In the construction industry, it’s not uncommon for team members to go from working on the crew to being in charge of the crew. The transition to supervising people the employee used to work alongside, or having a fellow coworker promoted to management, can be awkward. But it doesn’t have to be.
How to Make the Best Decisions for New Company Leadership Construction Contractors Need to Evaluate Values to Select the Best New Leaders
Business leaders have always been scrutinized for their decision making. In 1914, Henry Ford was both denounced as a fool and praised for doubling wages of factory employees from $2.34 to $5 per day. In 1987, Merck & Company decided to give away a cure for river blindness for free, an unfathomable choice for most pharmaceuticals, because they recognized the cost of the drug would be too high for impoverished international markets.
Almost every AEC firm has difficulty holding employees accountable. This issue goes so deep that many business owners will shy away from putting any policies in place—for fear they won’t be able to get employees to follow them. This practice often has the negative consequence of inconsistent quality control, compromised employee safety and reduced project profitability.
Most of people are creatures of habit. They do not always appreciate changes in their daily routine, working practices or working environment. They may become unhappy about any loss of freedom to do certain things, such as changes in shift patterns, hours of work, or in their standard of living and buying power.
Everyone starts with the best intentions: eat well, exercise, perform well at work, and get along with coworkers. Unfortunately, those good intentions don’t always translate into actual results.
Image this scenario: It is time for the big announcement. Employees have filled the staff canteen. The CEO approaches and delivers a rousing speech about a proposed change, building up to a conclusion and asking for everyone’s support.
The construction industry has a well-earned reputation for being wasteful and producing unpredictable outcomes for its clients. The culprit is variation. To paraphrase a popular construction industry phrase: Change is the only constant. One solution to this inclination is lean.
The United States still has a long way to go to keep up with the technological advancements occurring in the construction industries around the world. Knowledge of information technology in the United States has not been fully leveraged largely due to lack of training, as well as resistance to change. The main barriers that hinder the progression toward technology comes from the culture of the construction industry.
The New Year is a time when we collectively decide to improve from last year. It’s the time for resolutions and, perhaps most importantly, it is the time to implement change. For many, change involves losing weight, eating healthier, quitting smoking or making smarter financial decisions. In fact, it is estimated that 45 percent of Americans regularly make New Year’s resolutions. However, only 8 percent actually achieve their resolution goal, according to Harris Interactive.
More than 70 percent of most internal initiatives fail to meet stakeholder expectations, according to the Harvard Business Review. Whether it is implementing a new system, a merger or acquisition, a business process improvement, opening a new office or pursuing a new direction, initiatives fail all too often. These major internal projects meant to help the company grow, improve and thrive are derailed due to issues that could have been planned for, but weren’t.
Many closely held construction companies do not have succession plans for continuing the business when the major (or sole) shareholder wants to retire. If family members are unable or unwilling to take over—or if the existing management does not have the financial means to buy the business—an employee stock ownership plan (ESOP) can provide an internal market to buy the closely held stock.
Every day that value is added to a business without a plan for future transition increases the owners’ financial risk. Ideally, the co-owners of every multi-owner business put in place a buy-sell agreement at the time the company is formed as part of the startup process. A buy-sell agreement protects the remaining business owners and the co-owner who leaves the business.