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10 Traits of a Successful Construction Business Owner

NOTE: This article was originally published on ForConstructionPros.com.

 

There are many traits I have found that exist among construction owners I have worked with through the years. Consider a few common traits that seem to resonate with many successful owners of construction companies:

  • They are self-starters; they take the initiative.
  • They are confident in their abilities.
  • They see a different way, “their way,” of getting better results.
  • They understand and take accountability and responsibility.
  • They are always thinking about their business…always!
  • They are normally a master craftsman at their specialty whether it’s flatwork, finishing, asphalt, sweeping, electrical, HVAC, remodel, decorative concrete, mason etc.
  • They are effective problem solvers.
  • They are fast thinkers, movers and shakers.
  • They tend to be less patient with people.
  • They find themselves “asking for forgiveness versus permission.”
  • They often, but unintentionally, bruise the feelings of others BUT are quick to apologize…and mean it!
  • They are focused on “getting ‘er done.”

While many owners will relate to some if not all of the traits listed above, the owner that has been “at it” for a while will also admit that he has matured through the years. Ten-, 15-, 20- to 30-year experienced owners will admit that while the fire to succeed is still burning hot, they have found that how you handle people, how you solve problems and how you view the customer has also evolved and matured. What used to get an owner hopping mad might eventually have turned into looking at how to prevent the cause for the problem in the first place. In past years their approach might have been “Just fix it and we’ll worry about it later.” Today, that same owner might say “We’ll fix this now, but let’s find out why this happened and let’s rework our processes to prevent it from reappearing.”

The construction owner is the “engine, jet fuel and lubrication” of his business. While he may continue to serve as the company president and a few other roles, it is in the role of the owner that the deepest satisfaction and disappointment is often felt. As construction owners mature I’ve noticed that they become more caring for their employees, wanting them to succeed in their jobs and in their personal lives. I’ve coached and counseled many owners on trying to be firmer with poor performers or workers who have serious personal problems. The construction owner simply has a big heart…and sometimes he allows workers to take advantage of his good heart!

Well, then how does one go about “making a construction owner”? There are as many ways to be a great construction owner as there are construction owners today, but there do appear to be some commonalities shared by thousands of owners. Let me share 10 that I’ve researched over the past 20 years.

Construction owners must have:

1. An entrepreneur sSpirit

The true entrepreneur thinks her idea of how to get work completed, how to make money and how to be more successful is superior to others. While she is not necessarily arrogant, she is very confident in her approach. If a construction owner doesn’t believe that her way is better, her term of ownership is on a major collision course of titanic proportion.

2. Vision for their future

While the construction owner may not always be able to articulate to others what he sees in his heart, he is very clear about his future and what it will take to get there. This vision is more than seeing dollars made; it’s about how to go about making the dollars. It’s seeing his crews approaching work, planning out strategies, executing those strategies, solving problems, and achieving quality results when others do not.

3. Wisdom to balance the “Just do it” and “I’m in it for the long-term” emotions

This is truly the emotional center for the construction owner. One very successful decorative contractor I know recently shared with me that he has battled the constant struggle between doing things now, before another contractor can do it, and knowing that good results often take a while to realize. This is the daily conflict that can challenge an owner. The need to work with a promising employee, teaching him everything he needs to be successful while waiting for that knowledge to become instinctive. It’s like watching your kids grow up: you know that they are but it’s hard to see the growth on a daily basis.

Briefly, I’ve shared the railroad track analogy with many contractors and their leaders through the years. One rail of the track represents the short-term efforts, things that need to be done daily to keep cash flow moving forward. The other rail represents the long-term efforts. While the short-term rail often wins the daily attention, a contractor must not delay the long-term rail for long or face even greater challenges and struggles.

