Ep 53 : The $200,000 Estimating Miss (And Why PMs Have to Catch It) – Part 1 of 2

How Project Managers Catch Costly Estimating Errors Before They Sink a Job: Estimating vs Operations

Most project managers blame estimating errors for a budget that’s too tight and will tell you the estimator never gave them enough money to build the job. On this episode of Construction Hot Takes, Adam Cooper flips that around: on the trade contractor side, PMs get handed lump-sum buckets of money for scopes like gear and branch wiring and told to self-perform within that number, while Jeff Robertson’s general contractor-side experience was the opposite problem: estimators who struggle to price conceptually before a job even has enough drawings to work from.

Jeff lays out what he calls the documentation grid: the paper trail should run in reverse, thick with qualifications early, thinning out as construction documents firm up, until it’s down to a handful of allowances instead of a stack of caveats.

Adam pushes the conversation toward the handoff itself, making the case that a PM should always run their own takeoff to validate the estimator’s quantities: trust, but verify, before signing off on a budget they’re expected to deliver.

Adam backs it up with a true story: a $4 million electrical job where an estimator built one conduit raceway system for the entire building instead of the two separate systems code requires for emergency power: a miss worth roughly $200,000 that didn’t surface until three months into the job. Jeff matches it with the GC-side version of the same mistake: a lighting allowance buried in the wrong cost division that cost a young PM $25,000 he didn’t know he’d already spent.

 

Watch the Episode

In This Episode

• Why the “estimator never gives me enough money” complaint often gets the story backwards
• Why estimators struggle more with conceptual, pre-drawing budgets than most PMs realize
• The “documentation grid”: why the paper trail should shrink as construction documents grow
• Why a project manager should run their own quantity takeoff instead of just accepting the estimator’s handoff
• A true $200K conduit miss on an industrial job — and how a Saturday spent in the estimate caught it

Episode Chapters

• 00:00 — Why the “estimator never gives me enough money” complaint gets the story backwards
• 01:41 — Why estimators struggle more with conceptual, pre-drawing budgets than PMs realize
• 05:00 — Why the paper trail should shrink as construction documents grow
• 07:52 — Trust but verify: why a PM should run their own takeoff on the handoff
• 13:54 — The $200K conduit miss — and the line-item traps that quietly eat a budget

Notable Quotes

“If project managers were pure project managers who estimated the work, you’d never win anywhere.”
— Jeff Robertson, 00:00

“I trusted my estimator, but like Ronald Reagan — trust but verify.”
— Adam Cooper, 07:52

“You have to go through that estimate and understand it. You learn the job.”
— Jeff Robertson, 13:54

Frequently Asked Questions

Why is there tension between estimating and operations in construction?

Estimators price the work to win the bid, while operations has to build it and still deliver a profit. Estimators focus on staying competitive on bid day, and project managers need enough money and time to execute safely. That gap creates natural, often healthy, friction.

What is conceptual estimating in construction?

Conceptual estimating means pricing a project before drawings are complete, often from a program, unit counts, or square footage rather than a full takeoff. It requires judgment calls, like assuming a brick-to-stone ratio, that get refined as construction documents develop.

Should a project manager redo the estimator’s takeoff?

Best practice is validation, not a full redo. Project managers should spot-check quantities on major items, like panels, fixtures, and mechanical hookups, to confirm the estimator’s counts and pricing before signing off on the budget they’re expected to deliver.

How do costly estimating errors happen on large construction projects?

Estimating errors often hide in code requirements or systems an estimator overlooked, like a separate conduit run required for emergency power. Without quantity takeoff validation, a quantity check that only skims the surface can miss a six-figure gap that surfaces only after the crew starts building.

What’s the difference between GC and subcontractor estimating handoffs?

General contractors typically hand project managers a buyout book of bids to award and manage. Self-performing subcontractors get lump-sum buckets of money for scopes like gear or branch wiring, then have to buy out labor and materials within that number themselves.

About the Hosts

Adam Cooper: President & CEO of Ascent Consulting. Adam is the primary host of Construction Hot Takes and works directly with construction company owners on operations, growth, and leadership systems.
Jeff Robertson: Vice President at Ascent Consulting. Jeff focuses on AI and technology adoption, ERP execution, and the operating detail behind fractional COO engagements with construction companies.

