Construction Strategy Blueprint
Okay, this is Eric again and we’re just at 3 O’clock, Pacific Time here in beautiful Sacramento, California. Coming to the end of the summer and it’s starting to cool down just a little bit hopefully. Anyway wherever you are in the world welcome to the webinar, so glad that you could join me and we’re going to spend some great time together talking through the construction strategy blueprint. And as we start here what I would like you to do is to make sure that you really take the right perspective on this time that we spend together. This is very much your 60 minute oasis. So what I’d like you to do is put away the cell phones, close up the windows on your computer, grab yourself a pen and a piece of paper so that you can be thinking through what you can do to use and apply this information in your business. So it’s your 60 minute oasis, make sure that you’re focused, make sure that you don’t have any distractions. It’s time now to work on your business. So 2017 – construction I sure hope that you’re busy. I want you to just raise your hands, is everyone slammed right now with work. Are you busy? Just raise your hands to indicate if you’re busy or not. Yeah, I see that. Okay. I’ll tell you we haven’t seen it this good so to speak for quite a while. Now we know that construction goes in cycles but right now things are very busy, 713 billion of new construction in 2017, the sun is shining. That means your guys are out in the field kicking butt hopefully. That also means that you got problems coming as a result of that because you know how complex and challenging construction can be. You know how difficult it is – in between sub contractors and contractors and the clients and the field and the office. So I know that you’re under a lot of pressure right now and there’s a lot of work out there. And so that’s why I’m glad that you’re taking just a few minutes out of your time this afternoon to work with me at my promise that it would be well worth your time. I don’t need to tell you, you know this if you’re in construction that it’s a very, very challenging business. And if you think about the business on one hand it’s relatively simple, right, first you have to bid work. So you have to get jobs then you have to plan the work, then you build it and then you get paid for it. Easy to say, very, very hard to do. Just think of the one, the middle triangle there, the build. Think of all the things that you’re responsible for in terms of safety, in terms of speed, in terms of quality and in terms of taking care of your clients. Tons of complexity built into that particular process and that’s just one thing that you’re doing day after day. And that’s why it’s so important that you’re very good at consistent planning and communication. Always keep in mind that the construction that is best at communicating, that is clearest in knowing what they need to do in order to be successful that’s the construction company that’s going to succeed. And the reason why this is so important is because between 1964 and 2017 competition has gone up three times but the volume of work in constant dollars is about the same. So competition keeps going up, okay, not only competition for jobs but competition for talent. Think about it, how many of you just by a show of hands how many of you are having a challenge right now finding good help. How many of you are having a challenge with labor shortages, it’s a big issue throughout the entire industry. Thankfully I’m doing work with the local builders’ exchanges going into high schools and talking to the high schoolers about participating in the construction industry and I think that’s beginning to change now. There’s going to be a shift in the thinking towards construction and I think more people are going to be getting into it in the next few years.
There’s 3 percent net profit generally speaking throughout construction. If you’re doing more than 3 percent it’s because you’re working hard and you’re working smart. But the great thing about construction is there’s tons of opportunities. Once again construction is essential, it needs to be done locally, it’s a very local business. It can’t be outsourced, right the Internet is not going to kill your business. Your quality may kill your business, how well you’re able to build something safely and effectively. Your customer relationships may kill your business but you can’t get outsourced. The Internet will not kill your business. And its merit based, so you know this, if you’re good at what you do – I was talking to one of my clients yesterday and I kept telling him good help is hard to find. And if you are help through the ups and downs of the economy you’re going to be able to build a sustainable long lasting business. So a little bit about me for those who don’t know me. My name is Eric Anderton. I’ve been working with construction companies helping them build people and profits since 2004. It’s funny, I was with one of my clients this morning, they were my first client, in 2004 when I was in leadership development and they’re still my client today. We’re doing a internal leadership development course for their company. So I help you to strengthen your leadership with executive coaching, I was doing that all day yesterday with a very large contractor here in town. I help you to build your team through leadership development, I was doing that today with one of my clients and then I help you to grow your business through strategic planning. And if you’re interested in strategic planning it’s one of my great loves is to work with my construction clients helping them with their strategic plans and that’s exactly what we’re going to be talking about today on the webinar.
Okay. So here are some of the clients that I work with in the area. You can see there are subcontractors, there’s contractors, some of them are very large, some of them are mom and pop, so it ranges from I would say $10 million up to $500 million in revenue and this is what one of my clients says, “The strategic planning format you introduced is terrific”. You guys are going to be introduced to that strategic planning format today. “We’ve clearly articulated the purpose of our business, the values that drive our actions and how Cook Engineering is going to be successful. We know how to straightforward repeatable process to plan and take action. Cook Engineering is on track to achieving the highest revenue and profit figures in more than five years and you’ve made a significant contribution to that success”. So I’m very proud of the work that I do with Cook Engineering and other contractors. My personal model as far as running my business is this low overhead, stay humble and it’s not what you make it’s what you keep. And that’s something that I emphasize to my clients as well particularly in construction. Low overhead, stay humble, it’s not what you make it’s what you keep. And as far as my personal style is concerned you can tell I get really pumped up talking about business and talking about how to run an effective business. When I get excited sometimes I say, dude, you know, I just get pumped up so you’ll bear with me in my excitement and if you stick around to the end I’m going to send you a recording of the webinar and also I’ll tell you a little bit about how you can get some help if you want some. So let me open it up to the group here.