4. Desire to learn

I’ve never met a successful construction owner who didn’t get a thrill out of learning something new. In fact, most great contractors see everyday life as one big classroom. The genius of so many contractors through the years has been their uncanny ability to learn from just about any person, any situation, and from any other company. It’s the construction owner who can notice the way a restaurant owner has arranged her workers to provide the best eating experience possible…and adapt similar processes to his business. While the construction owner does view most of life differently, it is first his humility in realizing that he doesn’t know everything that leads to his great appetite for learning.

5. Engaging the “others” to grow and learn

This can be tough for owners to fully embrace. It’s the leading contributor to contractors who have not grown their company to more than eight to 10 employees. I actually had an owner approach me a few years ago at a construction conference that he no longer wanted to grow employees because “They just leave you and take all of your secrets to a competitor or start their own business.” While this can, and does, happen, to not develop your workers is to surely stunt your company’s intellectual, industry and profitable growth.

The successful construction owner realizes that part of excelling and expanding his potential is to engage other talented people. A great electrical contractor once shared with me that he viewed his primary purpose as finding those “others” who bought in to his vision for the company and to leverage them to execute their newly developed skill and expertise. A president and owner in a very large general construction company shared with me that he viewed his role, and that of other senior leaders, as “building up the people who are building our customers’ buildings.” The sooner an owner realizes he can’t do everything the sooner he will begin to achieve new heights of success he once only dreamed of achieving.

6. Commitment to a balanced scorecard perspective

When a construction owner first starts his or her business, her focus is primarily on getting work and doing the work. If she is lucky, she has a spouse or trusted individual who can insure that bills are sent and bills are paid, or she must face staying up all night to do the same. Over time, this reality leads to many contractors not being able to do it all and they fold up their business. The secret here is that owners must have a more balanced perspective of running their business.

An approach that I’ve shared and coached with owners for years is to look at their business with a balanced scorecard perspective. It recognizes the financial information as one area of their focus. But the financial is “balanced” by looking also at how they are meeting customer needs and expectations, how they are developing their workers to become more effective producers, and how their company work processes are creating a quality, lean and profitable result through getting work done right…the first time.

Certainly for the new start-up contractor there will be a heavy focus on acquiring work and completing the work. Yet this same contractor must spend time working on improving her worker’s efficiencies, improving their delivery of quality and turning customers into “raving fans.” This effort is better achieved when the owner sets goals and measurements for the company to monitor, posting areas of wins and losses for all to see, and then begins to address how to increase the winning experience.

7. Humility to leverage strengths and delegate weaknesses

Traditional construction owners were primarily craftsman, experts at their trade. They often grew tired of taking orders from others and decided to be their own boss. However, once they began their new business they often tried to perform the other needed roles but simply were unqualified for the other “jobs” and failed.

I’m not so sure that today’s new construction owners are craftsman only. In fact, a growing number of construction owners have come from nontechnical backgrounds such as finance, sales, engineering etc. No matter your background as an owner, always strive to position yourself to the areas of the company that you know best and look to place others in those roles that they have the skill and experience to execute.

8. Recognition of the “new” and openness to incorporate the same

Ok, I’ll probably step on a few toes on this observation but it’s still true. The “new” can be new trends in marketing, technology, industry, quality, client relations, finance, bidding work, software, etc. The list is almost endless.

An owner doesn’t have to be “cutting edge” on every new tool or product that surfaces, but he does need to be open to what some of the new ideas, processes and products might do to strengthen his firm’s efficiencies, improve safety or run the work more profitably.

Many of the “new” things can be screened by more than the owner. For many contractors, it is their employees that often bring back to the owner a new discovery learned from a competitor or presented at a recent trade show or conference. It is the owner who then needs to assess how the “new” will benefit the company and how they can incorporate the “new” as cost effectively and time efficiently as possible.

9. Full attention on the company’s financials

Over the past 25 years of working with construction owners I have found that while the owner might not have completely understood his own company’s finances in the early days, he soon became very skilled at reading Income Statements, Profit and Loss Statements, Balance Sheets and Cash Flow Statements and he understands what the numbers mean to running his business. The owner must recognize trends and future struggles based on the numbers that appear to be in play.

