Building a business takes a lot of work, and ideally, you build a business that you can be proud of.  As a construction business owner, you want customers (both current and potential) to see your business in a specific way.  So what do you do?

Sure, you work hard and get the job done right.  You conduct business fairly and treat people with respect.  But you also have to actively create your company’s corporate image.

While some of your company’s corporate image will come about naturally based on the work that you do and the manner in which you do it, companies that have a specific plan in place to create a corporate image have much more control over how they are perceived.  They also have more opportunities to highlight the strengths of their business and their culture.

Once you build your corporate image, you can showcase it.  For instance, my company has a very strong culture and we’ve been operating on the same values since our inception in 1985.  So this year, we are running ad campaigns that highlight these strengths.  The one below features my father and me, and definitely represents our corporate image.

So think about how you want the world to see your business, and then make the most of it.  Use it in marketing, in sales, and in conversation.  You’ll be surprised what a pride in your company and a strong image will do for your business.

Mid-January is a time of reflection for many contractors.  They’re starting a fresh new year, and wrapping up their year-end which is a task in itself:

• Preparing W2s & 1099s
• Creating year-end financial reports
• Closing your general ledger
• Rushing to get that last payroll out in December because you are unable to work between two fiscal years
• Looking at Over/Under Billing and posting the adjustment to the year-end financials
• Preparing Sales & Use tax reports for sales tax authorities
• Querying different type of jobs in job costing to look at profitability by type

If you have had trouble with any of these items in past year-ends, ask yourself, “Am I willing to go through that again next year?”

If the answer is no, then now may be the time to start looking into new tools and software programs that can make your job—and your life—easier.  There are plenty of construction-specific accounting packages that work the way construction does and can efficiently prepare W2s and 1099s and year-end financial reports.  Some systems are even date-sensitive and allow you process payroll over different periods, and even years, so you don’t have to rush to get that last payroll done.

What I’m getting at is this—year-end doesn’t have to be this painful.  Do some research and check out some of the resources, tools, and software programs available to you.  It can make your next year-end, your job, and your life easier.

Happy New Year!

As you know, I’ve been reading Steve Jobs’ biography.  I think there are some pretty good lessons in there, particularly for the start of a new year.  While I was reading, I came across Jobs’ explanation for why he wore a black mock turtleneck and a pair of blue jeans almost every single day:  because it was one less decision that he had to make.

Photo via Farhad Manjoo on www.fastcompany.com: Clay McLachlan/Reuters ('98); Getty Images ('99); Gabe Palacio/Getty Images ('01); Justin Sullivan/Getty Images ('04, '05); Peer Grimm/dpa/Landov ('07); Paul Sakuma/AP Images ('08); Robert Galbraith/Reuters/Corbis ('09); AFP/Getty Images ('10)

Now I’m not telling you that you should wear the exact same thing every day for the rest of your life, but why not make your life easier by minimizing the amount of decisions you have to make?  As a construction business owner, you put a lot of time and effort into making critical decisions.  Additionally you sometimes get drawn into trivial matters that should really be handled by others in the company.  To get to the point, you have to simplify by getting two things in place:  people and processes.

First, get the right people in place.  This is easier said than done, and comes in two parts.  Invest the time in finding people with the aptitude to do the job, and the right attitude to fit into your company.  The second part means getting rid of people who do not fit these requirements.  As hard as that may be, having the right people in place will increase simplification.

Second, get your processes in order.  Create a plan that makes sense.  In the mid 1990’s when my company was growing, I hired a president.  As fortune would have it, this person was an incredibly good manager and truly organized our daily processes.  This created new opportunities for the business and for our vision because I was able to focus on the big picture.

Getting people and processes in place is like Jobs’ wearing the same basic outfit—it eliminates minor decisions and troubleshooting so that you can focus on bigger decisions, ideas, and growing your business.

There’s a lot I could say here, but mostly, I just want to wish everyone a very Merry Christmas and a Happy New Year from everyone at Foundation Software.

See you in 2012!

