Listen to Radio InterviewsHigh-Performing Contractor - NEWSLETTER May 2007
**************** Leadership
A recent survey of US workers found that only 49% trust their senior managers. The trust level has dropped annually since 2004.
Only 53% of the employees surveyed feel that senior management makes the changes necessary for the company to stay competitive. In 2004, this was 57% for the same survey.
"This dip in ratings is concerning because employees' attitudes about their senior leaders are a key factor in building engagement," said Ilene Gochman, national practice director for organization effectiveness at Watson Wyatt (the company that did the survey). "People want to work for companies where they have confidence in the organization and trust what senior management is doing. Fostering that trust is especially important in today's global market as it creates an environment in which employees understand that changes to the workplace may be necessary to remain competitive."
While there is no indication that this survey included construction workers and there is also no reason to believe that it does not represent the views of workers in the construction industry. Construction managers and owners must be concerned too, for as stated by Ms Gachman, how employees feel about their leaders has a major impact on how the workers produce.
What can leaders do to gain more trust of their employees? First of all walk the talk. The survey found that only 55% of the respondents feel that their managers behave consistently with the company's core values. They won’t get it until you live it. If the leaders don’t role model the behaviors they expect from their employees, they will never gain a high level of trust.
Next, communicate with the employees. The same survey found that only 45% of the respondents feel their senior managers take an active, visible role in communicating to their employees. It is the responsibility of senior manager to share the company’s vision and purpose for existing; it strategic plans and progress in achieving it. This is not a one-time event nor can it be effectively delegated. Leaders need to say, “this is where we are going and this is how we plan to get there.” The message must be communicated many times before all employees realize that it is for real and not some flavor-of-the-month wish. Trust is enlarged as employees feel they are important enough to be included in knowing the company’s plan.
Leaders must also involve their employees in identifying barriers to progress and finding solutions. Trust becomes much stronger when employees feel they are contributing to the success of the company by their own ideas.
**************** Customer Focused
The first week of March of 2007 MSN Money published a column by Scott Burns on www.msn.com that focused on customer-service problems at Home Depot. As part of the article, MSN asked readers to share their opinions of Home Depot’s lack of customer service. MSN received over 10,000 emails responses and many more posted messages on MSN’s web boards. In response to that outcry, Home Depot’s new CEO, Frank Blake, posted his own message on MSN. Part of his response was ”I'm Frank Blake, the new CEO for The Home Depot. I've read a number of the postings on the MSN message board
(unfortunately, there were a lot of them), and we've dispatched a dedicated task force -- working directly with me -- that is ready and willing to address each and every issue raised on this board. Please give us the chance. There's no way I can express how sorry I am for all of the stories you shared. I recognize that many of you were loyal and dedicated shoppers of The Home Depot . . . and we let you down. That's unacceptable. Customers are our company's lifeblood – and the sole reason we have been able to build such a successful company is because of your support. The only way we're going to continue to be successful is by regaining your trust and confidence . . . and we will do that.” (1)
What if your company that was blasted on the intranet? The possibility exists that you may be singled out for poor customer service. While there are key actions to take should this ever happen and Mr. Blake appears to be taking several of those including admitting failure and promising recovery. Time will tell if he can deliver on his promises. Personally, I may never give Home Depot the chance to show me they are more customer service oriented. If you need help dealing with a customer attack, let me know and we can discuss options.
BUT, the best way to address such an attack is to prevent it. What do customers expect and want from contractors? Customers, first and foremost, want the project to be successful in meeting their needs. They want the building to have working heating and cooling. They want the plant process piping to work. They want the plumbing to function as designed the first time and every time. A recent survey of customers of HVAC and Sheet Metal contractors found that their customers feel the top five most important factors to successful projects are:
1. Quality of Work
2. Meeting Schedule
3. Customer Service
4. Business Relationship
5. Safety Performance
When the contractors were asked what they felt their customers would rate as most important to a project’s success, they had a different top five:
1. Meeting Schedule
2. Price
3. Customer Service
4. Problem Solving
5. Quality of Work
Obviously, there are some disconnects between contractors and their customers. If contractors are not on the same line with their customers on what is most important, how can they expect to satisfy and gain customer loyalty? The survey’s findings may or may not represent the views of your customers but it begs the questions: what are your customer’s expectations and how are you doing in meeting them? To learn more about this benchmark customer survey and how to listen to the voice of your customers read “Measuring Customer Loyalty” published by the New Horizons Foundation in 2006.
(1) Source. MSN.com March 13, 2007
**************** Employee Focused
Paul Steckel, President of Van Mulder Sheet Metal Inc. shared this interesting conversation.
