Masonry Magazine December 2017 Page. 98
CONTRACTOR TIP 01= THE MONTH
AST month we
discussed how
important it is to
.....-, hire and expand during boom construction cycles. When times are good, you best cash in on the opportunity before it disappears.
We also said that expand�ing when times are good means the opposite when things go south ... and they will go south eventually.
Many business owners struggle with this, and for good reason, because it is hard to lay off or let go of people you care about.
But as soon as the work is gone, you have to cut back just as fast as you expand�ed. If you don't, you might end up belly up!
Knowing when to expand and when to contract is one of the greatest responsibili�ties company owners and managers have.
Think about this: If you grow 40% during a boom�ing market and business drops by 40% in a down�turn, aren't you back to where you were before the boom began? Or, let's say you had 50 employees and expanded to 70 during the boom. Then during the re�cession, you cut essentially 20 employees. You are, of course, back to 50.
When you make cuts, be selective and only cut your poorest performers. In our example then, when you reduce the 20, you don't necessarily have to let go of the same 20 you hired when things are good. In�stead, find the 20 bottom feeders in your company and cut them, thereby making your team stron�ger than it was prior to the boom.
In essence, if you're lucky and all of your employees are top producers, this leaves you with a team of 50 terrific employees, a much stronger team than you had before the boom began. And, a team that should more effectively compete in the difficult market you just entered into.
It's like suckering and ty�ing tomato plants. When you sucker the plants, you remove the detrimen�tal branches that inhibit growth so good branches grow faster and stronger, later producing the juici�est and most tomatoes. If you don't remove just the bad branches and instead remove some good ones too, the plant suffers and produces sub-sufficient to�matoes. In some cases, the plants die.
mid 2000's when the reces�sion was setting in. After seeing poor results at one of our companies, I pulled the managers in and asked them what the heck was going on. They admitted the results at the company were disappointing, but
''LOOKING BACK, l'VE LEARNED THE MOST J:ROM THE TIMES I SCREWED UP. AND THE BIGGER THE SCREW UP, THE HARDER THE LESSON AND GREATER THE DESIRE TO EN�SURE IT NEVER HAPPENS AGAIN.,,
Our businesses are no dif�ferent.
I write this column because I have a lot of experience and enjoy sharing it with other emerging construc�tion business owners and managers. Like you, I've learned a lot running nu�merous businesses over the course of my career. Looking back, I've learned the most from the times I screwed up. And the bigger the screw up, the harder the lesson and greater the desire to ensure it never happens again.
A lesson I hope to help you avoid occurred to me following the boom of the
guaranteed to get a handle on the situation.
"Wait a minute," I said, "the company has lost over a million dollars over the last two years and your plan is to handle it?" They said they understood but what happened was in the past before they fixed their bidding processes.
Having spent a million dollars training the manag�ers, I was knee-deep in the situation at the time and assumed they could get it right this time. Not unrea�sonable, right?
So I chose to allow them to go on with their plans even
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