Tag Archives: retention

Loyalty Among Construction Field Personnel

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Since 2008 construction employment has dropped considerably and has remained below 2007 levels, with construction management positions still about 14% down (U.S. Department of Labor, 2015). Despite the boom currently occurring in the construction industry, general contractors (GCs) are finding it difficult to fill project management positions (AGC 2014), and construction firms expect these challenges to continue (Mutikani, 2014).

loyalty

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With greater demand for managers, retaining quality people is a paramount concern. Everyone knows the adage that “money talks”, but what can a GC do to engender loyalty besides just paying more? To explore that question and attempt to better understand the factors that engender loyalty among a GCs employees, the team at Pinnacle Development Group worked with Texas A&M University and surveyed the field employees of GCs and obtained 440 responses that provide insight into the factors that are most effective in engendering loyalty for GC’s field management employees.  

Loyalty Drivers

Of the respondents, 38% have been with their current company for over 20 years, and 70% have been in the industry for over 20 years. They constituted a variety of job titles and levels of education, and came from across the Unites States. The questions related to three general categories of: Company programs, Relationships, and Attitude and Engagement. Respondents were asked to rank various factors in each area with the lowest average rankings indicating the most effective factors. 

Not surprisingly, pay scale and bonus structures was a top factor. However, participants felt that relationships with management were the single most effective factor in their loyalty as employees.  Each of the three areas (relationships, company programs, and attitude and engagement) are represented in the top three factors, however relationships occupy four of the top six spaces. So the key to retaining employees may lie simply in a people focused organization.   

Table 1 – Ranking of Factor Influential to Loyalty

Factor Area Average Ranking
Relationships with management Relationships 4.7
Pay scale and bonus structures Company Programs 5.1
Belief and trust in the company and its direction Attitude and Engagement 5.27
Relationships with supervisor(s) Relationships 5.42
Relationships with co-workers/peers Relationships 5.67
Relationships with customers Relationships 7.09
Agreement with the company mission statement Attitude and Engagement 7.63
Employee training and development opportunities Company Programs 7.71
Willingness to promote and encourage involvement with the company Attitude and Engagement 7.9
Flextime policies Company Programs 8.11
Employee feedback mechanisms Company Programs 8.65
Structured career programs Company Programs 8.74
Willingness to sacrifice on behalf of the company Attitude and Engagement 8.76

Additional analysis was also performed to consider company programs, relationships, and Attitude and Engagement with and the participants: Length of time with their current company, Length of time in construction industry, and the highest level of education completed.

Company Programs

Company programs did not predict the amount of time spent with the respondent’s current company. While they could predict time in the construction industry most GCs are not concerned with keeping managers in the industry, but rather in their companies. However, the longer an individual had been in the industry the more important company programs became, so company programs should be geared to more experienced employees.  Flextime policies were more important for employees with greater education, but those same flextime policies became less important over time in the industry while employee feedback mechanisms became more important over time in the industry. So in recruiting and retaining industry veterans, company programs are probably the best bet.

Relationships

Relationships did not predict time in the industry, or education level, however not surprisingly relationships did predict an employee’s time with their current company. Which makes this factor very important in GC efforts to retain their employees. While respondents indicated that relationships with management were most important, the numbers indicate that relationships with customers had a stronger relationship to time with their current company.    

Employee attitude and engagement

Employee attitude and engagement did not have any statistically significant impact on time in the industry, time with current company, or education. So while employees perceive that belief and trust in the company and where it is going affects their loyalty, no statistical relationship could be found between them in the numbers. 

Good relationships among employees with internal and external customers are the most important factor to loyalty. Relationships were perceived to be important to loyalty and the numbers showed a statistically significant link between employee’s relationships with managers, supervisor(s), and co-workers/peers and the amount of time they reported having spent with their current company. So the old rule that it’s all about the people, hasn’t changed and we can see that it is not just about the people, but also their relationships.

 

Authors: 

Colby Humphrey PRC – Pinnacle CCID

Ben F. Bigelow PhD – Texas A&M University

Employee Development, , , , ,

New Revenues From Old Customers

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From marketing we understand that it takes less money to maintain our customer base than it does to develop new customers. It also means you can increasingly see new revenues from old customers as a key aspect of your future growth. While this seems to make sense for businesses that produce or sell “perishable” products like food, clothes, maybe even cars, I always found it rather difficult to apply this thinking to construction.  Boy was I wrong!