I’ve a question, “What is strategic planning?” If you just want to type in an answer to that or someone has a really good answer that they want to share. Raise your hand and I can unmute you if you want to share it with other people. But if you want to type it in or if you want to just tell everyone you could do that but let me ask you this question. What is strategic planning? Just type in that answer there, pls.
Here we go. “Planning the course of your company will take in the future.” Thank you. Yeah, so strategic planning, planning the course your company will take in the future. That’s excellent. Thanks for sharing that, Sean. And it’s a funny question to ask because a lot of times if you look on in like the business books and stuff there’s tons and tons of books written about strategic planning and I’d like to give you a very simple definition for strategic planning and that is this. It is your plan for how you’re going to be successful, that simple. Your plan for how you’re going to be successful. The nice thing about business is that you can define what success is for you and you can figure out how you’re going to plan that success out. So let me ask you the 3:30 am test. This is a really interesting one. I know most construction guys and gals were early risers so you’re usually up 4, 4:30, 5 in the morning ready to hit it hard. But if I was to wake you up at 3:30 in the morning and asked you four specific questions how would you respond. And let me give you what those questions are, these are really, really important questions. Number one, why does your company exist or what is the purpose of your company. Number two, personality. How does your company behave or what are the values that drive your organization. Number three is your plan, what is the core plan you have for your success. How are you going to succeed as an organization and number four is priority. What’s most important right now, what do you need to achieve in the next 90 days to be able to say with any credibility we had a good period of time. So if I was to shake you at 3:30 in the morning or call you on your phone and ask you hey, what is the purpose personality plan and priority of your business would you be able to give me clear answers for that. Okay, this is a very important question. Now if you don’t have a clear answer for each one of those that’s exactly why spending time with me here on this webinar is a good thing because I’m going to show you how you can get clarity as far as that is concerned. And these questions are critical for the alignment and the success of your organization and frankly and working with people over the years most people don’t have good answers to these questions. So typically when I ask someone what’s the purpose of your business this is what they say, “to make money”. And I whole heartedly agree. The purpose of every business should be to make money because if you don’t make money you don’t have a business.
But typically the best companies have a motivation that goes beyond just making money. The money is a reflection of that deep motivation. And it’s very important if you’re going to get good at strategic planning to be extremely clear on the purpose of your organization because that’s going to drive how you do your strategic planning. Then when people talk about personality or values there’s a lot of sort of words like honesty and accountability and consistency and all these sort of blah, blah, blah words. And the thing about the personality question is this, you’ve got to really nail it in words that mean something to you. And I’m going to give you three specific examples later in this webinar from three real construction companies who have nailed the purpose and the personality of their business and it has a massive impact on their strategic planning and on the way they run their organization. Now as far as plan is concerned right now your plan may just simply to be keeping your head above water. Just somehow getting the work done, finding the help, making sure your crews are in the field taking care of the clients, dealing with all the headaches, keeping your head above water. And I understand that that’s sometimes how companies roll but really the best construction companies are very good at nailing their strategic plan understanding how they’re going to be successful. And then as far as your priority is concerned, well, maybe it’s get it done, that’s all your priority is right now. You’ve got a big job out in front of you that you’ve got to get done in the next 30 days and you’re just looking to complete that as soon as you can. But I want to encourage you, the best companies are very good at getting together and clearly identifying what their priority is and then pursuing that with real rigor and real intensity. And we’re going to get into that in more detail as well. So let’s continue to dive in here.
Strategic planning. What is some of the big challenges that people have with strategic planning. No direction. Yeah, it’s really difficult sometimes for people to plan because they don’t have structure, they know that they need to get some control in their company but it’s hard because they don’t have a structure for the planning itself. Anyone else got an idea? You know, it’s interesting as I work – it’s the lack of clarity and a message that everyone on the team could – that’s very excellent here.
