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How To Improve Your Construction Business
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AuthorTodd Dawalt
May 5, 2023
Read Time: Less than 5 Mins
Last Modified: January 18, 2024

The question many construction business owners and senior leaders grapple with is, “How do I get out of constant firefighting mode, so I can work ON my business, instead of being stuck working IN it?”

The answer can be summed up in three words: Nail the Handoff.

Before digging into how Nailing the Handoff will help, we need to understand the underlying problems…and the hidden root cause.

Here is how a typical project goes.

The contractor is pressured to get the project started ASAP, so equipment and materials are mobilized to the site. When the crews show up, they have some of the information they need, but are missing some details that will be figured out later.

After the project is started, it becomes apparent that there was a combination of estimating mistakes, scope gaps, missing specifications, incomplete design details, missing selections, and purchasing decisions that weren’t made when they should have been.

Chaos is defined as “complete disorder and confusion.”

That’s what typically begins to happen next. Chaos.  Let’s take a look at a few of the ways that chaos ensues.

The project schedule suffers.  Materials that are not selected on time, subcontractors that are not scheduled properly, and delays caused by late decisions or changes all add up to schedule overruns.

Finishing projects can be a nightmare.  The steady stream of chaos and changes throughout the project pile up at the end, and it can be physically impossible to get enough people on the project to complete the work.  It doesn’t help when the subcontractors are frustrated, exceeded their labor budget and would rather put that project in the rear-view mirror.  Getting through the punchlist phase of these projects can be brutal.

There are difficult conversations among all parties.  Meetings are scheduled to explain unexpected change orders and schedule overages to the customer.  There are tough conversations between GCs and subcontractors about budget overages, back charges, T&M tickets, overtime, and maybe even liquidated damages.  Crew leaders have to try to convince their teams to work longer hours and weekends to get caught up.

Financial problems eventually surface.  The combination of schedule overruns, labor overages, contested change orders, and the other side effects of chaos always have a negative effect on profitability and cash flow.

Does any of that sound familiar?

When you put that all together, you have a lot of fires that have to be put out on one project.  Who typically gets pulled in to put out these fires?

The business owner or a senior leader, right?  What happens when there are multiple projects going on at the same time?  You can probably imagine what that would be like, or maybe you don’t have to imagine it because you’re living that reality right now.

The owner or the senior leader spends most of their time in reactive mode, putting out fires.

What’s the hidden root cause of all this chaos?

The root cause is what I call The J.E.T.S. Trap: The Just Enough to Start Trap.

Doing Just Enough to….

  • Get an estimate or proposal out the door.
  • Get the contract signed.
  • Write a subcontract agreement.
  • Mobilize to the site and get started.

“Let’s put together enough to get started, then we’ll figure the rest out later.”   Sound familiar?

From my experience managing projects including small remodels, custom homes, corporate remodels, new office buildings, and high rises totaling over $300 million, and coaching hundreds of construction business owners over the past 25 years, I can say with confidence that the #1 root cause of chaos in construction businesses is the Just Enough to Start Trap.

How do you get out of the Just Enough to Start Trap?

The first step is to Nail the Handoff.

The key to a smooth, profitable project is a clearly defined handoff of communication, accountability and all the information the field team needs to finish the project before the start of construction.

When you Nail the Handoff from the office to the field, or from preconstruction to construction, here are a few things you can expect:

  • Fewer questions from the field because they have all the information they need.
  • Projects will finish on schedule because less time is wasted waiting on decisions and information.
  • Your ability to hit your financial targets will improve because more costs are known in advance.
  • Lower stress and a better work environment for the team means higher productivity and less turnover.
  • Your customer will have a better experience.
  • Fewer fires and urgent situations that business owners and senior leaders have to respond to.

Less time spent in firefighting mode means more time to spend working ON the business: Selling, business development, recruiting, training and doing things to take the business to the next level.

If you want to get out of constant firefighting mode, so you can spend more time working ON your business instead of being stuck working IN it…

The first step is to Nail the Handoff.

What will it be like when your field teams have all the information they need to finish the project, before they even start?  How much time will you be able to reclaim each week because those fires simply don’t exist anymore?

Would you like to design your company’s process to Nail the Handoff, as well as put the crucial systems in place that will allow you to get out of day-to-day operations of your business, so it will run without you?  The Systematize Your Construction Business Program is designed to help you do just that.

You can hear about the results other construction business owners have experienced after designing their Nail the Handoff process as part of the Systematize Your Construction Business Program at www.constructionleadingedge.com/results.

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