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More Work Coming In Than You Can Produce? – Here’s Some Guidance and Advice

Posted by Shawn McCadden on Wed, Apr 27,2016 @ 09:25 AM

More Work Coming In Than You Can Produce? – Here’s Some Guidance and Advice

Increasing production capacity at a remodeling businessThe Joint Center for Housing Studies at Harvard University indicates that the dollars spent on remodeling will increase by 8.6% by the end of 2016.   Most remodelers are already feeling this surge in spending as their backlog of work keeps increasing and at the same time the number of estimates they need to push out is also increasing.  Smart business owners seeing this happening are already increasing their field staff capacity to take advantage of the work.  Adding staff can help get more work done.  However if production efficiency and organization are challenged due to the growth profits can quickly drop. To help these contractors out I have searched out and assembled the list of articles below. Each article is helpful, but collectively they can help identify a plan of action contractors can take to protect the profits they expect to earn by growing their businesses.

A good number of contractors have been contacting me for help in this area.  Most share now that they have more staff they are challenged to properly manage them and the sequence of work. Others report they have come to realize they may have hired the wrong staff.  The solutions to these problems are actually not that difficult to put in place.  What typically gets in the way is not knowing what systems to put in place to support the growth and how to get things started. 

 

Here is one message I got just today, from an employee:

“Hello. I was hired 3 years ago as an estimator. We had 2 carpenters and a super. We now have grown into 7 carpenters, super, production manager and additional secretary. None of our carpenters are "lead carpenters" but about 4 think they are. We are experiencing some growing pains for sure so any input would help. Thanks.”

 

Hiring the right carpenters and production managersSo, here is my list of helpful articles for contractors seeking to advance and grow their production capabilities.  The articles will help enlighten you to what your options are as well as several important considerations to be aware of before you jump in and get things started. I hope you find the info helpful and motivating. If you want help putting things in place at your business feel free to email me.  

But don’t wait too long. This surge in business opportunities for remodelers has also caused a surge in my business.  I too can only help a limited number of qualified customers! 

 

List of articles about growing production capacity at a Remodeling Company:

Options for Managing Production

What’s the Difference Between a Production Manager and a Production Supervisor?

All I want for Christmas… Is a Real Production Manager!

Is He Really a Lead Carpenter?

Key Differences Between Carpenters and Great Lead Carpenters: Part 1

Key Differences Between Carpenters and Great Lead Carpenters: Part 2

Checklist for Implementing the Lead Carpenter System

Considerations for Putting the Right Employee on the Right Job

Help With Evolving From Contractor to Construction Business Owner

 

Topics: New Business Realities, Employee Advancement, Business Growth, Earning More Money, Production Considerations, Lead Carpenter System

If One Of These People Asks, Can You Explain How Your Remodeling Company Does Business?

Posted by Shawn McCadden on Mon, Aug 10,2015 @ 01:01 PM

If One Of These People Asks, Can You Explain How Your Remodeling Company Does Business?

How a contractor does businessMost contractors can't explain how they do business, they just make things happen.   In a smaller remodeling business, say up to about $5-700K of installed work, this may get you by.  But as you grow your business, particularly if you want to grow past $1M in installed remodeling sales, the list of people below will want and or need to know how you do business.  

Would you be able to explain it to them?  Or will you let them tell you how it will happen?

