During my first seven years starting and building my construction company, I tried to do too much myself. Just like you, I did everything that took brains and was important to the viability of the business and more. I put all the estimates together and presented the bids; awarded, negotiated and signed all the contracts, subcontracts and change orders; I made the big field decisions; purchased all materials and equipment; went to all the job meetings; supervised concrete slab pours; and made every personnel decision. This made me crazy, raised my weight and caused most of my hair to fall out!
Why? I made lame excuses that I couldn’t find any accountable or responsible people I could trust. The real reason was I couldn’t let go. And I couldn’t let go because we didn’t have any written systems or training programs to ensure everyone knew what and how to do things the way I wanted them done.
One evening I took my family for a ‘happy’ meal at McDonalds. I noticed the boss wasn’t there, the employees were 16, customers were happy and the food was consistent and relatively edible. I also wondered who decides how many pickles they put on the hamburgers to make sure every one is the same. Do they have a pickle inspector or do they let each burger flipper decide? I thought: ‘How do they do it without the owner supervising full-time and making every decision for the crew?’ I asked a server to show me their secret. He took me behind the counter where they have pictures or blueprints clearly displaying how to build a hamburger with two pickles as well as the other menu items.
Good people or good systems
Wow! A huge company runs smoothly using simple pictures of the finished product. This guarantees consistent quality and results. Plus the owner doesn’t have to be on-site all the time supervising, juggling and making every decision for every customer order. If I could do this in my business, I could also build a systemized well-organized company. This could reduce my dependence on having great people. And it would allow me to grow beyond the level of what I can control, micro-manage and supervise.
A systemized business produces consistent performance and the same results every time. How much money are you losing relying on your people to do their best and not following company installation and operational standards? In your company, who decides how many pickles you include per burger, nails per top plate of wall, form braces per lineal foot of slab edge, support wires per light fixture, hangers per lineal foot of copper water pipe, depth of excavation lift, or what two coats of paint really means?
The results of owning a systemized business include on-time, on-budget projects, quality workmanship, safe working conditions, repeat customers and the ability to always make a profit. All this, with or without you being there all the time. Perhaps you could take a vacation one or two days per year!
Good systems are simple
Excellent companies have simple systems. Outline each system on one piece of paper, written or drawn detailing a picture of the end result desired to meet your company, customer or project specification. The best systems are team designed by the people who actually do the work and know how to do it best. For example, at hotels, all rooms always look the same when ready to occupy. How do they do this? Simple. A picture of a ready room is shown to the housekeepers and the supervisors explain what’s expected. They don’t care how the result is accomplished, just that the room is perfect when completed. This simple approach can be applied to every part of your business.
Create a “DO” manual
To organize and systemize your company requires time and effort to produce consistent results and get everyone doing business the same way. Create a “DO’ manual of pictures, checklists and guidelines as your company minimum standards. Build a three ring binder of standard systems for every aspect of your company and field operations. Include everything from how to prepare a timecard, calculate change order markup, install slab expansion joints, form door openings in concrete walls, do monthly job close-out, and get paid. Focus on the important things first that will make a difference in your bottom-line. Make a goal to create one system a week, and you will be very organized in a year.
7 steps to create systems
1. Identify areas to systemize
Start a ‘Fix-It List’ identifying everything you need to fix in your company. Keep this list handy and add to it when things go wrong. At your manager meetings, pick the top one or two items to systemize every month.
2. Assign system team
First assign a key individual in your company to be the systems keeper to formalize and keep them organized. After choosing a system to create and implement, pick three or four people to work on the company standard. Involve those who actually work within the area being systemized. For example, your team might include a project manager, foreman and journeyman when systemizing a field standard. Let them pick a convenient time and location to work together for a few hours.
3. Draft standards, guidelines & tracking system
Create checklists with pictures of the desired end result for each system. Include a way for the standard to be verified that it is being followed and implemented by everyone in your company. Draft it on a standard paper for three hole punching into a binder.
4. Formalize & try
The system keeper will be in charge of formalizing and distributing the systems. Let the team who created the system try it and work out all the bugs for a few weeks before implementing it company wide.
5. Implement & train
At regular monthly meetings, have the team who created the system present it to the entire company. Insist everyone do the system per the company standard – no exceptions including yourself. If someone protests, let them put the item back up on the ‘Fix-It’ list for further revision. These written systems can become your training manual, too.
6. Monitor & track
Your job will be to insist the systems are followed. Many of them will need a tracking mechanism to make sure they are being followed. For example, a pre-concrete pour checklist should include a place for the foreman to sign off on the checklist and submit it to the project manager for review.
7. Follow-up, evaluate & improve
After six months, revisit the new systems to ensure they are still being used and working well. If revisions are needed, ask the team to revisit the procedure and improve it.
The beauty of written systems is not having to worry about every little detail all the time. Your team will have a company standard to follow. This will allow you to spend time on important matters like growing your business and making more money. Get started now by making a “Fix-It List”, and you will get organized sooner than you think.
George Hedley works with contractors to build profitable growing companies. He is a professional business coach, popular speaker and best-selling author of "Get Your Business to Work!" available online at www.HardhatPresentations.com. To sign-up for his free e-newsletter, join his next webinar, be part of a BIZCOACH program, or get a discount coupon for online classes at www.HardhatBizSchool.com, e-mail [email protected]