Okay, so lack of clarity and a message that everyone on the team can understand and identify with. Yeah, you nailed it right there, Sean, that is excellent. A lack of clarity and understanding. And then, Andrew, yes, spending time on tasks and fires. Exactly. Now this is the thing, right. We’ve all got tasks and fires and the best companies they consciously set aside time no matter how painful it is to make sure that they’re doing strategic planning. And as I talk to executives in different construction companies a lot of the frustrations are is that the team lacks a common language for strategy. Okay, and so people argue over what strategy is instead of actually sitting down and doing strategy. And also the strategic planning process what it does is it generates too many ideas. You sit down and you come up with all these great ideas but because you have so many ideas there is no alignment around one idea or the most important idea and because of that nothing ever gets done. And that leads to the third frustration and that’s what I call the dusty binder frustration. Because every company knows they need to do strategic planning and they don’t really have clear processes. So a lot of companies you know what they do, they bring in outside consultants who work with them for 2, 3, 4 days, even longer sometimes and they produce this really wonderful binder and then you know where the binder goes with the strategic plan, it goes on the shelf and everybody goes back to doing things the way they were before. And that’s exactly why the process I’m going to teach you today as far as strategic planning is concerned is so powerful. Because it is the non dusty binder strategic planning process. It’s designed to give you a one page plan that everyone in your organization can align around and you can hold people accountable for. And so what we want to be able to do is answer the most important strategic questions to give your organization an edge, agree on the most important priorities that are required for your success and then put in place accountability and a structure to make sure that your strategy actually gets implemented throughout the whole organization. So what is the strongest – here is a question for all you construction folks, what is the strongest geometric shape. Sean says a circle. Okay, so I Googled this so if I’m off if you’re an engineer I’m off here, you got to have mercy on me. But from what I read the strongest geometric shape is a triangle due to the rigidity of its sides which allows a transference of force more evenly through their sides and more evenly than other shapes. So what I like about triangles is they’re simple and they’re powerful and they’re flexible. And that’s the whole idea of the strategic planning process that I’m going to be sharing with you today. It’s simple, it’s powerful and it’s extremely flexible. It’s simple in that it just asks four questions. Now there’s depth to those questions but it’s four main questions. It’s powerful in that the clarity that you get on those questions if you get that clarity it can lead to alignment in your organization. And its flexible because this process can be used for very large construction companies and smaller companies but also divisions within companies and you can even use this process to do strategic planning on individual projects.
Now it asks four questions, what is the purpose or our organization, what is the personality of our organization, what is the plan and what is the personality. Okay, so this is very important. If you don’t do strategic planning what you’re going to find in your organization is confusion and then you’re going to find misalignment and disunion. And many companies I work with and I initially start working with them they’re kind of like this. People are jumping ship, the foundation of the organization seems kind of crumbling and that’s exactly why we need to sit down and go through a strategic planning process to help them get that clarity and alignment. And frankly a lot of companies they get stuck, they get stuck doing the same things over and over again and expecting a different result and unfortunately they get stuck in mediocrity. Now right now the economy is such that basically any construction company that’s living and breathing should be at work. But when the economy goes down again that’s when the cream of the crop rises to the top and what you’ve got to ask yourself is will we be the cream of the crop. Are we the very best right now and in the future are we planning and building our organization so we can be the very best? Because if you’re not the very best you either should be striving for it or perhaps go do something else. So let’s think about it a little bit more. If you’re able to get strategic clarity it’s extremely important because then you can get that alignment that we were talking about and from that alignment you can make real progress as people work together building your organization. And again it’s simple, it’s powerful and flexible.
Four Ps, purpose, personality, plan and priority. So we’re going to dive into more detail here. So let’s begin with purpose. You’ve got to get crystal clear on this. What is the purpose of your organization. Why do you exist? And as far as the purpose is concerned there is three things that you want to identify. Your core talent, how you’ve expressed that core talent and then what is the driving force behind your organization. Okay, so let’s dive into that in a little bit more. Think about this, as far as your core talent is concerned what is it that you do well that gets you paid. Let me ask you guys that question, if anyone wants to answer that I’d like you to do that. What is it that you do well that gets you paid? In other words when your clients call you and say hey, I’ve got a job and maybe they don’t and they say I just want you to work with me, I’m getting this thing done. What is it about you that gets you paid? Let me ask that to the group here. Okay, solve problems. Excellent answer there. Yeah, thank you very much. What else? What is it that gets you paid? If you’re not really clear on this answer by the way it’s something that you have to think about. Why is it that people do business with you? Okay, that’s one thing about construction, really, it’s a problem solving business. All day every single day you’ve got to be able to solve problems. And so then let’s say your core talent is solving problems the next question you got to ask is how do you express that core talent. Okay, so yeah, and then we have another one, that idea of responsiveness and dependability. We’re all working owners in all aspects of the business, supporting the client from – see, that’s great too. Those are things that set you apart, those are your core talents that you’ve got to really be able to identify and then you’ve got to think about how you express that core talent in very practical ways. And then the last question you want to ask yourself is what is it that drives the organization, what motivates you to get up in the morning and keep going. Because what is constructional all the time, it’s the dude pushing that red ball up the hill every single day, problems, problems, problems. And that’s a good thing because you know what happens if you can solve problems you can get paid. There’s a great quote, it’s this, there are no secrets to success. You’ve got to solve problems, you’ve got to be worth more than you cost and then you got to outwork everyone. Solve problems, be worth more than you cost and outwork everyone. If you do that you’re going to be successful. And so the reason why this is so important is because you have to have that clear purpose that you can rally people around. So I want to give you some examples and these are actual client examples from construction companies who I work with going through this four P process, the purpose, the personality, the plan and the priority.
