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Surveying Ethics and Conflicts of Interest
Norman_Oklahoma replied 3 years, 11 months ago 41 Members · 130 Replies
Gene Kooper, post: 424660, member: 9850 wrote: When I conduct mineral survey retracements/resurveys, I bid the initial research at time + materials. Upon completing the research I submit a fixed fee proposal to complete the survey..
Actually, what you are describing is not fixed fee surveying if you are doing the research for time and materials. I’ll even go so far as to guess that on some mineral surveys the research may approach or surpass the cost of the field work. I note that you don’t rebut the main points, i.e. that fixed-fee pricing tends to (a) encourage price competition and (b) to result in surveyors trimming corners as an immediate result. The anecdotes about how “I once lost a whole bunch of money on a job, but it made me a better person” are amusing in the singular, but in the plural are fairy tales when price competition is the rule.
Gene Kooper, post: 424660, member: 9850 wrote: For whatever reason, Kent often displays a penchant for gross generalizations. It appears that fixed fees for surveying services is akin to his PLSSia generalizations.
Kent’s gross generalizations and the vast chasms that in reality separate his deduced corollaries are downright funny at times. For example: anyone that owns or operates a surveying business with a name that is ANYTHING other than the name on their personal license is at least capable of, and possibly guilty of both shoddy surveying and deceptive business practices. You need more than a good long stretch of rope to pull those two concepts together. But in Kent’s orations these concepts are crammed in close proximity with a few good words like “therefore” and “obviously”.
To assume every professional will cut corners to avoid losing money on a fixed-fee contract is not only a gross generalization, it’s demeaning to every surveyor that ever finished a job over budget. Fees and professionalism are two distinct facets. I have done some really hairy jobs for free simply because I liked the folks that truly needed my expertise but fell well short of affording the work. A surveyor that will cut corners will do so whether he loses money or makes money.
There are plenty of professional surveyors out here operating with admirable ethics that work for fixed fees at times. And some of them even own companies that don’t include their given names.
Does this also mean that contracts should not contain any verbiage about timeline either? I’d think time constraints can argueably be more of a problem with cutting corners than having a fixed fee.
A few days ago I finished and got paid $2,500 for a fixed fee survey that took 3hrs in the field including travel time and a couple of hours in the office. This would be well above a price based on hourly rates. But the lady is high maintenance. She had a long list of questions neatly typed out and ready when we met to discuss the survey and final map, then she called three times after the meeting. I’ve been patient with all of her questions and even agreed to take a quick look at a certain easement description in her Title report even though it wasn’t part of the scope of work. I feel fine with all of it, because she has already compensated me for this time. But if on hourly rates, I’d be stuck trying to bill for phone calls and lost time after a job had been completed.
And she may call again to talk tomorrow.
Unethical?
paden cash, post: 424663, member: 20 wrote: To assume every professional will cut corners to avoid losing money on a fixed-fee contract is not only a gross generalization, it’s demeaning to every surveyor that ever finished a job over budget. Fees and professionalism are two distinct facets. I have done some really hairy jobs for free simply because I liked the folks that truly needed my expertise but fell well short of affording the work. A surveyor that will cut corners will do so whether he loses money or makes money.
There are plenty of professional surveyors out here operating with admirable ethics that work for fixed fees at times. And some of them even own companies that don’t include their given names.
I’m sure that there are people who have jumped out of tall buildings and lived because they landed in a dumpster, but that doesn’t mean that jumping out of tall buildings expecting to be saved by a dumpster is an excellent practice to be encouraged. If you want to claim that taking work on for a fixed fee tends to do anything other than tailor the effort to fit the fee, I’ll hold your beer and watch. Unless the work is so routine and uneventful, such as many tasks of engineering surveying tend to be, you’ll be kidding yourself not to say that there is time pressure in play. As time gets used up and the job isn’t moving along as planned, what should one realistically expect to happen?
