11 Steps to Tripling a Coating Contractors Profit, Step 2
Step 2 in our series of how to increase profits is Project Management.
The Project Manager has financial responsibility, customer interaction responsibility and responsibility for directing the activities on the job site. The skill set required for this is rare because the guy who is tough enough to lead a crew of skilled labor and thrifty enough to watch the money rarely comes with good customer sales skills. Yet it is this combination of skills that will likely determine how much profit a contractor makes on each job and how satisfied the customers are. A contractor’s ability to recruit individuals with this combination of skill will ultimately determine the size to which the company can grow and how profitable the company can be.
Nearly every hire will be a compromise because no individual scores 100% on this wide range of ability. Use the instruments available to test for these qualities, and make decisions about which shortcomings you can compensate for. For example, if an owner will visit a job site often and possesses great people skills then you can compensate for a project manager who doesn’t know how to sell.
The Project Manager should give clear instructions to his first line supervisors in the form of a three day work list updated daily. He should then ask the supervisor to walk him through the job and have the first line supervisor explain each task to him including how he will acccomplish it and what tools he will use.
The Project Manager should walk the job regularly and stop anyone committing even a minor safety violation. This demonstration that safety is important to management will permeate the ranks. The reverse is also true.
The Project Manager should set expectations about the outcome, including hours to complete, of every task. And he must hold people accountable for shortcomings as well as praise accomplishment.
The Project Manager must review and understand each cost item daily. It should come to him in a detailed report. The time to challenge costs is the day they occur.
The Project Manager should develop customer expectations about additional costs by pointing out the unexpected (and not contracted for) problems encountered on the job. He should never submit a change order until asked for one and he should never address a problem until the customer has recognized the need. Point out the problem and wait until you are able to get the customer to see the magnitude of the problem and that it is his problem before you ask for money to solve it.
I welcome your feedback. — TonyC