Audits are a fact of life for businesses. A financial statement audit required by a bank or bonding company is a lot of work for a contractor’s accounting department and comes with an unwelcome fee. Contractors that understand and prepare for the audit can significantly reduce their stress level and possibly even reduce the audit fee. Continue »
Typically, disruption in the workplace is counterintuitive to productivity. But in terms of creating innovative ways to manage people, processes and technology, the concept of “disruption” isn’t such a bad thing for the construction industry. Change is stirring whether contractors are ready for it or not, and firms that have adopted new ways of managing scheduling and workflows are seeing stellar results—earning the accolades of repeat projects for key clients, as well as happy project partners.
The nation’s slowly dropping unemployment rate may be a sign that the economy is on the road to recovery. But surety executives still expect the next year to be tough for the construction industry as the impact of the recession and depleted backlogs continue to take a toll on contractors’ balance sheets. Continue »
The construction industry tends to be dominated by privately held entities, so specific financial information such as leverage ratios or overhead often is not readily available. Although many contractors anecdotally understand other firms’ financial results, they lack the information structure to compare their results to similar operations. Smart contractors understand having a yardstick to measure their results can provide either affirmation of a well-executed business plan or guidance on a course correction. The trick is finding a source of reliable information. Continue »
A new trend is emerging across the U.S. workforce that reflects how the nation’s economy is evolving. It’s the concept of a “knowledge economy,” where people use their education, skills and unique set of experiences to add value to an organization’s customers. This trend mirrors the rise of the professional services market within the U.S. economy. In these industries, knowledge replaces manpower and labor as the most important asset an employee can provide.
In the knowledge economy, even among asset-intensive companies like manufacturing firms, people are more to an organization than just interchangeable, anonymous human capital that can be reallocated at will. Tangible assets such as equipment or technology remain important to a company’s success, but ultimately they are replaceable. The key differentiator for businesses today is the combination of knowledge, education and hands-on experience that employees can bring to the table. Continue »
As 2012 comes to a close, it is important for construction companies to step back and analyze where they stand, and determine where they need to be in the immediate future. Contractors must shift their focus from cutting costs and reducing overhead to strategically identifying and delivering value-added services for customers. They must look at their past successes, examine market and customer niches and identify what unique competencies they bring to owners and customers. Introspection is often easier than looking forward, but the latter is more important to implement a strategic market position and take advantage of the slowly improving economy. Continue »
Though Ted Benning is the third-generation owner of Benning Construction Company, Smyrna, Ga., he didn’t want his children to feel obligated to join the construction industry. So when his kids took professional paths outside the family company, he decided the best course of action would be to initiate an employee stock ownership plan (ESOP). Continue »
In some ways, 2012 was a replay of 2011. The economy had significant momentum coming into the year due to surging financial markets and ambitious consumers. In fact, the U.S. economy expanded 4.1 percent during the fourth quarter of 2011. Continue »
Some bond producers report the outlook for the construction industry has improved slightly compared to a year ago, but most believe the tough economy has not passed. Continue »
The November 6 general election removed some of the political uncertainty with the convincing re-election of President Obama and immediately launched the country into the uncertainty of the “fiscal cliff”-hanger. But four years after the financial panic that produced the Great Recession, people just want a return to normal. Can the new politics in Washington deliver that? What can the construction industry expect from a renewed Obama administration and a slightly more Democratic Congress? Continue »
Unique regulations and safety considerations often pose special training challenges for construction employers. An online training program can be an ideal solution for contractors with large, geographically dispersed workforces and diverse training needs. Continue »
Although the general economy shows signs of a slow recovery, construction spending remains below November 2006 levels. When the construction playing field changed drastically as a result of the 2008 financial crisis, contractors found themselves spending more money chasing projects with significantly more competition and lower profit margins. Many were not financially or operationally prepared for this shift. Some did not survive, but many did through careful planning, confident leadership and solid decision-making. A key to survival was a close partnership between contractors and their critical advisors, including accountants, banks, insurance agents and sureties.
Tim Hughes, Attorney – Bean, Kinney & Korman, PC, Arlington, Va.
What are the benefits of having a succession plan?
Failing to plan is planning to fail. That applies not just to establishing a business plan and implementing it over time, but also to providing for the sustainability of that business over time. We all face threats to our businesses, whether from the economy or life events, including death, disability and people at the top of the company moving on. Unless you think through the ramifications of these possibilities, you’re putting your business in a very precarious position. Every company needs to think about the long-term growth trajectory to develop leadership that will keep the ball moving down the field when current leadership moves on to other things. Smaller companies that rely on their founder will face a real challenge when that person is gone if they don’t prepare for it. Companies with a bigger, more established national presence that are much more corporate and have more stock ownership especially need strategic planning to develop future leadership. Continue »