Making a routine of fixed-fee surveying means that time pressure is always present. As fixed fees follow the marketplace downward, time shrinks even further and something has to give. It is a rational result of economics that fixed fees will inevitably produce in the marketplace for services. I expect that you see it at work in the residential survey bazaar on a regular basis. There the “surveys” are already a commodity to be purchased with time to deliver and price as the leading criteria for selection. It doesn’t take X-ray glasses to see what sort of products are generated to meet that demand and there’s nothing about the rest of the surveying market that would render it immune from the same downward dynamic.
The ethics of both fixed-prices and of franchise-sounding names that are intended to give the impression that the firm is as reliable as Enron or some other great monument to free markets, fall into the same category in the impression that they leave about the nature of the surveying services. Naturally there will be exceptions. I realize that you chose not to practice under your name as Cash Surveying since that would scare off too many customers in Oklahoma who might want to pay with a credit card or barter something for the work. I wouldn’t personally fault you for opting instead for Red Dust Surveying or some other colorful local name.
Tim Libs, post: 424665, member: 12482 wrote: Does this also mean that contracts should not contain any verbiage about timeline either? I’d think time constraints can argueably be more of a problem with cutting corners than having a fixed fee.
I’d think that a surveyor who commits to furnishing a service on a schedule that turns out to be unrealistic has made a fundamental ethical error. I see nothing wrong with giving an estimated completion date in good faith and revising that estimate as work progresses, but, say, someone whose business model involves charging high prices for ridiculously quick turnaround is most likely going to have a high failure rate.
Most of my work is done on a fixed-fee basis. I don’t like to lose money, but on some jobs I go over my proposal number. It doesn’t change the way I do things, it just means some jobs are more profitable than others. Despite this, I live well.
There are some types of projects that I can’t do fixed-fee, because I can’t predict the level of effort required within a reasonable margin of error at the outset. Those I do on a T&M basis. They tend to be large jobs, and they also tend to be very profitable. But they’re the kind that only come around maybe every five years on average, so for the most part I remain fixed-fee.
Many years ago I undertook the boundary survey of a large-ish ranch for a fixed fee. It was about 2500 acres of ground that hadn’t seen any surveying for decades in some parts, and more than a century in others. I blew the estimate badly, mostly because the number seemed so large, and midway through the job I had to go back to the client to explain the situation and ask to increase the fee. I offered to split the difference between my original estimate and the revised estimate, and he agreed without complaint. I probably could have gotten him to spring for the whole amount, but I felt bad enough about the situation that I didn’t want to saddle him with all of the consequences of my mistake. The loss was mostly in my own time rather than out of pocket, but it taught me not to commit to a fixed fee unless I was pretty sure that my number was in the ballpark.
With regard to the Texas ethical standards, if one were to take a rigid interpretation of them, pro bono work would be disallowed. How can one do a competent job knowing that they’re not going to make a nickel on the project?
Contracts with fixed fees is kind of like playing Texas Holdem. If I go into hands (contracts) with little experience I will probably lose more than I’d win. But with experience I’d get my money in where I’m a favorite to win more often than not. I may still lose some hands (go over budget), but it won’t change the way I played (surveyed) it because I knew I was going into it more likely to succeed than fail. Even if I’m on a bad roll (way over budget) it shouldn’t change how I’m playing (surveying) if the odds are with me statistically to win in the long term.
Kent McMillan, post: 424662, member: 3 wrote: Actually, what you are describing is not fixed fee surveying if you are doing the research for time and materials. I’ll even go so far as to guess that on some mineral surveys the research may approach or surpass the cost of the field work. I note that you don’t rebut the main points, i.e. that fixed-fee pricing tends to (a) encourage price competition and (b) to result in surveyors trimming corners as an immediate result. The anecdotes about how “I once lost a whole bunch of money on a job, but it made me a better person” are amusing in the singular, but in the plural are fairy tales when price competition is the rule.