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Episode Transcript

[00:00]

Adam Cooper: We’re back. So, welcome back to Construction Hot Takes. A couple of months ago you and Greg did an episode that was Ops versus finance.
Jeff Robertson: Oh, yes. Yeah, that was fun.
Adam Cooper: It was fun for you. I was bored. Anyway—
Jeff Robertson: Oh, okay.
Adam Cooper: So I thought I’ll do one. I want to host one. And it’s Ops versus estimating. Not that they’re necessarily opposed, but as I’ve said before, project managers make poor estimators because we put everything in to try and make sure our bases are covered.
Jeff Robertson: If project managers were pure project managers who estimated work, you’d never win anywhere.
Adam Cooper: Correct. And estimators think that way too — they think estimating is a bit of an art and a bit of a science. There’s a little mystique to it. I had my friend Josh on the show a month or so ago, and we talked about the benefit of having both estimating and operational experience. To be really successful in Ops, an estimating background can be highly beneficial. But there’s typically a decent amount of friction between estimating and operations.
Jeff Robertson: Healthy tension would be a good way to put it. Sometimes there’s a lot of friction. I think healthy tension’s okay.
Adam Cooper: Yeah. I tend to see it more on the trade contractor side, but you’re a general contractor predominantly, by experience. So I thought it’d be fun to talk about the tension and how to maybe diffuse some of that between the estimating department and the construction operations department.
Jeff Robertson: Okay.
Adam Cooper: So, first pain point: estimators estimate conceptually, and they never give me enough money to build the project. That’s typically what I hear from project managers.

[01:41]

Jeff Robertson: I’m going to reverse that.
Adam Cooper: Okay.
Jeff Robertson: From an operational standpoint, my experience was estimators struggled to estimate conceptually, and it was difficult at the front end of a project because clients are asking for budgets, or maybe you’re being paid to be a pre-construction consultant. Estimators struggled to do conceptual estimating. They needed more drawings, and I found myself having to push them to break it into components and conceptually estimate in order to get a number together.
Adam Cooper: Interesting.
Jeff Robertson: That was my experience.
Adam Cooper: They didn’t have good square foot analysis numbers to fall back on?
Jeff Robertson: I think they did. I think the way I understood it was — I’ll say impolitely — they lacked vision or creativity.
Adam Cooper: Okay. All right.
Jeff Robertson: I understood the program of the job — the architect had done the program, the owner put the program together, I had a really good understanding of it, and I was already thinking about logistics and how we were going to build the project. They were still struggling to estimate the elements of it. I’m like, ‘Nobody cares. Just decide 50/50 brick and stone. Just write it down. That’s all you have to do. If they tell us they want 60/40 brick to stone, fine, we’ll change it.’ They struggled with that — they needed something more solid to price.
Adam Cooper: Interesting.
Jeff Robertson: That’s what I ran across.
Adam Cooper: When I worked at big electrical contractors, we did a lot of multi-family high-rise, and after doing 50, 100, 200 of these buildings, we knew roughly per square foot what a lobby would cost — amenity spaces, pool decks, lobbies, apartments, corridors, distribution systems, all based on unit counts and number of floors. We were able to put together conceptual estimates very quickly. What I found was that when they actually won the job, they never went back and did a nuts-and-bolts takeoff on everything — they quantified the big things and swag-numbered the rest. That reminds me — there’s a section in the book I wrote all about that, called Build It Better. Available for free on our website, go get a copy today.
Jeff Robertson: So you just reminded me of something. I used to say that if you think about it on a grid, x and y-axis, the amount of documentation an estimator has to produce is inverse — it declines over time as the actual construction documents increase. So it ends up being an X, right?