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Steve Jobs was no doubt a great businessman with many valuable lessons to teach.  In his commencement speech to Stanford University graduates in 2005, he references The Whole Earth Catalog from the mid-1970’s:

On the back cover of their final issue was a photograph of an early morning country road, the kind you might find yourself hitchhiking on if you were so adventurous. Beneath it were the words: “‘Stay Hungry. Stay Foolish.’  It was their farewell message as they signed off. Stay Hungry. Stay Foolish. And I have always wished that for myself. And now, as you graduate to begin anew, I wish that for you.

Stay Hungry.  Stay Foolish.  My take on this idea is very simple:

Stay Hungry. As a business owner, you can never be satisfied. Even if sales are booming and you’re doing better than you ever have before, you can never be satisfied.  You must maintain a hunger to be better, to keep moving forward, and to grow your business.  In order for your business to survive and thrive, you must maintain that hunger.  Because as soon as you’re satisfied, you become too comfortable and stop evolving.

Stay Foolish. This leads right into what it means to stay foolish.  In running a business, there must always be a certain amount of risk that you’re willing to take.  Risk is healthy; it keeps things fresh and gives you the opportunity to evolve.  Take marketing for example.  I  took a risk in 2005 and dressed up as Superman for a marketing campaign.  It could have been a horrible flop, but almost seven years later, people still remember it and bring it up at conferences and tradeshows.  Or you could take a risk in offering a new product.  In 2006, we started our sister company Payroll4Construction.com as one of the few, if not the only, national payroll services just for construction.  At the time, we weren’t sure what was going to happen, but it ended up being a great risk to take, and the company is growing every day.

Never settle and take some measured risks.  You’ll be surprised what it does for your business.  Stay Hungry.  Stay Foolish.

Last week, I talked about Jim Collins’ book Good to Great, and the common characteristics of great companies.  I’ve listed them below so you can have them in front of you again:

1. “Level 5” leadership at the top
2. First people, then processes
3. Confronting the brutal facts of your business and industry
4. Do only what you can be the best at doing
5. Maintain a culture of discipline
6. 6. Leverage technology to enhance what you already do well
7. Generate momentum that accelerates your growth over time

Last week, I focused on what it means to do only what you can be the best at doing.  Today, I want to talk about #6—“Leveraging technology to enhance what you already do well.”

We live in a technological world, so much so that if business owners don’t embrace technology, they may be doing themselves a disservice.  Many contractors go into business because they’re great at what they do.

I know a successful excavating contractor that took over his father’s grave digging business when he was younger.  This is a true story—his father refused to use anything but shovels and picks to dig the graves, but once the son took over, he purchased a backhoe.  Sure, there was a learning curve, but taking the time to learn how to use the backhoe (the current technology) made him substantially more productive.  In fact, he turned his father’s small grave-digging business into a large union excavation business.

This young man took the time to think about what would ensure the long-term success of his business.  Leveraging technology is not limited to heavy equipment, though.  There is wonderful technology available for the field and for back office operations.  Take some time and look at what you could be doing better, then see if there are any technologies that could help you enhance what you already do well.

I read a lot.  I think it’s a great way to keep the education ongoing like I talked about two weeks ago.

One of my favorite books is Good to Great by Jim Collins.  It crystallizes our mission to make contractors’ jobs easier and we put that mission into our own words:  “When better is possible, good is not enough.”  These words are as true today as they were ten years ago.

Good to Great discusses a 5-year study performed by a Stanford Business School professor and some of his graduate students focusing on eleven Fortune 500 companies that were identified as businesses that had evolved from good companies to great companies over 15 years.

So what were the common characteristics of the great companies?  They go something like this:

1. “Level 5” leadership at the top
2. First people, then processes
3. Confronting the brutal facts of your business and industry
4. Do only what you can be the best at doing
5. Maintain a culture of discipline
6. Leverage technology to enhance what you already do well
7. Generate momentum that accelerates your growth over time

Let’s focus on point #4 here.  Every successful business has a clear mission to be the best.  For instance, Foundation Software’s vision is this:  “To provide the best in accounting software and service for the labor intensive contractor.”  Everything we do is in pursuit of that mission.

