Why Hope Is Hurting Your Business

You are 100% accountable for your current situation and the results you’re achieving. They are a direct reflection of your leadership. As a leader, you have defined the results your company produces, including the performance, procedures, project types, financial systems, and the employees being held accountable to deliver results. The bad news is you have manufactured the current state of affairs at your company. But, if you aren’t happy with the status quo, the good news is you can take action to change it.

Hope Is Not a Strategy

Still hoping your situation will magically get better? Stop. The betterment of your company can only be realized through decision, action and innovation — all of which require an investment of time, energy and money. Positive change requires time and dedication to create and implement new systems and strategies. Improvement also requires the owner or president to reshape their role and stop trying to handle it all alone. To accomplish their vision, the company president must change their focus to leading, building new customer relationships, winning high margin sales, seeking projects and niches with low competition, developing key talent, creating and enforcing systems, achieving best-in-class results and implementing improvements. This new focus will cost money, as the president will need to hire new talent, implement software, improve the accounting department, develop field production and job-cost scorecards, build an accurate estimating and cost history system, hold weekly manager meetings with direct reports, implement a customer marketing strategy and focus on moving the company to the next level of success.

 

What You Need to Improve

Consider the following tasks and what might help to improve their chance of success or completion. Note the items that need improvement. As you work through the list, consider how many of these are just hopeful ideas, how many are actions still in progress, and how many you can personally take responsibility for.

• Our company financial reports are almost never produced or updated in a reasonable timeframe.
• Field labor job-cost tracking is not completed often, if ever.
• Project budget updates with estimated final job costs are not up to date.
• We tend to complete projects late and not on schedule.
• We generally don’t close out projects quickly and have too many callbacks and punch-list items.
• We don’t always meet our bid markup goals on projects, which causes our profit margin to fade.
• We don’t produce accurate estimates without missed items.
• We don’t track our bid-hit-win ratio or follow up aggressively on bids or proposals.
• We tend to bid on the same type of projects and customers against too many competitors at low prices.
• We don’t have a specialty, niche expertise or project type that sets us apart from the competition.
• We need to hire more talented people, but we’re too busy to get it done.
• We don’t have an ongoing hiring or talent development program to attract and retain great people.
• We’re too busy to implement a training and promotion program.
• We don’t hold regular manager, supervisor, field, crew, financial or companywide meetings.
• I don’t have much time to dedicate to improvement.
• I’m too busy to go out and see repeat or new customers on a regular basis.
• More than five people report directly to me, and I’m responsible for their performance, activity and pay.
• Problems, issues, deadlines and fire drills seem to overtake my days.
• Our customers call me on most important issues and problems.
• I don’t have time to meet one-on-one with my direct reports weekly to monitor, mentor or train them.
• Employees ask me to make decisions for them or tell them what to do.
• We don’t have enough time to update our business plan or develop new ideas and strategies.
• I make most of the important decisions including contracts, pricing, scheduling, hiring and pay.
• We need a strong management team accountable to achieve results and run the business.
• Our business is stuck. It’s not getting better or moving to the next level.

What to Improve First

It can be difficult to know which direction to take to start improving your business. Your check marks from this list indicate your critical areas for improvement. And there might also be other areas that need some help, standardization, change or innovation.

So, how do you get started on the right path to improvement?

First, identify areas in your business and roles which need to be standardized, documented, enforced, clarified or improved.

Second, prioritize the areas needing improvement based on which will generate the highest return or improved results. Examples:

• Hire an assistant who will free you from performing many of the busy-work tasks that could be easily delegated.
• Develop an accurate and detailed estimating template with all the required and potential cost codes, line items, tasks, activities, inclusions, exclusions, allowances, potential missed items, general condition costs, supervision, security, temporary requirements, cleanup, mobilizations, move-ins, delay costs, labor, materials, subcontractors, suppliers, tools and equipment, etc.
• Decrease the time required to make decisions and answer everyone’s constant calls by drafting an organizational chart, workflow, chain of command, clear written job descriptions and levels of authority for all positions.

Third, select the improvement item you’ll commit to start working on first. Start slowly as it takes dedicated time and money to create strategies, systems, processes and standards. The key is to not only hope it happens but to do it. Dedicate time to improving your business as a priority, and do the work required. Improvement generally requires people to change. But remember: People don’t like to change unless they see what’s in it for them. Be sure to communicate the big reasons for improvement, and then include your team in developing the overall strategy to build a better business which will allow your company to grow, profit and generate opportunities for employees.

Take one step at a time. Don’t get frustrated and let the pressure of changing your old ways of doing business slow you down or stop your improvement program. Be sure to assign some of the next improvement items to key managers or supervisors to get their involvement and earn buy-in. For example, you could assign the task of drafting a field job startup checklist to a supervisor or foremen to create. Or you could assign your estimator the task of selecting a subcontractor bid solicitation software program. As each improvement system is created, have the person in charge of developing it present the new way of doing business to the entire team to gather their input and win their buy-in as well.

Change Is Your Choice

Remember: Improvement is hard work, and it’s slow and painful getting people to do things differently. It’s not easy to hire the right person and then let go and delegate to them. It’s hard to implement a new software program which will improve your project management and estimating success. It takes a time commitment you don’t have to seek new customers who’ll negotiate with you rather than ask for another low bid. It’s hard to spend the time needed to find projects where you can earn higher margins. It’s hard to replace poor performers who have been with you a long time but haven’t committed themselves to learning the new technologies required. It’s difficult to let go of good workers who have bad attitudes, are not team players and are resistant to change. It’s also uncomfortable to invest money and dedicate regular time to making improvements and doing the difficult things you know you need to do.

As the leader of your company, you must take full responsibility for the results you’re currently achieving — good or bad. You can choose to do nothing differently and continue to accept subpar results. Or, you can stop hoping for better and decide to commit and invest in your future success, continuously improve, do business differently, and ultimately raise your business performance to a higher level.