“I was meeting with an insurance risk consultant regarding our company's general liability and auto coverage. He asked me whether we had a safety incentive program. I responded that rather than a safety incentive program, we instead apply management concepts such as employee involvement and responsibility (i.e. safety culture, lean). Surprisingly, he replied that what we were doing was much better than a canned incentive program that often become an employee expectation rather than a real way to improve safety.”
**************** Process Management
Research done by Management Professor Allen Bluedorn found that “Meetings at which all participants stay on their feet are a third shorter than sit-down conferences and that the decisions made in them are just as sound.”
Source: < ahref="http://www.trizle.com/category/learn-stuff/blog">How to Conduct Your Meetings , Jan. 19, 2007 in Management, Blog
**************** Keeping Score
“All of us use the scoreboard and dashboard very frequently. They’re most useful in knowing what is happening. Imagine going to a sporting event and finding the scoreboard missing or non-functioning. The fans and players would find it very frustrating not knowing the score. Even more frustrating and risky would be to drive a car with a non-functioning dashboard…..These two ‘boards’ have great application in running a company too.
The scoreboard represents the critical success measures one keeps to determine if we are winning or successful in our business. Profit is probably the overall scoreboard measure used most by owners and managers. Other key measures one might find on a company’s scoreboard are: safety (incident rate), customer and employee satisfaction, and days sales outstanding.
Any measure used on the scoreboard is there because it tells how we are performing in key areas of the operations. Managers can, by looking at the scoreboard measures, quickly tell if we are winning or losing.
The advantage of using the scoreboard concept is that it forces senior management to be clear on what measures are most important. Just like the scoreboard at a game, the company’s performance scoreboard can be seen by other managers and even employees; providing a common platform to discuss performance.
The most useful scoreboards are ones where senior management identified the key measure together thus taking ownership for them. They review the ‘score’ regularly with their employees. Without these key measures and the review process departments and managers tend to focus on their own pet measures leading to mixed and sometimes conflicting actions.
While the scoreboard gives visibility of our company’s overall success, it has a major weakness in how we manage the company. It’s late! We usually don’t know the month’s score until 10 to 15 days into the next month. By then any corrective actions taken may be too late to prevent additional losses for that month. After-the-fact measures are good for executive meetings and trend analysis but are limited in getting to the root causes and timely preventive measures.
Enter the dashboard. Just like driving a car, this measure or what I prefer to call indicators, are of most value while we are driving and of little use once we reach our destination. Dashboard indicators should tell us our company’s speed, fuel supply, temperature, etc. Financial indicators could include: cash available each day; dollar amount of invoices 90 days uncollected and inventory levels.
Safety indicators might include: attendance at training sessions or tailboard meetings; number of safety inspections conducted; safety-related work orders completed; pre-task planning completed on time; and safety suggestions reported and implemented.
Customer satisfaction indicators could include: complaints received & resolved this week as well as RFI’s and change orders outstanding.
Employee Satisfaction indicators might include: absentee rate this week & month-to-date; number of improvement ideas/suggestions submitted this week; and the number of unfilled positions for more than a week.
Operations indicators could include: productivity rate; PPC (Percent of Planned Work Completed this past week); percent of bids won or lost this week or month; service calls per day; rework required this week; shop hours worked or scheduled this week; and unscheduled overtime worked this week or month.
A company should have only one scoreboard set of measures. If every department creates their own scoreboard, chaos will result. There can be many dashboards indicators as some fit only certain functions or operations while other indicators may be universal.
In sports it is important to know the score, the time or innings remaining and other key measures. In driving a car it is very important to know your speed, temperature, fuel level, etc. In running a company we need both the overall score and the leading indicators. We are then better able to management by facts and not shoot from the hip.“
Source: You Can Be Guided by Scoreboard, Dashboard. By Dennis Sowards, Contractor Magazine, Feb. 2007.
**************** Training you don’t want to miss
You may be interested in attending one of these training seminars taught by Dennis Sowards.
May 31, 2007 – Lean Job Planning the Really Works - Phoenix, AZ – Sponsor: PIPE & 469 JAC, contact Cathy at pipetrust@qwest.net
June 20, 2007 - Lean Works in Construction – Kansas City, MO –Sponsor: SMACNA- KC – Contact Sang 816-421-3360 ext. 112 and at information@smacnakc.com
Sept. 27, 2007 – Lean is not a Fad Diet – it works in construction too! – Phoenix, AZ – Sponsor: PIPE & 469 JAC, contact Cathy at pipetrust@qwest.net
**************** Thought for the day
- On December 8, 1903 the New York Times wrote: “ A man-carrying airplane will eventually be built, but only if mathematicians and engineers work steadily for the next 10 million years.”
- On December 18, 1903 the Dayton Herald reported: “Wilbur and Orville Wright successfully operated a flying machine in North Caroline.”
Someone once said, “The difference between possible and impossible dreams has much to do with the strength of the dreamer.”
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