To grow a successful construction business these people in your path will need to know how you do business: 

Prospects:  
If in the past they have had a bad or good experience with another contractor, savvy remodeling customers already know what worked or didn't work for them and their project. Before they hire you they will want to know how your business operates.
Customers:  
If they have already bought from you without knowing how you do business they may have bought on price and have already assumed how you will do business. It’s probably not the same way you are assuming.
Employees:
lead carpenter system workshop click here If employees don't know how you do business they will be challenged to take on responsibility as the business grows because they will never be able to assume what you want them to do or say at job sites and or with customers.  If they take the risk of doing so, and then you chastise them for what they did, they will probably never take that risk again and or may look for a different job.
Recruits:
Finding good employees these days is challenging.  Finding a real lead carpenter or production manager is near impossible.   Try this example.  You find a real lead carpenter, and while interviewing that candidate starts asking you questions about how your business and your lead carpenter system work. Will they gain confidence in working for you or will they come to realize they should look elsewhere?   Good lead carpenters know what they need from the business and how it should happen so they can actually produce projects on their own, from the job site.  (Check out this Lead Carpenter System Workshop for business owners)
Architects:  
Explaining how you do business to an architectBe careful here.  If you don't explain how you do business before winning the bid on an architect driven remodeling project you might just be told how you will do business.  Examples include how and when you will be paid, what will be considered a change order vs. what you should have assumed to be included, what margin you can earn on change orders, and what hoops you will need to jump through before receiving progress payments and final payments.  Be sure to carefully read any AIA Contracts before signing them.
Sub Contractors:
Good trade subs are hard to find. If you find a good one but don't clarify how you do business with your subs before you hire they will likely be telling you what they expect after you are already committed to them.  At that point you may have no other choice than to suck it up if you want to keep your job on schedule and your customer happy.   A lack of clarity and consistency regarding your payment policies is probably the most common reason subs will lose interest in working with you on your next project.
Vendors:
Again, be careful here. Be sure to explain how your sales process works and how you price materials before sending prospects and clients to vendors to pick things out.  By doing so they can become part of your sales team.  If you don't, in a sincere effort to help you, they may actually create problems for you.  Examples might include quoting wholesale prices, giving pricing breakdowns, or suggesting products you prefer not to use.  If the prospect never even shares you sent them there, and you didn't let the vendor know they were coming, the vendor may even recommending a different contractor just so they can be sure to get the sale.

 

Can't explain how you do business?  

Thinking of growing to or past $1M and need a defined way of doing business that works for you?  Consider joining our upcoming Construction Business Owner Peer Group and Education Program.  By participating in the 4-month program you'll get structured education to help you as well as great insight and suggestions from your peers.  

 

Topics: Working with Vendors, Business Management, Recruting, Employee Advancement, Business Growth, Differentiating your Business, Marketing, Marketing Considerations, Prequalifying, Breaking $1Million

Key Differences Between Carpenters and Great Lead Carpenters: Part 1

Posted by Shawn McCadden on Tue, Jul 07,2015 @ 06:00 AM

Key Differences Between Carpenters and Great Lead Carpenters: Part 1

Creating lead carpentersSkilled Carpenters are assumed to have the trade skills needed to do the work at hand and to understand construction. But just because a carpenter has these skills doesn’t necessarily also mean he or she has the rest of what it takes to be a successful Lead Carpenter. Below is the first half of a list of key skills a carpenter should have or will need to acquire to become a great Lead Carpenter. We will be discussing this list at our Lead Carpenter System Workshop for business owners to help carpenters and construction business owners improve their chances of success developing Lead Carpenters and a true Lead Carpenter System.  

 

Skills to be a lead carpenter

 

This first list describes the basic skills and thinking skills a carpenter must possess to be eligible to become a Lead Carpenter. These are skills that should be inherent to the carpenter already, learned from an early age through schooling and practical application as a person evolves from childhood to adulthood.   If a carpenter does not already possess these skills the chances of success as a Lead Carpenter will be greatly compromised.

In my next article I will discuss the people skills and personal qualities a great Lead Carpenter must learn and develop.

 

Basic skills needed to be a Lead Carpenter:

  • Math skills for a lead carpenterSpeaking: Ability to speak clearly including selecting language, tone of voice, and gestures appropriate to a specific audience.
  • Listening: Listens carefully to what people say, noting tone of voice and their body language, then can respond in a way that shows a true understanding of what is said.
  • Reading: Ability to identify relevant facts and locate information in books or manuals. Ability to find the meanings of unknown words and use computers to find information.
  • Writing: Ability to write ideas completely and accurately with proper grammar, spelling, and punctuation. Also able to use computers to communicate information in writing.
  • Mathematics: Ability to use numbers, fractions, and percentages to solve problems and communicate solutions.