In more than twenty years in the construction industry, both as a contractor and consultant, I have realized time and time again the reality of increasing business from my number one “prospect”…my current customer.  Yet I continue to get requests from contractors on how to grow their revenues through developing new and creative business development strategies to capture new customers.

Now, we certainly need to maintain an effort to drive new business but too many opportunities slip by us to increase our revenues, and our profits, with those customers who we have performed work for in the past.  Let me share a few techniques and approaches that may help you to raise your revenue this year by going back to a proven “fishing hole.”

Gain the Vision of Your Customer

New Revenues from Old Customers

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Getting a clear picture from your customers about what their building or project objectives are should be an effort made during the selling phases leading up to the first sale.  If the project is commercial, will there be additional concrete needs?  What are the expansion projections?  If the job is for a residential customer, will the customer be looking at additional add-ons or improvements in the future?  Don’t be timid when it comes to identifying future opportunities that your customer may be looking at in the future.  If you don’t ask the customer might mistakenly assume you really aren’t that interested in more work.

Strive to “Partner” on the Development & Budgeting Effort

Nothing ties a contractor to a customer better than having been part of the actual development phase of the project.  Whether you can assist the customer develop a more inviting patio design or you can provide a more efficient method to put the columns in place, being part of the development of any project gains you greater respect and long-term opportunities.  Likewise, working as the financial consultant on developing a practical budget with your customer allows you to get close to the real emotional side of paying for the project.  Once you enter the “inner sanctum” of the customers financial world there is little else that they will be shy about discussing with you.

Personalize Your Follow-up and Stay-in-Touch with Customers

This combination of efforts continues to be the leading reason why more contractors fail to new revenues from current customers.  Follow-up moves to contact the customer about work that is in process to see how they are doing and what they are thinking.  If the customer shares their desire for additional work in the future follow-up gives you license to call or e-mail them on a consistent basis to keep your name and desire in front of them.  Even if you have sales people who made the sale it is important that you contact the customers.  Often, an owner brings even greater interest and intensity to the relationship.  Many contractors will send out generic thank you cards and letters, perhaps even putting new customers on their newsletter receiving list.  While these efforts keep your name out there they are not of the personal nature that brings greater “likeability” to you and your company.  Touch your customers…personally.

Host Customers for Your Company’s “State of the Union”

Once a year you should host a breakfast or luncheon where you invite some of your better customers to share with them your firm’s direction and commitment to your customers.  This is a good time to invite your customers to share their needs and expectations about where they are going.  I’ve facilitated many of these luncheons, often called “Lunch and Learns,” for contractors across the United States and the response is always very positive.  You can always hold more than one of these luncheons a year and simply better segregate the customers you want there.  The customers actually enjoy the luncheon since they will often fall into conversations with other customers who have also enjoyed your company’s work results.

Provide an Incentive to Repeat Customers

Certainly, many customers appreciate an incentive from a contractor who they have given work to in the past.  An incentive might be a percentage discount on upcoming work to be performed, a “pass” on a deposit that is often required of new customers, or a higher priority in scheduling upcoming work.  While the financial incentive might be the hook with customers whom you have just completed one or two projects the long-term customer may simply appreciate knowing that you will move their job up a little sooner on your schedule when possible.

Continue to Provide Before & After Photos

One mistake contractors can make is to discontinue giving past customers photos of their projects.  This is a subtle way of telling the customer that you don’t have to work that hard to keep their business or that you might be taking their business for granted.  It is just as important to maintain the same energy and sales effort with customers that you have done five or fifteen projects for as it is with the brand new customer who you are trying hard to impress.

Ask Customers for Referrals

This networking technique is especially important for contractors who work with residential customers.  While the home owner who needed a drive way or patio poured and finished might not own other homes or buildings they very often have other friends and relatives who trust their judgment to use you for their concrete needs.  Asking your customers for referrals is really part of “Sales 101” for sales and estimators but is often neglected.  Too bad because for those sales professionals who do ask for referrals every time they sell a job they increase their revenues 40%-60%!  This technique is a great way to grow your revenues through turning your existing customers into sales people and door openers for your company.

