Double Your '04 Profit With Simple Math In '05
How many of you visit your jobsites at starting time, coffee breaks, lunch time and quitting time? Did you ever look at your watch to see how much of your profit is going down the sewer?
We had a long discussion with a group of PHCC contractors who were totally amazed at how much money all of these wasted minutes were costing them. As we sat and did some simple math, the larger contractors could not even believe they were allowing all of that outright stupidity.
They all agreed their crews were probably at their actual work sites somewhere between six and seven hours each day:
- 1. Starting time averaged 15 minutes late.
2. Two 15-minute coffee breaks averaged a half hour each.
3. Half-hour lunch breaks wasted an additional half hour.
4. Quitting time was another 15 minutes wasted. Some of them allowed “pick-up time” for tools, which was misinterpreted as being in your pick-up to go home.
Fortunately, we did not do this math until after we finished our lunch because some of these men would have been too upset to eat!
Seven and one-half hours multiplied by $30 per hour equals $225 per week, or $11,700 per year for each employee. All of a sudden, everyone realized we were not talking about wasted minutes. This was their companies' money!
Of course, some were below and some were above that average. One contractor had over a hundred employees and sadly remarked that they were definitely not getting a full six hours each day. I told him to do his math and then give me a call so I could show him how to remedy those losses.
Another contractor sheepishly said, “Everybody else is doing it and our crews feel that it's OK. How could we possibly change it without losing all of our good employees?”
I answered, “Do you realize that you could give every single employee a $5 per hour raise if they worked a full 40 hours for their paycheck? You'd even have some money left over for yourself!
“Of course, that approach would be ridiculous. You are already paying them a fair wage to work 40 hours and all you need is basic leadership and discipline from your jobsite foremen. Were they ever taught how to train, motivate, discipline, monitor and measure their employees?”
The Capon AnalogyAnother contractor interrupted with, “All my foremen get a good eight hours work from each employee. They've been to Paul's foreman training seminar and always joke about his 'capon' comparison.” He then asked me to explain that to the other contractors.
I told them that, during each of my foreman human relations seminars, I explain the vital dollar cost of those wasted minutes. Most of my attendees are embarrassed until I assure them that their bosses should have explained this before they were put in charge of controlling that much money. As you know, most foremen in all trades are promoted from journeyman to foreman without even one hour of orientation or training.
I then tell them that they are not being unkind or unfair to ask each employee to work a full eight hours in return for a full eight-hour paycheck. We then go on to basic discipline, which is always difficult for any superior, especially without proper training.
I use this example:
Starting time is 7:30 a.m. and one of your crew shows up at 7:40 a.m. Do the other employees know that he or she is late? They also know that you are the boss and you are aware that person is late. They simply watch to see what you are going to do about it. If you don't react, what time do all the others come in tomorrow?
That old saying, “Are you a man or a mouse?” doesn't have too much effect today. So I like the word “capon,” which many of these foremen have never heard. I explain that a capon is a castrated rooster that grows exceptionally large, and that some families use for holidays and special occasions, rather than a larger turkey. I emphasize my disciplinary principles with, “The only reason those men work less than eight hours is the company sent out a capon instead of a foreman to run that crew.” That gets their attention fast!
The Need To DisciplineIt is easy to understand why it is so difficult for an untrained foreman to discipline employees and most of you have heard these worn-out excuses:
1. I don't want to give my buddies hell.
2. I don't want to be an s.o.b.
- 1. If he or she were truly your buddy, you would never have any reason to discipline. Everything they do makes you look good or bad as their boss.
2. You are not being an s.o.b. by doing exactly what you are paid to do.
- Employees need written rules that they agree to and sign. You should never say, “You should have known better.”
- When an employee breaks those rules, you need to discuss the situation in private.
- You need to document and date the incident and place it in his or her file.
- If he or she repeats the violation, you need to discuss it again and get him or her to sign a written second notice.
- Three strikes and the employee is out.
The next question came from a contractor with 60 employees. “How long does this foreman training seminar last? There is no doubt that we need it desperately, but we can't afford to send 18 foremen and shut down all of our jobs.”
I told him that his company was big enough to have me come to his shop and do an eight-hour program from 1 p.m. to 9 p.m., which would allow his foremen to start and organize their projects for that day. We also do winter programs in the northern states, as well as Saturday or even Sunday when necessary.
In addition to discipline, this foreman program also includes basic guidelines to avoid mega fines and litigation:
- Following OSHA's rules will help prevent costly injuries and eliminate serious violations.
- Preventing any type of discrimination or sexual harassment.
- Basic rules for avoiding unfair labor practices.
- How to deal with union workers and officials, especially with a picket line or organization drive.
- Maintaining an accurate job log.
- Initiating CYA letters as needed.