re going to need, and so on. It’s all there in the template you’ve created for that sort of job. It’s a matter of refining what’s there, rather than creating it from scratch every time.

With systems like that in place, it gives you the opportunity to create a more informed project, rather than a skeleton without much info on the bones. And we’ve got to remember that it’s a bit hard for a skeleton to talk about a muscle ache. Funny about that. So, you’re not going to know where the project aches will arise if you’ve only got bones.

A rubber band around it — the importance of the elastic loop in project set up

With Synergy we’ve made that whole ‘automated project creation’ as streamlined as possible. We’ve done this by linking things in an elastic way. One example is, you can set up a Gantt chart that’s proportional for a template — you can say, ‘well, if I’ve got five stages in this sort of project, and if the whole project was two months long, how long would the first stage usually be? How long would the second stage be? Does it overlap at with the first?’ and so on.

Here you’re creating a typical chronology of how the job is going to roll out. Of course you can change that around once you’ve put it in, but the really cool thing is that you can grab that template and say, ‘I know this sort of project runs over a two month period, but this job’s actually six months’. And as you adjust the timescale in your template, the system proportionally grows all those time periods, and the relationship between them. It works with the ratio of time and load and stretches (or contracts) them proportionately. So, if it was a two-month template and stage one and stage two overlap by a week, then if you make it a six-month job, Synergy makes that overlap three weeks. Which is really important for a quick, complex, streamlined project set up in our industry.

This way, you end up with a picture of what this job could look like, and then it’s up to you to refine it. If you can look back at your job history and say, ‘for this particular type of work, in this particular stage, for every hour of director, there would be five hours of architect and three hours of project architect — and they’re the only three labor rates that I’d use.’ We’ve got the facility in ‘planning mode’ for you to enter a fee related to each of those three rates, and we’ll proportionally split that according to that historic split of data in the system. Shiny! That means, if all those fees add up to $1,000 and you put in a fee of $20,000, it multiplies all the units by 20 — you’ve still got the relationship between the rates. So, for every one hour of director, you’ve still got five of architect and three of project architect.

There are lots of facilities like that, which help you quickly build a job. We’ve got it all the way down to having the function that underneath the stages you can list the tasks that you typically do, and under those tasks you can have the to-dos or the checklist items that you have for each person to be allocated to — so you can keep track of the 18 things that have to be done for a particular stage. You can actually see which ones have been done, which ones haven’t been done, and which ones are in progress.

You can see how useful this is, it just saves time exponentially — the more you learn, and tailor, the more data informs the project set up system. It becomes really quick and valuable to create a project with more information in it, because there are all sorts of benefits to that.

As one instance, if you’re doing cashflow forecasting and you’re not including proposals in there with their likelihood percentage, then what you’re doing is essentially pretending that you’re not going to win work — there’s no point looking six months down the track and saying, ‘it looks like we haven’t got much work there’, when in fact there are two jobs worth a million dollars each that you’ve got a 50% chance of winning (which means you’re going to win one of them, mathematically) and therefore there’s a million dollars of work that starts in that month. Now, if you don’t have that somewhere where you can assess it like that, you can end up in a situation where you think you’ve got very little work, but you’ve actually got too much work. Not good, and a threat to the health of your business and your projects.

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Scale of job should not equal scale of set up time

Additional to the capacity of your project set up to be detailed but malleable, is the need for your set up to be scalable. What you want to avoid is the scaling of the size of the job creating a proportional workload. You need a process in place that lets you (or whoever’s setting it up) create a small job quickly, and a much bigger job just as quickly. It shouldn’t take you that much longer to enter a project that is a much bigger, much more sophisticated job. You just can’t have that.

What has to happen though, as I’ve said, is your project set up system needs to be responsive. If you’re pioneering in any particular market sector, it’s quite likely there will be an initial overhead in building projects, because they’re new to how you do business. Once you get into that sector though, and you get a feel for how that sector works and the nature and construct of the projects, then what you have to do is reflect that back in a template. That means when you create the fourth job in that sector, your template is now reflecting everything you know from the first three jobs — you’re not reinventing the wheel.