drive your organization.So here’s one right here. This is a $10 million dollar company, the purpose of their business is to crush the competition. Sounds like a construction guy, it is to crush the competition. Here’s another one, we build to provide and endure. This is a large construction company, it’s a sub contractor that’s an ESOP company. And their goal is to provide for the 400 families that they’re responsible for and to endure over a long period of time. So it’s not just one guy running his business who is looking to get a few deals for a 20 year period and then be gone they want to endure multiple generations. And then here’s another one. Building lives by saving lives. This is a sprinkling contractor and the building lives part refers to how they treat their employees and the saving lives part refers to how – the impact of their work on people in the community because they’re a sprinkler contractor and therefore the work they do saves people’s lives. Now, here’s a question for you. Do you have a clear statement that you could write of why your company exists? Or do you have a clear statement of why your company is in business. Can anyone say that, anyone want to type that into the box to me there, a clear statement, something that’s really clear that your company is aligned around. And by the way this clear statement it isn’t something that’s just residing in your head but other people know it as well. So here we are, “to win and help others win”. Yeah, it’s really interesting, that’s an excellent clear statement right there. That’s great, so we have another one here, “building solid connections”. That’s very excellent. Now what’s really important here guys when you’re identifying the reason your company exists you need to put it in language that means something to you. Okay, so to crush the competition that really reflects the attitude that this particular construction company has. And it’s a strong attitude because you’ve got to get out there and hustle work and build it safely and quickly and with high quality and they’re doing all of that because they like to win. So it’s okay to have a clear statement that reflects who you are and the purpose of your business. Okay, now if you’re not clear on that that’s something you need to begin to work on. So the purpose is very important. The next thing is the personality. And what I mean by personality is your values or how you behave. Okay, now this is extremely important for you to be able to identify the values that drive your organization. Okay, so let’s take a look into that in a little more detail.
So when you’re looking at the personality of your business there’s three things that you want to take a look at. Number one, you want to identify your core values. Number two, you want to be able to use those core values to think about who you should be attracting and repelling. One of the problems about companies is they’re not very good at attracting the right people or repelling the wrong people. And I’m going to talk about that in a little more detail. And then when you’ve identified those values or when you’re clear on how you behave that should then drive your operations. So let’s take a look at that, your core values. Now what core values are, are values that actually exist. They’re unique to you and they’re unchanging. In other words you are who you are and you express who you are in the way that you do business and you attract people to do business with you both from an employment perspective and from a customer perspective who will like you as well. So the clearer you are in your core values the clearer you’ll able to be in the light of who you hire, who you fire, who you choose to work with, who you partner with, which subcontractors you use, which general contractors you work with. You just have to get crystal clear on that and you’ve got to understand that if you’re clear on those things the values that drive your business that provides you an extremely strong foundation. Now one thing that you have to get used to if you’re going to really live by your values is intolerance. You have to get intolerant of people who violate your core values. In other words if you behave in a certain way we will not do business with you and you will not do business with us and you will not work with us. But if you behave in alignment with our core values then those are the types of people that can work with us over the long term and we can build a great company together. But if you’re not clear on those core values how then can you attract and repel the right people? This is one of the great struggles that a lot of people have is that they bring in a certain type of person in their organization and they wonder why they don’t succeed and it’s not because of their lack of technical skill it’s because they don’t align with the way that the company operates. Okay, and that’s the one thing that you need to see is that your purpose and your personality they’re going to drive who you bid to, how you plan your work, how you build your work, even how you get paid for your work. All of these things, they’re foundational to a successful organization. So you have to get absolutely clear on what the values are that drive your organization.
So let me give you some client examples. That tile company that wants to crush the competition these are their core values. “No hacks, zero punch, and make our clients’ lives easier”. You notice there, there’s nothing about integrity and all those kind of stuff like words that everybody uses that mean nothing. These words mean something to them, they want no hacks. What that means is they want quality people working with them. They want zero punch, that means at the end of the job they’re not going back again and again and again getting all this profit fade because they’re not diligent in punching out the job. And then they want to make their clients’ lives easier. So those are their core values. And check this out here, this is the ESOP that I was telling you about. “The courage to break molds and eliminate excuses”. Okay, now this is really important. They have four divisions in their organization, they started out with the two owners in the back of their truck 25 years ago and now they have four divisions and employ 400 people. They have the courage to break molds and eliminate excuses. The discipline to kick ass and the wisdom to stay humble together. So when we’re working with their people there we ask them how are you kicking ass today, how are you disciplining yourself to kick ass because the values of the organization drive the operation itself.
Okay, let me give you another example here. This is from the fire sprinkler contractor. Taking nothing for granted, delayed gratification and earn everything. Now these are core values that they came up with going through this process with me and it’s absolutely essential for you guys to see that these are all words that came from them and that’s the most important thing. You have to be able to express from your heart if you like from the depths of your being the values that drive your life because if you can identify that clearly it’s so going to help you to build really meaningful strategic plans that you can actually execute.
