COURSE OBJECTIVES WHAT WILL BE ACCOMPLISHED: WAYS TO OPERATE A - - PDF document

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COURSE OBJECTIVES

WHAT WILL BE ACCOMPLISHED:

• WAYS TO OPERATE A SUCCESSFUL CONSTRUCTION BUSINESS
• LEARN THE KEY AREAS FOR A SUCCESSFUL BUSINESS
• LEARN THE IMPORTANT TOOLS FOR YOUR CONSTRUCTION BUSINESS AND HOW IT CAN

MAKE YOUR BUSINESS GROW

• HOW TO ADD VALUE AND BETTER ACHIEVE YOUR VISION

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SECTION 1: LAYING A FIRM FOUNDATION TO BE SUCCESSFUL YOU MUST:

• BUILD A FIRM FOUNDATION
• ASK YOURSELF, “WHY DID I START A CONSTRUCTION COMPANY?”
• UNDERSTAND CONSTRUCTION TAKES HARD WORK
• MUST ASK YOURSELF, “WHAT GOALS DO I HAVE?”

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ADVISORS & GUIDANCE RESOURCES

• SEEK ADVISORS WHO HAVE GONE DOWN THE ROAD BEFORE
• FIND A MENTOR (HBA, ABC-CAROLINAS, CAGC, NCBPA, SCORE, ETC.)
• ASK QUESTIONS,” A SUCCESSFUL FIRST STEP IS ALWAYS PRECEDED BY GREAT QUESTIONS” – LAO TZU
• THE 5 W’S AND AN H.
• WHY -WHEN
• WHAT -WHO
• WHERE -HOW

THE HARD Q’S - INTROSPECTION

ASK YOURSELF HARD QUESTIONS BEFORE YOU INVEST AND TAKE THE RISK:

• -WHY AM I TAKING THE RISK?
• -WHAT ARE MY GOALS? WHAT PRICE AM I WILLING TO PAY FOR SUCCESS?
• -WHERE WILL MY WORK COME FROM?
• -WHEN IS THE BEST TIME TO START THE BUSINESS?
• -WHO ARE MY CUSTOMERS? WHO ARE MY ADVISORS?
• -HOW WILL I MARKET MY COMPANY? HOW WILL I SUPPORT MY FAMILY WHILE THE

COMPANY GETS STARTED?

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BUILDING A FIRM FOUNDATION

• CREATE A LIST OF POTENTIAL POSITIVE AND NEGATIVE RESULTS TO YOUR COMPANY.
• SEEK HELP WITH SOMEONE WHO HAS DONE WHAT YOU WANT TO DO – A MENTOR, A COACH.
• BUILD RELATIONSHIPS WITH KEY ADVISORS – DON’T GO IT ALONE! CHOOSE QUALITY ADVISORS THAT

INCLUDE:

• A BANKER
• AN INSURANCE AGENT
• A LAWYER
• AN ACCOUNTANT

BUILDING A FIRM FOUNDATION – CONTINUED

• ASSOCIATE WITH OTHERS WHO ARE ON THE SAME PATH—ONE OF THE BEST WAYS TO DO

THIS IS TO GET INVOLVED WITH YOUR INDUSTRY’S TRADE ASSOCIATION.

• READING RESOURCES—THERE CAN BE A LOT OF DOWN TIME DRIVING BETWEEN SITES AND

WAITING ON SUBCONTRACTORS. LISTEN TO AUDIOBOOKS OR HAVE YOUR DEVICE READ A BOOK OUT LOUD TO YOU SO THAT YOU MAY CONTINUE COMPLETING OTHER TASKS.

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SECTION 2: CARVING OUT YOUR NICHE

• SMALL BUSINESSES THAT FIND A NICHE AND SPECIALIZE ARE MORE SUCCESSFUL THAN THOSE

THAT DABBLE IN A BIT OF EVERYTHING

• AVOID THE TEMPTATION TO BE A JACK OF ALL TRADES…

SPECIALIZATION IMPROVES PERFORMANCE AND PROFIT

• COMPANIES START OUT DOING ANY TYPE OF WORK.
• GROWTH WILL FORCE A FOCUS.
• GROWTH WILL OCCUR EACH TIME A TYPE OF WORK IS TRIMMED DOWN.
• THERE IS A FINE BALANCE BETWEEN TRIMMING THE WORK AND HYPER-FOCUSING ON A

CERTAIN TYPE OF WORK.