As the construction owner grows his business and the hiring of a company controller or CFO becomes important, the owner must continue to give his full attention to the company financials. His focus on this very critical area of the company will point him toward making offensive decisions to grow the business at some point in time and be just as critical at defensively pulling pack in areas where the company needs to steer away.

10. A never-ending desire to see success

Actually, I think the biggest and most common trait shared by the successful owners I’ve met through the years is that trait that never seems to tire. The mind of a construction owner is always turned on and working around opportunities, solutions and “what we can still do.” They can dream, discuss and decide till late in the night and then be fresh as a daisy by five in the morning, ready to knock out another day of “living their dream.”

The never-ending desire is not spent on wasted efforts but all the more focused on seeing success in how the company plans, executes, acquires new business, gains greater market share and improves customer satisfaction. The owner never tires of seeing promising employees finally “connect the dots” after struggling with making needed improvements. In the end, the owner energizes others to work harder, work smarter and work faster because “we have much to do, before the other company does it!” The owner, while still desiring to experience personal success soon grows to enjoy more the successes that his employees realize, knowing that such sharing of success will strengthen his company to carry on with winning attitudes and an unstoppable work ethic for years to come.

It is the owner who must be solidly in place, comfortable in his own skin and even more committed to the role that he needs to play within his business. If you will allow me a bit more time, let me very briefly bring this article to a close by providing what I think are good principles to become a great construction owner.

  • Never say never!
  • Hire only employees who “want” to work
  • Keep dreaming…and infect others with your dreams
  • Know when and how to walk away from opportunities
  • See failures as learning opportunities…and grow!
  • Swallow your pride and learn from others
  • Take time to think and plan strategically
  • Commit and demand field excellence through planning
  • Be quick to listen, praise, forgive and slow to anger!

I know that there are a hundred other great principles, but you can start with this list and add your own. Be proud of being an owner but not so proud that you are the smartest person in your company. Hire those “above you” in intelligence and experience and leverage them to be their best. These folks will appreciate you more for it and will work their hearts to death to make you proud of them.

Construction owners, maybe more than any of the company roles, understand the importance of keeping their eyes up, focused on positive opportunities and always quick to encourage good things. Commit today to challenge yourself to take your own leadership to the next level, embracing many of the items presented here in this article.

Here’s to “living the dream.”

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The Star Concept – How to Increase Crew Power

First of all, the Star Concept gets its name from a strategy I used several years ago, not only with my company but also with many other contractors over the years. It is a process of engaging more of your workers to participate on their crews. A number of reasons caused me to consider such a strategy.

  • Employees who are more engaged with their co-workers usually have better attitudes
  • Workers who are involved with their crews are normally more productive
  • One foreman can’t have his eyes on every area of his crew
  • Crew members who are more involved with making their crews better and safer typically stay with the contractor longer
  • The Star Concept actually provides a subtle but positive training opportunity for a future crew roreman

All five reasons above still hold true for many contractors today. So now, let’s look at what the Star Concept is and how it functions.

There are several areas within each construction crew that are either directly or indirectly impacted by the workers. The five most visible areas, each represented by a point of the “Star,” are:

  • Safety
  • Quality
  • Maintenance
  • Schedule
  • Production

Again, each crew member impacts these five areas in some form or fashion. The one constant within any crew is the crew foreman. He is responsible for the positive results of all five areas yet cannot really be 100 percent focused on any one area for very long during the workday.

Because the crew foreman is only one person, it is important to get support and assistance from the crew members. Let’s face it: construction is more challenging today. With all the required safety, DOT, state and federal laws or guidelines that exist, the responsibilities of a crew foreman are simply broader than ever.

The Star Concept works to assist the crew foreman by getting more support from those already engaged to work on the crew while still holding the crew foreman responsible for the final results.

How the process works

To begin the Star Concept, select one or two of the five points of the star shared previously in this article. I often coach contractors to start with safety and maintenance. Next, you need to select a crew member to take on the role of a “coordinator” for each area.

