Editor’s Note: This is the fourth in a six-part series titled “The Project Manager’s MBA,” which analyzes six key components of leading business practice and applies them to the construction industry.
One of the greatest misconceptions in the construction world is that project managers and superintendents do not market and do not sell. Managers see their role with a myopia, failing to understand that they can further any customer relationship and generate more sales. To them, marketing and selling techniques are like parlor tricks of snake oil salesmen.
In worst-case scenarios, more common with low-price or hard-bid contractors focusing on price alone, the customer is viewed as the enemy. This mindset creates an uphill battle that rarely has a positive outcome. In all cases, marketing should begin with understanding the customer’s needs and communicating those needs throughout the entire project team. When everyone involved understands what the customer wants, the organization has the information necessary to meet expectations and gain long-term credibility.
The customer is the vehicle to success for both the project and the organization as a whole, and the first step to providing a customer-centric construction project is creating a stable foundation for the relationship. This is accomplished by defining what is important to the customer.
Pre-construction meetings should set the tone early. These meetings are required on most public projects, but they often lack the depth necessary to attack important issues. Items are reduced to mandatory bullet points that are established because the specifications demand them rather than explored to gain a fuller understanding of what the customer needs. An effective kickoff discusses these issues in depth, and as a result, contractors are better prepared to understand customers’ motivations and manage their expectations.
First, understand why the customer is building the project in question. The stock answer of “to make money” is not enough. Whether the job is personally motivated (such as to avoid losing a job) or corporately motivated (perhaps to gain market share), the contractor must understand why the project is important to the customer.
Second, understand how the project will be built and what mechanisms will be used to handle issues such as invoicing and change management. For some reason, many contractors are fearful to ask these questions early in the process. There is a general feeling that such questioning is antagonistic and confrontational. When conducted with a professional tone, this fact-finding can help your customers manage their money, and it can also expose any potential flaws in the payment process before they become problems. Determining there is no methodology for handling change orders at the time the change occurs, for instance, signifies poor management practice. Ultimately, the process should serve the interests of everyone, protecting the contractor as well as the customer.
Finally, understand your customer’s business. So many managers lump all customers in the same circle. Customers like to think that they are mutually exclusive, however, and they should be treated accordingly. Regardless of whether a customer’s project is virtually the same as any other, managers must create customized construction solutions for each individual customer.
Contractors often work like thoroughbred horses speeding down the track with blinders on to maintain focus on the remaining length of the race. Such linear thinking tends to dominate the thought process in construction: first, site work; then, foundations; then, walls; then, roof; then, finishes; then, landscaping and then you are done. Contractors who take this approach make the mistake of viewing all projects equally rather than considering whether they fit into the construction company’s master strategy. Taking on only those projects that fit within the organization’s business plan is essential to marketing and creating an identity for the company.
Creating a vision to manage toward is essential. John Kotter discusses the power of vision in his book “Leading Change.” He explains that in many cases, the reason firms fail is that they “underestimate the power of vision.” For example, misalignment of vision at a corporate level can send a convoluted message to the entire firm. A firm can say they are seeking to grow at a modest level of five percent annually but aggressively pursue new accounts, achieving a growth rate of 20 percent. This inconsistency conveys that the firm has little regard for the big picture and has little credence in the other components that make up their strategic plan.
This misalignment can exist on the project level as well. Before a project begins, the vision must be created and ratified by the team. Here are some potential project visions:
- Increased market share – By completing this project in this niche, the firm adds to its command of the larger market.
- Increased customer share – By completing this project, the firm has the ability to negotiate future work with this customer.
- Increased customer goodwill – By completing this project, the firm has the ability to leverage this relationship with similar customers.
- Increased backlog – By completing this project, the firm will maintain its workforce.
- Increased workforce training opportunities – By completing this project, the firm will develop new team members in a low-risk environment.
Building for the sake of building is a constructor perspective. Building with a vision helps create a viable business.
A discussion of marketing would be remiss without a discussion of customers and their perceptions of the project team. Individual feedback is a crucial part of developing and honing skills. Feedback is not always flattering, of course, and there may be a tendency to avoid any discussion that is expected to be uncomfortable. Contractors should remember that regardless of whether the feedback is positive or negative, the perception remains. Those who choose to confront it and use the criticism to improve the way they work have the potential to retain top customers longer and please more customers in the future.
One strategy that high-performing organizations use regularly is the solicitation of feedback. Today consumers are asked to grade performance on everything from an interaction at Home Depot to the service at an Outback Steakhouse. Contractors can do so as well. Feedback can be gathered at the completion of a project, possibly in conjunction with the post-job review.
Taking this concept a step further, a mid-job review can also help to increase efficiency and reduce the chance that customers will be unsatisfied upon the completion of a job. A survey consisting of the following questions can be an excellent tool for contractors to gather the information necessary to make improvements before the end of the project:
- How are we doing at proactively communicating with you about issues and resolutions? What could we do better?
- How are we doing at managing to your schedule? What could we do better?
- How are we doing at managing your costs? What could we do better?
- How are we doing at managing the project site, clean-up and disruption to neighbors? What could we do better?
The key to this process is to take action. Do not ask the customer about areas of improvements and then fail to deliver. A short, concise survey such as this is powerful in the hands of a project team intent on delivering for the customer.