Excel for Civil Construction Cost Management

For many decades, Microsoft Excel has been the go-to tool for civil construction cost management. Today, around 80% of civil contractors use Excel spreadsheets to manage critical elements of their businesses, including project budgets, workforce management, contracts, suppliers, and materials.

Excel has proven to be a powerful tool over the years, with its greatest strength being its flexibility. With the right know-how, you can perform most data management tasks that you need to do for a typical business. Moreover, it is simple to use, and most people have at least basic Excel skills. Additionally, it is effectively free since most people already have it installed on their computer, and there are no incremental costs in terms of software subscription costs.

The Hidden Costs of Excel for Civil Construction Cost Management

However, while Excel has been around for a long time, its costs can be easily overlooked, and these hidden costs can be detrimental to your business. These costs include additional man-hours consumed in populating and manipulating spreadsheets, duplication of data between systems, and delays in getting time-critical data, among others. Most people are so familiar with Excel and have been using it for decades to manage construction costs that these costs can be easily overlooked.

Recently while assisting a civil construction customer to onboard onto Varicon they shared a too-common horror story with me about the real cost of Excel. They ran impossibly complex spreadsheets to run all the aspects of their business.  A few months earlier they won a multi-million dollar job that they were about to start. The problem arose when they reviewed their cost estimates and found a broken calculation in their Excel template. This mistake resulted in them under-estimating their project by over $200,000 dollars.

At the time of our conversation, they were preparing to start this construction project knowing that they were sure to lose money before they even began. Unfortunately, this is not an uncommon occurrence since most Excel spreadsheets contain errors, with the number being somewhere around 88%, according to Forbes.

This is the downside of the great amount of flexibility that Excel provides – it also provides the possibility (very likely) that mistakes will be made that are almost impossible to diagnose in advance.

The Solution to Excel’s Hidden Costs and High Probability of Error

The downside of the great amount of flexibility that Excel provides is the possibility of making mistakes that are almost impossible to diagnose in advance. Fortunately, there is a way out of this quagmire. Instead of depending on a generic tool that is prone to errors, you would be better served with tools that are designed specifically for businesses like yours. With the construction technology market growing, focused solutions are emerging to solve different construction problems in an efficient, reliable way while eliminating many possible sources of human error.

If you worry about the reliability of your civil construction cost management, we can help! Varicon is the product of my decade-plus experience working for small to medium sized civil construction contractors. We connect cost and contract data directly from the job site to the office, providing real-time visibility and eliminating much of the duplication of data inherent in managing civil construction costs… and in the process we’re eliminating Excel one construction project at a time!

To learn more about how we can help you get a better nights’ sleep knowing that your construction costs are under control, get in touch for a no-commitment introductory meeting.

Author: James Baker

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