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OPPORTUNITY COST

• SAYING YES TO ONE THING REQUIRES YOU TO NO TO SOMETHING ELSE
• WHEN YOU SAY “YES” TO EVERYTHING YOU MAY BE SAYING “NO” TO MORE PROFITABLE

WORK

• BUILDING A NICHE REQUIRES YOU TO SAY “NO” TO WORK EVEN WHEN THE TEMPTATION IS

THERE TO TAKE THE WORK THAT FILLS THE SCHEDULE

• OPPORTUNITY COSTS EXIST WHEN SOMETHING IS LIMITED

 IN A NEW START-UP THIS CAN BE CASH OR MORE LIKELY THE OWNERS TIME

“WE ARE ALL EXPERTS IN OUR OWN LITTLE NICHES.” – ALEX TREBEC

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HOW DO YOU DETERMINE YOUR NICHE?

• BEGIN BY ASKING YOURSELF THESE QUESTIONS. GIVE HONEST ANSWERS AND AVOID TRYING TO

FIND A REASON WHY YOUR IDEA WILL WORK.

• WHERE ARE YOUR UNIQUE SKILLS OR TALENTS IN YOUR PARTICULAR TRADE?
• IS THERE A LOT OF DEMAND FOR YOUR UNIQUE SET OF TALENTS?
• WILL THAT DEMAND CONTINUE OR IS IT FADING?
• ARE THERE A LOT OF OTHERS COMPETING FOR THE SAME MARKET?
• IS THE DEMAND SEASONAL?

TOOLS TO HELP YOU TO CARVE YOUR NICHE

• FIND A MENTOR – FIND THOSE WHO WILL SHARE THEIR SECRETS AND HELP GUIDE
• FIND A COACH – A BUSINESS COACH WHO CAN ASSIST YOU AND FIGURE OUT IF YOU SHOULD

TAKE ON A PROJECT

• TRACK PROFITABILITY – WHEN YOU START YOUR BUSINESS YOU WILL TAKE ON VARIOUS TYPES

OF WORK

• TRACK YOUR EXPENSES (JOB COST) AND COMPARE THEM AGAINST THE JOB BUDGET (ESTIMATE).
• DETERMINE YOUR MOST PROFITABLE JOBS AND FOCUS YOUR EFFORTS ON GETTING MORE OF THAT

WORK.

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TOOLS TO HELP YOU TO CARVE YOUR NICHE

• CONTINUED
• SHARE YOUR TALENTS AND SKILLS – FREELY SHARE YOUR FOCUS IN BUSINESS WITH ANYONE

WHO WILL LISTEN  THIS IS #1 IN EXPANDING YOUR COMPANY.

• DEDICATE YOURSELF TO LEARNING – NEVER STOP LEARNING!

QUESTION #1

DOES SPECIALIZATION IMPROVE PERFORMANCE AND PROFIT?

• TRUE
• FALSE

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QUESTION #1 – ANSWER

DOES SPECIALIZATION IMPROVE PERFORMANCE AND PROFIT?

• TRUE
• FALSE

TRUE IS THE CORRECT ANSWER

SECTION 3: CREATING A BLUEPRINT FOR YOUR BUSINESS

YOU WOULD NOT BUILD A BUILDING WITHOUT A BLUEPRINT – MAKE SURE YOU HAVE A PLAN FOR BUILDING YOUR BUSINESS

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FAILURES IN PLANNING LEADS TO FAILURES IN BUSINESS

CONTRACTORS HAVE MADE MAJOR MISTAKES WHICH IMPACT THEIR BUSINESS:

• WORK DONE ON THE WRONG HOME.
• FAILING TO REACH OUT TO ONE-CALL SERVICE BEFORE DIGGING.
• NOT SETTING THEIR BUSINESS UP IN A WAY TO PROTECT THEIR ASSETS.
• SHRUGGING OFF LICENSING AND INSURANCE REQUIREMENTS.

