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Focus on Finishing Projects Faster

05/15/24

Suppose you were visiting one of your construction jobsites, where you were building a 95,000-square foot manufacturing building. The project superintendent and concrete foreman were discussing the job schedule and when the tenant was expecting to move in. They weren’t sure what the exact move-in date was, nor the contract completion date, nor what the City required to get a final inspection and certificate of occupancy to get the utilities turned on. Not a comforting thought considering this project team was supposed to be in charge of a $4,500,000 project!

Put the dates where everyone can see them

Most companies who bid on this type of project typically calculate the costs and project requirements based on a six to seven- month total completion schedule. The contracts should always specify the start and completion dates. In the first project meeting with your customers, these dates should be confirmed and documented to avoid issues at the end of the project, when people tend to forget what was said and committed to six months earlier. Your team should post these critical dates on the job office wall in bold letters for all to see. The dates should include: the start date; completion milestone target dates, including foundations, slab, exterior walls, roof structure, rough framing, drywall taping, floor coverings, final inspection, utilities on, and punch-list completion; and the final contract completion date. With these dates clearly posted and tracked, your team will stay focused on the tasks required to not let them slip up.

A project team without a clear knowledge of the contract completion date, or understanding of what is required to make it happen, is a disastrous predicament for a construction company. Finishing a project late means you will surely spend more than the estimated and budgeted costs for field labor, supervision, and general conditions; the customer will be unhappy; and you will end up in a dispute over delays and damages with your customer and subcontractors. And your customer will tell everyone that your company finished later than promised.

Spend a little to make a lot

At a jobsite meeting, an owner asked the project team leaders when they were planning on tilting or erecting the building exterior concrete wall panels. Erecting tilt-up wall panels is a critical path item when building warehouse buildings from the ground up. They said they had scheduled the 100-ton crane to erect panels in mid-November. That was three more months, which seemed way too long and would not leave enough time to finish the project and meet the contract completion date. The owner asked them how they arrived at mid-November. They said they had all decided it was reasonable, doable, and makeable in order to make sure they would be ready for the crane. When the owner inquired whether they had checked the construction contract or budget estimate to see if mid-November would work or fit into the project goals, they replied that they had not. In fact, neither of the team leaders knew what the contract said about the completion date or the budget for time on the project. Wouldn’t this be upsetting if it was your project?

Rather than fire them both on the spot, the owner decided to see if they could be coached to a better result for themselves, the company, and the customer. When asked if they could possibly move the date up a few weeks, they hesitated and shook their heads ‘no way’ in protest. The owner then tried to encourage them to think about how they could move the job a little faster, but they had no ideas. Next, the owner offered them both a $1,000 incentive bonus if they erected all the walls by October 31. Guess what happened? They both changed their tune in a hurry, agreed, promised, and guaranteed they could easily and would surely finish two weeks faster. Not a bad investment for the owner— a $2,000 investment versus a 20-men crew working for two weeks longer than expected ($40,000 minimum savings). The end of the story is they actually tilted-up the walls on October 26, and the owner gave the superintendent and foreman $1,000 each, plus every crew member received a day off with pay for their extra efforts.

Offer more to get more

What games, bonuses, and incentives can you offer to entice your crews to work faster and boost your bottom-line? Faster jobs equal more money in your pocket. Try different incentives like competitions between crews, games to beat the budget, challenges to finish ahead of schedule, hardware store coupons for no defect or punch-list items, catered barbeque jobsite lunches for meeting milestones, dinner gift cards for crews who hit important targets, winter jackets for no jobsite accidents, or anything else that will keep work fun, exciting, interesting, and competitive.

Make it your priority to tell your people how difficult it is to actually make a profit. Explain that these bottom-line boosters can make a big difference. Your job is to make it your priority to focus on the positive factors you can influence instead of complaining about the economy or your competition. Get your team focused on what needs to happen in order for you to make money. Post the schedule completion dates for all to see and offer some incentives to beat the schedule.

Business - Commercial Real Estate Industry

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This article contains general information only. Sunflower Bank is not, by means of this article, rendering accounting, financial, investment, legal, tax, or other professional advice or services. This article is not a substitute for such professional advice or services, before making any decisions related to these matters, you should consult a qualified professional advisor.