Alright. Now let’s move on to the actual core there which is the planning part. And you notice just the colors of this triangle. I intentionally put the colors like this because your purpose and your personality there blue. So when you think of the color blue what do you think of. “Calm”. Okay, that’s a good one. What else? “Steady”. That’s a good one. I think the thing I think about is calm and steady is good, these are things that are solid and they don’t change. Your purpose and your personality don’t change over time, they stay the same. But then you notice the plan and the priority they’re in sort of more brighter reddish colors, so what do you think of when you think of brightness and red and all that kind of stuff? “Active”. Yeah, that’s a good one. So that’s the thing, your plan and your priority. These things are going to change over time. Your plan today may be different than your plan next year or in two years from now. And your priority should absolutely be changing probably three or four times a year. That doesn’t mean you’re all over the place but you really are making sure that you’re thinking through what’s the most important right now on a regular basis in your organization.
Okay, so let’s take a look at this idea of the plan. And the idea of your plan is this, a strategic plan answers this question, how will we succeed. How will we succeed? And there’s a lot of depth to this question and it takes time to answer it but if you do it well your answer should be simple and understandable and something that people can rally around and clearly pursue. And there’s three aspects to it, there’s your niche, there’s your edge and then there’s the SWOT. Okay, so let’s take a look at that. What is your niche? This is one of the things that many businesses really strive to identify because you cannot be all things to all people. This is one of the challenges that construction companies have is they need to get really good at nailing their niche. And I’m going to go to that in a little more detail here in a minute. Then you’ve got to think about what your edge is. I mean we touched upon that a little bit earlier but what is it that sets you apart from a general contractor that’s your competition or a sub contractor that’s your competition. What is it that makes you unique? Because what you want to be able to do is to leverage that uniqueness in your strategic plan so that you can avoid doing things that take you away from the core of what makes you who you are and what makes you successful.
And then the next question you want to ask is what are our strengths and our weaknesses? The SWOT analysis is absolutely essential for most organizations, I would say for every organization. And the best organizations are extremely clear on what their strengths are and what their weaknesses are. And so when I say niche this is what I mean my a niche particularly when it comes to construction. This is absolutely essential guys, your niche is the right client, the right job and the right location. Now think about the purpose of your business in terms of making money. If you have the right client but you have the wrong job in the wrong location think about what that does to your reputation and your profitability. Okay, think about if you have the right job with the right client but it’s in the wrong location. So a lot of times you know, there’s like where I live in Sacramento you have a lot of construction companies who go down to the Bay Area for work and that’s cool because the Bay Area is way more active than the Sacramento area but if you don’t have a crew that you can trust in the Bay Area or if you’re stretching yourself geographically and that’s causing your profit to fade then perhaps it’s not the best idea unless you can man those jobs in a way that’s effective. So the niche again, right client, right job, right location. Now here’s a question for you, here’s a challenging question. Think about all the jobs that you’re working on at the moment. Can you say with absolute certainty it’s the right client, it’s the right job and it’s the right location. You should be able to analyze every single job that you do and rank them and figure out where there are weaknesses in your niche identification and niche execution. This means that you actually have to sit down and look at the numbers from your jobs, look at the interactions that you have with the client, look at the interactions you have with the general contractor and ask yourself is this my niche. And if you haven’t clearly identified who your right client is, who your right job is and who your right location is then that sustained success is going to be a challenge and that’s something that you need to work on. Now as far as your edge is concerned think about the building process itself. Perhaps your edge is in safety, perhaps it’s in speed, perhaps it’s in quality, perhaps it’s in your client relationships. But you’ve got to be able to identify where your edge is and then when you’ve got that edge identified the whole purpose of that is to help you to leverage that edge. And that’s where the SWOT analysis comes in. So think about this as far as your strengths and weaknesses, SWOT by the way means strengths, weaknesses, opportunities and threats. And great construction companies do this kind of stuff all the time. If you’re not sitting down at least twice a year doing a SWOT analysis in your business then you need to get doing that right now.
So you think about the factors as far as that influence a business, your service, the quality, your cost, your speed, safety is definitely a big one that’s actually not on this list here. Where are you strong, where are you weak and what is the implication for your strategy. Okay, that’s something you’ve got to ask for each one of these here. Where are you strong, where are you weak, and what is the implication for strategy. Think about information systems, when it comes to construction one of the most important things is that the field is communicating to the office the information they need to ensure that their bidding is accurate. What are your information systems in place that enable you to get accurate information so that you can put out bids that can be accepted and can be selected by the people that you’re bidding to. So you have to ask where am I strong, where am I weak, and what are the implication to strategy. And this is not just like a five minute conversation right here. This is something where you gather the people in your team and you sit down and you really have this strong discussion where you get people from the field, you bring in your superintendents, you bring in your top foremen, you bring in your estimators, you bring in your project managers and you sit down and you talk about these things because you need to get everyone’s perspective as far as this is concerned. And then what you want to do is you want to ask what are your opportunities and threats. What are your opportunities and how will you build on your strengths to seize those opportunities, how will you shore up your weaknesses to seize those opportunities. Let me give you an example here from the NBA. Just recently Kyrie Irwin from the Cavaliers was traded to the Boston Celtics. The Celtics traded away their best player to get Kyrie Irwin. And the reason this opportunity came up was because Kyrie Irwin no longer wanted to play with LeBron James. And so the Boston Celtics general manager Danny Ainge saw that opportunity and he seized it. Now think about this, we’re all so busy running work at the moment that perhaps we’re missing opportunities to expand our business or to change our business. And that’s exactly why you need to stop and ask this, what are the key opportunities that are out there at the moment that we could build on using our strengths. Or how can we shore up our weaknesses to seize those opportunities. Think about the threats, perhaps there’s a new competitor in town. Obviously there’s a lot of companies out there doing cheap work at the moment. But where are those threats and how will you build on your strengths to defend those strengths and how will you shore up your weaknesses to defend those threats. This is a deep conversation here, again, this is not something that you just go over in a few minutes. But you sit down with your key team members and you go through these questions and you ask what are our strengths, what are our weaknesses, what are the opportunities and what are the threats. And as you go through that process what you should be able to do is to narrow down your decision to a particular strategy to help you to be successful.
