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H.B. Zachry Company Heavy Division Estimating and Bidding First Steps Arthur Andersen LLP Page PAGE 178 FIRST STEPS FIRST STEPS This section of the report describes “First Steps” opportunities which have been identified as a result of the detailed analysis of the Estimating and Bidding process. These first steps will help the Division towards achieving the necessary improvements in the Estimating and Bidding process. These first steps are capable of being implemented within the next three months (with the appropriate resources dedicated and empowerment received) with the benefits beginning to be realized in the upcoming new year. The first steps are as follows: DESCRIPTION BENEFITS IMPLEMENTATION Create a Marketing function that includes: Searching for new opportunities, Assessing current opportunities Developing customer relationship Opportunities in new markets Additional opportunities in existing markets Improve owner relationships Refined, professional image Define the desired objectives of the Marketing Function Define geographic market areas being served today Define market segments Research and identify high potential markets Assign market area “leaders” Pilot job postmortem (continuous learning) in select areas. Applied learning experience Potential pitfalls Best Practices More accurate application of historical data Timely feedback of technology, work force, etc. Implement pilot postmortem analysis process Develop a Positioning Team to price estimates whose objective is to maximize the value contributed to the Division’s objectives. Clear distinction between costing and pricing Strategic positioning of bids The maximization of the value contributed by a project to the Division Composition of the Positioning team Create a Strategy for the team Define and Develop: Risk assessment models Discounted Cash Flow mod