More data = better data (and proposal count)

We know there is almost certainly a conflict of data that is felt to be required at various levels of a project, but the more meaningful information you have in the system, the more valuable the whole data set is to you. If you’ve only got active jobs in Synergy, you’re halving your view on your practice.

It’s kind of like only wearing one lens in your glasses. It kind of works, but you’re a bit one-eyed about things — you’re missing a whole field of vision. I think this an essential thing for AEC practitioners to embrace. It’s just so critical to success that you make your proposals as full-bodied as possible, so that you can then do the same sort of analysis on your proposals as you do on your active jobs. It’s all very well to look at active jobs and say, ‘well, 65 percent of them are industrial’, okay, but what about the proposals? What happens if 85 percent of the proposals you’re doing are residential? That’s a huge shift in the type of work that you’re potentially about to do. You need to be aware if that’s going to happen, because it may well be worth your while to hire someone who specializes in that particular area.

You have to be aware of these things, and if you’ve short changed yourself on the information you’re using for analytical purposes, you end up making uninformed decisions — and that’s a strategic no-no.

The trick is to get smart about it. There are only 24 hours in the day and built environment people are already really busy. So, even though they want to win the work, there’s a potential limit on how much they can invest in winning that work — you have to maximize your transition from having nothing, to actually having some sort of record of the fact that you’ve got those projects upcoming.

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Know thy software, know thy number

Actually, understanding the software you’re using, whether it’s ours or anybody else’s, is essential to knowing and constructing projects the right way — and that feeds into the efficient way, the smart way, to actually doing the work.

Often, we’ll find when consulting with customers, the reason they’re not doing something, or the reason they’re doing something the hard way, is simply because they don’t actually know a better way, or the best practice. Particularly if they’re caught up getting things done.

Just to give you an idea, most of our clients will actually look at a job and they’ll price it a number of different ways:

  • A ‘bottom up’ pricing — where they actually take a detailed labor guess at the number of hours it’s going to take for each stage, and add that up
  • They take an average price for a set of drawings and multiply that by the amount of drawings they think they’ll need
  • They take the total construction cost and add their percentage fee on top

Once they’ve got these estimated costs, they look at the bottom up pricing and they go, for example, ‘Okay well that ends up being $125,000, and we’ve got the construction plus fee estimate that’s pretty much the same, but drawing one’s a lot higher, so we suppose it’s more likely to be around $125,000 than it is $150,000.’

Because these clients are doing these mental gymnastics — often an Excel spreadsheet — where they’ve got those three different ways to price the job, using a system to then record what you’ve decided and assumptions you’ve made is sometimes seen as an ancillary thing. But what you really need is a software management product (ah hem, like Synergy) where you can track those decisions. Without it, you’re guessing every time, without consistency, without systems informed by your experience, without learning.

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Investing time in project set up = value in your project and business

Half the reason some people don’t see the value in an investment in setting up the project in a detailed way is that they don’t understand the benefits of having all that information. Once you realize there’s a benefit in having that information there, you can do a value judgement about doing the hard side — which is the data entry. The analysis is kind of the fun and beneficial part, from a business point of view. The hard part is having the data to analyze in the first place. Again, this comes back largely to having the right software and to knowing how to use it.

A lot of AEC kids don’t actually know the sort of stuff you can actually get from a system with something like a planning board, or they don’t understand how the resourcing works, and so on. In these instances, the value-add of the software often isn’t realized.

It is what they call ‘a conundrum’.

So, there needs to be a discipline in the practice to ensure that you get those benefits, because unless you take the disciplined approach to it, you’ll find yourself short changed on information. Basically, to get value of a project management system, you have to invest the time to set it up properly, tailor it effectively, and enter the data you have correctly. It’s a no pain, no gain situation. A quality in, quality out scenario. Sorry to break it to you.

