Life-changing eye openers
It’s easy to imagine how many major and minor changes affected my life and my work beginning in the Great Depression. Then we entered into World War II, followed by the Korean War, the Vietnam War, the tragedy of the 9/11 disaster, recent Middle East conflicts and now another controversial presidential election.
During all those years, we endured many changes in the construction industry: new tools, materials, methods, equipment, regulations, technology, licenses and inspections. Flex-time work hours and virtual-office concepts also became popular.
I began my work day with two questions on my mind: Why change? Why not? Fortunately, answering these two questions helped me stay abreast of most changes at work, as well as in my personal life.
In all my seminars and in-company consulting, I stress the efficiency and profitability of delegating to a competent assistant. As computers and electronic equipment brought us data processing, software, email, iPods and iPads, cell phones then smartphones, digital cameras, websites, social media, etc., I depended on my secretary to handle it. When my secretary retired, I trusted my wife to keep me up to date. I am amazed my children and grandchildren can do what I can’t. This is one example of dropping the ball on my “Why change? Why not?” philosophy. And it turned out to be a bad decision on my part.
However, I’m thankful for all the good decisions I have enjoyed!
Today’s horrible economy is creating many doubts for many contractors. It’s not only a question of “why” you should change but “how” to change. I hope you are in this enviable group:
- Our net profits exceed our estimates.
- Our collections are on time for monthly draws and change orders.
- Our credit rating is excellent with our bank, bonding company and
- We have no court costs or unnecessary legal fees.
- Every project is completed ahead of schedule.
- Our foremen and project managers maintain a full eight-hours work
for an eight-hour paycheck.
- We control material and tool handling.
- We have a comfortable backlog of negotiated work to maintain our
- Our salvage center provides database skills training for our service
techs, plus an inventory of used parts and equipment for needy customers.
- Our service department is thriving on repeats and referrals from satisfied customers.
Management changesA contractor who is not enjoying those 10 positives definitely should consider the following how-to-change-management guidelines:
1. Post a written chain of command. Include proper titles defining specific authority.
2. Provide written job descriptions for every employee who is not fully supervised. You also will need a detailed performance file to keep track of how well each employee does his job. This updated file should be used to establish wages at scheduled reviews. Wage reviews for fully supervised employees must be conducted by their immediate supervisors.
All wages and benefits must be based on the cost to replace that employee in your work area. Seniority should be honored by recognition, but never by wages.
Union contractors should get involved in negotiating wages and work rules. Your foreman should use those work rules to maintain cost control on your jobsites.
3. Read and question the entire set of plans, specs and bid documents for each project. Submit RFIs for any doubtful or missing information and negotiate before signing the contract. And always value-engineer each project!
4. Promote from your present employees. When hiring, always ask existing employees for references. Never hire top positions; maintain critical pride that each employee knows he can move up to any position on your management team. Provide the opportunity for employees to do what they enjoy. They will earn more money and so will you.
5. Utilize your database skills inventories for effective training. Your foremen should share project blueprints and mentor each employee. And train foremen on human relations, cooperation with other trades, and time and cost control.
Use your salvage center for specific skills training. Your vendors will provide on-site training to demonstrate their products.
Training changesProbably the most abused attempt at training is called “on-the-job training.” Many companies have four- or five-year registered apprenticeship programs where the apprentice must attend evening classes plus learn the job skills.
Unfortunately, their wages are reduced and many apprentices are simply assigned to do cheap labor tasks. They must work with a journeyman craftsman who has no interest or training to help that apprentice learn the trade.
Why not change this abuse? Here is how to do it:
- You are bound by union
apprenticeship rules but you are permitted to pay apprentices a full
journeyman’s wage, if they can do the job.
- Assign the apprentice to a
mentor who was taught properly and has a sincere interest in developing the
apprentice’s skills and ability. The most effective training is called “role
reversal,” where the mentor becomes the helper and the apprentice performs the
- Brag about your
apprentice’s progress and increased wages. It’s a direct result of, “Add pride
to his life, his work will show it!”
- Naturally you also should promote effective on-the-job training without any registered apprenticeship programs. Keep in mind, many new employees have inherited skills and have worked for other contractors, including their fathers.
Join your local trade associations and attend state and national conventions. These are your competitors who socialize and cooperate to better our industry and their own companies. They can help you with legal counsel, permit problems, financial advice, bonding and banking, and making contact with manufacturers and suppliers. Attending convention seminars - plus networking with other members - will be interesting, informative and beneficial to your company. And it will be fun, too.
If you took over your dad’s successful business 18 years ago and you are surviving through this recession - why should you change? My question is, why not? You deserve congratulations for maintaining your family company. But doesn’t that make you wonder what else you could do?
1. Start a new company in a different market area where the economy is good.
2. Start a general contracting company or any of the other trades that might complement your existing company. We have many craftsmen with business licenses who are unemployed or working for wages who would be proud to share those licenses.
And you might have a wife or daughter who would appreciate you starting an all-female, dream-team service company.
3. Joint-venture a project to increase your capacity and bonding power.
4. Venture outside the construction industry with something you would enjoy, such as a restaurant, golf course or rental business.
The critical question for all these feasible options is simply, “Why not?”