Confronting the Myths & Truths of Business Management

No, this is not a sermon or reflection on my years in Sunday school. However, it does provide a glimpse into many of the myths that individuals have as they look at their businesses, projects or even lives. Think back to when someone asked, “What do you want to be when you grow up?” This isn’t the 5-year-old version of you who said “astronaut-doctor-pirate” but the version in your high school or college years who started to shape who you are today. More than likely, there was a dose of “I’d like to own my own business one day” or “I want to be the president of a construction business.”

“Shoot for the stars,” they say. “Never settle, and be all you can be.” While there are certainly individuals who did achieve their dream, there are many who also realized that their vision for the future was maybe grounded in a level of ignorance. This is not to say that being an owner, president, grand pooh-bah, etc., is a bad dream — ahem — but being a head coach of a football team and playing wide receiver on a football team are two entirely different things. Same sport but different skills, talents and competencies. Even being an owner and coach of a team are completely different, but in the construction industry we fail to embrace some of the most fundamental truths. Do you find yourself failing to recognize this in yourself and your team members?

Wants to Be an Owner Until They Have to Be an Owner

Being an owner in a business requires many things, but one important item that may be overlooked is money/capital. To most, this is glaringly obvious. However, for many people in the industry, there is a perception that being an owner is glamorous, filled with amazing vacations, nice cars and mansions.

Now that I have your attention, most owners, while not destitute, are saying, “When do I get my boat and mansion?” The reality is this: Being an owner of a successful business should come with rewards, but the following items are often forgotten:

• The risk — The construction industry is one of the riskiest business ventures in the world, and for every successful contractor there is a wake of failed businesses.
• The equity trap — The business may be worth $X million, but try going to the ATM to withdraw that cash. The banks, bonding institutions and owners will most likely grimace when equity is “removed.” So, while team members think the business is sitting on a pile of gold, they forget that the gold is sitting under a layer of granite.
• The bad times — When times are good, there are distributions and bonuses and dividends. In bad times, there are cash calls, no bonuses and the ever-present risk of losing your home. Once again, the rewards may be grand, but there are risks that are not talked about enough.

In short, there are many owners who wouldn’t have it any other way. The juice is worth the squeeze, and they couldn’t see themselves working for someone else. However, new shareholders/owners must be “Mirandized” to understand the responsibilities and encumbrances that may come with being an owner.

Wants Accountability Until They Are Held Accountable

“Our biggest problem is that no one follows the playbook — we need more accountability in this place!” Perfect. We will create a Brand X Operational System that everyone has to utilize, and we will track compliance to ensure the standards are being universally followed. Problem solved.

“Well, as long as it is my way, we’ll have no issues.” And there is the rub. 
 

First, the answer is not to remain a lawless bunch of barbarians, regressing further into chaos. Instead, these processes and tools should be developed by the team that will use said processes and tools. Getting their fingerprints on the development moves the behavioral modification in the right direction.

Wants to Be the Leader, But They Really Just Want to Be a Manager

In a similar vein to being the president, there are many individuals who want to be promoted just because it appears to be the natural evolution of things. For example, “I’ve been a project manager for five years, so being a project executive is the next step.”

While on the surface the progression makes sense, the responsibilities of the roles should be completely different. Put another way, one is about managing a project, while the other should be about managing people who manage projects. This is where terms like delegation, collaboration, development/nurturing and motivation for all the perspiration come into play.

“I love construction, but I hate having to work with all these people.” Look, there is nothing wrong with being a project manager or superintendent. Being the best project manager is an incredible career goal. Growth as an individual does not necessarily mean upward. It may be a broader view, evolving in a role to do possibly more complicated projects, adopting new technologies, etc. Construction organizations need both leaders who set direction, align their resources and provide the development of the team, and managers who run projects well, provide the controls and follow the playbook.

Wants to Be Innovative Until It Means Changing

“We want to be the most innovative company in the construction industry”: Another bold statement that is often the manifestation of a firm’s grand strategy. Being innovative sounds sexy and attractive to younger associates looking for a company that isn’t grounded in an antiquated mindset. However, how many firms declare themselves as innovative but can’t honestly say the last innovation — big or small — they introduced?

Being innovative means there may be a shake-up for the good or something that will be changed. To be clear, this is not simply adopting the flavor of the month or trying to roll out a half-cooked idea that will never gain long-term traction. Innovation also does not necessarily mean incorporating AI, autonomous equipment, drones, new tablets, spaceships, etc. Innovation means changing for the better … and we all know how much people LOVE change.

Best-of-class firms lean into some of these perceptions and provide clarity to associates on the benefits, consequences and challenges to all aspects of their business. For instance, think about the ownership comment again. As senior leaders are looking to their next generation, they need to help future generations understand those risks of being an owner, almost to a point of “negative selling.”  There is certainly an enormous upside to being an owner, but a future shareholder can make a more objective decision about their future and their risk tolerance when presented with facts.

Regardless of the situation, businesses will be well suited to create a vision of how to effectively live on earth to eventually “get to heaven.”