Profit isnota dirty word! Last month we covered some of the bragging benefits of flex-time that your employees will proudly use to recruit their friends and family to work with you. Our motto - “Make a good life, not just a living” - applies to contractors and their employees. Wouldn’t those extra profit dollars sweeten your good life?
When you consider all of the rocks on the road our industry struggled with in 2006, compared to your bottom-line profit picture, I’m sure some of you readers were not pleased.
- Material prices skyrocketed.
- Escalation clauses were needed in most contracts.
- Our skilled labor shortage turned into a crisis.
- The home-building market slowed down.
- Insurance and overhead costs continued to rise.
- Bid prices were slashed just to get a job.
Fortunately, the 13 “Just Say Yes” items we covered in the September 2006 article will guarantee your make-a-good-life, not-just-a-living hopes and dreams.
Now, let’s look at the fantastic profit-producing benefits for any contractor who simply asks each individual employee, “What days and hours would you like to work?” This may sound too good to be true, but there are no drawbacks with flex-time. Everybody wins!
- - Your employee and his or her family now enjoy the good life.
- Your customers appreciate getting their projects done on time.
- You capitalize on your reputation for offering the best job in town and by beating critical schedules.
The only losers are your competitors who continue to work traditional five eight-hour-day work weeks.
Flex-Time Profits: In addition to all of those blessings, let’s look at some of your new profit dollars. These savings will vary with the size of your company, the type of work you do, and your market area, especially with travel and subsistence expenses. But you can easily surmise how much each of these conditions are presently costing your company and do the math.
1. Utilizing 3-13s on local projects saves you and your employees four trips per week. (Traveling is extremely costly when you must pay travel time as well as travel expenses.) You can bypass frustrating and costly rush-hour traffic jams. You can also save four job mobilizations and four de-mobilizations each week.
Weekly rental rates on welding machines, backhoes, forklifts, man lifts, tampers, scaffolding and miscellaneous tools or equipment are cut in half when you work two shifts each week. Your office and company overhead applied to each project is also minimized.
You also reduce the need for costly time-and-a-half overtime and the risk of liquidated damages on critical path projects. When extra help is needed, you always have the second shift at home. These workers are already familiar with the actual tasks on that project.
You can use part-timers from the other trades - factory workers, sales people, teachers, and above all, college students. Your flexible work hours can be coordinated with their other commitments and do not result in overtime.
2. On out-of-town projects where your employees must be away from home, all of those 3-13 savings apply, but 6-13s also save the time and cost of one long-distance trip to the project and one trip home for each week’s work.
For example, employee A travels to your project on Sunday and works his full week on Monday, Tuesday and Wednesday. He remains at that site and works his second 3-13 on Thursday, Friday and Saturday. Employee B travels to that same site on Sunday and repeats the 6-13s. You can hire local help to work either of the 3-13 shifts or your 6-13s, which provides a four-day weekend of 26 full weeks at home.
In addition to the cost-savings for travel time and expenses, you also will save by renting motels at a weekly rate. Here again, you always have the second string on the bench for meeting critical path schedules.
3. The biggest cost-savings, and most popular 3-13 flex-time options, belong to service contractors. You can start with having only one stocked service truck ($30,000 to $80,000) for two service techs. You can also provide after-hour service, for which most customers expect to pay premium time, without paying overtime to your service techs.
4. Prefabbing and preassembling at your shop or in a temporary jobsite fabrication facility will save you more than half of your installation labor costs. You minimize your need for jobsite labor to maintain critical path schedules. In addition to phenomenal cost-savings, your fab shop’s availability 24/7 provides you with these benefits:
- Employees can work any hours needed for a full week’s paycheck. Bad weather, jobsite delays, personal “good life” commitments and time lost for feeling ill, etc., would otherwise result in an unhappy employee.
- Your fab shop is an ideal facility for task training and skill certification. You can easily understand how those flex-time hours can be coordinated to meet your mentor’s good life.
5. Although four 10-hour-day work weeks do not provide nearly as much cost savings for your company, it should still be available as an option for your employees.
6. Your entire management team and your office staff also have flex-time options that will save you actual dollars, as well as providing that good life for them.
- Top of this list is the virtual office. This allows employees to work at home. Naturally, the biggest benefits go to your employees with no daily travel time and costs. Employees with small children will save babysitting or child-care expenses. They can also save on special work clothing.
The company’s biggest savings involve the costs of owning and maintaining office space and having after-hour availability for emergency or service calls.
- Here again, you will have those happy, bragging employees recruiting their friends and associates.
- The good life’s high morale among your management team will increase productivity, improve cooperation and communication, and create profit-producing customer relations.
I’m sure you’re wondering, if flex-time is so profitable, why aren’t more contractors doing it? I’ve never conducted a study or a poll, but my exposure with thousands of contractors in all 50 states and most of Canada shows that less than 10 percent are using it.
Aren’t you glad? Isn’t it nice to compete with that mentality? You have all heard their comfortable excuses:
- - We can’t find good help and our turnover is horrible.
- Our morale and productivity is low in our office and on all of our jobs.
- When we considered changing to 4 -10s, most of our employees threatened to quit.
- The companies that we know who tried flex-time could not measure or control productivity.
We never recommend changing anything for your employees. Instead, offer options for them to decide. Measuring and controlling productivity must be done with or without flex-time. You can use cost-coding, job descriptions, daily 6-8-10 scorecards, or basic piecework.
Naturally, this decision is up to you. Almost every major business decision I’ve made is money-motivated: how much will this cost vs. how much will it make. That makes flex-time a very easy option.
If you need help, call me at home (407/699-8515), on my cell (407/467-4916), or e-mail me at jcridilla@aol.com (subject: PM magazine article).
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