Welcome to our SWIFEE PLANNER Tour-torial. SWIFEE PLANNER calculates “backwards” from a target design fee to generate a one-page “fee master plan.” In this Tour-torial you will learn how to generate that one-page plan, against which you can assess and plan your in-house work effort for any given potential project, strategize your teaming relationships, and even begin negotiating with sub-consultants. Of course, you also will learn how to swiftly produce the basis for a sensible, strategic and successful design fee proposal.
You will find instructions to every section of the PLANNER in the yellow box numbers, which you are asked to follow sequentially. This Tour-torial simply augments those instructions with an example. For details on the profitability metrics required, please click here.
Reminder: Before using SWIFEE, first “SAVE AS” a new document named after your project. Then work from within the new document you named after your project.
Project Fee Parameters
#1. You have a choice of keying in a straightforward number or a formula. If you know that a project’s estimated construction budget is $12,500,000, you could key that figure in, as we have done in our example. Or perhaps you only know the project’s proposed size, and what that building type would cost per square foot. Then you could key in the formula =100,000 SF * $125/SF to get your construction budget. If the project is part new new construction and part renovation, your formula should reflect that complexity. For example, =(50000*125) + (100000*200).
#2. Now let’s say that given the complexity and scale of the project, you deem 8% is a prudent fee basis. You key that in #2. This results in a Potential Fee of $1,000,000.
#3.You could key in the Potential Fee Amount determined in #2, or you could test any other fee amount. Your client, for instance, might have approached you to see if you could do the job for less. Or you might want to ascertain the implications of a lower or higher fee. In that case, type a lower or higher Initial Target Fee in #3. For this example, we will keep our Initial Target Fee at our original $1,000,000.
#4. Your response to Consultant Fee Retention will depend on whether you are pursuing this project as a prime consultant or as a sub-consultant. If you are pursuing as a sub-consultant, then your answer should be 100%. On the other hand, if you are pursuing the project as a prime consultant with sub-consultants under your wing, then you will want to establish how much of the fee you would like to retain to cover your in-house labor, overhead and profit. Let’s say that is 65%. By keying in that figure in #4, we are automatically left with a balance of 35% for sub-consultants’ fees.
#6. Next, we indicate up to 9 phases of work anticipated for this project. For this example, we will use typical project design phases: Predesign through Construction Administration. Note: If you are preparing this fee proposal for a prime consultant, you may want to match your phases of work with the prime consultant’s first before proceeding.
We then will want to show how each individual Team Role’s time will be distributed across each phases of work. The default percentages that appear for each Team Role are values that are typical to standard design phases, but you may change them as needed. For example, you may want to adjust the percentages of involvement of your Sr. Planner-Designer and your Construction Administrator, who will be more heavily involved in the front and back end of the process, respectively. We shall do that in our example. Note that the total of percentages for each Team Role must always equal 100% in the blue cell.
#7. Finally for your in-house team, we will want to step back and assign percentages to the functions served by Team Roles. In our example we will give 5% to Project Principal for project oversight; 20% apiece to Project Manager and Project Architect for management and design; 15% apiece to the Sr. Planner/Designer, Construction Administrator and Production Support; and 10% to Administrative Support. The total of these percentages must again equal 100% in the blue box at the end of the row.
On the basis of your input in this section, SWIFEE automatically calculates each team member’s hours to be devoted to each phase of the the project and to the project as a whole. To facilitate your interpretation of the results in terms of adequacy or feasibility, hours reflect full 8-hour workdays. Note. If you wish to make changes to any Team Role’s hours or distribution of hours across project phases, we recommend that you adjust percentages rather than the hours themselves.
First, indicate what services will need to be subcontracted for this project. For this example, we determine that we need Structural Engineering, Mechanical Engineering, Electrical Engineering, Civil Engineering, Landscape Architecture, Food Service Design and Cost Estimating. Though optional at this point, we could already identify potential sub-consultants corresponding to the disciplines listed. For this example, however, we shall keep our sub-consultants unnamed.
#9. Next, assign target fee percentages to each discipline, bearing in mind that our target fee total for sub-consultants (which we determined earlier in #4) is set at 35%. You will see that figure in green as our target total in this column. For this example, we shall allocate 5% of the fee for structural, 11% for mechanical, 11% for electrical, 4% for civil, 1% for landscape, 1% food service design and 2% for cost estimating. That puts us at exactly 35% for sub-consultants on this job.
