Estimating by Experience? Put That Knowledge Into Estimating Software

Put historic engineer knowledge and experience into a database to help your bottom line

Estimating by Experience? Put That Knowledge into a Database!

If your company is still estimating primarily by experience, you are not alone. The majority of job shops estimate by relying on an individual who has decades of experience in the industry or within the company itself. This experience can enable the individual to look at drawings as the quotes come in and return an estimated time or cost in sometimes minutes- it takes many years for someone to be able to do this accurately and consistently. Once a company finds themselves with an individual like this, the experienced individual soon becomes irreplaceable. Now take that person out of the picture for a moment – turnover, cost cutting, the next global pandemic affecting your company’s bottom line. How is your ability to generate quick and reliable quotes now?

Trouble on the horizon

When the estimating duties fall heavily on your most experienced employee day-to-day, you are setting up the process for failure. Employees can get sick, have short to long-term leaves, move on to other opportunities, or retire. Unfortunately, these things can occur with little notice, leaving you scrambling to fill the void of an essential staff member along with the knowledge they carry with them. The immediate result can be costly and important quoting opportunities either can fall by the wayside or are not completed quickly or accurately enough. When going through these difficult times, manufacturers are forced to pull in resources often from multiple departments in order to keep up with the quoting. This collaborative effort can sometimes get you through the tough times on the short-term, but pulling others away from their actual day-to-day responsibilities is not a long-term solution.

Be Proactive

Unless you have a replacement waiting on standby, then being proactive will help you avoid some of these pitfalls. You could sit down with your estimator and try to extract all that knowledge, and then try to develop a spreadsheet tool around it; You could hire another full-time estimator to begin the understudy process, with hopes they learn all there is to know. However, what happens when that estimator leaves? All of these options could be costly and take a lot of time. A cost effective and dependable option for you is to implement a database driven Cost Estimating Software.

Technology is here to Help

A database driven estimating software program enables sheet metal, fabrication, and machine shops to take some of that extracted knowledge from their most experienced personnel, and put it into a database. Not all of their experience can be withdrawn, but after implementing, your company can rely on a standardized tool and not on a person. An estimating software will be bring many benefits to your organization, including the following:  

  • Consistency – Using formula driven methods to calculate the times for processes like laser, welding, milling, drilling, and turning, and more, will standardize the process. It makes estimating consistent no matter what day it is, or who is using it and how they feel that day. It can also make estimating accessible to different skillsets.
  • Accuracy – It is not in the eye of the beholder, it is in the database. With database driven Estimating Software, the accuracy comes by what you put into it. Some programs come ready with machine data, speeds & feeds, formulas, time standards, etc., but every shop is unique so finding an estimating software that is fully customizable should be a top priority.
  • Speed – While nothing can compete with the speed of someone looking at a drawing for a few seconds then coming up with a (right or wrong) number, using a standardized estimating system can be very quick, and for most companies is an improvement on their estimating time. Some cost estimating software programs integrate with 3D CAD files as well as ERP’s, which can greatly speed up the quoting process from begging to end.   

It’s Never Too Late

It is a tough situation when an indispensable staff member suddenly becomes unavailable or decides to move on. Do yourself a favor and plan ahead for the worst. There are tools available to help smooth the transition. In addition, you will be standardizing your estimating process for all those involved, and for decades to come. Why wait until disaster strikes? Be prepared and stabilize your quoting process before it is too late. 

About MTI Systems, Inc.

MTI Systems provides cost estimating software and estimation services for the manufacturing industry, serving both suppliers and OEMs. For more information on Costimator and MTI Systems, contact MTI Systems, 1111 Elm Street, Suite 6, West Springfield, MA 01089; Phone 413-733-1972

Sheet Metal Safety Tips that Affect Costs

While many professionals in the sheet metal business can agree on all of the following safety issues, there are times that “common sense ” is sometimes overlooked. Much of managing and implementing proper safety standards and procedures begins by brainstorming situations and estimating the effects of not having reasonable safety procedures in place. Working without a plan, in a new production environment or where characteristics of the environment change, exposes workers to the “trial and error” effects on injury. It doesn’t take a whole lot of planning to foresee, prevent, or at least reduce the possibility for injuries.

