Since 1997 J.F. Ahern has seen its profitability skyrocket 115 percent, while its revenue ballooned 31 percent.
“I think the rise is a direct result of focusing our efforts in the past one to two years on the fundamentals of mechanical contracting — compiling an accurate estimate, doing an adequate job of preplanning our work, utilizing the tools and equipment that our foremen feel are absolutely essential to getting their job done profitably,” says Tripp Ahern, president and chief executive officer of the Wis.-based company. “We focus very closely on knowing what our project costs are all of the time. So we aren’t surprised by any savings or overruns that may occur on a job.”
The company also places high emphasis on its employees through its new training program. J.F. Ahern employees are required to obtain 32 hours of training per year on a broad range of subjects, including leadership, planning, goal setting and communications skills, as well as technical training specific to their job.
“All the training is paid for by the company,” Ahern says. “Most of the training is done during business hours, but some of it is held afterwards.” Like Shambaugh & Son’s PIPE and PRIDE programs (see p. 90), J.F. Ahern has partnered with local schools to enhance its training programs — holding classes and seminars at the University of Wisconsin at Fond du Lac and Moraine Park Technical College.
“The program has been very well received,” explains Ahern. “What our employees like best about the training is that they have flexibility in when they can take their training hours. They have flexibility to choose the classes that they and their supervisor feel are most appropriate for their development.”
J.F. Ahern allows its employees to space training out over 12 months. Ahern says he doesn’t want his employees to feel inundated with tremendous amounts of training information compressed into too short of a time period.
Another key to the program is a $200 allowance to take any course the employee so desires. The employee can learn how to use a computer or take a class in fly fishing.
“I think it will take some time for us to determine how effective it really is,” Ahern adds. “The early signs are positive, and we feel there is a lot of enthusiasm for our programs. We’re looking for improvements our employees and company will make as a result of this training mission.”
Ahern believes dividends will be paid down the road with the company’s focus on training.
“It would be premature to say the training program we embarked on in late 1997, early 1998, has had an impact so far on profitability” says Ahern. “I think that the company’s commitment to training over a number of years has attributed to our profitability. We’ve been in business now for 118 years — you can’t stay in business that long unless you’ve been able to maintain profitability. Fortunately for us and for our employees, we do have a good track record for being a profitable company.”
J.F. Ahern finds most of its work in the upper Midwest, and hasn’t seen a rise in one geographic region over another, or in one segment of the company over another. The 550- employee company does work in fire protection, pipe fabrication, process piping, plumbing and water and wastewater treatment.
“We continue to place a high degree of emphasis on customer satisfaction because it leads to repeat work,” says Ahern. “Upwards of 60– 70 percent of our work comes from people with whom we’ve worked for before. I think the familiarity we have with our customers gives us a better opportunity to lower the project cost and perhaps earn some additional margin on that type of work.
There is still room for growth, Ahern says. “We’re confident about the future prospects of our company. We’re intent on seeing the company grow at a managed pace. We think that there is going to be a plentiful amount of new work opportunities in the upper Midwest.”
The sales growth is not going to be as dramatic as it was a year ago for J.F. Ahern, but Ahern believes as long as the economy continues to perform well, it will mean an abundance of work opportunities.
“Competition continues to be very strong, but that’s always been the case in our industry, and I don’t expect that to change any time soon,” says Ahern. “Nonetheless, I do think there is a good amount of work out there. Prospects for the future look very good.”