Introduce Your Customer to Other Building “Partners”

[pullquote]By keeping an open ear you might just hear something that could allow you to play “broker” between two potential partners that would only naturally look at you to do the construction portion that you specialize in providing.[/pullquote]

This technique may be more doable with commercial clients but there is a growing number of building owners who are looking to further their investments and ownership of buildings by looking for partners who might share some of the financial and management risks.  The conduit common to such an arrangement could very easily be you!  This gets back to the need to understand what your customer’s vision is for their own company growth and their resource situation.  By keeping an open ear you might just hear something that could allow you to play “broker” between two potential partners that would only naturally look at you to do the construction portion that you specialize in providing.

Do Quality Work!

One thing is certain, if you do not perform quality concrete work for your existing customers you fail to get new revenues from old customers.  All the greatest marketing and customers service tricks in the world cannot make up for poor quality.  You can increase the likelihood of driving up revenues from existing customers by doing a great quality job the first time.  If you and your work crews are not 100% fanatics about performing quality then you would be best served by getting this part of your company fixed first.

Just Ask for It

Do you really want to increased revenues from old customers?  There is only one thing that will do this in the end and that is to just ask for the business.  Even the customer whom you have had a great relationship wants to be asked.  No one likes to be taken for granted, even your most loyal customer.  When you are having that morning cup of coffee with a long-term customer and they talk about that new construction job they want to get started on in the next year, don’t assume that they already have your name written in as their contractor of choice.  Ask them for the work and let them know that you want their work.

Increasing your revenues can certainly be done without a lot of extra marketing and advertising costs.  Treating your current customers well and taking a sincere interest in their future will open many doors to repeat work.  Sure it may cost you a dinner a few times a year, maybe even a round of golf or some tickets to the ball game but this is still small potatoes compared to digging and scratching everywhere possible to find new business.

If you are doing some of the items listed above then go back and measure how successful any technique has been to increasing your revenues.  Can you see a direct correlation?  If not, perhaps you may need to rethink and adjust the effort to capture more opportunities to win additional business.  It is possible to realize new revenues from old customers but it will take working many of the ten techniques and approaches shared here.  Go back to your “old” customers and consider renewing your commitment to their future success.

Strategic Planning, , , , ,

Improve Construction Employee Retention With a 90-day Action Plan

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TCBF

This article originally appeared in The Contractor’s Best Friend at ForConstructionPros.com.

 

Any contractor knows that retaining workers takes a huge effort. No leader is “off the hook” from working to keep workers on-board and committed to staying with their employer. Interesting new research demonstrates that even an employee peer group can be quite influential to encourage a new employee to stay with her new employer longer.

In a previous article on how to retain our workers I introduced seven steps that many contractors have embraced with success. They are:

  • Step #1 – “On-boarding”
  • Step #2 – The 90-day Plan
  • Step #3 – Skill Training
  • Step #4 – Coaching & Mentoring
  • Step #5 – Engagement/Participation
  • Step #6 – Responsibility Enhancement
  • Step #7 – Performance Review

While not every contractor excels at each of the steps, all contractors at some point realize that all seven of the steps are critical to any serious attempt to retain workers. And with a great shortage of workers for our construction industry current in play, it is imperative that every contractor consider what he might do to find, hire and hold on to those “precious assets” we call employees.

We will pick up today then with our second step to employee retention, something I call the “90-day Plan.”

The 90-day Plan is a strategically developed action plan that lines out for a new worker what her first weeks with the new company will entail. Is there anything magical about “90-days?” Well, sort of! Let me explain.

For companies with more than 50 employees, the attention paid to complying with government employee regulations is important. Most companies recognize that it is important to provide a period of 90 days to allow a thorough opportunity for the new worker to prove her ability and demonstrate her potential to a company and to allow the employee to recognize if the company is the sort of company she would like to work for.

Certainly most contractors will tell you that they have their opinions formed about a new worker much sooner than 90 days. The fact is, allowing a “probation” period does allow for greater review and assessment and prevents a rush to judgment. However, most companies that formally commit to a 90-day trial period fail to have any real plan for a new employee. Here’s the typical first few days for a new employee:

  • Introductions to coworkers and leaders
  • General orientation to company policies
  • “Go to work…and figure things out!” (employee is “turned loose” to see what she can do)

While that might exaggerate things a little, those efforts are not far off for many contractors. Think about this reality for a newly hired employee: when she arrives for her first day of work she has invisible antennae on “high alert” listening, watching and sensing anything and everything that confirms for her the decision she made to join the new contractor. Personalities, smiles, tones of voices, jokes, manners and amount of attention are just a sample of the things that a new worker will be sensitive to experience.

