What do you do to set your construction company apart from your competitors when viewed from a marketing perspective? How do your clients perceive your firm vs. how you and your employees perceive your firm? What is your competitive advantage and how do you exploit it? Better yet, how do you go about simply getting people to put your firm’s magnet on their refrigerator and call you first?
Developing a marketing plan for your company does not have to be expensive. It doesn’t have to be overly high tech or include a “wow” factor. It doesn’t have to have a stamp from an MBA or include tens of thousands of dollars in the budget to be successful. At the end of the day a marketing plan doesn’t mean just advertising, it means conveying the “sum of the experience” that your firm offers. We can all place an ad in the paper. But can you pen articles for a local newsletter, or handwrite thank you notes to past clients and clients that you have met with? Where are you when it comes to thought leadership? Are you seen as an expert businessperson or an expert craftsman – or both? It isn’t just about placing an ad, it is about the venerable 4 – P’s of marketing: Product, Price, Place and Promotion. Notice that advertising (promotion) is only one aspect of the program.
Product:
What is it that you are selling? We sell a service that is dependent upon numerous products. Become as expert in your products as possible, but tout service if you are a high service provider. Service is the difference in most cases. It is important to actually back up your service claims with actual action or this will backfire in short order
Price:
Are you selling on price? Service? Believe it or not I believe that there is a market for firms in each category. But you must understand your target market and build your strategy accordingly. Very seldom will the markets mesh – you can’t be a low price volume firm marketing to demanding service oriented customers. No one will win in that arrangement.
Place:
Define your region that you have the most clear cut advantage in and exploit it for all it is worth. If you narrow your focus to those areas that have provided you with work in the past, your marketing dollars will go further and your success rate will climb. Blind marketing may yield results, but the yield will be much less efficient than defining the geographic areas where you have an advantage. Expand your regions of focus slowly and with thought, not just haphazardly.
Promotion:
Advertise; provide thought leadership (articles, lunch and learns) develop how to videos, tighten up your website; get interviewed on the radio, etc. Pick a firm color and roll with it. Pass out shirts with your logo on them. Sponsor a lunch for past clients, maybe an annual “Friends and Family” type of event. Bring in your subs. Bring on a forum of experts to discuss issues of the day. “Green” topics work well (at least until the tax credits run out at the end of the year!) Sponsor a good deed – it is amazing what a team building exercise this can be.

I’ve seen so many great ideas. One firm I know hands out excellent quality brooms with their logo emblazoned on them to homes near where they are working, extolling the level of “Care” that they provide to their clients. Another pays an artist to draw a pencil rendering of their home or office, frames it and presents it to the client after the final punchlist. We have used a “Good Neighbor letter” for years with great effect. We’ve also been diligent in handwriting thank you notes to people that have honored us by working with us or allowing us the opportunity to legitimately compete for their work, even if we were unsuccessful. We ask when we don’t get the job what we could have done better and learn from the responses, unless the client was driven only by cost. If that is the case, we learn that we didn’t screen them well enough and learn from it.
Developing a marketing package need not be an expensive proposition. In fact, many times marketing can cost a postage stamp. The key point that I am trying to make is that it is critically important to develop your own marketing plan and stick with it. Develop your own “stamp” to imprint on clients. I would love to be the company that “Dropped that darn broom on my porch” the other day when that client is thinking about building an addition. I would love to be the company that brought thinking capital into the workplace and discussed aging in place to a group of baby boomers or green technology to young families. We have the knowledge to market effectively, yet many (if not most) of us don’t do it and depend solely on word of mouth. Word of mouth is great – but that is only one P of the 4 P’s – don’t neglect the other three. And have some fun while you are doing it.
I would love to hear some low cost methods of marketing you have used successfully in the past.

I am not an actuary or a statistician, but my guess is that overall morale in our industry is quite low.  Employees who once worried about climbing the ladder of responsibility now feel that they are fortunate to have a rung to hold onto.  Business owners fear making payroll.  Production managers who used to fear they wouldn’t get all of the work on the board completed and on time may now struggle to keep people busy.  Even if your company is maintaining performance metrics, the evening news is filled with down notes.

I often discuss corporate culture in this blog and the vast impact that a sound culture has on a company’s bottom line.  If employees “buy in” to the program that the company promotes, everyone benefits.  Folks get to work on time.  Jobs can be finished quicker.  Pride in ownership displays itself.  But I believe a part of this equation is employee morale.  This is a tough time for all of us, and many construction business owners who are struggling to fill job boards and make payroll don’t have much sympathy for staff.  But your staff, even if they aren’t directly feeling the heat from reduced hours, pay or benefits may still be struggling.