[05:00]

Adam Cooper: Yes.
Jeff Robertson: So as the general contractor, the stack of quals at the beginning should be like this tall.
Adam Cooper: Mhm.
Jeff Robertson: Because you’re producing everything. There’s maybe a napkin on the table. Maybe a narrative of a program. You may not even have drawings at all. So your quals need to be literally this tall, and as the drawings are produced, you’re checking that, assuming you’re in a budgeting capacity.
Adam Cooper: Mhm.
Jeff Robertson: You’re checking that against those quals, and this is getting smaller because it’s actually going into the construction documents.
Adam Cooper: Right.
Jeff Robertson: So at the end, you have a quantity takeoff, and what used to be this tall is now a couple of minor clarifications that should be allowances — like, we haven’t picked the brick color yet, or the light fixtures. But we like that number, we’ll carry it. A million bucks for light fixtures is perfect, we’ll figure that out later.
Adam Cooper: Right. We’ll true it up after the fact.
Jeff Robertson: Right. Right.
Adam Cooper: All right. So again, trade contractor, general contractor — your estimators were probably getting coverages, three bids from all the trades.
Jeff Robertson: Supposed to. Not always, but yeah.
Adam Cooper: So you went into it as a project manager with basically a buyout book.
Jeff Robertson: Bid bucket, we called it, sometimes.
Adam Cooper: Yeah, bid book — ‘Here’s all the quotes I got, here’s which ones I carried. Go buy it out now, or maybe I’ve bought out some of it already for you, and here’s the rest of it, you take care of it.’ As a trade contractor self-performing and supplying materials, I’m getting an estimate that’s conceptual, with buckets of money — this much for the gear, this much for branch, this much for corridors and units. Go buy it out, manage it, self-perform it. And now I’ve got to buy it out and meet the number without going over.
Jeff Robertson: I mean, we do the same thing on the GC side. It’s broken down a little differently, but yeah, same thing.
Adam Cooper: But as a project manager, I’d often say, ‘There’s not enough money here. You got too competitive to win the job, and left me almost no profit. You underestimated the labor and how difficult it was going to be’ — because it’s half math and half art. Let me ask you something that came up in a client workshop last week: do you promote a project manager doing his own takeoff to validate after the handoff from the estimator?

[07:52]

Adam Cooper: Yes. Not always, but yes — best practice. I trusted my estimator, but like Ronald Reagan — trust but verify.
Jeff Robertson: Yeah.
Adam Cooper: So I’d trust that he did his job well, but I’m still going to do some type of takeoff to validate what they’ve done and make sure they didn’t miss things, make sure the counts are right. I’ll do a hard takeoff on certain things — check all the panels, all the light fixtures, make sure they’ve counted enough switches and plugs, make sure they’ve captured all the mechanical hookups. It’s also my way to learn the project.
Jeff Robertson: Right, there you go.
Adam Cooper: In that process, what I’m really doing is validating that the estimator got the right quantities, and now I’m just worried about pricing. If he’s got pricing and quantities wrong, I’ve got a bigger problem to solve.
Jeff Robertson: Right. You’re profit-and-loss responsible once they hand you the folder, right?
Adam Cooper: Yeah, I’ve got to sign off on it at some point, and they’re only going to give me a few weeks to do my due diligence.
Jeff Robertson: So at some point you have to say, ‘I am going to deliver’ — bid day fee was this, I’m expected to deliver that or more. We were actually taught as PMs, at the first project review, to write the job down day one.
Adam Cooper: Just walk into it going, ‘Can’t build it for this.’
Jeff Robertson: No way to do it. Not going to make that fee, it’s going to be a half a point lower — even if you think you could improve it, doesn’t matter, write it down day one.
Adam Cooper: Well, that’s sandbagging 101.
Jeff Robertson: Yeah.
Adam Cooper: There’s no way, this estimator’s an idiot, there’s no way! But then you swoop in and put your cape on.
Jeff Robertson: That’s right.
Adam Cooper: Captain Project Manager, and you save the day. ‘Give me some time with this, let me see what I can do.’
Jeff Robertson: ‘You wouldn’t believe the blood I sweat for this, but I fixed it. I fixed everything for you.’ Thank me later.
Adam Cooper: Yeah, right. Thank me later with a big fat bonus check.
Jeff Robertson: Right.
Adam Cooper: But yeah, I’d gotten burned a few times by estimators who missed things. I was building a big industrial building — a pulp and paper plant — and I was going way over on lighting conduit. My superintendent’s calling me going, ‘This takeoff doesn’t look right at all, this bill of materials looks super light.’ I realized — for those who aren’t electricians — you cannot run regular power and emergency power in the same conduit system. You have to have a separate conduit system for emergency power, so if somebody cuts the regular power, you still have emergency power.
Jeff Robertson: Still have emergency power. Is that code or just good practice?
Adam Cooper: No, that’s code.
Jeff Robertson: Okay, that’s what I thought.
Adam Cooper: You cannot mix the two. But the estimator had built it as one raceway system for the entire half a million square feet of overhead lighting.
Jeff Robertson: So you were wrong by half.
Adam Cooper: Well, technically I’m wrong by whole, because you have to cover — every third or fifth light is on emergency power — so you need a complete conduit system for the lighting that covers the whole amount.
Jeff Robertson: Yeah, I guess I shouldn’t say that. You were 100% wrong.
Adam Cooper: Right. You just don’t have as many lights on it, so it’s less wire or smaller gauge wire, depending.
Jeff Robertson: You still need the conduit.
Adam Cooper: You still need all the conduit. This equated to about a $200,000 miss on a $4 million project, which was significant — that’s multiple points. And this was about three months into the job. I’d done my estimate check when I first got the job, counted everything, and it looked okay on the surface. Then this came up. I spent a Saturday in the office going through the estimate and the drawings, figuring out where the problems were, and surfaced it as one of the core problems, plus a few others. Monday morning I had to go to my branch manager and say, ‘Got a problem on this job, the estimator missed all of this.’ Everybody wanted to dig in and make sure I hadn’t screwed something up, but we validated it was a miss — and I had to write the job down and find ways to get that money back. So a cursory check is sometimes not enough on a big job. You need to go into the details — like, yeah, he’s got all the raceway for the ceiling, but does he have the secondary conduit system for emergency power?