Seeing the transition

Whether it’s the creation of the proposal or an active job, you almost have to have an introspective approach to looking at how that early part of the project actually transitions in your practice — and then you can see whether that transition is being done in a way that gives you value through the whole life of that proposal/project and the practice that runs it.

If it’s six months until you’re going to hear back about a project in your system, if you don’t have information in there about that job, that’s six months where you’re flying blind. Sure, it’s in the system and you can see it there, but you can’t see much about it because all you know is that it’s a $750,000 job. You don’t know whether you’re going to need architects, senior architects, engineers, a subbie, who knows?

That blindness is a liability much more expensive than the cost of you taking the time to properly set the project up. Much more expensive.

Look at it like this — if that same job then pops up and you win it, and you’re short staffed, well then, you’ve got a problem. You probably priced it using your personal staff, and if you find yourself short staffed you have to sub-contract that work out. At this point, all the lovely envisaged profit you were going to make, is gone. Because you’re not going to get a sub-contractor for anything like the prices you pay your staff. Especially not last minute.

You’ll find yourself on the phone to a contractor who says, ‘Oh yeah look, we might be available. When’s that going to be?’ and you’ll have to ask, ‘Ah, what are you doing this afternoon?’ … I don’t have a crystal ball, but any smart contractor would ask you to hold while they add some zeros onto their prices.

As a result, I think it’s really important to recognize that you have to set up a proposal as if you’re going to win the job in order to get the value out of it through the proposal phase. Then be as ready to go as possible if and when you win the job, not only for that job, but for the rest of the practice as well.

Consistent precision pays

You also need a good data checking system in there as well. You need to have a system that, for example, lets you know if there’s other work you’ve done for Person X. You need to know if you can trust them, basically.

If you’re a practice that typically asks for a deposit invoice from people you haven’t worked with before, then you have to have some nice, simple mechanism to let you check that you haven’t worked with that person before. Even obvious things like that, often aren’t in place and are very time consuming. And if it’s time consuming, people then have to make the choice about, ‘do I do it or not?’

Then there are questions like, ‘do I have time to check I’m setting up the folder structure for this project properly?’. There’s always a set of project folders that have to be set up for a project, and it’s most useful (and least time-consuming in the long run) if that’s done in a consistent way. So you can do fancy stuff like find files, and all that.

You want things like that to be automated in some way and you want that to be either in SharePoint if you’re in the cloud, or you want it to be done automatically on your file servers. It’s the automation of things like this that seems insignificant that ends up saving you an incredible amount of money in the long run. You save money, save fixing mistakes made manually, and save the time you spend on doing all the stuff that isn’t actually designing the built environment. What’s not to love?

It’s just really important that you give yourself information at every step you possibly can, because people need to make fairly fast decisions. If it’s a very small practice, you can pretty much work on gut feel, but it doesn’t take much hierarchy in a business for that to get muddied. The result is that you find yourself listening to either a select group of people (who may or may not be giving you information), or you keep going on sheer gut feel. And that, dear friends, is why good, thorough project setup is critical.

In the next part of the series, we’ll be looking at resource and task management to cure our built environment project woes. If you haven’t already, sign up to our newsletter to get it as soon as it comes out.

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Read part 1 of this series:

Project management for built environment businesses — The 4 pains (and how to cure them)

The nature of the AEC industry is that it’s one driven entirely by projects — very detailed, very complex projects at that. We check out the four big pain points of managing built environment projects, and what’s needed to ease them.

Read now

Read part 2 of this series:

Project management for built environment businesses — Proper portfolio planning

In this whitepaper we zoom out to take a look at the importance of portfolio planning to your project management. We’re going macro to see its impact on the micro, and how actually, you can’t understand one properly without the other. Especially when it comes to AEC industry projects.

Read now

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