I recall a time in my life when interesting projects that involved the use of my seldomly used timber framing tools was all that was needed to keep me motivated.  Working on many of the house museums in Savannah, GA, also helped me get excited to work each day.  But then marriage and family came, and my focus changed with their arrival.  Setting a timber truss wasn’t the only thing I needed to stay motivated.  I needed other things - job security, insurance and a check each week.  Our staffs are feeling these same pressures coupled with a deep uneasy feeling that something in our economy just isn’t right.  They may not be able to address it in scientific terms, but they know that something just isn’t right.

Now is not the time to withdraw to the daily struggles of the corner office and wall yourself off from staff.  To the contrary, now is the time to interact with them, and get a solid feeling of your construction company’s working pulse.  Meet with carpenters, team leads, superintendents and project managers. Most of all, communicate to your employees every bit of information that you are willing to divulge.  Empowering staffs with information won’t make them cut and run – instead, it will help them to better understand fundamental economics that are impacting their career and employer.  Ignoring questions of staff morale will surely lower it.

The gulf oil spill has given those of us in the construction industry a valuable lesson.  My guess is that if I took a straw poll of contractors, 99% of them would submit that they never cut a corner to reduce costs and speed up a project.  While the vast majority of them would be telling the pollster the truth, I would estimate that quite a few would be lying to both the poll taker and themselves.

I am certainly no expert in prospecting for oil, drilling wells or collecting crude.  In fact, I know very little on the subject.  But I do understand intimately well the pressures that we all face to keep our projects on time, on budget, faithful to the drawings and specifications and accident free.  Most of the time these goals are mutually inclusive and fit hand in hand with one another.  Sometimes, though –extraordinary time or financial pressure exists to subordinate one of these fundamental goals to the others. 

Don’t do it.

One of the great things about our industry is that much of what we are supposed to do is scoped out, drawn and specified for us beforehand.  The better the bid package, the less confusion and opportunity to skimp on details exists.  While this may sound like an advertisement for the American Institute of Architects, make no mistake that many important details are left out and remain up to the general contractor to faithfully execute.  Most of these issues have industry standards as a guide, but again some are open to interpretation.  When we sign a contract, our companies are given the fundamental trust by our clients to faithfully execute the bid documents and to perform all phases of the project to or above industry standards.

What the gulf oil crisis teaches us is that no time constraints or financial pressures are great enough to cause us to not perform our work to acceptable standards.  Checks and balances must remain in place at all times and not ignored.  Warnings from subcontractors must not go unnoticed.  Problems cannot be simply buried under stories of earthen backfill, hidden behind a layer of ½” drywall or sunk below a mile of ocean water.  These checks and balances exist to mitigate future damage or, especially sad in this case, eliminate the loss of life and property and the destruction of precious ecosystems.

Ours is an inherently dangerous endeavor.  Powerful equipment, falls, etc. are all part of our chosen profession.  Entire industries have sprung up to help make construction less dangerous and safer for our employees and clients.  By making our projects safer, we save lives and property and build our reputation.  But no industry exists to check and double check each and every phase of our work.  That alone is up to us and our project teams.  Each person must be empowered to have input.  Each issue must be addressed.  And above all, we cannot allow any of our fundamental goals to exclude the others.  Doing so may cost us a bit more at the time, but the cost of skimping on quality and not constructing to  or beyond acceptable industry standards will be paid for generations.  

At the end of the day, we have a solemn duty to do what is right, not just what we can get by with.  The scary thing is I understand where the pressure comes from.  We are all under it nearly every day.  I can put myself in the position of the project manager who is told it “should be good enough” by a subcontractor and struggles to balance costs, time and safety.  Some instances in life are the kick in the mouth we need to avoid complacency and acceptance of anything less than our best.  The photos of shrimp boats skimming for oil rather than shrimp is an image that should convince us that “sort of ok” is just not good enough. 

As an industry, we simply cannot tolerate “good enough” or assume that problems, once buried, won’t have catastrophic consequences down the road.

As many of you know, the current economy has created tough competition among contractors. Since construction is expected to rebound more slowly than other industry segments, the biggest challenge for construction business owners is figuring out how to weather the continuing economic storm. Many contractors are bidding jobs at a loss just to keep work coming in the door. But this isn’t the best survival strategy, since building a backlog of low-paying projects will leave you with limited resources when more profitable jobs return. A smarter approach is to cut costs, increase efficiency and downsize your staff to a core group of A-players.