Let’s look at the role of “maintenance coordinator.” I would begin by selecting a crew member who has demonstrated a bit more attention to making sure that a tool is in working order or that one of the pieces of equipment has enough oil. Or it might be the employee who has a bit more mechanical skills or interests.

After you select your maintenance coordinator (MC), you’ll then need to educate him on what he will do in the role. Consider a general overview of this role that you might use:

The maintenance coordinator can assist his crew by assessing the condition of tools and equipment needed by the crew. If something is not in working order or needs maintenance, the MC informs the crew foreman of the need. The MC is not responsible to fix or maintain the crew’s tools or equipment but initially serves as an extension of the crew foreman to see that the tools and equipment are in working order for the crew.

A more detailed maintenance coordinator description is needed.  Such a description should answer the questions highlighted in the sample below.

MAINTENANCE COORDINATOR

WHY?Well-maintained equipment provides for better-conditioned equipment, greater equipment availability, better quality of product, longer equipment life, less overall maintenance costs, and happier team members!
WHO?
One or more team members coordinate a maintenance “check” on all equipment within the team. The coordinator serves as the crew’s formal point of contact to other crews and the maintenance department of the company.
WHAT?Coordinates with the mechanic when equipment is scheduled for major maintenance work. Works with their crewmembers on maintenance activities that others can handle. Develops a monitoring chart that is to be completed daily/weekly to ensure maintenance checks are regularly completed. Coordinates a weekly machine check to identify potential breakdown reasons. Key to the effort will be scheduling maintenance people to provide training on equipment and/or tool maintenance techniques that would be easier and better for crewmembers to perform.
WHEN?Daily checkup with individuals to monitor equipment. Assist crew foreman, as needed, whenever a maintenance issue arises that requires inspection or scheduling a repair.
MEASUREMENTS?Check-sheets that measures all equipment or tools that received daily inspections.Process Interruption Sheets for downtime and causes.Recording the cumulative hours of use for equipment per maintenance specs.

The Star Concept works! It brings more workers into participating with the well being and performance of the same crew of which they are a member. When more workers participate in something like the Star Concept, there is a healthier work culture. More workers feel more needed and thus more important.

Using the maintenance coordinator as an example, you can follow the same process to add to your crew’s “star points.” If your crew size is in the five to 12 member range, then fielding a coordinator in all five of the suggested areas might be possible. If your crew size is more like the three to seven-member size, then perhaps only two or three “star points” might be considered.

Keep a few final thoughts in mind about incorporating the Star Concept into your crew strategy for greater crew safety, performance and motivation:

  1. “More is not better!” You would be wise to begin with one or at the most two of the areas. You can always expand as needed.
  2. Don’t initially ask for volunteers to fill the coordinator roles. Personally invite selected employees to consider taking on the role. Start with your “winners” first to pave the way.
  3. Create the coordinator description that is best for your crews. Remember, the coordinator IS NOT another crew foreman. Not getting that point across will kill the one chance you might have to build greater participation.
  4. Do you need to offer an incentive? Maybe. Giving an employee another five to 25 cents an hour might be a great bargain for the extra attention he might bring to the crew.
  5. Can you have “co-coordinators”? Sure, BUT be careful that the “co” think doesn’t become a social experience, taking two workers away from performing their jobs within the crew.
  6. Provide training for each coordinator selected. Provide some basic overall understanding of the area and give each coordinator a list of items you need them to execute.
  7. Have a coordinator meeting once or twice a month. It’s important that the coordinators are supported by their crew foreman and you, the contractor. This meeting can be short but should entertain challenges, problems and opportunities.
  8. Allow your coordinators to grow into their role. Often, the coordinator matures into a very effective assistant to your crew foreman. Certainly be careful not to allow any coordinator to be “the boss” or to act “bossy.” Do, however, allow them to grow in their area of focus, coverage and insights.

