Masonry Magazine August 2008 Page. 42
BUSINESS STRATEGIES
Lang Masonry continues to advertise during a down economy as well as expand into markets that are more stable.
"In a strong economy, we can be a little more selective with the kinds of jobs we want to bid," he says. "We never underbid to get a job, because losing money is worse than not getting the job. We are aware that there are times that work will be slow. During those times, we make cuts in expenses and work-force as soon as possible to avoid tremendous losses. When work picks back up, we hire and gear right back up to handle the increased work load."
"We never underbid to get a job, because losing money is worse than not getting the job."
Damian Lang. Lang Masonry
Like everyone else, Lang feels the squeeze of high fuel prices, but says the increased cost of materials is difficult to pass along to clients also struggling in a tough economy. Instead, the company cut trucks from their fleet and has adopted more conservative travel habits. In addition, they try to hire skilled labor in areas where they are currently working, so employees don't have to travel so far to the jobsite.
While growth is typically a good thing for any business, it's usually most effective when done at a steady pace, which Lang has learned from experience during the last 24 years. They aim for a 20 percent to 40 percent growth and know success is dependent upon the management staff and systems they have in place to handle the growth.
To keep things running smoothly, Lang Masonry hasn't been shy about investing in technology and has armed every foreman with laptops, digital cameras and cell phones. Ongoing training in the latest technologies is also provided, Lang says.
"We've incorporated electronic job clocks for more efficiency among field workers," he says. "And, our estimators use Tradesmen Soft-
Ask an Expert
Dan Lehman
Director of Product Management
Maxwell Systems Inc.
Masonry spoke with Maxwell System's director of product management, Dan Lehman, to find out how software can assist or benefit the back offices of masonry businesses.
Q: What are you seeing regarding business process automation? Are you finding a majority of companies are looking to streamline processes?
A: More contractors are realizing the benefits of automating processes, especially in this tight economy. It was easier to be a profitable contractor years ago without intense concern for optimal productivity, streamlined and automated processes, and exact profit margins. Back then, there was plenty of work to be had, and profit margins were wide to afford a lackluster outcome now and again.
However, today's business owners must be smart, resourceful and tech savvy to get ahead during the industry's challenging economic conditions in which every penny counts. To succeed in the increasingly competitive marketplace, contractors need end-to-end visibility to see how jobs perform from start to finish, as well as be able to track costs on a line-item basis for tight control and oversight.
Q: Why is it so important for companies to have a completely integrated solution? Why is a solution that combines estimating, job-cost accounting and project management different than two or three separate programs?
A: The bid needs to be as accurate as possible, and then companies must be able to execute on that bid in the project management and job cost accounting. That's only efficiently feasible using an integrated solution, which allows owners to have end-to-end, real time visibility of every project and hone business strategy, improve control of cash flow, and keep financials in the black with accurate ROI and true profitability.
By utilizing integrated systems, more contractors are realizing the profit potential in their business and competing for business on a much smarter level a level with real-time intelligence of material costs, labor rates, estimated versus actual budgets, productivity comparisons of crews, and more. They are able to evolve the way they extract information and analyze knowledge from critical business areas.
Q: What is your advice to contractors looking for a business management software solution?
A: Consider two critical items: the quality of the vendor (and their solutions) and the capability to provide true end-to-end solutions. Only consider technology providers with long history in construction business management software that are financially stable, have a strong customer base, and offering more than the software package, such as support in upgrades, implementation, training and maintenance. Demand a solution which meets the variety of business functional needs, so that you achieve the level of knowledge, understanding and decision-making analysis that a truly integrated solution delivers. Choosing a single vendor with multiple solutions that integrate seamlessly will further promote your ability to achieve optimal productivity and return on your technology investment.
Also, gather input from all of the different functional areas of the business (estimating, job cost accounting and project management) during vendor selection, and ensure they stay involved as stakeholders throughout implementation. Commitment leads to maximum ROI so it's wise to have a plan for implementation and time appropriately. MAS