In construction, your A-players are the moneymakers who consistently get the job done – on time and under budget. Keeping these people on your payroll, and giving them the tools they need to optimize productivity, is your best bet for enduring the rest of the recession. Fortunately, the leading construction software technology trends support this endeavor by increasing efficiency in the office and the field. Electronic document management systems and wireless field-to-office solutions are the newest technology tools to hit the construction industry, and they offer the greatest potential for helping contractors accomplish more with fewer staff. But if you’re still using a generic accounting program, replacing it with integrated construction-specific accounting software will also deliver immense productivity gains.

At ComputerEase, we’ve used the less-frenzied pace of the last few years to cultivate stronger relationships with our clients and to better understand their needs. We discovered that better communication between their office staff and field force was a top priority. As a result, we developed FieldEase for the tablet PC, an easy-to-use suite of wireless field and service management solutions that turn paper-based field processes into paperless transactions. While some construction software vendors have scaled back their development plans, ComputerEase has done the opposite. We remain competitive by staying on the forefront of product development, striving to understand how new technology will benefit our users and continually enhancing our existing solutions.

Our most successful clients are using the slowdown to refine their internal business processes and put new technology in place that will help them to capitalize on the inevitable upturn. The earliest adopters of FieldEase, for example, are achieving enhanced cash flow through more accurate job costing and same day billing for service work. Other companies are streamlining invoice routing and approval by implementing our Electronic Document Processing solution.

Although 2010 will likely be another year of financial uncertainty, construction business owners that invest in their company’s future by cutting costs and embracing technology have the greatest opportunity to survive the downturn – and thrive during the recovery.

We have all read about it and probably experienced it‹when the economy is strained, businesses cut back, and more often than not, marketing and advertising is the first expense that gets cut.

When a business struggles to get work and cash flow slows, the business owner often decides to stop spending on marketing and advertising. But marketing and advertising generates the work, so this isn¹t particularly logical. Yet, it has been happening in many businesses throughout the United States over the past year and a half.

Interestingly enough, I have noticed some companies have actually begun marketing more regularly to the construction market; these are businesses determined to maintain a presence in construction. Through regular advertising in this industry, they are keeping their brand visible and apparent to the construction business owner. These businesses know that construction will build again, so to speak, to be a productive, profitable, evolving industry. And each of these companies wants to be the first one you think of when you need what they have to offer.

You, too, need to keep your name and brand visible to your customers and prospective clients. Marketing a construction company takes effort, and if you have had to cut your marketing budget, then find creative, less expensive ways to keep yourself in the minds of your clients.

Don¹t let them forget you. It takes very little time for your name to be forgotten. Rethink your budget and your time spent on keeping your name in the mix.

Keep attending local events and chamber of commerce functions; contact your clients and past clients through phone and mail; and do everything you can do plus a little more to keep your brand alive.

Don¹t cut the expenses and efforts that generate the business. Keep your business presence constant with your customers to make it through this very tough time and profit down the road.

I don’t know about the rest of you, but I’ve noticed something very positive that has occurred in this recession and for the past few years.  Nearly every where I look, from the Discovery Channel to PBS, I see a movement that embraces blue collar work.  It doesn’t take much effort to find sites such as MikeRoweWorks.com that celebrates “…all aspects of hard work”.  It takes even less effort to sense that our manufacturing base – long forsaken to cheaper currencies and labor, is beginning to understand the virtues of building things at home.  In my home state, the Construction Education Foundation of Georgia (www.CEFGA.org) is developing curriculum to help teach our future builders outside of a standard apprenticeship program.  Indeed, building things is becoming cool again.

What does this mean for the construction industry?  It means that our craft is slowly, perhaps painfully, becoming a hip place for people to work.  We may be on the precipice of a movement that embraces Builders and Tradespeople as those who have sought meaningful work – not those left out of the movement towards professional services.  It wasn’t long ago I cringed in reading that America would become the accountants of the world.  That may yet indeed be the case, indeed I hope it does.  But that doesn’t mean we also shouldn’t make it a goal to become the designers, builders and tradespeople of the world, either.

But with this sea change must come the understanding of responsibility that we share as business owners and managers.  In order to capitalize on this movement we must provide opportunity for people to grow and prosper, not just earn a paycheck.  We must develop and promote our industry as a viable alternative to professional services and white collar work.  We need to accentuate the positive and fix the negative connotations that our industry has long been saddled with.  We need to reach those kids who want to become the Green technology innovators; the building scientists and the affordable housing problem-solvers of their generation.  I have written about this on several occasions and will say it again here – Ours is an industry that can know no limit for a bright, ambitious, imaginative mind.  But we have a long way to go for the hype of the moment to match the reality.  We don’t have to be the job of last resort for the broken set – but our tent should be large enough to provide anyone with ambition and talent an opportunity to grow. 