CREATE YOUR BLUEPRINT THROUGH YOUR BUSINESS PLAN

• MISSION STATEMENT
• WHY ARE YOU STARTING THE COMPANY?
• PRODUCT DESCRIPTION
• DESCRIBE YOUR NICHE/HOW YOU ARE DIFFERENT?
• YOUR COMPETITION
• WHO ARE YOU COMPETING AGAINST?
• YOUR TEAM
• WHO IS GOING TO TAKE CARE OF THE VARIOUS DEEMED RESPONSIBILITIES?

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CREATE YOUR BLUEPRINT THROUGH YOUR BUSINESS PLAN - CONTINUED

• MARKETING/ADVERTISING
• HOW ARE YOU GOING TO FIND NEW WORK?
• FINANCIALS/ACCOUNTING
• WHAT DO YOU EXPECT TO DO IN REVENUE/PROFIT THE 1ST TWO YEARS AFTER YOU HAVE DESIGNED

YOUR PLAN?

• SUMMARY
• HERE IS YOUR CHANCE TO ADD ANYTHING ELSE TO THE DISCUSSION, ESPECIALLY IF YOU ARE LOOKING

FOR INVESTORS.

SECTION 4: BUILDING YOUR BUSINESS TOOLBOX

THERE ARE 8 AREAS TO PROFIT AND SUCCESS IN CONSTRUCTION

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AREA 1: BUSINESS MANAGEMENT

• BUSINESS OWNERS MUST KNOW:
• WHERE THEY HAVE BEEN,
• WHERE THEY ARE RIGHT NOW AND…

WHERE THEY ARE HEADING

• WHAT ARE THE COMMON BUSINESS

MANAGEMENT AND LEADERSHIP MISTAKES?

• MICRO-MANAGING EMPLOYEES
• ASSIGNING JOBS AND TASKS TO EMPLOYEES

THAT THEY ARE NOT CAPABLE OF COMPLETING

• NOT WRITING DOWN OR COMMUNICATING

CLEAR GOALS

• AS THE OWNER FAILING TO CONTINUE TO

LEARN AND GROW IN YOUR PROFESSION.

• FAILING TO PUT IN PLACE SYSTEMS AND

PROCESSES

SETUP CLEAR GOALS USING SMART

SMART – GOALS NEED TO BE UNDERSTOOD BY YOUR TEAM IN ORDER TO BE ACHIEVED

• S - SPECIFIC
• M - MEASURABLE
• A – ATTAINABLE
• R – REALISTIC
• T – TIME SENSITIVE

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KEY SYSTEMS AND PROCESSES TO ESTABLISH EARLY ON

• REGULAR ADVISOR MEETINGS
• SET ASIDE TIME FOR SELF-

REFLECTION

• DOCUMENT EVERYTHING

AREA 2: INSURANCE AND RISK MANAGEMENT

• THE STEPS IN BUILDING A BUSINESS INCLUDE RISK – BUT IT DOES NOT MEAN IT HAS TO BE RISKY
• “PLAYING SAFE IS VERY RISKY.” – SETH GODIN
• EVERYTHING WE DO HAS RISK. DRIVING TO WORK IS RISKY. LIFE IS FILLED WITH RISK
• THOSE WHO SUCCEED LEARN HOW TO RECOGNIZE RISK AND THEN MANAGE IT

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COMMON INSURANCE AND RISK MANAGEMENT MISTAKES

• NOT SETTING UP A CORPORATE ENTITY TO LIMIT PERSONAL LIABILITY
• FAILING TO SET UP A COMPANYWIDE SAFETY PROGRAM
• ESTABLISHING POLICIES FOR THE COMPANY RELATED TO SAFETY AND RISK MANAGEMENT
• UNDERESTIMATING THE RISK EXPOSURE AND CHANCES FOR LOSS.
• NOT CARRYING SUFFICIENT INSURANCE WITH LIMITS AND COVERAGES FOR YOUR BUSINESSES.

