Construction Industry - Surviving 2011 Thriving 2012 Presentation
-
Upload
scotthursh -
Category
Documents
-
view
1.467 -
download
2
description
Transcript of Construction Industry - Surviving 2011 Thriving 2012 Presentation
![Page 1: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/1.jpg)
1
Perform, Produce and Prosper
M. Scott Hursh, CPA, CCIFPFebruary 23, 2011
![Page 2: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/2.jpg)
2
Perform, Produce and Prosper
• What we will discuss– State of the Industry– Why focus on productivity? – Bonded work as a niche
![Page 3: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/3.jpg)
11
Perform, Produce and Prosper
• Why Focus on Productivity?– Increased Profitability– Less Rework– Improved Margins– Happy Customers
![Page 4: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/4.jpg)
12
Perform, Produce and Prosper
• Why Focus on Productivity?
– The current competitive environment will continue for some time
– The fat has been squeezed out of overhead
– That’s where the money is!
![Page 5: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/5.jpg)
13
Perform, Produce and Prosper
![Page 6: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/6.jpg)
14
Perform, Produce and Prosper
Percent Improvement
Per 8 HourDay
Increase in Profitability
2% 10 Minutes 20%
5% 24 Minutes 50%
10% 48 Minutes 100%
![Page 7: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/7.jpg)
15
Perform, Produce and Prosper
The difference between average and world class
performance is 48 minutes!
![Page 8: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/8.jpg)
16
Perform, Produce and Prosper
• The secrets to improved productivity– Have a process for everything you do– Document the process– Measure results
![Page 9: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/9.jpg)
17
Perform, Produce and Prosper
© FMI Corporation
![Page 10: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/10.jpg)
18
Perform, Produce and Prosper
• The secrets to improved productivity– Focus daily on improving productivity– Continually look for creative, innovative
construction techniques– Glorify the field– Don’t have profit fade
![Page 11: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/11.jpg)
19
Perform, Produce and Prosper
• The secrets to improved productivity– It starts with project selection
• Know the types of work and customers that are most profitable
– Track estimates and performance on every project
– Examine by type, size, location and customer
– Beware of risk!
![Page 12: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/12.jpg)
20
Perform, Produce and Prosper
• Estimating– Have superior estimating skills and
systems• Written process• Track results
– Know the contract termsScope of work, general conditions payment etc.
– Involve operations people in the estimating
![Page 13: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/13.jpg)
21
Perform, Produce and Prosper
• Project turnover (estimating to production)• Have a written process
• Provide adequate timeBoth hours and calendar
• Involve both estimator and PM
![Page 14: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/14.jpg)
22
Perform, Produce and Prosper
• Production• Daily Huddles
• Weekly job meeting
• Two week look ahead report
• Management dashboard report
![Page 15: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/15.jpg)
23
Perform, Produce and Prosper
• Fundamentals of Productivity Improvement
– Increased productivity = increased margins– Firm-wide best practices = improve efficiency – Proactive processes > reactive individuals– The greatest challenge is changing individual
behaviors
![Page 16: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/16.jpg)
24
Perform, Produce and Prosper
• For Introspection– Do you have these processes in your
organization?– Are they consistently applied? Are they
the same or does each person have their own way of managing?
– As your customer base has changed, have your processes changed?
– How do you ensure they are being followed?
![Page 17: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/17.jpg)
3
Perform, Produce and Prosper
State of the Industry
![Page 18: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/18.jpg)
4
Perform, Produce and Prosper
![Page 19: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/19.jpg)
5
Perform, Produce and Prosper
![Page 20: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/20.jpg)
6
Perform, Produce and Prosper
![Page 21: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/21.jpg)
7
Perform, Produce and Prosper
44.7
34.1 35.6
45 44.8 47.7 48.4754.5
51.3 5346.546.1
52.6
0
50
100
Q4 2007Q1 2008
Q2 2008Q3 2008
Q4 2008Q1 2009
Q2 2009Q3 2009
Q4 2009Q1 2010
Q2 2010Q3 2010
Q4 2010
FMI N
CR
I Sco
re
![Page 22: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/22.jpg)
8
Perform, Produce and Prosper
FMI
![Page 23: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/23.jpg)
9
% 'Clha:ng:e
Illndli·c::atolF :2:009 20--:1 '0' :2:0 1 "I .. :20"10-:20-1 .,
_ Bu"-'_""""'"<".S- CEln
$557
![Page 24: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/24.jpg)
10
Perform, Produce and Prosper
Why Focus on Productivity?
![Page 25: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/25.jpg)
25
Perform, Produce and Prosper
Bonded Construction Work as a Niche
![Page 26: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/26.jpg)
26
Perform, Produce and Prosper
• Why pursue a niche?– 1960s - 800,000 Contractors– 2010 - 2,700,000 Contractors– Adjusted for inflation, the amount of work
put-in-place is about the same– Both competition and customers are more
sophisticated
![Page 27: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/27.jpg)
27
Perform, Produce and Prosper
• What is a Niche?– Focusing on types of work, customers
and locations that reduce your exposure to competition
• Inner-city work• Rural work• Special technologies• Demanding customers, etc
![Page 28: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/28.jpg)
28
Perform, Produce and Prosper
• Why a Niche?– Differentiation– Reduced competition– Expertise improves productivity– Sophisticated customers seek value more
than price
![Page 29: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/29.jpg)
29
Perform, Produce and Prosper
• Why bonded work?– Reduced pool of bidders– Bonded contractors are better competition– Sharing bonding capacity with a new
client shows that your firm • Has financially strength• Understand your costs• Manages risks
![Page 30: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/30.jpg)
30
Perform, Produce and Prosper
• Why bonded work?
During an economic downturn a higher percentage of work tends to be in sectors that normally require a bond
![Page 31: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/31.jpg)
31
% 'Clha:ng:e
Illndli·c::atolF :2:009 20--:1 '0' :2:0 1 "I .. :20"10-:20-1 .,
_ Bu"-'_""""'"<".S- CEln
$557
![Page 32: Construction Industry - Surviving 2011 Thriving 2012 Presentation](https://reader035.fdocuments.net/reader035/viewer/2022062513/5568649cd8b42a203d8b4c8f/html5/thumbnails/32.jpg)
32
Perform, Produce and Prosper
M. Scott Hursh, CPA, CCIFPStambaugh Ness, PC
2600 Eastern BlvdYork, PA 17402
717-840-6116 [email protected]