1. Client Background

Client was an equipment supplier for the oil and gas industry. They were in a tough financial situation and hired 3 high caliber applications engineers to try to get estimates out quickly.

2. The Challenge

The engineers were spending about 4 hrs on estimating a product called a “meter run”. This is a fairly simple product, but was occupying a lot of expensive engineering time.

• There were redundant parts, parts with similar descriptions, and different prices on every one in the MRP system (QAD). They had to hunt through the entire MRP part list for every estimate.

• There was no standard format for the proposals going to the customers.

• Labor had to be recalculated manually for every job.

• They had to build each estimate completely from scratch.

3. The Approach

We always start with the client, what challenge(s) are they facing, including all levels, from leadership to functional. Next we assess what could be driving that issue. This is our entry into PDCA, Plan - Do - Check - Act.

In this case, we saw that we could attack the issue from a few different angles at the same time.

• We saw that we could separately figure out what the correct items were in the MRP system, while we began constructing a standard tool for the engineers to use.

• We sat with the engineers to understand what a “typical” estimating process looked like. Then we sat with the manager to understand what the final product needed to look like.

4. The Solution

We delivered an Excel based tool with standardized pricing and labor that exported an estimate that was ready to go.

• It exported the same format so every estimate looked the same.

• We used dropdowns and lists so that both parts and formatting were uniform

• The engineer could add personal verbiage to it and send it.

• We also helped them to update the MRP system to remove (or obsolete) the parts that should not be used.

5. The Results

The process that once took 4hrs+ to complete, now took less than 5 min. The longest part of the entire process was the phone call getting information from the customer. The estimates were now consistent for materials and labor cost, presentation to customers, and turnaround time from request to proposal to the customer.

6. Key Takeaways / Lessons Learned

This project reminded us that we need to be connected to our customers closely through the process. We were able to let them sample the design as we built it so we could shift anything per their request. At the end of the day, they have to use it, not us!