RECOGNIZE THE SOURCES OF RISK

• EMPLOYEES
• WEATHER
• CONSTRUCTION DEFECTS
• AUTOMOBILE
• CUSTOMERS
• SUBCONTRACTORS
• MATERIAL SUPPLIERS

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WHAT BUSINESS OWNERS CAN DO ABOUT RISK

FOUR THINGS TO MANAGE YOUR COMPANY RISK:

• DECLINE THE WORK THAT IS CREATING RISK
• ENGINEER THE SOURCE OF THE RISK TO REDUCE YOUR EXPOSURE
• TRANSFER THE RISK TO SOMEONE ELSE—HOLD HARMLESS CLAUSES / INDEMNIFICATION
• RISK THAT REMAIN NEEDS TO BE INSURED

INSURANCE – DISCUSS YOUR BUSINESS WITH YOUR INSURANCE AGENT

• DON’T OVER INSURE AND BECOME INSURANCE POOR.
• TYPES OF COVERAGES:
• WORKERS COMPENSATION – COVERS WORK RELATED INJURIES TO EMPLOYEES.
• GENERAL LIABILITY – PROVIDES GENERAL INSURANCE FOR LOSSES FROM OPERATIONS.
• AUTOMOBILE LIABILITY – INSURANCE FOR VEHICLES OWNED BY THE COMPANY.
• POLLUTION LIABILITY – PROVIDES COVERAGE FOR POLLUTION RELATED LOSSES.

 (ESSENTIAL FOR ABATEMENT COMPANIES)

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AREA 3: MARKETING & BUSINESS PROMOTION

MARKETING AND BUSINESS PROMOTION IS KEY TO A SUCCESSFUL BUSINESS. IT CANNOT BE AN AFTERTHOUGHT – ONLY AFTER THE WORK RUNS OUT.

QUESTION #2

DOES WORKERS COMPENSATION COVER WORK RELATED INJURIES TO EMPLOYEES?

• TRUE
• FALSE

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QUESTION #2 – ANSWER

DOES WORKERS COMPENSATION COVER WORK RELATED INJURIES TO EMPLOYEES?

• TRUE
• FALSE

TRUE IS THE CORRECT ANSWER

COMMON MARKETING AND BUSINESS PROMOTION MISSTEPS

• TRYING TO DO TOO MUCH WITH TOO LITTLE.
• MARKETING TO AN AUDIENCE THAT IS TOO WIDE
• FAILING TO DEVELOP A UNIFIED MESSAGE OR A UNIQUE VALUE TO THE MARKETPLACE
• WHY SHOULD SOMEONE BUY FROM YOU?
• FOCUSING TOO MUCH ON GETTING THE NEXT JOB BUT FAILING TO WORK HARD TO EXCEED THE

EXPECTATIONS OF AN EXISTING CUSTOMER.

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THE 4 P’S OF MARKETING

MARKETING A BUSINESS IS BROKEN DOWN INTO 4 P’S:

• PRODUCT – WHAT’S THE PRODUCT OR SERVICE BEING OFFERED?
• PRICE – WHAT IS THE PRICE OF THE SERVICE?
• PLACE – WHAT AREA WILL BE SERVED?
• PROMOTION – HOW WILL THE COMPANY BE PROMOTED?

ADDITIONAL MARKETING

TRADE ASSOCIATIONS – FIND PEERS OR COMPLIMENTING INDUSTRIES TO COLLABORATE. CHAMBER OF COMMERCE – HELP PROMOTE LOCAL BUSINESSES. NETWORKING GROUPS – PROVIDE OPPORTUNITIES FOR BUSINESSES TO HELP EACH OTHER. CHURCHES, SOCIAL GROUPS, ETC. – LET PEOPLE KNOW WHAT YOU ARE DOING.

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AREA 4: PROJECT COST ESTIMATING

• COST ESTIMATING IS YOUR COMPANY’S ABILITY TO PRICE ITSELF EITHER INTO THE MARKET OR

OUT OF IT.

• ABILITY OF THE ESTIMATOR TO SEE THE DETAILS AND TO BE HONEST ABOUT THEIR ABILITIES

TO ADDRESS THE DETAILS.

MISTAKES MADE IN ESTIMATING PROJECT COST

• NOT PAYING ATTENTION TO DETAILS
• NOT UNDERSTANDING THE INDIVIDUAL

COMPONENTS OF A JOB

• BASING BIDS AND ESTIMATES ON

ASSUMPTIONS AND OPINIONS INSTEAD OF EXPERIENCE AND FACTS

• ESTIMATING TO A SELF-BIASED OUTCOME
• USING ESTIMATING SYSTEMS THAT ARE

OUTDATED / PRONE TO ERRORS AND MISTAKES

• IGNORING BUILDING CODE REQUIREMENTS

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WHERE IT ALL STARTS

SUCCESSFUL COMPANIES  SUCCESSFUL PROJECTS  START WITH GOOD COST ESTIMATES

• BUMPS IN THE ROAD ARE TYPICALLY FROM OVERSIGHTS IN THE ESTIMATING PROCESS.
• OVERSIGHTS COME FROM EITHER OVERLOOKING SPECIFIC DETAILS OR ASSUMING A DETAIL DID NOT

MATTER.