Actually, Kent my initial research does not usually take much time. Over the years I built several databases for the Colorado mineral survey plats, field notes, connected sheets, Master Title Plats, Historical Indexes and patents, to speed up data collection. I also snapped digital photos of over 5500 pages of mineral survey registers housed at the National Archives in Denver. The below attachment is an example register page showing the information for eight mineral surveys (see the entry for MS 11568).
On occasion I need to visit the BLM Public Room or National Archives to obtain field notes that have not been scanned or to acquire the township triplicate plats, correspondence from the GLO Commissioner and/or the Land Entry Case File. The remainder of the survey is usually a fixed fee and includes any research at the county. If the client balks at the fee, I at least get paid for my initial research.
As for not rebutting your hypothesis, I don’t share your pessimism that fixed fees are an evil festering within the survey profession. You seem to believe that ethical surveyors will invariably and inevitably become corrupted by that evil. IMO unethical surveyors choose to be regardless of their billing method.
Edit: Here’s a photo of the 11 register volumes at the National Archives
Gene Kooper, post: 424674, member: 9850 wrote: As for not rebutting your hypothesis, I don’t share your pessimism that fixed fees are an evil festering within the survey profession. You seem to believe that ethical surveyors will invariably and inevitably become corrupted by that evil. IMO unethical surveyors choose to be regardless of their billing method.
I seems remarkably unobservant to think that not charging a sufficient fee is other than the main reason for the prevalence of poor quality surveying. The equation is obvious to me. For those who accept that premise that there is a nearly infallible causal connection between not collecting enough money to pay for all the work that should be done and some lesser amount of work being done, the question with broad ethical implications is which method of basing fees is the more likely to result in insufficient fees. The answer is pretty clear when price competition is a factor, as it it.
Gene Kooper, post: 424674, member: 9850 wrote: Actually, Kent my initial research does not usually take much time. Over the years I built several databases for the Colorado mineral survey plats, field notes, connected sheets, Master Title Plats, Historical Indexes and patents, to speed up data collection. I also snapped digital photos of over 5500 pages of mineral survey registers housed at the National Archives in Denver. The below attachment is an example register page showing the information for eight mineral surveys (see the entry for MS 11568).
That’s great that you were able to build up your private database and photograph more than 5500 pages of mineral survey registers without spending any time at all on it. I couldn’t do it, but even though it is upon its face impossible, I’ll take your word for it.
The way that most surveyors would work is that the time you put into assembling and organizing your copies of records would be considered an investment that the hourly rates would be structured to reflect.
Jim Frame, post: 424669, member: 10 wrote: With regard to the Texas ethical standards, if one were to take a rigid interpretation of them, pro bono work would be disallowed. How can one do a competent job knowing that they’re not going to make a nickel on the project?
I think that pro bono work should be disallowed if the end result is substandard surveys being produced because the whole effort is for free. Many surveyors do pro bono work as a way of inducing others to give them paying work. That is a smelly arrangement from an ethical standpoint.
Since no one else will say it I will go ahead and get it over with!
Kent is always right and the rest of us are blooming idiots and its a wonder how we managed to find the parking lot of the testing center much less actually passed the exam(s) to get our license. Even worse than that, the board continues to allow the rest of us to go around practicing surveying without consulting Kent to tell us how we have misinterpreted the rules, let alone even have a first graders comprehension of ethics and business practices.
Now Kent can move on to beating the next dead horse.
I don’t think that Kent understands fixed fee proposals because he doesn’t work that way. As I have mentioned before, I take a different view on my fixed fee proposals. How much is worth TO ME to do your project. That way my “value” is established. I have no regrets if I happen to miss that goal, either in my favor of the clients. I established the value, not necessarily based on time but on what it’s worth to me. I don’t keep timesheets, either, a huge benefit of working alone most of the time.
foggyidea, post: 424709, member: 155 wrote: I don’t think that Kent understands fixed fee proposals because he doesn’t work that way.