 

Thinking skills needed to be a Lead Carpenter

  • Carpenter_framing-wrCreative Thinking: Has the ability and is not afraid to use imagination freely to combine ideas or information in new ways. Can easily make connections between ideas that seem unrelated to others.
  • Problem-Solving: Can easily recognize a problem, identify why it is a problem, create and implement a solution, and naturally watches to see how well attempted solutions work so they can be revise as needed.
  • Decision Making: Can identify goals, suggest alternatives and gather information about them. Can identify and weigh pros/cons and choose the best alternative along with a plan to follow through.
  • Visualization: The ability to imagine, strategize and sequence the construction of a building, object or system by looking at a blueprint or drawing.

 

Don't miss Part-2 of the list

Subscribe to the Design/Builders Blog Be sure to come back here to find the second half of this checklist to learn about people skills and personal qualities a great Lead Carpenter must learn and develop. It will be published in a few days.   To be automatically notified via email when new blogs are published simply subscribe to the Design/Builders Blog.

 

Click here to see a Job Description for a Lead carpenter

lead carpenter system for business owner workshop click here

Other articles to help contractors and construction business owners choose and grow the right carpenters into Lead Carpenters

Evolve From Being A Contractor To Being A Construction Business Owner

Afraid To Hire Production Employees For Fear I Would Run Out Of Work For Them

A lead-carpenter system helps both the business and the employees to grow

Compliance Checklist: Will You Be Ready If OSHA Visits Your Job Site?

 

Topics: Worker Training, Careers in Construction, Recruting, Employee Advancement, Production Considerations, Lead Carpenter System, Mentoring/Coaching

3 Reasons Contractors Don't Share Financial Info With Employees

Posted by Shawn McCadden on Tue, Jul 15,2014 @ 07:51 AM

3 Reasons Contractors Don't Share Financial Info With Employees

Sharing financial info with employees

 

I recently read an interesting article about how much a business owner should tell their spouse about their company finances.  Two different opinions were shared and explored.   I’m on the side of sharing the info myself, but certainly not everything in detail.

That article got me to thinking about why so few construction and remodeling business owners share financial information with their employees.   First, I’ll offer a few great reasons to do it.  I hope the benefits will motivate more business owners to do so.   Then, I’ll offer my thoughts on why business owners avoid doing so. 

 

3 reasons to share your business financial information with employees:

Construction business owners who keep all the financial information about their businesses to themselves are definitively missing out on several potential benefits.   Simply put, by sharing financial information you can accomplish at least three things that will help lower your financial anxiety and help you make and or keep more money:

    1. Discussing financials with employeesYou can get the opinions and advice of others so you can be more confident in your numbers and using them to make sound business decisions.  Getting insight from others can also help you avoid costly mistakes.
    2. By involving the right employees with the creation and interpretation of business financials you can share the workload required to create them.  This can make getting your financial reports much more timely and therefore improve their accuracy.
    3. By mentoring employees on how to use financial reports you can help them learn to think like a business owner so they too can make sound business decisions.   This is an important and required step if you ever want to remove yourself from the day to day management of your business and or offer a profit sharing plan to employees.

 

So then why do so few owners share their financial information?