In this era of 40% revenue reduction and staff cuts it may be difficult to project out 3-5 years and see this coming.  But there will be more work someday.  And we have every opportunity to get quality people that we never thought would choose our industry, and allow our current crop of over-achievers to light the way and provide guidance.  Hard work has always been rewarding  and, in many case, enjoyable.  It is about darn time that the conventional wisdom of the era is catching up with what we already know – building things is just plain cool. 

I read this past week that employment rates may be slower to rise due to the fact that employees have become more productive.  I assume these analysts mean more productive due to layoffs and that fewer employees are expected to get more done. Employees are doing just that, mostly because anyone with a job is just happy to have one and scared of losing the one he/she has.

Some of this increase in productivity may be due to investing in technology, some may be due to the fact that people are working a lot more overtime and some may be due to the fact that some businesses were overstaffed before the recession hit. 

Businesses are slow to rehire after a recession.  If you have had to lay off staff or not replace staff lost due to normal attrition, you tend to be hesitant to build that staff back for fear of starting the process all over again.

If you are in a position of trying to decide to hire again, take the time to evaluate what your current staff is doing.  Can you use outside employment/labor services to assist you in the busier times and avoid increasing full-time year-round staff?  Do you even know what your staff is doing? Work on your organizational chart, and write out new job descriptions for your staff. 

During this very tough business atmosphere, you may have stretched people thin with little thought of what assignments and responsibilities were being assigned where.  People just took up the slack, with no consideration of strengths and long-term employee or business growth. And you may think that if work is getting done, then what’s the point of hiring? The work may be getting done, but is it getting done the most efficient way? Sometimes one smart new hire can pay for hiscompensation and put profit on the bottom line in a very short amount of time.

Is your business now organized and positioned for maximizing long-term growth? As business begins to pick up, truly evaluate how the workload is allocated, and rework those systems and job descriptions with a forward-thinking approach. 

You may well not want to do things the way you used to do them, but you will always need the right people on the right jobs to build your business.

I have to travel often for work, so I am a frequent flier on a large carrier located here in Atlanta.  I am fairly comfortable with the service they offer.  I feel that the airplane is airworthy and relatively clean; the crew is well trained; the staff members are reasonably courteous.  Aside from the baggage fees  that I don’t use because I  carry on luggage only and the fares that continually inch upward, I don’t feel that I have too much to complain about.

The other day I was in Dallas and flew on Southwest airlines for the first time.  I wasn’t too crazy about the method of boarding, but was pleasantly surprised by how efficient the boarding process was. The gate agents were courteous and the flight service crew seemed comfortable and excited to be at work.  The over-riding theme of the day for me was “Happy”.  Everyone associated with that flight in a Southwest uniform projected happiness and a fun atmosphere shrouded in excellent professional etiquette.  The standard FAA required pre-flight briefing was fun and even, dare I say, entertaining.  I didn’t feel cheated because it wasn’t delivered in a dour monotone.  I didn’t feel less safe because the attendant made a few wisecracks in the middle of it.  In fact, for the first time in a long time, I actually listened to the briefing!

The culture at Southwest has been written about ad nauseum.  Staff are empowered, executives are humble and focused; flight crews are excited to be at work; customer service agents seem to actually like serving customers.  How did they do it?  How did they create this culture that can only breed self fulfilling prosperity?  What can we do at our own organizations to make life more tolerable for our employees who then project that image to our clients?

Culture change doesn’t happen over night.  It doesn’t happen in a month, either.  Culture modification is a profession in and of itself.  But in our construction organizations, I feel it doesn’t have to be.  As we continue to step through the worst economic downturn in decades, take a moment to analyze the culture of your firm.  Are the employees genuinely happy to be there?  Do they have a stake in the outcome of your organization aside from the proverbial pay check?  Are they empowered to offer ideas, point out problems and own the solution?  The first step to modifying culture is defining what you want your culture to be.  Too often we allow someone else to define who we are rather than defining our own companies.   Too often culture shifts from one crew to the next without displaying a focused message.  Too often we retain the rotten eggs with the understanding that all the eggs must be rotten, so let’s just stick with those  we currently  have.  Are your jobsites clean and well marked?  Do your superintendents own the project that they lead or simply act as a conduit to someone else?  Is every member of your staff asked to bring ideas and solutions to the table, or told to sit tight and watch the pros work?