So again let me give you some client examples that come from these types of discussions. This is the tile contractor. This is how they’re going to be successful. 20/12 minimum, those are the profit ratios that they want to achieve on their work. Large negotiated design build, okay, so that has to do with their niche. Large negotiated design build and then the key clients. That’s their strategy for success, we’re going do 20/12, we’re going to have large negotiated design build and we’re going to have the key clients. Okay, so let me show you that on the ESOP sub contractor. The way they’re going to be successful is in these three ways. Number one, fully support the field in the shop. Number two, targeted estimating and number three, promote and develop from within. Promote and develop from within. And then I’ll show you the sprinkler contractor. Their strategy is this, grow and develop the family. Okay, what they mean by that is to grow and develop their people. The way they’re going to be successful is to grow and develop their people and then what they need to do based on their SWOT analysis is to protect and expand the base. So competition is fierce in their industry and they’re focused on protecting and expanding the base. So if I was to ask you what your strategy for success is would anyone be able to give me a simple answer for what your strategy for success is. Alright here we go, “Develop every employee into a leader”. That’s awesome. Okay, “Pick the right clients”. Excellent. It’s really good. So you think about that, if your strategy for success is developing every employee into a leader your next step then is to ask in what specific ways can we develop every employee into a leader. And if your strategy is to pick the right clients your next thing to do is then to do an analysis on the clients you currently have and force rank them in light of what makes a good client and what makes a bad client. And do your very best to avoid working with the B and the C clients and to work only with the A clients. And to keep pushing towards that. Alright. So just to remind you if you’re unclear on these things in your business right now it’s going to create confusion, misalignment and you’re going to keep stuck doing what you’re doing. But if you get clear on those things if you get that clarity it’s going to get the alignment in your organization and it’s going to help you to build an awesome company and make progress. Okay, so we talked about the purpose, we talked about the personality, we talked about the plan. Now let’s talk about the priority. This is the last part of it, and the whole idea of priority is this question, what is most important right now. This is a great question. Another way of putting it is this, what do we need to accomplish in the next 90 days in order to be able to say with any level of credibility we had a good period of time. What do you need to accomplish, it’s extremely important. And so with that there’s three parts to building a strong priority. Number one is your Rally cry, then your areas of fierce focus, and then the critical numbers. And I’m going to show you how this works. And really what I’m sharing with you here right now is absolutely essential for every single company to do at least every 90 days. And if you’re not doing something like this you need to get started right away. So let me give you a little more detail on that. So the rally cry, the rally cry is really simple. The rally cry is a very clear statement of what you need to do to be successful. The fierce focus are the areas in your business that you need to work on and emphasize in order to achieve the rally cry. And then the critical numbers are the numbers or the measurements or the metrics that indicate that you’re doing those areas of fierce focus that are leading you to achieve that rally cry. So these things all work together, right, the rally cry in the areas of fierce focus and the critical numbers work together so that you can build a very simple straightforward powerful 30-90 day plan that’s going to help you to execute that deeper personality and purpose and strategic perspective.
So Patton says this, “A good plan violently executed now is better than a perfect plan executed next week”. One of the great limits that we put on ourselves is a demand for perfection. And if you’ve been in construction long enough you know that perfection ain’t going to happen. So don’t wait for the perfect plan, it’s not going to happen. Okay, what you want to do is you want to be directionally correct and then you want to take action. Because as soon as you take action there will be a reaction and if you need to adjust your plan you can then adjust it. The planning process itself is absolutely essential though. And so the first thing you want to ask is what is your rally cry, what is your rally cry. Okay, so let me ask you this, what is your 90 day rally cry. I’d like someone here to respond to that. What’s the most important thing you need to accomplish in the next 90 days? Anyone clear on that. Give yourself a 3:30 am test right now. Shake you in the middle then I ask you what’s the most important thing you need to accomplish, what would you write down. Spread the word about developing leaders. Excellent. Okay. “Hire help, the right help”. See, that’s great, very good. “So expand pipeline of new business”. Excellent. Very good. Now what you’ve got to think about, right, is there is lots of complexity underneath each one of those. Right, if you’re hiring the right help there’s complexity. Expanding the pipeline of business, there’s complexity. Spreading the word about developing leaders, there’s complexity and challenge right there.