And when that new worker arrives at home after her first day at work, and if she has a spouse, significant other or even just a roommate, you can be sure that at least one question will be asked of the new worker: “How was your first day?”

How that new employee answers this question is based totally on how she interpreted her first day of reading the workplace and the people she just spent time with. What sort of impression do you imagine she would realize on her first day at your work place?

This is why I developed something that I call simply the “The 90-day Plan.”  It’s not magic, but it does provide you with a bonafide strategy to share with your new workers on their first day. Just imagine the positive first impression a new employee might have for your company if on the first day she received, as part of her orientation, a well-thought-out plan for her first 90 days.

While such a plan might scare some new workers, it will more likely have a positive impact on the new employee’s mental attitude, as she clearly understands that your company is prepared for her participation. The plan also sends a strong signal that she is expected to contribute sooner rather than later.

While every 90-day plan can be different for every new employee, there probably are several items that might appear on most of your new worker’s first 90 days of work. Let me share with you a sample 90-day plan for a crew foreman. Look more at the range of things that are presented during the first 90 days rather than the specifics. Obviously, what you might create would be tailored to your organization and the job that you hired the new employee to do.

The 90-day Plan for crew foreman

  • Week #1 – General information about company, policies and walk-through of employee handbook
  • Week #2 – Focus time discussing leadership skills and techniques
  • Week #3 – Focus time on job scheduling and planning
  • Week #4 – Training on construction “math” to improve calculating productivity rates and projected manpower
  • Week #5 – Review of company equipment, vehicles, tool needs, and maintenance and operating requirements
  • Week #6 – Discuss industry, challenges and trends
  • Week #7 – Training on building teamwork for construction crews
  • Week #8 – Communication training to improve interactions with different personalities
  • Week #9 – Training on coaching and counseling employees
  • Week #10 – Review of material use, advantages and options
  • Week #11 – Introduction to improving customer retention through satisfaction techniques
  • Week #12 – Developing the crew foreman’s strategy for growing crew productivity, quality and safety

Now, there are a few other “secrets” to making this approach more beneficial to both the company and the individual.

First, there should be a “pop quiz” every Friday for the first 12 weeks. The pop quiz can be verbal or written and should not necessarily be conducted to “flunk” the new worker. In fact, just the opposite intent should be in play. For example, to have some fun with the new worker, the questions for the pop quiz at the end of Week #1 might include some of the following questions:

  1. Where are the rest rooms for the women and men?
  2. What are the hours of the company?
  3. What are the company colors?
  4. What type of construction did you experience this week?
  5. What are the names of two employees you met this week?

You can see from this list that the first week’s questions are softballs not intended to trip up anyone but simply to remind the worker that the company expects her to retain some of what she learned during her first week. Certainly the questions can become a bit more challenging as the weeks proceed.

Second, the worker should be engaged with work and her peers as soon as possible. Short of positioning a new worker in an unsafe work situation, the sooner the new worker can join her peers and begin to get a feel of the tasks involved the better motivated she will be. While there might be some weekly topics for training or discussion, the contractor needs to expose the new worker to her specialty of construction as quickly as possible, even if the new worker comes from a similar background. The contractor must demonstrate why the company is different from the company the new worker just left.

Third, for the first 12 weeks the new worker should have a “partner” while at the workplace. The partner might be a fellow crew or department worker, but the more important role is for the partner to check in with the new worker at least once a day to see how the “newbie” is getting along. Such extra attention can really go far in winning the new worker over to the culture of the contractor AND, such a relationship also provides the contractor with another employee’s opinion about the new worker.

Fourth, require a “lessons learned” report from the new worker. Like the pop quiz, contractors can gently push new workers to be more alert and interested in learning their new role. Here’s what I would recommend a contractor ask the new worker to verbally report to her senior leader each Friday, just before the pop quiz:

  1. What did you learn this week?
  2. What did you learn that will improve your performance or behavior?
  3. What did you learn that will help this company be better?

The questions are simple and really allow the new worker to demonstrate her awareness and her attention to what was presented during the week. A contractor might be surprised at how many new workers, even management level, “sleep walk” through their first few weeks. It’s almost as if the new workers are enjoying their lack of accountability!

The 90-day Plan will not cure all of your new employee learning needs, but it will set your construction company apart from many of your competitors. Remember, raising the excellence at your company can be done through a number of means. The 90-day Plan is just one method to building long-term employees.

Make the first 90 days work for you … and for your new workers!

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