Let me also offer three common reasons why many construction business owners can’t or won’t share business related financial information with their employees:

    1. The most common reason is because the business doesn’t have a real financial system that properly separates and tracks costs and expenses.  For these business owners their financial system is really no more than a checkbook showing money coming in and going out.  Without the ability to identify and separate your actual job costs from overhead expenses there is no way your business can get a meaningful profit and loss report.   These business owners don’t share the information because there really is nothing of value worth sharing.   Eventually, once a year for most of these business owners, their accountant gives them the good or bad news when their tax returns are ready to be filed.
    2. Contractor financial helpOften financial information is held back because the business owner is embarrassed that he or she doesn't understand the business finances well enough to explain them or answer questions about them.  This is not good.   Imagine what a great employee will think about his boss and or the business if he discovers the owner is guessing at the financial health and well being of the company.  Think about it.  If you were an inspired and career motivated employee would you want to invest in your career at a business that is in the dark about predicting and measuring profits?
    3. During my years of experience providing financial consulting for construction business owners I have had many owners share with me their concern that if they educate employees about and share company financial information with them it will only serve to help them get ready to leave and start their own businesses.  This could be true.  On the other hand I found by educating my employees most of them figured out they didn’t want all the stress and financial responsibilities that came with being a business owner.   However, those who did leave and started their own businesses where in a much better position to be financially successful.   As a business owner I found personal satisfaction in helping make that possible.

 

Some words of advice

If this articles speaks to what is happening at your business it’s up to you to do something about it.   I definitely recommend you do not consider growing your business in any way, or sharing the information with employees, until you and your business can produce and interpret accurate business financial reports.   To help you see if doing so might be worth it try this self quiz to see if a properly setup financial system can help you and your employees improve business profits and reduce financial anxiety.

Let me know if you want my help.

 

Topics: Business Financials, Employee Advancement, Financial Related Topics, Earning More Money

3 Objections Your Boss May Have About Hiring an Industry Expert

Posted by Shawn McCadden on Thu, Feb 06,2014 @ 06:00 AM

We Can't Do That -3 Objections Your Boss May Have About Hiring a Construction or Remodeling Industry Expert

Remodeling Industry Expert

As an employee often times I bet you see challenges and opportunities at the business where you work that you believe your boss doesn't.    It’s not necessarily that you might be smarter than your boss, although that sometimes is the case.  It’s typically because you are involved in the business in a different way than your boss. If you are a Lead Carpenter perhaps that involvement exposes you to the day to day realities in the field while your boss is working on other things.  Or maybe as the production manager you're the one who has to manage the projects and build from the information provided by your boss; but you can't.  You have to constantly call him to get answers and or details. 

Often times I find that employees can be the eyes and ears their bosses are missing in certain areas.  If you are a dedicated and conscientious employee you may want to share what you see and offer solutions to help your boss.   One solution can be to hire a construction industry expert to come in and help right the ship.  This suggestion might probably be a good one.  However, if your boss objects to it, what can you do or say?  

Here are a few suggestions you can consider depending on the objection.

 

Objection #1: It cost too much.  

Remodeling company improvementsHiring a construction or remodeling industry expert certainly can be expensive.  Depending on the nature of the problems to be addressed the fees can add up quickly.   However, compared to the money lost over time by not correcting or improving things that slow you down or increase project costs, years perhaps, the lost revenue and compromised profitability can far exceed the initial cost to fix the problem.  Perhaps you could help your boss see the cost as an investment.  To do this consider using a simple analogy from your world as an example to help get your intended point across.  Maybe consider using the example of having a table saw.  Sure you could do your job without one, but it sure would go a lot faster and come out a lot better, and at a much lower labor cost, if he made the investment in a good one sooner than later.   And by doing so the labor savings alone would quickly cover the cost of buying the table saw.  

 

Objection #2: Don't have the money right now, so we would have to wait for a profitable job to pay for it.  

Improving profits at a construction companyIf you hear that objection it may be the truth.  But you know what they say about the definition of insanity.  Depending on your relationship with your boss perhaps you could ask what he has already done or will do different to get that profitable job.  The positive news is that often times the business is actually already in pretty good condition.  I find many construction businesses might only need a few tweaks and or new processes to make significant improvements.  If the expert helps start with low hanging fruit the initial changes can often generate the additional money needed to finance additional changes.

