For the construction industry, 2017 has been a busy rollercoaster of a year. But before the dust settles on 2017, contractors should spend some time reviewing lessons learned and create baselines and benchmarks for an even more profitable 2018.
By identifying areas for improvements, contractors can implement a timeline to stay on track. Applying lessons learned is all about building knowledge from one project to the next, preventing the same mistakes over and over.
Asking the Tough Questions
Start reviewing 2017 by asking some hard questions. Here’s a sample list:
- What was our 2017 sales goal?
- Did we achieve our profit goals, man-hour targets, and safety meeting frequency for projects won?
- Did we achieve our bid production rate?
- Did we exceed our bid/hit ratio?
- How many lost hours did we have due to safety issues?
- Did we dig deep into change orders to see if we could have done better?
- Did we implement new software as planned?
- Did we set up an effective maintenance plan for new field equipment and correctly allocate for the entire expense in our bids and job costs?
Processes and People
- Did we set up and adjust metrics to measure our goals?
- Did we effectively engage with our employees? What would they say?
- Did we provide effective feedback to our vendors and suppliers? Will they give us the best price next year?
- How did we recognize our clients? Did we show our appreciation or ask for a referral?
Now, you can determine the breadth of changes required and whether to apply them to just the takeoff division or your entire worldwide operation with 100 offices.
The Numbers Speak Volumes
It’s important that every contractor sets metrics for success. Here’s a handy checklist to get you started on fresh, new goals for 2018.
- Retool month-end reporting and sequencing based on input from operations, and update accounting calendar, including new items from lessons learned.
- Implement with quality CRM this year, no more excuses. Document what the prospect really wants, and make sure the estimating and operations teams get the message.
- Update metrics and new marketing calendar to share with staff and revise newsletter to bring value to both clients and vendors.
- Update bid/hit ratio with revised metrics, use more detailed views into market segments, and ensure processes and systems reflect it.
- Project Management
- Make sure to connect project actuals with accounting. Implement new processes for software systems, and work with estimating for a better transition from estimate to project start.
- Update documentation for field so they can manage, document, and report based on real need and revise safety equipment budget.
- Field Operations
- Make sure new hires receive specific training in 2018. Invest in this process and achieve increased production, which will be measured and adjusted against.
- Make staff reviews enjoyable and meaningful again. Implement the new payroll system that integrates with the new project management field operations software.
Stronger Business in 2018
By making sure to create performance baselines and benchmarks, contractors can identify areas of improvements and implement a timeline to stay on track. No doubt, this will help you get on your way to beating the competition in 2018.
Allen Crowley, is director of business development for On Center Software.