• FOCUS ON DETAILS – THEY WILL MAKE A DIFFERENCE.

THE IMPORTANCE OF INTUITION

• INTUITION IS A GUT FEELING BASED ON YOUR PAST EXPERIENCES BEING APPLIED TO

CURRENT SITUATIONS

• DON’T OVERLOOK INTUITION AS PART OF THE ESTIMATING PROCESS
• INTUITION CANNOT BE TRAINED OR TAUGHT – IT REQUIRES ESTIMATORS TO GATHER

EXPERIENCES

• START SMALL AND BUILD ON EXPERIENCES – AS YOU DO, APPLY YOUR INTUITION TO THE

ESTIMATING PROCESS

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BASIS FOR DEVELOPING AN ESTIMATING PROGRAM

• SECRET FORMULA –
• THE ESTIMATING PROGRAM IS A TRADE

SECRET.

• BUDGETS –
• COST ESTIMATES ARE ACTUALLY

BUDGETS FOR PROJECTS

• MANAGEMENT –
• THE ESTIMATE BECOMES THE

MANAGEMENT FOR OVERSEEING THE PROJECT

• ESTIMATES ARE COMPRISED OF:
• LABOR
• MATERIALS
• OTHER DIRECT COSTS
• OVERHEAD, MARKUP AND

PROFIT

AREA 5: SALES FOR YOUR COMPANY

• WITHOUT A SALE, THERE IS NO COMPANY TO WORRY ABOUT.

THE FUTURE OF THE COMPANY IS BASED ON YOUR ABILITY TO CLOSE THE DEAL. “SALESMANSHIP IS LIMITLESS. OUR VERY LIVING IS SELLING. WE ARE ALL SALESPEOPLE.”

• J.C. PENNEY

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WHAT ARE THE COMMON SELLING MISTAKES?

• OVER-PROMISING AND UNDER-DELIVERING IN THE SALES PROCESS.
• NOT LISTENING TO A CUSTOMER OR CLIENT DURING THE SALES PROCESS – TALKING TOO MUCH!
• CONTINUING TO SELL AFTER THE WORK HAS BEEN SIGNED.
• NOT UNDERSTANDING THE SALES CYCLE FOR THE REGION OR THE TYPE OF WORK THAT ONE IS

COMPETING IN.

THE SIX KEY ITEMS TO SELLING:

• 1. ASSESS – LEARN ABOUT YOUR PROSPECT OF CLIENT.
• 2. APPROACH – LEARN TO ADJUST YOUR APPROACH ACCORDINGLY.
• 3. ASK- ASK GOOD QUESTIONS AND THEN LISTEN.
• 4. ANSWER – ANSWER OBJECTIONS.
• 5. ASK AGAIN FOR THE ORDER.
• 6. APPLY FOLLOW-UP SERVICE – CUSTOMERS EXPECT FOLLOW-UP SERVICE.

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LISTENING IS ACTIVE

• SPEND ABOUT 70 - 80% OF YOUR TIME LISTENING TO YOUR CUSTOMERS
• NOT LISTENING MEANS YOU ARE SAYING NO TO LEARNING ABOUT THE

CUSTOMER’S NEEDS

• RESIST THE ATTEMPT TO ASSUME THAT YOU KNOW THE SOLUTION

BEFORE YOU COMPLETELY UNDERSTAND THE CUSTOMER

OVER VS. UNDER PROMISING/DELIVERING

OVER PROMISING AND UNDER DELIVERING

• AVOID EXAGGERATING WHAT YOU

CAN DO

• DON’T PROMISE ANYTHING UNLESS

YOU CAN FULFILL IT

• LEADS TO UNHAPPY CUSTOMERS

AND PUBLIC REPERCUSSIONS

UNDER PROMISING AND OVER DELIVERING

• WORK HARD TO EXCEED YOUR

PROMISE AND IMPRESS

• BUILDS MOMENTUM ON A PROJECT

WHEN TEAM MEMBERS REALIZE THEY ARE DELIGHTING THE CUSTOMER

• LEADS TO REFERRALS AND BUSINESS

GROWTH

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CLOSING SALES WITH BUYING SIGNALS