Well, what’s to understand? You propose to perrform a service that your client probably doesn’t fully understand for a lump sum price that the client assumes will meet the request as tendered to you. In the standard model that various practitioners have mentioned, the lump sum price is sufficiently high that the practitioner believes that he or she will make so much money on the transaction that he or she can afford to lose money on a certain percentage of projects that is discovered over time. Obviously, from the client’s standpoint they end up paying more than a fair price for the service and are never the wiser since they didn’t understand the nature of the work in the first place.
The practitioners of fixed-price surveying argue that there is nothing unfair about charging a client whatever they can get away with because the client agrees to it and it’s a free market for services. The problem, of course, is that only the surveyor typically really understands the nature of the work. So the client’s choice isn’t an informed one unless he or she has called several surveyors to get fixed price bids from them as well.
So, in that scenario, price becomes a measure of comparision as probably does time to complete. Once that becomes the accepted mode of operation, the stage is set for the flat spin descent in economic downturns.
I have worked on hundreds of Fixed-Fee projects over the years ranging from as little as 5k to 1.5 million and never once has price been the deciding factor. QBS laws around this area are well known by all and we all watch the agencies to ensure they are complying. Things must be different in Texas.
TXSurveyor, post: 424706, member: 6719 wrote: Since no one else will say it I will go ahead and get it over with!
Kent is always right and the rest of us are blooming idiots and its a wonder how we managed to find the parking lot of the testing center much less actually passed the exam(s) to get our license..
Actually, that’s a rule of the licensing board that I posted. I didn’t invent that. So conflicts of interest are inherently unethical and can at best be mitigated by a licensee’s disclosures to a client.
The surveyors who want to claim that taking on a project for a fixed fee that turns out to be insufficient to make money on the project doesn’t tend to place their self interest in conflict with the client’s interests are free to do so. It does sounds oblivious to reality.
I disagree, when “by the hour” pricing becomes the norm then the client can’t budget for your work, give them a range and they only hear the low end. Somebody pricing their field crew at $100/hour may spend much more time that I do at $200/hour, probably more than half because I can make a lot of decisions in the field that a crew chief will have to take back to the office, have the calcs done, and then return to the site. Also “by the hour” pricing lends itself real well to the “race to the bottom.”
I’ve only been doing this surveying thing for the past 35 years, and I have worked both ways. I hate hourly pricing, I hate arguing with a client why something took so long, and cost so much MORE THAN THEY EXPECTED. Since I’ve been on my own, I have been very happy, successful, and I think that my clients are happy. I have two that I have done over 100 projects with, each, and they return. several others with 20-30 projects each. My clients like to be able to budget their projects and appreciate a fixed fee proposal.
But, like I said, I have worked both ways, how about you, Kent? Are you king from first hand knowledge or just shooting from the hip?
By the way, I did find out that the governing board of land surveyors in Prince Edward Island, Canada, specifically prohibits fixed fee proposals exactly because of Kent’s issue.
WA-ID Surveyor, post: 424721, member: 6294 wrote: I have worked on hundreds of Fixed-Fee projects over the years ranging from as little as 5k to 1.5 million and never once has price been the deciding factor. QBS laws around this area are well known by all and we all watch the agencies to ensure they are complying. Things must be different in Texas.
Working under contract on surveying projects for government agencies would tend to be a special case because the scope and nature of services tends to be much better defined than the average member of the public can muster. Many of those same agencies may even have surveyors on staff to monitor contract performance and may not be shy about holding malperforming contractors’ feet to the fire.
I’d guess that less than 10% of all land surveying work in the US is performed under contract with a government agency, though.
foggyidea, post: 424726, member: 155 wrote: I disagree, when “by the hour” pricing becomes the norm then the client can’t budget for your work, give them a range and they only hear the low end.
That is certainly a human tendency, but survey estimation is self-correcting over time and a surveyor learns to produce estimates that are likely to be realistic.
By the way, I did find out that the governing board of land surveyors in Prince Edward Island, Canada, specifically prohibits fixed fee proposals exactly because of Kent’s issue.
Yes, it’s likely a cultural thing. The piratical free market in the US is considered to be healthy and good for reasons that probably won’t hold up to ethical inquiry in the long run.
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