Maximizing productivity is one of the keys to running a successful and profitable business. Yet, especially in the case of contractors, the demands of running a business and the attention required for immediate, tangible tasks often take precedence over macro-level assessments of productivity.
NFBA understands these priorities but also understands the positive effect of increased productivity on your bottom line. At next month’s Frame Building Expo (to be held February 20–22 in Memphis, Tenn.), NFBA will offer the workshop “Improving Your Competitiveness and Bottom Line Through Productivity.” The workshop, being offered at the Expo for the first time, will be conducted by FMI. This national firm has specialized in business and productivity consulting and research in the engineering and construction industry for the past 60 years.
“It’s difficult to head a construction business in this market,” said James Schug, a senior consultant at FMI. “There’s uncertainty and volatility. We’ve been in a changing market in recent years — from a boom to a downturn to the very slow, murky uptick we’re in now. Lots of change means lots of changes in leadership demands.”
The state of the industry brings with it a slew of concerns: fewer work opportunities, increased competition, margin erosion, increasing labor costs. In many ways, these external influences are out of your control, but operating your construction company in a consistently efficient manner is within your control. In fact, taking such steps is critical to business success, given the need to shift strategies.
In addition to working with companies individually to aid them in assessing specific areas where they can improve productivity, Schug said FMI also helps these companies implement solutions to correct issues inhibiting efficiency.
FMI conducts many national surveys each year, polling construction companies on various topics including productivity and using the data to direct its consulting assessments and solutions. A 2009 poll revealed many construction companies were dealing with five major internal challenges to improving productivity:
- Lack of planning skills at the field management level
- Lack of communication skills at the field management level
- Cultural resistance to change
- Poor communication between project managers and field managers
- Lack of technical training at the craft level
Schug said efficient operations start in the front office, not in the field. For FMI, productivity represents a measure of effective management. Schug said these efficiencies can be realized with proper planning for each project, as well as proper management of field labor.
Field labor affects the project budget and the company’s competitiveness on bid day. But controlling labor efficiency is not necessarily the same as managing the number of laborers and their hours worked, Schug said. The largest impact on labor efficiency as it relates to cost-cutting comes from management’s directives.
“I think the great leaders today are focusing on a detailed planning of job-site execution,” Schug said. “Taking time to explain the layout of the site to vendors and subcontractors, planning access to materials and equipment, ensuring delivery efficiency — all of these aspects allow you to maximize labor productivity.”
Another aspect is having field managers who are mindful of the up-to-date costs of the project so they can assign measurable daily goals for their crews to achieve.
In FMI’s 2009 Contractor Productivity Survey, a staggering 84 percent of contractors responded they believe fewer than half of their field managers communicate quantifiable production goals with their crew prior to starting a day’s work. Schug said continued planning throughout the project and the setting of short-term goals are solutions that can increase productivity.
According to Schug, some employees resist implementing new practices aimed at assessing and improving efficiency. Naysayers manifest their resistance in phrases like “That’s not the way we’ve always done it,” “That will never work,” or “We’ve always done it this way, and it’s worked just fine.” In addition, some field managers may believe that another meeting or more paperwork is unnecessary. In certain instances, they may be right, Schug says. But the awareness created by taking time to assess efficiency creates a better workflow and ultimately, Schug believes, increases productivity.
FMI is available to help implement these new practices. “We can bring in an outside perspective and talk about what we’ve seen succeed in similar businesses throughout the country. We help field leaders customize those solutions and add their great ideas, resulting in improved motivation to implement them and create successful outcomes.”
These topics and more will be discussed at the productivity workshop, which will be held from 7 a.m. to noon on Friday, February 22. FMI also offers individual consulting services to help contractors with productivity and to implement new strategies to maximize efficiency.
To register to attend or to get more information on the productivity workshop or the Expo, e-mail email@example.com or visit the NFBA website at www.nfba.org. FBN