• LOOK FOR BUYING SIGNALS IN YOUR SALES CALLS / EMAILS
• BUYING SIGNALS ARE SIGNS OR COMMENTS THAT INDICATE THE CUSTOMER IS

READY TO MOVE FORWARD

CLOSING SALES WITH BUYING SIGNALS - CONTINUED

COMMON BUYING SIGNALS:

”HOW LONG WILL IT TAKE YOU TO COMPLETE THE PROJECT?” ”WHAT COLOR IS THE SHINGLE, COUNTERTOP, FENCE AVAILABLE IN?” ”CAN I HAVE SOME REFERENCES FROM PAST CUSTOMERS?”

STOP SELLING WHEN SOMEONE HAS MADE A PURCHASE!

• ONCE BUSINESS IS CLOSED, STOP THE SALES

PROCESS IMMEDIATELY.

• MOVE INTO PROJECT MANAGEMENT AND

WORK TO EXCEED THE CUSTOMER’S EXPECTATIONS.

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AREA 6: MANAGING OPERATIONS

YOU MADE THE SALE. IT’S TIME TO DELIVER – THROUGH EXCELLENT OPERATIONS. TIME TO PUT THE SKILLS TO WORK.

PITFALLS IN PROJECT MANAGEMENT

• IT’S ALL ABOUT PAPERWORK
• FAILING TO READ AND STUDY THE PROJECT

DOCS BEFORE THE PROJECT STARTS

• ALLOWING “SCOPE CREEP” – COMES FROM

NOT HAVING A FIRM GRASP OF THE PROJECT SCOPE

• CHANGE ORDERS – FAILING TO DEFINE WHAT

IS IN THE SCOPE OF WORK -VS- A CHANGE ORDER

• SUB-CONTRACTOR MANAGEMENT –

SETTING AND FORGETTING THE RELATIONSHIP INSTEAD OF ACTIVELY MANAGING AND GUIDING THE SUB

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QUESTION #3

HOW MUCH TIME SHOULD BE SPENT LISTENING TO CUSTOMERS?

• A) 20%
• B) 30%
• C) 60%
• D) 70%

QUESTION #3 - ANSWER

HOW MUCH TIME SHOULD BE SPENT LISTENING TO CUSTOMERS?

• A) 20%
• B) 30%
• C) 60%
• D) 70%

CORRECT ANSWER IS D) 70%

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SOLIDIFYING COMPANY VALUE

THE VALUE OF YOUR COMPANY IS BASED ON THE SYSTEMS AND PROCESSES OF YOUR CONSTRUCTION BUSINESS.

• IDENTIFY CONSISTENT ISSUES
• CREATE PROCESSES THAT ARE SIMPLE AND CAN BE REPEATED TO ADDRESS THOSE ISSUES
• TRAIN YOU PEOPLE ON THOSE PROCESSES
• GET FEEDBACK ON THE PROCESSES FROM YOUR TEAM(S)
• LEAD YOUR PEOPLE THROUGH THE PROCESSES

BEFORE AND DURING THE BUILD PROCESS

PRE-CONSTRUCTION MEETINGS:

• PROJECT MANAGER/COMPANY OWNER
• PROJECT FOREMAN
• BUILDING OWNER/HOMEOWNER

IN-PROGRESS MEETINGS:

• SCHEDULE ON A REGULAR BASIS
• DEVELOP ITINERARY TO REVIEW WEEKLY

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PROJECT CLOSE / PUNCHING OUT

PROJECT CLOSE-OUT – THIS MEETING TYPICALLY FOLLOWS THE COMPLETION OF A PROJECT

AND IS A WALK THROUGH TO ALLOW THE CUSTOMER TO SEE THE FINISH PROJECT.

• CUSTOMER HAS OPPORTUNITY TO ASK QUESTIONS.
• CONTRACTOR’S OPPORTUNITY TO ADDRESS PROBLEMS AND ALSO TO SELL FOLLOW-UP SERVICES IF

AVAILABLE.

