Are you running your renovation business…
or is it running you? If you are feeling overwhelmed by the demands of running your contracting ﬁrm, it’s time to take a long, hard look at your systems. By Mike Draper
often hear contractors say they are overworked and that they feel the need to do everything themselves since nobody else will do it as well as them. And with the owner’s name typically being part of the company name, many owners feel the need to be involved in every single aspect of a project. It is at this point that the company’s growth stagnates, no matter how many hours the contractor puts into the business. I see this pattern all the time. The bottom line is that most contractors’ businesses do not have enough systems in place to enable that business to expand. With the current level of systems, the business has reached its peak. There are many reasons why contractors don’t implement more systems. It does take time. It typically takes longer to document a system or process, so that someone else can easily do it, than it does to just do it yourself, today. But the downside of this approach is that you have to keep doing the same task over and over because you haven’t trained someone else to do it.
Systemizing to remove inefficiencies Systemizing a business is not to make it boring. Rather, it is about removing inefficiencies and maximizing your output.
Print 4, 2012
Take a look at this example: When a call comes in for insurance work, the contractor has to respond immediately and get a quote out very quickly, usually within 24-48 hours. The quotation must be accurate, very detailed and with full disclosure of the scope of the work to be performed, whether it is a $10,000 or $100,000 repair. How can anyone do it so quickly? Well, the answer is to have a system that you follow every time. You might argue that each renovation project is utterly unique and that there is no way to follow a standard model. Well, the work will always vary, but the process or system you follow, from the time that you receive a lead until you deposit the last cheque, can be exactly the same for every project.
Systemizing your quotes Developing a quoting system, or using one of the industry available quoting systems, will make the quoting process a whole lot easier for you. You will have a standard sequence to go through to make sure you have
included all the components of a renovation, including the time each step should take to complete, and the cost of each step. Imagine being able to create a professional-looking, detailed quotation on every job you bid, even for the smaller quotes. So why don’t most renovation contractors use a computerized estimating system? Typically because it takes time to learn. But it’s worth spending more time, as you learn the new system, on your first few quotes, to save more than half the time on all subsequent quotes.
Systemizing phone calls The idea behind systems is to document the work to be done in such a way that the lowest-level employee in the company can perform the task. Documenting how people in your firm should answer the phone is a great example of the benefits of systemizing. If you ask three people at your company to write down how they answer the phone, you may get something like the following:
point. If your cellphone number is given out, you might be interrupted in a client meeting and they will start calling your cell phone directly in the future. In each case, there is going to be follow-up work on your part and a high probability of telephone tag. With Person #3’s response, it not only gives a positive impression, but Person #3 may be able to take care of the matter without you ever having to take the call. So the systemizing of how your business’s phone is answered takes out work and improves efficiency. With respect to messages, do you handle them the same way every time? Do you follow up each message within 2 hours of it being left on your voicemail? How often do you actually not return the call because you forgot, or you lost the piece of paper you wrote it on? Whatever the case, phone answering is a good place to start to introduce simple systems into your business. For an example of a telephone answering process, visit www.renovantage.com/telephone/process.
Typical systems that every contractor needs Step 1: Answering the phone greeting Person #1: “Jones Contracting.” Person #2: “Good morning/afternoon. Jones Contracting.” Person #3: “Good morning/afternoon. Jones Contracting. This is Mary. How can I help you? Step 2: Caller asks for the owner, Bill Jones Person #1: “He’s not here.” Person #2: “He’s not here. Can I take a message? Or would you like his voicemail? His cellphone? Person #3: “I’m sorry, he’s in the field right now. Can I help you?” Now let’s look at these various responses. The responses from Person #1, in both cases, sound lazy. Unfortunately, you only get one chance to make a positive first impression. The responses from Person #2 are clearly better. But look what happens next. If Person #2 takes that message, it has to be written down and communicated somehow. If transferred to voicemail, you will have to access the voicemail and retrieve it at some
• Marketing: Home shows, website, jobsite signage and perimeter marketing, vehicle signage, brochures, employee uniforms • Sales process: Lead follow-up, qualification, estimating, proposal generation, conversion strategy, Unique Selling Proposition • Sales or production turnover system: Without this, the salesperson, typically the owner, has to be involved in every step going forward • Project pre-planning and scheduling: Hiring subtrades, client decision list and timing • Project start-up: Ordering materials, tools/equipment needed on site, Ground Rules Meeting, safety station and emergency procedures, contact numbers • Production: Change orders, clients communications, employee timekeeping and reporting • Safety training
Mike Draper is a business coach for Renovantage (www.renovantage.ca) and a frequent contributor to Canadian Contractor
Print 4, 2012
Canadian Contractor August 2012