Masonry Magazine January 2008 Page. 58
Full Contact Project Management
FULL CONTACT
By "Coach" Gary Micheloni
PROJECT MANAGEMENT
You Can Be QB1
Become the quarterback your team needs for 2008
As January rolls around, we can get caught up in college bowl games and pro football playoffs. The funny thing is that this all happens at the end of those seasons. At the same time, the rest of the world is wondering what to do about their own seasons: the brand new year of 2008 and the promise-or the hope of better things to come.
It's interesting that, with most football teams, as fans, coaches and players wonder about the future, wonder what happened, wonder what went wrong with the old season, they talk about leadership. In football, the talk is often about the quarterback - the QB position. And the team's starting quarterback is called "QB1."
In the sports world, the talk shows are all about whether so-and-so is the quarterback of the future, and who should get recruited or drafted. Even in little towns all over this country that seem to be defined by high school ball, QBs and their coaches are hot topics of conversation.
If we look at the basics of our team, we can start with some exercises to help you survive.
Survival exercises? You bet. Listen; in almost every area of our country in 2008, construction will be down, at least somewhat, in our industry. So, here are your "survival" exercise questions:
Question I: If things get slower, do you expect more or less competition in your market area?
Question 2: If things get more competitive in your market area, do you expect more or less profitability in your projects?
COACH GARY SAYS:
As PM on your project, you are QB1.
Question 3: If profits are down in your own projects, what do you intend to do to take up the slack?
You see, it's all about you, and your ability to lead your team. You're smart enough to know that, with a softer economy, if you make no changes now to your team and its game plan, you'll soon suffer. So, what is your plan?
Well, here's a thought for you as you ponder your new career as "quarterback." Increase your profit on your projects, even in a down market.
Here are a couple of examples. Let's say you have a small company doing $1 million in yearly sales, and you're averaging a 10 percent gross profit. (You can use numbers that better fit your own company. The principle and the equation remain the same). Well, a 10 percent gross profit would yield $100,000 annually. And, let's say that your company has done that for the last few years and can function okay with those numbers.
Using round numbers, let's assume that your volume this next year, if you change nothing, will drop 10 percent to $900,000, and your 10 percent profit drops
COACH GARY SAYS:
Too many contractors do toe much extra work - for free!
to $90,000. You have $10,000 to make up. Again, rounding off, call it $1,000 per month of make-up profit that is needed.
You could cut your profit to, say, 5 percent; try and pick up an additional $200,000 in volume; and get your $10,000 lost profit back. Of course, that would be in a much tougher market. And, that additional volume would probably strain your limited resources even more. When you're working on thinner margins, you've got to be even more careful, don't you?
So, by now, are you interested in a simpler, more logical solution - something that won't tax those resources and will deal with the reality of the market? Something geared to helping you survive?
Let's resolve that 2008 is the year that we stop working for free. I know you've heard this before. You've always thought it was a good idea. Maybe you've been too busy. With so much work out there in