Now check this out. This is the map of the Allies advance across Germany in 1945. There’s a great deal of complexity right here. You can see this, right, there’s at least four or five six different armies attacking Germany both from the West and the East. You’ve got the British, you’ve got the US, you’ve got the French, you’ve got the Ruskies and they’re all seeking to attack Germany. And if you will woke up every single soldier in those armies at 3:30 am and you ask them what is the rally cry, what’s the one thing that you need to accomplish in the next 90 days they would tell you without doubt beat Germany. Okay, the great thing about that again is there’s tons of complexity. Go back to the map here. There’s lots of complexity. The high net rally cry of beating Germany but the fact is everyone knows exactly what they’re doing. And do you know what the best companies do, they identify a rally cry that encompasses the whole organization. Now not every single person in the organization may have to do something to achieve that rally cry but everyone in the organization understands the rally cry and does whatever is necessary to achieve that rally cry. Okay, so you’ve got to be really, really careful to make sure that your rally cry is clear, understandable and that everyone in your organization buys into it. And by the way when we’re talking about these things as far as your plan is concerned one of the things that you have to get used to is a leader in your organization is over communication. Okay, if you have kids you know that you have to tell them something again and again and again before they get it. And it’s the same thing with stuff like your purpose and your values and your strategic plan and your priority. You have to communicate it to people again and again and again so they don’t lose focus through all the trauma and all the difficulty on what you’re looking to achieve. And that’s why having a simple rally cry is so important. And then you got to move on to the – so if we go back to the map here and this is really important here. If we go back to the map you’ll see that the rally cry is to beat Germany but then there’s these areas like right up here they’re going to take Hanover and they got to get to Bremen and they eventually got to get to Berlin so there’s areas of fierce focus and different kinds of responsibility that people need to take in order to achieve the rally cry. So if you’re thinking about hiring the right help what are the areas of fierce focus that you need to work on in order to achieve that rally cry? If you’re expanding a pipeline of new business what do you need to focus on in order to expand that pipeline of new business. And then in addition to the rally cry and the fierce focus critical numbers that indicate to you whether or not you’re doing those areas of fierce focus. Whether or not you’re achieving what you’re setting out to achieve. And on a piece of paper it looks something like this. Your rally cry will be at the top, your areas of fierce focus will be underneath that and your critical numbers that tell you whether or not you’re achieving your areas of fierce focus will be under that.
So let me give you actual client examples here. A rally cry for the company then the sub contractor the tile company is to “implement training”. That was their rally cry and this is taken from about a year ago. And so what they had to do is they had to build the skill matrix to understand how they’re going to implement that training. They then had to pick the training that they were going to do and then they had to schedule the training. So in order to implement training they had to figure out what to train on, they had to pick the training and then they had to schedule the training. And you see the initials here because these are the individuals that are accountable for each area of fierce focus. So you must have individuals accountable for each area of fierce focus if you’re going to be able to achieve the rally cry. And then underneath that they have critical numbers. So for building the skill the critical number was this, field trained by January 1st. That was their goal. A 100 percent of the office is going to pass the Excel test and then they’re going to have weekly check in on the progress. So these were the critical numbers that they focused on in order to ensure that they were driving these areas of fierce focus that then led up to them achieving the rally cry of implementing training. Let me give you another example. I just want you to see how practical this is. Another one of my clients their rally cry was “Kill bad jobs”. They had a couple of bad jobs on their books and they were determined in a 90 day period to get those bad jobs completed and off of their books. So they had to identify scope, they had to estimate the cost to complete and they had to do production planning. And you see the initials that are associated with each one of those areas of fierce focus and then they were going to get the scope done by September 30th, cost to complete by October 14th and they were going the draft their production schedule by October 14th as well. So these were all critical numbers related to the areas of fierce focus that were then driving the rally cry. I’ll give you one more. Again, this is very practical. So another client there, their rally cry was “defining the organizational structure”. Absolutely critical for a lot of companies. They don’t have their organizational structure very clear. And so they had to do a master task list, they had to do job descriptions and organizational chart. And then they had dates associated with each one of those fierce focuses in light of accomplishment. And all of these three things worked together to help them to achieve that rally cry of defining the organizational structure. So by a show of hands is this fairly clear to you. Do you guys see what I’m talking about here. Is this something that makes sense, something that you might be able to do? Okay, excellent, good. I’m seeing some shows of hands here. I appreciate that you’re giving me some feedback there.