 

Objection #3: This isn't a good time, we are straight out right now.

Again, this may be completely true.  And again I'm not sure how you would do or say this depending on your boss, so be careful and be respectful.   Come up with a safe way to remind him that it's been pretty much like that every day and all the time for quite a while now since the company started running more than one or two jobs at the same time.  If true, also remind your boss that things were going really well on the jobs when the company only did one or two jobs at a time. Point out that maybe some additional preconstruction activities and or introducing a Lead Carpenter system might be the answer.  To help really make your suggestion practical you could also share your willingness and desire to take on additional responsibility provided you get the right training and tools to do so.

 

Last thoughts

Hiring a construction business expertMost construction business owners are thoughtful and kind people.  They are also typically very busy and put in a lot of hours to help keep the business going and keep the employees working.  If you see things that your boss doesn't, keep these considerations in mind.   Choose a good time to share your opinions and offer your suggestions.  Most importantly, do it with good intention and respect.  I hope you have a boss who is willing to listen and will hear your suggestions.  

If you give any of these suggestions a try let me know how you made out by posting a comment.  If you’re afraid to say anything I hope you'll share that here as well.  If you're afraid your boss will react negatively to a posted comment, email me your comment and I will post it anonymously for you.

 

Topics: Success Strategies, Employee Advancement, Business Growth, Mentoring/Coaching, Sage Advice

Have The Right Compensation Strategy For Carpenters Before You Hire!

Posted by Shawn McCadden on Thu, May 30,2013 @ 06:00 AM

Have The Right Compensation Strategy For New Carpenters Before You Hire Them!

Pay rate for a carpenter

 

One of the benefits of the great recession was that as business slowed down businesses got rid of underperforming and or overpaid employees.  This article is intended to help those remodelers who had or may still have such employees.   I hope by reading this information they can avoid repeating the same mistakes again as the economy eventually improves.

 

During the boom times many contractors, trying to get enough field labor to keep up with volume demands, resorted to overpaying carpenters and other field workers just to get them on board.  Also, over time, many remodelers gave wage increases to these people just to keep them, either in fear of losing them and or because another business offered the employee more money.  Additionally, many employees received wage increases based on longevity, perhaps with little or no consideration for any actual advancement in performance, responsibility or productivity.  One could fault the business and or the economy for why this was happening, but certainly not the employees.  After all, if market demand stimulated increased wages, employees would be foolish not to pursue and take the increases.

Then the bottom fell out

pay rate for carpentersThe great recession changed this scenario somewhat due to layoffs and downsizing.  The surplus of unemployed field workers got as high as 27% for the construction industry during the recession.  Unfortunately many skilled workers left the industry for other jobs, less physical jobs and or better job security.   This has set up what is expected to be a major labor shortage problem for our industry as the economy and construction pick up again.  Many contractors around the country are already reporting challenges finding skilled carpenters to keep up with construction demand.  As the demand goes up, so will the wages that carpenters can demand to either stay at their current jobs or that other contractors will use to lure workers away to work for them.

 

Finding, attracting and keeping the best carpenters will require strategic thinking

Finding good carpentersIf you plan to hire additional carpenters as your business volume picks up now is the time to put a plan together for not only finding, but also attracting good carpenters to work for your business and then to get them to stay with your business.  The compensation package you put together should not only capture their interest, but also help them see opportunities for future growth and increased compensation if they are loyal and motivated.

This provides a great opportunity for remodeling business owners to get compensation and any future wage increases in line with actual performance, rather than continue using the subjective reasons so prevalent the past.  It should only make sense for a business to put a plan in place that properly compensates employees based on the value they bring to the business.  It also makes sense to put such a plan in place so employees will know how they can and when they have earned the right to expect increased compensation.