[13:54]

Jeff Robertson: Yeah, it’s not terribly different on the GC side. We don’t do as much takeoff, for obvious reasons, but we do a fair amount to validate subcontractor quantity on specific scopes — yards of concrete, door counts, hardware, square footages for finishes. Where we had to go back and validate was — let’s assume we had multiple quotes per trade, which wasn’t always true, sometimes we had to go solicit after we’d won the job.
Adam Cooper: Mhm.
Jeff Robertson: That happens more than it should. The validation is: how did he take it off and build the estimate? To pick a ridiculous example — maybe he put the lighting allowance not in division 16, or whatever number it is these days after they changed the numbers, I have no idea.
Adam Cooper: Still 16.
Jeff Robertson: I thought it went to like 32 or something.
Adam Cooper: It is, but I still live in 16.
Jeff Robertson: So anyway, let’s say he put the lighting allowance in division 9 instead, because he thought of it as a finish at the time — that made sense to him when he built it. Going through and understanding that there’s extra money sitting in division 9, and not accidentally spending it — because you don’t see that line item that says lighting allowance, and you go, ‘Yeah, I bought it for the budget, I’m awesome,’ but actually you overpaid, because that money was never earmarked for that scope. Now you don’t have money to buy the lights.
Adam Cooper: Oops.
Jeff Robertson: That happens.
Adam Cooper: Wow.
Jeff Robertson: So you have to go through and validate the line items — not necessarily ‘where did you put it specifically,’ that’s a dumb example, but to prove the point: you have to go find where everything actually is. Maybe there’s a little bit of fluff in one number, an allowance, some contingency, a plug number one of you agreed to sort out later. We used to see the same thing in the trades — ‘I bought the lightning protection, there’s your plug number,’ but the downleads and grounding were carried in a different line because we were going to self-perform that. If you want the lightning guy to do all of it, you have to move money over to pay for his work. You have to go through the estimate and understand it, think about how you’re going to buy it.
Adam Cooper: Right.
Jeff Robertson: I had a young PM I thought I’d explained all this to. He went out and bought something, and this exactly happened — he’s like, ‘I bought it for the budget, I’m so proud of myself,’ and I’m like, ‘You lost $25,000, because that was float, that was fluff, that was our money.’
Adam Cooper: That was for something else.
Jeff Robertson: That was for something else, whatever it was, I don’t remember. But — same concept.
Adam Cooper: All right. Well, thanks for joining me. Catch us on the next episode — YouTube, Spotify, Apple, wherever you get your podcasts. Thanks, and like and subscribe.