The root cause of your problems could stem from chronic satisficing.  Or, perhaps you have survived the economic downturn and look to emerge from survival mode and grow.  Or it is even possible your sector of the construction industry is recession proof – think renewable energy.   Yet you feel you are not running a great company or even a very good one.

The notion of owning, building and running a great company may be a worthy goal that could take a lifetime to achieve.  However, bragging rights also come from leading a very good company.  Becoming very good does not take forever.

How to distinguish between very good and great?  When your firm is very good your forward view in the key performance areas allow you to say:  ‘I see some but not much room for improvement.’ Improvements in any one of the areas below can lead to higher margins.

Please recall, the math is compelling.  To get an assessment of your plan to improve in any one of the areas noted below, or, if you need help devising your initial plan, call Ron Lewis.  The initial conversation is free.

Is your ‘chronic satisficing’ standing in the way of your company becoming very good in the following areas?

Leadership

Problem: You have a disquieting feeling that your company is either not performing at the great level you envisioned or is heading for the ditch and you don’t know what to do.

Solution of Value: Become ready willing and able to improve.  Plan to improve, execute the plan.  Knowing where to steer the bus and making sure your team is doing so requires the right leadership skills.  Leadership is the ‘what’ and the ‘why.’ Managing is the ‘when’ and the ‘how.’ Ascending to the top executive level is not by itself a guarantee you have all of the knowledge, skills, abilities and attributes to be successful.  This is perhaps a most difficult realization for owners and executives.  They find admitting the need for help humbling.    Find the right help.  Doing so takes daring.  Not doing so in the long run is often far more problematic.

Results: Saying goodbye forever to ‘chronic satisfycing’ and realizing your vision that answers this simple question: ‘What do we look like when we are as good as can be?’

Vendor Relations

Problem: Your vendor relations are defined by conflict, disorganization, maybe even distrust.  You are often starting over with new subs and suppliers,  your vendors are blaming you for their shortcomings or are you blaming them for yours.

Solution of Value: Plan for mutually beneficial vendor relations.  Devise the right outcome and learn to negotiate for it.  Often too little effort is spent on the areas that consume 50% to 70% or more of Cost of Goods Sold (COGS). Continuous bidding for the lost cost vendors has significant drawbacks.  The solution is to build sustainable and mutually beneficial relationships with your vendors and make doing so a strategic initiative so it becomes part of the backbone of your organization.

Results: A forward leaning relationship with your vendors that results in you having confidence they are helping you spend your money wisely.

Procurement

Problem: Your cost control / procurement system is disorganized or ineffective.  There is no synergy between it and how you undertake vendor relations.

Solution of Value: Procurement must be an executive level responsibility. No successful procurement system is complete without a comprehensive purchase order system.  And both are connected at the hip with a strategic commitment to healthy and vigorous vendor relations.

Results: You are acquiring goods and services not just at the right price but properly aligned with all of the project objectives and you have healthy working partnerships with your vendors.

Cost Accounting, Cash Flow Management and Controls

Problem: Your job cost subsidiary ledger present convincing evidence that you are not capturing your planned margin on each project.  Your slippage rate and post-closing warranty spending both seem too high. Even worse, you don’t know.

Solution of Value: Set benchmarks.  Hit the benchmarks and then slowly improve further.   Use industry best practices for guidance.  Plan to know how much you spend on what and how much you are going to spend on what.  Both are essential for business survival and must be tied to an effective cash flow forecasting tool.  It seems obvious but more companies can do this better.

Results: Accurate, complete and timely financial metrics to steer your company by.

Quality Assurance (QA)

Problem: You have no formalized QA system.  Your punch lists are too long and you believe employing punch-out personnel is the only remedy.

Solution of Value: A formal system that models or fully adheres to the NAHB’s National Quality in Housing program is doable for any size or type construction company. Employing punch-out personnel in many cases represents your desire to throw good money after bad.  Vendors need to be contractually required to adhere to your QA program.  More importantly, your vendors need to commit to helping you design and implement the system.  It is far better to gain their commitment then to extract their compliance. You can’t have a successful QA program without full vendor commitment. Benefits will accrue to them too.

Result: A system that compels your venders to know what is right and tells you when they have done so.  Producing superior quality assurance can be implemented without adding staff.

Scheduling

Problem: You have no formal scheduling process (sorry, no chicken scratch on napkins allowed) or you do but your Work Breakdown Structure (WBS) is ether too vague or overwhelming.

Solution of Value: Commit to a formalized (computerized) scheduling system that is field operations, employee and vendor friendly.

Results: Formal planning with confidence so you can take pride in the plan

Project Management

Problem: You believe your project manager(s) are really glorified clerks of the work and have not been taught proper project management – set up to succeed.  They tend towards being reactive (fighting fires) instead of being proactive (planning, and then compelling events to occur per plan (a Lee Evans favorite)).

Solution of Value:Plan to employ effective project managers.  The Project Management Institute defines project management as “the application of knowledge, skills, tools, and techniques to project activities to meet project requirements” (PMBOK Guide, 3rd Edition, Project Management Institute Inc., PN, 2005). Said differently, project management is a discipline of initiating, planning, executing, and controlling resources with the goal of completing specific deliverables within budget and time. In short, make it happen.  Successful project management is not as easy as everyone thinks but can be done remarkably well with the right commitment.

Results: Success in the areas of time, budget and quality while achieving the most important deliverable - customer satisfaction.

Human Resource Management

Problem: You believe some of your employees are unhappy or under performing.  Your turnover too high.  You don’t know why.

Solution of Value: Inspire your employees to excel by setting them up for success.  Implement the right tools for recruiting, hiring, evaluating (objective performance metrics), retaining.  Get the right people in the right seats on the bus and keep them on the bus.  Doing so is essential for the success of any business.  It can and often does happen in firms that commit and plan to employ the right team.

Results: Low turn-over.  High moral.  High performance.

When you are ready, willing and able to break from the vice grip of ‘chronic satisficing’ and implement the formula for success for your firm – R B Lewis & Associates -  is ready, willing and able to serve up a meaningful assist or two.  Our focus is on the right transfer of skills and how your firm will be improved when our work together is done.

Call R B Lewis & Associates.  The initial conversation is free.

R B Lewis & Associates
Anchoring Excellence the Foundation of Your Business

Home | About us | Mission & Values | Words From My Peers | Our Core Values | Our Mission | Solutions that work | Why Hire A Consultant | Our Services | Contact Us|Vote For This Site!