 

Buying a boat or getting married is not a good reason to give a carpenter a raise!

pay rate for a carpenterThe automobile industry uses a flat rate manual to determine the labor costs for auto repair services.  The strategy they use is not to estimate the number of hours to do a certain task, but rather the typical actual cost of the labor to perform the task.  A repair shop that uses flat rates pays their employees for what they accomplish, not how long it took them to do it.  A construction or remodeling business could do something similar.  Such a strategy could also help the business and the employees learn where to invest training to improve performance and stimulate wage increases for those who buy into performance based opportunities.

If remodelers and other contractors continue to use purely subjective methods to determine compensation for field employees, they will be setting the example for and encouraging employees to also continue using subjective methods to assess their own performance.  If this plagued your business in the past it’s up to you to make sure it doesn’t happen again. 

Summary

Before you hire new employees or bring previous employees back into your business take the time to think out and document compensation plans based on merit.    If you introduce such a plan to job candidates it could even act as a filter.  Top performing candidates will be attracted to such a plan, but those who can’t or won’t perform will likely find somewhere else to work.  After all, as a business owner your compensation is based on actual performance.  Why not offer the same opportunity to employees.  If they make more money participating in such a plan, so will you!


Compensation plan for a carpenter


Related articles:

Successfully Grow Your Business By Creating A Ladder Of Opportunity For Employees

How To Make The Ladder Of Opportunity Happen At Your Construction Business

Simple Profit Sharing Plan For Contractors

 

Topics: New Business Realities, Hiring and Firing, Worker Training, Careers in Construction, Team Building, Employee Advancement, Business Growth, Sage Advice

How To Make The Ladder Of Opportunity Happen At Your Business

Posted by Shawn McCadden on Thu, Apr 11,2013 @ 06:00 AM

How To Make The Ladder Of Opportunity Happen At Your Construction Business

Note: This is the last article of a 3 article series on this topic (Click for article #1 or for article #2)

Turnkey business model for contractors 

Let’s use the example of creating a “Turnkey Business”

If you want a turnkey operation, which is one that runs without the need of the owner’s participation, the employees need to be self-motivated rather than motivated by the owner, their manager or short term measured motivation programs. Even if turnkey is not part of your vision, a single owner can’t wear all the hats of a continuously growing company. Vacations, health, and emergencies will at some point require the owner to delegate responsibilities to key employees.

 

Learn the “whys”

Employee motivationsThe best way to find out what will motivate team members is to ask them. While interviewing recruits or existing employees, find out not only what motivates them to grow, but also why. Connecting the “why” to the “what” can help get you, your business and that employee to where everyone wants to be much faster for two reasons.

  1. The first is the simple fact that adults choose to commit and follow through on their goals for their own, sometime selfish, reasons.
  2. Second, if the business, the marketplace or life changes at some point, knowing the why can help us find alternate ways to accomplish the long term company vision while still maintaining motivation.

 

Managing employee growth requires scheduled reviews

To help facilitate success support employee career advancement planning and implementation with a structured employee review process.  Be sure your review process identifies where the employee is today, where he or she is headed, and where you both expect them to be along their career path by the next scheduled review meeting. 

 

Generating a vision for where they will be is not enough

Career paths in construction

 

Work with the employee to identify the plan required to get there.  Include what the employee needs to do, as well as the company’s commitment and the necessary steps to help make it happen. 

Implementing a ladder of opportunity may require that the employee train and mentor his or her replacement.  Be sure the company provides "training of the trainer” early in each employee’s career path.  Education then becomes part of the company culture and facilitates constant growth among workers. 

 

Write down and maintain records of the employee review process.

Cosntruction employee performance reviewInclude in your record keeping not only the reviewer’s comments, but employee’s feedback about how well the company helps him or her to get there.  If your process includes writing down what has been agreed to at this review, both the company and the employee will know what to do between now and the next review.  You will also both know what you will be discussing at the next review.  This helps minimize the typical fears experienced by both the reviewer and the employee when anticipating the next review meeting and what they should talk about during the next review. 