Okay, so now let’s move on here. The question is what about you. Is this something that you think you could do in your organization? Is this something that you think could be done on one page? So again remember this is the no dusty binder strategic planning process. It’s four simple questions and it’s all designed to be on one page. So let me show it to you. This is the client example number one. Remember their purpose was to “crush the competition”. Their personality, “no hacks, zero punches, make our clients’ lives easier”, their plan was “20/10 and large negotiated design build and key clients” and their priority was “implementing training”. We went through this process together in a day. They had a clear one page plan. Now there’s complexity under each one of these but the point is, is everyone in the organization was crystal clear on who they are, why they exist, what they need to do to be successful and what’s most important right now. Ask yourself this question, is every single person in your organization crystal clear about this and what is your responsibility as a leader as far as helping your people to clarify those things and then communicate them. Let me give you another example from client number two, “We build to provide and endure” that’s their purpose, their personality we talked about that earlier, here’s their plan, here’s their priority, one page, everyone’s clear. You know, these guys have done a killer job with this. They posted this all over their office and they talk about it all the time. You’ve got to get it really ingrained in your organization. This is who we are, this is why we’re here, this is how we act, this is how we’re going to be successful, this is what’s most important right now, ingrained in your organization. Get crystal clear on it, it’s your responsibility as a key executive in your company. And here’s that other client, the purpose is to build lives by saving lives. There are their values, there is the plan, there is the priority. So again, think about you and your organization. Are you that clear in the way that you do business. Are you that clear with your strategic plan because if you’re not, if there’s confusion and misalignment you’re going to get stuck, you’re going to be frustrated and if you don’t get busy doing strategic planning then what’s going to happen is you’re going to find yourself in the same place next year or if the economy goes down it may be a worse place. Okay, and remember taking time to just do strategic planning it helps you to get that clarity, it helps you to get that alignment and then it helps you to make progress in your organization.
hope you and I can stay in touch. Have So again I’m asking you, what about you? What is the purpose of your business? What is the personality of your business? What is your strategic plan and what is your priority? This process on one page should take you no more than one or two days to accomplish, okay, depending on the depth of conversations that you have. And again of course you may take one page for the entire organization and a department may have one page that they take. And a job may have one page. And you may have one page for your estimating department and one page for your project management department. But the point is there’s a process that you can use again and again and this is what I want to encourage you, a real leader is somebody who can help us overcome the limitations of our own individual laziness, selfishness, weakness and fear and get us to do better things than we can get ourselves to do on our own. And that’s exactly what this process does, it helps people to overcome their laziness, selfishness, weakness and fear. It gets everyone on the same page. It’s simple, it’s powerful, it’s flexible and it can help you to have a much more successful organization.
Okay, so now it’s time for you to get to work. Now if you have a piece of paper or pen there what I’d like you to do, I’d like you to write down very clearly where do you want to be 12 months from now in terms of waving a magic wand where would you like to be 12 months from now as far as your business is concerned. What kind of clients do you want to be working with? What kind of jobs do you want to be working on? Where do you want to be in terms of the quality of your people? Where do you want to be in terms of the accuracy of your estimates? What about the safety in your organization or the quality of the actual work that you do. Where do you want to be in the next 12 months? That’s the first question you want to ask. And then you want to ask this question, where are you now. This is where you’ve got to be honest. Okay, you know the truth in your organization. So be honest about where you are at the moment in terms of your organization. And then you’ve got to ask yourself this, what’s holding you back. Maybe one of your clients is holding you back. Maybe someone that you’ve been working with for many years is holding you back but you keep going to them because they keep offering you work but they’re not that A client. Or maybe it’s someone in your organization that you should have fired six months ago but because labor is tight you haven’t and yet this person doesn’t line up with your values. They’re not bought into the company, they’re just kind of picking up a pay check but not really making a strong contribution. What’s holding you back from getting to where you want to go in your company. These are things that you need to reflect on and this is part of the strategic planning process. Part of the discussion again is this, where do I want to be 12 months from now. Where am I now? What’s holding me back. Okay, at the beginning of the webinar I talked about how you could get help. Okay, and if you’d like to take the framework that I shared with you today those of you who stick around to the end I’m going to share this entire presentation with you on the PowerPoint and I’m also going to send you a recording of the webinar that you can review with your people. But if you’d like some more help as you can see this is a process I’ve used with my clients again and again and again. And I’m happy to have a simple ten minute discussion with you about where you are now, where you’d like to be and what’s holding you back. Okay, in light of this strategic planning process if you’d like to sit down and just have a simple ten minute discussion with me over the phone I’ll send you this link along with the e-mail that I sent you in light of the recording of the webinar and also the PowerPoint. And this link here you can click on and you can book in ten minutes with me. Now give a quick heads up as far as that’s concerned. The great thing about this conversation is you’re going to get some clarity. I’m very good in a very short amount of time at asking pointed questions that are going to help you to really focus on what you need to do to build an effective strategic plan. And so if you’d like to have that conversation please book in with me through that link and I will send that link to you in the e-mail following the webinar. You can tell from this webinar that this strategic planning process is one of the deep passions that I have and I know it’s one of the things that has had the most positive impact upon my clients over the years. So feel free to contact me if you want further help, thanks again for joining me on this webinar and I hope you and I can stay in touch. Have a great day, guys.