Practical project management lessons from environmental, demolition, remediation, and industrial work. For project engineers, developing PMs, and field professionals. Delivered every Friday.
Friday Field Notes #19: Equipment Costs Keep Running
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Good morning team, This week’s topic: equipment cost exposure. 1. From the Field Equipment costs don’t wait for someone to notice them. A rented excavator can be fueled, inspected, parked in exactly the right spot, and accomplish absolutely nothing while the rental clock keeps running. Sometimes the delay can’t be avoided. An approval may still be pending, the work area might not be ready, or the sequence may have changed. The trouble starts when “we’ll probably need it later” becomes the entire equipment-management plan. When the work changes, the equipment plan should get another look. A machine might be useful somewhere else on the project, but it may also make more sense to return it and bring it back when the work is ready. One idle day probably won’t sink the job. Two weeks of rental charges can leave a decent mark on the forecast. 2. Leadership Perspective Good equipment management requires someone to make a decision while there are still useful options. Returning a machine could mean paying another mobilization charge later, but leaving it onsite indefinitely because nobody wants to make the call isn’t much of a strategy. Put the costs in front of the PM and make an informed decision. 3. Field Observation The equipment list won’t tell the whole story by itself. Review it alongside current costs and actual production so you can see whether each major unit is still supporting the work. A specialty attachment may have been brought in for an activity that’s now ten days behind. It still looks perfectly reasonable on the equipment list, but by then it may be serving mainly as expensive yard decoration. Company-owned equipment deserves the same attention. The project may not receive a rental invoice, but internal rates, fuel, maintenance, hauling, and operator time still hit the job. Owning the machine doesn’t make its project cost disappear. A quick weekly review with the superintendent is usually enough. Talk through how the equipment was used, what work is actually ready next, and whether keeping each major unit onsite still makes sense. 4. Spreadsheet Tip This week’s formula tracks estimated equipment cost through the off-rent date, or through today if the equipment is still onsite:
In this example:
If Column C is blank, Excel calculates the cost through today. Once the return date is entered, the cost stops accumulating. Because the formula counts calendar days, weekly or monthly rental rates should be converted to an equivalent daily rate first. This works well in an equipment log because it shows the current exposure before the invoice arrives and introduces everyone to the damage after the fact. 5. Question for the Week Which piece of equipment on your project is earning its cost, and which one is mostly enjoying the scenery? Have a great weekend, Dan |
Friday Field Notes
Practical project management lessons from environmental, demolition, remediation, and industrial work. For project engineers, developing PMs, and field professionals. Delivered every Friday.
Good morning team, This week’s topic: small tools and consumables. 1. From the Field Nobody calls an emergency meeting because the project bought another box of cutting wheels. Small purchases rarely look concerning one at a time. Over several months, though, the job may go through far more blades, filters, hoses, batteries, PPE, and other consumables than the estimate allowed. Some small tools will also disappear into gang boxes, service trucks, and whatever mysterious place tape measures go...
Good morning team, This week’s topic: labor hours. 1. From the Field Knowing that a project used 500 labor hours does not tell you much by itself. You need to know what those hours accomplished. That is where labor tracking becomes more useful. If 500 hours produced 1,000 units one week and the same 500 hours produced 650 the next, something changed. The reason could be completely legitimate, but the project team should understand it. I’ve found that labor discussions become much more useful...
Good morning team, This week’s topic: production rates. 1. From the Field Production gives the project team an early way to compare what was expected against what is actually happening. If the estimate assumed twenty truckloads per day and the project is consistently completing twelve, that difference deserves attention even before the cost report shows a problem. The same applies to demolition quantities, excavation, waste loading, concrete removal, equipment production, or almost any...