Culture may be the one item that can’t be quantified in any legitimate manner, yet has an enormous impact on your company and client service.  Not all service companies can project fun in their marketplace like Southwest does.  But that doesn’t mean that we don’t define our culture and surround ourselves with staff and managers that support that effort.  A little bit of effort at making your company a rewarding place to work will pay off in spades in customer relations.  One short flight on an airline made all the difference in the world to me.  I will now actively pursue that company to pay my travel dollars to when the situation arises when I can use them.  Imagine that each interaction with a potential client does the same for your business. 

How do you want to be perceived?  As the company that is just going through the motions, however rote they may be, or the company that is focused like a laser on projecting the best customer experience possible from initial contact to signed punchlist?  As a customer, we may go back to the former out of necessity and convenience, but we patronize the latter out of choice.  The difference is subtle when written in words, monumental in scope.

“What’s the use of a fine house if you haven’t got a tolerable planet to put it on?

(Henry David Thoreau)

I’ve enjoyed the writings and philosophy of Thoreau for a long time.  Growing up on a farm with our very own scaled down version of Walden pond gave me nearly limitless area in which my mind could wander as a youth.  Although I am, by many aspects, a proponent of an agrarian lifestyle and a great fan of nature, I haven’t ever considered myself much of a staunch environmentalist.  I have, however, considered myself a student of economic theory and a fan of free and open markets.  I now find myself attempting to balance in practice what could be considered polar opposite philosophies – Environmentalism vs. Capitalism.

Proponents of each philosophy often antagonize each other.  One politically fights for the rights of the environment as defenseless entity, the other fights unmercifully for the quest of property rights, individual rights, open markets and profit.  Often the ideals are competing and place the environmental lobby at odds with economic pursuits.  At this odd juncture in our human existence, these two competing ideals must work together.  I would submit that each side not only must work together, but need each other.  This is one of those rare moments in history where competing philosophies have the same objective.

As builders, many of us have tried to follow the principles of reducing waste and maximizing efficient use of resources.  This is not only sound environmental stewardship, but it also makes excellent business sense.  We have often been at odds with environmentalists that demand ever fewer developments and ever greater density, much to the chagrin of our clients.  But the enemies we face are now common.  Fossil fuels are a finite resource that are becoming ever more expensive to move to market. When they do get to market, more and more people and businesses are competing for these scarce resources.  Economic law dictates to us that decreasing or static supply coupled with increasing demand raise prices.  The gas price shocks of a couple of years ago were the final push needed to tumble into a deep recession and there is no doubt that the excess dollars printed to ward off a severe depression will at some point cause inflation, further enhancing that ever skyward push in prices.

The nation that wins the race to develop viable and sound alternative energies and consistently develops and builds buildings and infrastructure that reduce consumption of scarce resources will own the next century economically.  Strikingly enough, the nation that does this will also lead the globe into an era of environmental stewardship never seen since the dawn of the industrial revolution.  The industrial revolution brought with it economic prosperity and economic freedom never before seen.  It also brought with it an insatiable requirement to consume energy and other resources.  Perhaps an ugly side of capitalism is that in many cases it takes no prisoners.  But the beauty of free markets is that capital flows to where it is most effective.  Currently, capital is most effective (and more available) for designing and constructing buildings that require less energy, energy production that requires fewer fossil fuels and leaves less waste by-product in its wake, and those practices which promote energy independence.  As developers, builders and contractors we may not fully realize our potential to be at the forefront of a vast and changing energy landscape, but we are.  In fact, our clients not only wish this from us, but expect it from us.

Environmentalism and Capitalism do indeed make strange bedfellows.  But they need not.  For the first time in my lifetime, the goals of the “Greens” align directly on this issue with the goals of the “Capitalists”.  Free markets and environmentalism singing the same tune?  If past distrust of each other can be worked out, the current energy era will be unlike anything we have ever seen.   There is no human force more powerful than pure idealism coupled with a profit motive.  At this select moment in history, these two forces are in agreement.

So I think the hopes of a recovery beginning in early 2010, or maybe even 2010 at all, is fading fast.  I was talking with a few contractors and bankers, and so far, no one is seeing any indication of a market correction.  Seems we are all waiting for a spark in the economy that is going to kick thinks into gear.  Is anyone seeing some exciting trends that are leading toward an optimistic 2010?  Head down, work hard, and make your own luck – the rally cry for 2010!

Please share any of your ideas on how to make 2010 a successful year.