As a business owner, it is important to constantly evaluate everything you do.  If it does not fit your mission to be the best, then abandon the project or task.  Place your best talents and resources on your greatest opportunities, and don’t be afraid to obsess with continually improving and being the best.

With all of the percentages in the news lately (99% here, 1% there), I found myself wondering about a different percent—the 30%.   I have a theory that only 30% of the people in the world are willing to change and improve… So take a minute to ask yourself this—Are you part of that 30%?

When I was teaching high school in the 1970’s, I was doing the teaching the majority of the time—but the truth is that I was still learning, sometimes just as much as my students were.  I learned even more as I traveled the world, hitchhiking across the United States and backpacking across Europe.  And when I started Foundation Software in 1985, on top of what I was learning on the fly, I made it a point to actively seek out knowledge, learning as much as I could about management, sales & marketing, leadership, technology, and the industry itself!

What I’m getting at here isn’t just that we should never stop learning, but that we should be more proactive about our education in every aspect of our lives!

That’s why I make it a point to read, talk to people, and attend as many conferences and tradeshows as I can.   And for my time, I usually walk away both inspired and loaded with new ideas to put to use.  Even one new idea can be worth its weight in gold…but that’s just my opinion.

This thirst for knowledge has also transcended into the way I run my software business.  We make a point to provide our construction clients with a variety of ways to continue learning.  Webinars, whitepapers, classes, and user conferences like this most recent one:

So do yourself a favor and keep learning!  Education leads to improvement, efficiency, and profitability!  Not to mention, it feels good to be the one with the answers.

When I moved into my new home, I made all the calls to ensure that my utilities were on prior to my move-in date.  When I tried to get my internet service working, it took me days and lots of phone calls, automated loops, etc. to get it running.  It was absolutely frustrating!

The point is that when dealing with a service or purchasing software, it’s important to have a Support department you can rely on.  Usually the first department you talk to when dealing with a new company is Sales.  Evaluate their competency and knowledge level. Do they know the software inside and out?  Have they ever worked in support? Do they understand your industry and how you will use the software?  You can also talk to existing customers about their experiences and trade groups or associations that the company is connected with.  Here are a few other things to consider:

• When calling, are you greeted by a live receptionist, or funneled into a voicemail loop?  (While not absolutely necessary, it sure is a nice touch to deal with a real person.)
• Where is the support department located?  Are they direct employees of the company?
• How are the company’s support reps trained?
• What is the average tenure of the group?  A longer time in a support position equals knowledge and indicates that the company knows how to treat its employees.
• Are there resources like eletters, tips, fax solutions, etc. that clients have access to?
• Does the company have an area dedicated exclusively for clients on their website?
• Are there multiple methods to contact Support, like phone, fax, email, and web?

The best Support offers multiple means of communication, timely responses, and thorough information.  You deserve a great support system, so make sure you do your research when looking into new construction accounting software, or any software for that matter!

A lot of contractors have asked me about Section 179. Most of these contractors are considering an investment in equipment or software, and they want to know if it can actually help their construction business. The answer, in many circumstances, is yes. Section 179 was designed to provide an attractive tax savings on these purchases. And who doesn’t like to save a buck or two, right?

I highly recommend that any contractor considering such an investment first consult with their CPA or tax specialist to discuss how Section 179 applies to their unique situation. While the circumstances may change for each unique situation, I can share a few basic facts about Section 179:

• 2011 Deduction Limit – $500,000 (up from $250k previously). Good on new and used equipment, including software.
• 2011 Limit on equipment purchases – $2 Million Dollars (up from $800k previously).
• “Bonus” Depreciation – 100% (taken after the $500k deduction limit is reached).
• Who Qualifies for Section 179? All businesses that purchase, finance, and/or lease less than $2 million in new or used business equipment during tax year 2011 should qualify for the Section 179 Deduction. If a business is unprofitable in 2011, and has no taxable income to use the deduction, that business can elect to use 100% Bonus Depreciation and carry-forward to a year when the business is profitable.

There are plenty of good reasons to take a closer look at Section 179. As I said, be sure to talk with your CPA or tax specialist so that you know what you qualify for before making any purchases—whether it’s construction accounting software or a back hoe, you’ll want to make sure you’re informed!