If the review process is well thought out, properly documented and followed throughout each employee’s career, you have created a ladder of opportunity!

 

Related articles:

Article #1 of this series: Successfully Grow Your Business By Creating a Ladder of Opportunity For Employees

Article #2 of this series: How To Create A Ladder Of Opportunity For Your Employees

Government to Contractors: Start Hiring Convicted Felons!

Mentor Me, Please - Gen Y Business Owner Offers Peers Advise

Contractors: How To Work With Generation Y From One Of Them

Gen Y Member's Advice To Peers: How To Develop A Good Work Ethic

 

Topics: Hiring and Firing, Success Strategies, Worker Training, Careers in Construction, Recruting, Team Building, Employee Advancement, Business Growth

How To Create A Ladder Of Opportunity For Your Employees

Posted by Shawn McCadden on Sun, Apr 07,2013 @ 06:00 AM

How To Create A Ladder Of Opportunity For Your Employees

Note: This is the second article of a 3 article series on this topic (Click for article #1)

Look ahead to where you want to be

Ladder of Opportunity

 

Creating a ladder of opportunity requires that you create a vision for where you want your business to go and how you will make it happen.  It also requires that you sell the vision to existing and recruited employees. Help them see the vision and growth plans of the company so they can see where they have opportunities to fit in and contribute to the growth as well as, at the same time, accomplish their own personal goals.

The Ladder of Opportunity strategy requires that you develop a career planning strategy based on a deliberate balance between how the company needs to grow and how employees envision their roles. For example, a designer who possesses previous field and production management experience will likely generate designs that are easier, more efficient and cost effective to build. Projects designed using such experience are also more likely to be consistently profitable.

 

Hiring the right employeesGrow or get out of the way

If qualified employees do not see themselves as part of the evolution, you must either decide to keep them in their current roles, if possible, and/or realize that you will eventually need to hire someone else to fill future positions as the business grows. Be sure to seek out and retain the right people on your bus and take the wrong people off of the bus. Tolerating poor performance from some employees may give the wrong message to the more motivated workers.  

For smart employees, climbing the ladder of opportunity in a growing business means that someone else may be on that ladder rising right behind them.  Aspiring and high performance employees may become frustrated and lose motivation if they are held back in their career paths due any inability to climb the ladder of opportunity.  This being the case be watchful for the employee who tries to sabotage or hold other employees back as a way to maintain their status.

 

Managing career paths

Establishing employee career paths that benefit the business requires that you create a plan to Design/Build both the business and its employees. Decide where you want to take your business, what employee skills are needed to get there and how you will incorporate those abilities into your team’s existing pool of strengths.

Employee carreer pathsTo help manage the process of building employee skills, avoid mutual mystification. Clearly detail your vision and sell the goals involved to your team members.  Ask for a commitment for this required growth, both personal and professional, from each team member. Ask them how they see themselves fitting into this vision. Employees can choose to grow with the company, or, to be fair, perhaps they should be told that the company will out-grow them.

 

Be proactive with job descriptions

As an added caution, be careful not to develop job descriptions based on who you already have on the team. This would be like Design/Building a project for a client by only using the left over and miss-ordered materials that are collecting dust in your warehouse. How could you fulfill the purpose of the client’s project if you limit the design in such a way? Instead, Design/Build your business by creating job descriptions specific to your company’s vision and the path required to achieve it. 

Construction company job descriptionsIf you are the business owner, create job descriptions for employees who will complement the skills you bring to the business.  This helps you to concentrate on what you are best at and/or prefer to do yourself.  If you plan to eventually give up certain responsibilities, keep an eye out for your replacement and include mentoring as part of that person’s career path.  Mentoring helps socialize the employee into the nuances of the already established norms and values of both the job position and the company.