AREA 7: LEADING PEOPLE

CONSTRUCTION PROJECTS ARE ALL ABOUT THE TEAM DEVELOP AND LEAD YOUR PEOPLE AND YOUR TEAMS

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COMMON LEADERSHIP MISTAKES

• TREATING EMPLOYEES AS A MEANS-TO-AN-END – INSTEAD OF FINDING VALUE IN THEM
• CONFUSING MANAGEMENT WITH LEADERSHIP
• FAILING TO BUILD A BUSINESS CULTURE AND ENVIRONMENT THAT MAXIMIZES THE CHANCES OF

SUCCESS FOR EVERY EMPLOYEE

• ASSUMING THAT BECAUSE YOU DON’T HEAR ABOUT PROBLEMS THAT EVERYTHING’S OKAY
• NOT GETTING TO KNOW PEOPLE AND LEARN ABOUT THEM ON A PERSONAL LEVEL

LEADING PEOPLE

CREATE A STABLE SYSTEM AND PROCESSES:

• BUILD SYSTEMS AND PROCESSES THAT ARE APPROPRIATELY SIZED FOR THE PROBLEM
• ONCE THE SYSTEM OR PROCESS IS DESIGNED AND IMPLEMENTED – TRAIN THEM

THROUGH THE PROCESS

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OWNER GROWTH & RESPONSIBILITY

“IF YOU WON’T ROW, YOUR PEOPLE DON’T GROW.”

 SELF-DEVELOPMENT FOR A BUSINESS OWNER IS CRITICAL.  GET INVOLVED WITH TRADE ASSOCIATIONS.  LISTEN TO PODCASTS WHILE DRIVING TO PROJECT SITES AND CONSTANTLY READ INDUSTRY

RELATED CONTENT.

AREA 8: FINANCING YOUR COMPANY

CASH IS TO THE COMPANY LIKE OXYGEN IS TO THE HUMAN BODY. WITHOUT IT, THE COMPANY DIES.

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WHAT ARE COMMON FINANCIAL MISTAKES?

• CASH FLOW MISS-MANAGEMENT.
• FAILING TO PAY THE BURDENS OF THE BUSINESS – TAXES, VENDORS, ETC.
• FINANCING THE BUSINESS START-UP AND OPERATIONS WITH HIGH INTEREST MONEY – CREDIT CARDS,
• ETC.  1ST TRY FOR LOWER INTEREST BUSINESS LINES OF CREDITS
• NOT LEARNING HOW TO MANAGE A COMPANY FINANCIALLY INCLUDING WORKING CAPITAL
• TREATING THE COMPANY ASSETS LIKE A PERSONAL BANK ACCOUNT  DON’T COMINGLE!

WORKING CAPITAL

• WORKING CAPITAL IS THE MONEY THAT IS USED FOR FUNDING DAY TO DAY OPERATIONS
• DETERMINED BY SUBTRACTING CURRENT LIABILITIES FROM CURRENT ASSETS
• NEEDED TO PAY KEY ITEMS, WEEKLY PAYROLL AND MATERIAL VENDORS

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FUNDING WORKING CAPITAL

• CASH THAT AN OWNER OR INVESTOR PUTS INTO THE BUSINESS
• LINES OF CREDIT
• USE PHYSICAL ASSETS, ACCOUNTS RECEIVABLE, INVENTORY TO SUPPORT A LINE OF CREDIT.
• OTHER CREDIT SOURCES – EXTEND PAYMENT TERMS WITH VENDORS, USE CREDIT CARDS, ETC.
• MAKE CREDIT CARDS A LAST RESORT IF POSSIBLE

EXCESS CASH

• A WELL-RUN COMPANY SHOULD SPIN OFF EXCESS CASH-
• RE-INVEST FOR GROWTH
• PAY OFF DEBTS
• TAKE THE EXCESS CASH FOR OTHER USES

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IN SUMMARY…

• WE HAVE COVERED HOW TO START AND OPERATE A SUCCESSFUL

CONSTRUCTION COMPANY.

• BY UTILIZING THE 8 KEY AREA'S DISCUSSED YOU WILL BE ABLE TO MAKE YOUR

BUSINESS GROW.

• YOU CAN NOW ADD VALUE AND VISION FOR YOUR START-UP OR CURRENT

COMPANY.

Q & A

ANY FINAL QUESTIONS

• OR-

ITEMS NEEDING FURTHER CLARITY?