#10. SWIFEE is extremely helpful in instances where clients want to see the participation of certain types of certified business enterprises on your team (minority or woman-owned, disadvantaged, small business, local, etc.). Indicate those considerations as Special Classifications column headings and then indicate which are applicable to each sub-consultant by typing or selecting “1” from the drop down menu in the appropriate cell/s. Automatically, SWIFEE organizes the subconsultants fee information under the appropriate light green columns to the right, to quantify how much of the fee would go towards satisfying the participation considerations of the client. The transposed percentages are based on the final target fee rather than on the intial target fee.
If specific participation goals have been defined by a client, SWIFEE allows you to quickly see how close you would come to meeting those goals with your proposed team, and if you need to consider revising or augmenting your team to reach your client’s goals.
In this example, we decide that we need to add another minority firm to our sub-consultant roster, an Associate Architect, for another 5% of the fee to meet our client’s goals. While that allows us to meet our special considerations goals in the green boxes, we will exceed our 35% budget for sub-consultants’ fees. Therefore, we must either adjust our other subconsultants’ fees and/or recalibrate our Consultant Fee Retention in #4 above to accommodate the added fee. In our example, we will reduce the Consultant Fee Retention from 65% to 60%.
Reconciling Target Fee Differences (a neat but optional feature)
#11. Let us now return to the Consultant Fee section, where we will note that there is a difference between the Consultant’s target fee (in green) and the calculated fee (black column total). This difference is caused by the rounding of hours to the nearest full 8-hour work day, as described earlier.
The exact difference between the two amounts is indicated in the Red Box below the Consultant’s spreadsheet. In our example, that difference is -$264. This means that if we wanted both amounts to square, we would need to deduct $264 worth of hours from the Consultant’s various Team Roles.
SWIFEE offers the chance to reconcile both amounts, or at least bring them to within a hair of each other. To do that, we would click on one of the Reconcile buttons that appear just below the Red Box and a row of red zeros. Specifically we will want to select the Reconcile button that corresponds with the number of Team Roles on the Consultant’s team. In our example, we had seven team roles indicated and so therefore select the “7 Team Roles” button.
#12. After hitting the button, SWIFEE will take up to a minute and a half to generate a solution that will recommend adding, deducting and/or shifting hours around. You know SWIFEE is “thinking” by the activity in the lower left hand corner of your screen. You then will receive one of three responses:
- SWIFEE will find a solution and ask you if you wish to keep it. Select OK to KEEP solution.
- SWIFEE will run out of time to find the ideal solution, and ask if you want to continue. Select STOP. Then select OK to KEEP solution in the next dialog box.
- SWIFEE will not find a “perfect” solution. Select OK to KEEP solution anyhow.
In each case, SWIFEE will replace the red zeros with other numbers representing hours to be added or deducted from the Team Roles directly above. A positive number means to add hours, and negative number means to deduct hours. You may add or deduct from one or several phases or cells. To add or deduct from any given cell, simply precede its value with an equal (=) sign, and then add or deduct the red number indicated below (example, =48-8). After you add and deduct hours, the result will be either an exact match between the Consultant’s target fee and calculated fee and the Red Box will show “0″; or the difference will be very small and reflected accordingly in the Red Box. Let’s see how this works in our example.
After hitting the “7 Team Roles” button, SWIFEE advised us that it found a solution. We then selected KEEP solution. SWIFEE’s solution recommended to deduct three hours (-3) from the Project Principal, deduct one hour (-1) from the Project Manager, and add six hours (6) to the Construction Administrator. We followed accordingly, adding and deducting from the Construction Administration phase of each of the three Team Roles. As a result, we achieved an equal match between the Initial Target Fee and the calculated fee. The Red Box confirmed this with a “0″.
Total Target Fee Breakdown
Based on all our input thus far, SWIFEE has calculated a target fee for the Consultant and target fees for sub-consultants. This section combines them all into one to one Total Target Fee for design services. It also automatically shows how the combined fee would break down by phase of work. The phase breakdown percentages are standardized for the entire team based on default percentages that are typical to each design phase. You may revise these percentages as needed or desired.
Reimbursable Expenses Breakdown
#13 and #14. Finally, SWIFEE provides you with a section to estimate reimbursable expenses for the project. We enter expense items as column headings and their corresponding amounts as column totals.You may include items like Printing, Travel, Communications, etc. At this point of the planning stage, however, a percentage of the fee may be all that is needed. In that case, you may include your typical formula here, for example, =Target Fee x 5%. In our example, we will indicate a finite amount for Printing & Miscellaneous, Travel and services outside your scope of work that the client has requested you provide (Surveying and Geotechnical Engineering). We have also adjusted the percentages of distribution within each Expense Item to indicate when these expenses are expected to be incurred.