Stan is the owner of Compass Contractors, primarily a subcontractor specializing in metal studs and drywall installation on office building projects. Stan constantly struggles with the demands of owning and managing his business, from working on bids, estimating, ordering materials and scheduling 25 field workers to coordinating equipment, fielding phone calls and visiting jobsites daily. To make matters worse, cash flow is tight and he often has to cut prices to win work. He is frequently unaware of job costs until months after the project is finished. Stan works more than 65 hours per week and isn’t making much more than he pays his top foreman.
It Isn’t about Doing
Stan’s situation sounds like that of a typical construction business owner who has reached the limit of what he can handle by himself. He wants to grow the business and make more money, but he’s stuck and doesn’t know what to do next.
Most business owners want to own an organized and systemized company that is efficiently run by the management team, has plenty of loyal customers, makes a lot of money and allows for significant freedom. To make this dream a reality, owners must step up to leadership and stop doing the day-to-day tasks that bog them down.
Effective leaders delegate roles and responsibilities to the right people in the right positions, and make them accountable for achieving desired results. This leaves the owner free to focus on growing the business and maximizing the bottom line.
Be the Head Coach
To transition from doing the work to leading the company, start thinking like a winning head coach. Top coaches aren’t out on the field playing the game. They’re on the sidelines providing leadership and vision, strategizing with assistant coaches and offering motivation and discipline.
What else do great coaches do? They follow a written game plan and playbook. They have excellent assistant coaches and delegate responsibility. They hold regular meetings after every game to review the results, what worked and what didn’t. They meet with individual players to discuss their performance, good or bad.
Winning coaches keep their jobs by putting the best teams on the field, winning more games than the competition and meeting overall team goals. In turn, seats stay filled, financial targets are met and recruitment is easy because the best available players want to play for a winner. As the head coach of your business, are you creating a winning team?
Consider the CEOs of major public companies. What are they responsible and accountable for? Results are paramount.
A CEO is tasked with leading the company toward higher net profits and keeping stockholders satisfied with performance. Growth is also important. The value, net worth or equity of the company must grow, and revenues must increase year over year.
Planning to Fail
Your company is currently designed to produce the results you are currently achieving, and the leader is 100 percent responsible. If your company is achieving average or poor results, the leader is the reason or problem.
Poor leaders accept poor results and poor performance from their team. Ineffective leaders don’t make tough decisions or do what they should do with priorities, time and people. If leadership is not elevating your company to become a best-in-class business, it is time to change the game plan.
Too many contractors complain about cheap competition, that they can’t find enough good help, that they don’t get paid fast enough or that customers shop prices. CEOs don’t whine. They take responsibility, change their business plan and get results regardless of the economy, customers or competition.
Poor decision-making and ineffective leadership are the only reasons your company requires constant hands-on micromanagement or is not making best-in-class profits. Head coaches who fail to make good, quick, correct decisions will eventually lose their jobs.
What do you need to do differently to become a winning leader instead of the head worker? Who should you hire or fire? What should you change or eliminate?
A Winning Blueprint
Stan was no longer willing to accept the poor results he was achieving for all the energy and effort he was expending, so he scheduled a two-day business coaching session. We discussed his challenges and worked together to complete his “BIZ-Builder Blueprint” action plan.
Stan’s blueprint outlines his company’s core values and principles, as well as his five-year vision. His business plan lays out his new organizational chart and helps him determine necessary hires and job accountabilities. The blueprint facilitates prioritization and delegation, and incorporates a bid-tracking system, a new customer target list, a marketing calendar, financial targets and goals, a scorecard tracking system for job cost and monthly results, a list of systems he needs to create to get organized and a weekly and monthly meeting schedule to help him regularly stay in touch with managers and supervisors. Most importantly, it includes a commitment to stop working so many hours.
By taking responsibility for the success of his company and setting the goal of becoming a best-in-class business, Stan is now on the track of an effective leader.
What leadership decisions and steps do you need to make to become the best company in your marketplace and be known as a winning business owner?