Watch for the follow up to this blog (article 3 of 3) which will be titled "How To Make The Ladder Of Opportunity Happen"

 

Related articles:

Article #1 of this series: Successfully Grow Your Business By Creating a Ladder of Opportunity For Employees

Article #3 of this series: How To Make The Ladder Of Opportunity Happen At Your Construction Business

Government to Contractors: Start Hiring Convicted Felons!

Mentor Me, Please - Gen Y Business Owner Offers Peers Advise

Contractors: How To Work With Generation Y From One Of Them

Gen Y Member's Advice To Peers: How To Develop A Good Work Ethic

 

Topics: Success Strategies, Worker Training, Careers in Construction, Recruting, Team Building, Employee Advancement, Business Growth, Culture, Leadership

Grow Your Business By Creating a Ladder of Opportunity For Employees

Posted by Shawn McCadden on Thu, Apr 04,2013 @ 06:00 AM

Successfully Grow Your Business By Creating a Ladder of Opportunity For Employees

Ladder of opportunity for employees

Note: This is the first of a 3 article series on this topic

It has been my observation that the most successful construction businesses are the ones that plan for and achieve consistent growth. This growth is measured in two ways that go hand in hand.  The first, and probably the most obvious, is growth in revenue.  The second, and most important, is the growth of the employees who comprise the team.  These two forms of growth go hand in hand because without employees to manage and complete the work, you cannot increase your revenues. Another important consideration is that growth will be pointless unless you maintain profitability.  Adding quality employees helps you to maintain and boost your financial success.

You can jeopardize consistent growth by constantly replacing employees or forcing new hires into management positions. The fact is that as a business expands, you will need additional employees and skills to maintain the growth. Employee retention and improving upon their skills are easier and quicker ways to grow. Creating a ladder of professional and career opportunities for your employees helps facilitate a long-term design strategy for your business.  The ladder of opportunity is created by moving employees forward into new positions and bringing on new team members to fill the positions they leave vacant.  You maintain the ladder of opportunity by helping new hires to grow in this same way.

Reasons for using a "Ladder of Opportunity"


Evolution Vs. Revolution?

Business growth strategies for contractorsIt’s not easy to replace employees as they leave your team or to bring on new hires that possess the necessary skills to ensure your business grows. Doing so also delays the rate at which you your construction business can grow.  You need to also consider whether you feel it is really fair to existing employees if you don’t give them the opportunity to move up within the company. If you are not developing employees as the company grows, you will eventually face a revolution, rather than an evolution.  If this happens, you may be forced to replace these employees with others who already have the skills the growing business needs.  This approach can be very risky and expensive.

 

Offering a ladder of opportunity helps keep good employees. 

Career path for a carpenterI always found that great employees are far more motivated by opportunity, responsibility, accomplishment and a sense of personal fulfillment than by the use of short-term incentives, such as cost of living wage increases, one-time bonuses, or an occasional pep rally. The right strategy, as long as it is sensitive and relative to the career path of your employees, will help keep those employees on the team.  It can also steer your company in the direction of recognizing who can move up the ladder and how to train them to ensure that your business evolves. The effects of such strategies are longer lasting and often permanent for the business and its employees.  Additionally, this strategy works well because existing employees are familiar with your company’s systems. They already fit into the culture and know how and why you do business the way you do.  It will take longer for new employees to learn about your culture, adapt, adjust and become productive dedicated members of your team.  Having employees start their career paths at the bottom of the ladder affords the business owner the advantage of limiting the expense and risks if the employees do not fit in or decide to leave the business.

Read the follow up to this blog (article 2 of 3) titled “How To Create A Ladder Of Opportunity For Your Employees”

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Gen Y Member's Advice To Peers: How To Develop A Good Work Ethic

 


Topics: Hiring and Firing, Worker Training, Careers in Construction, Recruting, Employee Advancement, Business Growth, Culture, Business Planning