Integrate the Star Concept into your crews this year. You may be surprised at the support and enthusiasm of your workers after they get a real feel for the benefits of having another point person for one or more areas of crew work.

If you have any questions about the Star Concept, either before considering its use in your company or even after you’ve installed it, please write me via our blog. As they say, “Shoot for the Stars” and you just might find your crew’s productivity, enthusiasm and attitude about work moving skyward!

Coordinating the Stars!

© Brad Humphrey, Pinnacle Development Group/The Contractor’s Best Friend™

10 Reasons Why Construction is Your Best Choice

Do I go to college?

Should I quit college now and get a job?

What’s the best job for me?

I’m getting a degree, but I can’t see myself doing what my degree is in. Now what?

 

Hey, if you think you’re the only person to have ever asked these questions, and thousands more like them, you must be smoking banana peels! (Yuk!) So, stop and smell the reasons why construction might be just for you!

#10 – Construction isn’t for “dummies.” Never was! Construction provides you with daily challenges that bring out the best in your brain! Contractors are now looking to hire workers with a head on their shoulders!

#9 – Working in the “great outdoors,” and sometimes indoors, allows a person to breath freely and not be stuck in a room with re-circulated air that transfers all the virus bugs from other workers to you!

#8 – Construction is full of the most diverse group of people in skills, smarts, personalities, ethnic background, and…well…just about any sort of tastes for adult beverages.

#7 – Construction workers actually learn how to work! In many other industries, a worker doesn’t really know what is going on all the time, much less what the day’s goals are. Contractors actually teach their workers how to perform work that the worker may have never dreamed that they could do!

#6 – Construction…pays really well! Most construction workers begin to make some serious money after they’ve served a brief training and “apprentice-like” time learning their trade. In today’s market, it’s not uncommon to find entry-level laborers making $12-$15, even $16-$18 an hour just to start. Heck, college graduates can start at $40,000 – $60,000.

#5 – Construction success is based on the “team.” Contractors really do practice the axiom, “Together Everyone Accomplishes More.” Construction companies, projects, and crews are perfect for the individual who likes to share the pressure, sweat, excitement, and diligence with others.

#4 – Construction practices an equal employment opportunity AND an equal PROMOTION opportunity. New workers are taken seriously by their owners, and leaders, and you can bet that if leading a department, a crew, a project team, a division, heck, even a company is in your wildest dreams…those dreams might not be so wild!

#3 – Construction companies build and remodel some of the most iconic, beautiful, and most meaningful buildings, parks, bridges, hotels, yadda yadda yadda. Think about, the house or apartment you live in was built by a construction company. All of the trees, plants, flowers, grass, and lights were put in by a construction company. That hospital that took great care of your friend, or that church you go to, or that school you went to, all of these were built by construction companies…and the people who worked as construction workers.

#2 – Construction workers love construction because there are never two days in a row…exactly the same. Didn’t like Monday? Don’t hold your breath…Tuesday is guaranteed to be different. That’s what almost 100% of construction workers like about construction…it is never boring!

#1 – Perhaps the biggest reason that construction is your best job choice…because it’s flat out fun! The construction industry is full of some of the smartest, most energetic, funniest, and talented people in the world. When construction workers are “rockin & rollin” they can’t wait to get to work every day…offer their best ideas…and share the hard work and celebration with others…who are just as excited to working as they are.

Look, is construction really your best job choice? Well, if you like boredom, if you like working where it might take you 10-20 years to really “gain anything,” and if you like to work where you’re not expected to think for yourself…you may not be made of the stuff needed for construction.

I’ve seen college majors in English, Political Science, Psychology, Music, Math, Biology, Education, and a host of other specialty majors all in the construction industry…and loving it! I’ve also seen individuals who received more than a college education by going right into the construction field and…loving it as well!

Hey, think about it! You don’t see yourself working in a fast food restaurant, or as a manager of a retail store, or maybe selling smart phones for a national cell phone company, then take a good long look at construction! We’re looking for you!!