When safety is compromised, injuries can increase a company’s overhead cost, which ultimately increases part costs and/or reduces a company’s profits.

Gene Barsaleau, 1 of our cost estimating trainers, who also had been working in the sheet metal business for 30 years, has the following recommended tips and real life experiences he shares here:

Top 10 Sheet Metal Safety Tips for Manufacturing that Affect Costs

1.) Gloves– Select good ones and don’t just carry them – wear them. “They can be a hand saver, even when you or your co-workers may think the immediate job is “a quick move and carry.”  Take the time to get your gloves on for protection. A simple cut not only can become a serious infection it can delay and/or affect your ability to remain employed. This costs you and your company money. Even if you are still able to work its likely you are operating less effectively.”

2.) Too big to handle – Recognize what is too big to handle. “Too many times I’ve seen workers, even family members, go at a job or task with the ‘I can do it attitude’ and that’s just when injury likes to lend a hand (no pun intended).”

3.) Don’t scrimp on hoisting equipment – “Material moving tools are expensive, but losing an employee is much worse. The good news is that an effective hoisting tool can greatly reduce the time to manufacturing parts by reducing the time to move parts and materials. The time savings converts to cost savings. Pass this cost savings along to your customer, reap higher profits, or both. It can be a win-win for all.”

4.) Don’t try to stop Inertia – Inertia, (the resistance of any physical object to a change in its state of motion or rest, or the tendency of an object to resist any change in its motion), rules how easy it will be to stop “out of control” metal from causing harm to you or others – “get out of its way.”

5.) Know the limits of fork lift trucks – Just because you aren’t the driver doesn’t mean you should be ignorant to its limitations of gravity and strength. “I once dropped a 40″ plate of steel because the back wheels lost contact with the floor.”

6.) Safety Glasses/ Helmets – “While it’s easy to throw this on the list it’s not easy, or acceptable, to show graphically what can happen to the eyes or head when impaled with flying debris – wear them always.”

7.) Hearing Protection – “What did you say? Don’t be a hero…save your hearing!”

8.) Steel toe shoes – “These can make a difference between having toes and not having them!”

9.) No loose clothing – We hear this more and more. “Don’t become another statistic because you had strings attached.”

10.) Don’t work under the influence – While obvious… always read the labels. “Even over the counter medications can affect your ability to function safely.”

Estimating Tools for Welding Manufacturers

Identifying welding time and the cost for various weld types has been an age old challenge for manufacturers. There are few companies to this day that have a good understanding and estimating tools or methods to determine what the times and costs are. Many companies have failed to take advantage of estimating software technology tools that’s available today. Also, they may have neglected to even look at their welding cost and how it might affect the outcome of winning the job or selling more products!

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The Evolution of Estimating

Estimating. From our parents, to our children, to a deli clerk halfway around the world, everyone is estimating something daily. In general, estimating is a computation of a value. In its everyday use we often compute the value in our heads. Like when you’re at the grocery store and trying to calculate how much chicken, burgers, and hot dogs you’ll need for the next day’s barbeque. You give it your best guess, and in most cases, that’s good enough.  Uncle Jim will survive if there’s no more hot dogs left. But what about when tens or hundreds of thousands of dollars are at stake? When the estimating determines whether or not your company wins an important contract that is vital to growth (or in some cases survival), is it still ok to use that same method? The obvious answer is NO.

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Is Cost Estimating The Old Fashion Way Costing You?

There nothing more frustrating for a manufacturer than spending hours, days, even weeks on a quote package only to find out you were not awarded the job. What a kick in the gut. What’s worse is if you find out the reason for losing the bid was because the quote was submitted too late or your quoted price was way out of whack compared to the competition.

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