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Perform, Produce and Prosper     M. Scott Hursh, CPA, CCIFP           February 23, 2011                                  1
Perform, Produce and Prosper• What we will discuss  – State of the Industry  – Why focus on productivity?  – Bonded work a...
Perform, Produce and Prosper• Why Focus on Productivity?  – Increased Profitability  – Less Rework  – Improved Margins  – ...
Perform, Produce and Prosper• Why Focus on Productivity? – The current competitive environment will   continue for some ti...
Perform, Produce and Prosper                               13
Perform, Produce and Prosper  Percent     Per 8 Hour   Increase inImprovement      Day       Profitability    2%        10...
Perform, Produce and ProsperThe difference betweenaverage and world class   performance is 48        minutes!             ...
Perform, Produce and Prosper• The secrets to improved  productivity  – Have a process for everything you do  – Document th...
Perform, Produce and Prosper© FMI Corporation                                    17
Perform, Produce and Prosper• The secrets to improved  productivity  – Focus daily on improving productivity  – Continuall...
Perform, Produce and Prosper• The secrets to improved  productivity  – It starts with project selection     • Know the typ...
Perform, Produce and Prosper• Estimating  – Have superior estimating skills and    systems    • Written process    • Track...
Perform, Produce and Prosper • Project turnover (estimating to   production)   • Have a written process   • Provide adequa...
Perform, Produce and Prosper • Production   • Daily Huddles   • Weekly job meeting   • Two week look ahead report   • Mana...
Perform, Produce and Prosper• Fundamentals of Productivity  Improvement  –   Increased productivity = increased margins  –...
Perform, Produce and Prosper• For Introspection  – Do you have these processes in your    organization?  – Are they consis...
Perform, Produce and Prosper   State of the Industry                               3
Perform, Produce and Prosper                               4
Perform, Produce and Prosper                               5
Perform, Produce and Prosper                               6
Perform, Produce and Prosper                         100F M I N C R I S c o re                         50    52.6         ...
Perform, Produce and Prosper          FMI                               8
%   Clha:ng:eIllndli·c::atolF   :2:009   20--:1 0    :2:0 1 "I ..              :20"10-:20-1 .,                            ...
Perform, Produce and ProsperWhy Focus on Productivity?                               10
Perform, Produce and Prosper Bonded Construction   Work as a Niche                               25
Perform, Produce and Prosper• Why pursue a niche? – 1960s - 800,000 Contractors – 2010 - 2,700,000 Contractors – Adjusted ...
Perform, Produce and Prosper• What is a Niche?  – Focusing on types of work, customers    and locations that reduce your e...
Perform, Produce and Prosper• Why a Niche? – Differentiation – Reduced competition – Expertise improves productivity – Sop...
Perform, Produce and Prosper• Why bonded work? – Reduced pool of bidders – Bonded contractors are better competition – Sha...
Perform, Produce and Prosper• Why bonded work? During an economic downturn a higher  percentage of work tends to be in sec...
%   Clha:ng:eIllndli·c::atolF   :2:009   20--:1 0    :2:0 1 "I ..              :20"10-:20-1 .,                            ...
Perform, Produce and Prosper     M. Scott Hursh, CPA, CCIFP          Stambaugh Ness, PC           2600 Eastern Blvd       ...
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Construction Industry - Surviving 2011 Thriving 2012 Presentation

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Construction Industry Seminar Presentation

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Construction Industry - Surviving 2011 Thriving 2012 Presentation

  1. 1. Perform, Produce and Prosper M. Scott Hursh, CPA, CCIFP February 23, 2011 1
  2. 2. Perform, Produce and Prosper• What we will discuss – State of the Industry – Why focus on productivity? – Bonded work as a niche 2
  3. 3. Perform, Produce and Prosper• Why Focus on Productivity? – Increased Profitability – Less Rework – Improved Margins – Happy Customers 11
  4. 4. Perform, Produce and Prosper• Why Focus on Productivity? – The current competitive environment will continue for some time – The fat has been squeezed out of overhead – That’s where the money is! 12
  5. 5. Perform, Produce and Prosper 13
  6. 6. Perform, Produce and Prosper Percent Per 8 Hour Increase inImprovement Day Profitability 2% 10 Minutes 20% 5% 24 Minutes 50% 10% 48 Minutes 100% 14
  7. 7. Perform, Produce and ProsperThe difference betweenaverage and world class performance is 48 minutes! 15
  8. 8. Perform, Produce and Prosper• The secrets to improved productivity – Have a process for everything you do – Document the process – Measure results 16
  9. 9. Perform, Produce and Prosper© FMI Corporation 17
  10. 10. Perform, Produce and Prosper• The secrets to improved productivity – Focus daily on improving productivity – Continually look for creative, innovative construction techniques – Glorify the field – Don’t have profit fade 18
  11. 11. Perform, Produce and Prosper• The secrets to improved productivity – It starts with project selection • Know the types of work and customers that are most profitable – Track estimates and performance on every project – Examine by type, size, location and customer – Beware of risk! 19
  12. 12. Perform, Produce and Prosper• Estimating – Have superior estimating skills and systems • Written process • Track results – Know the contract terms Scope of work, general conditions payment etc. – Involve operations people in the estimating 20
  13. 13. Perform, Produce and Prosper • Project turnover (estimating to production) • Have a written process • Provide adequate time Both hours and calendar • Involve both estimator and PM 21
  14. 14. Perform, Produce and Prosper • Production • Daily Huddles • Weekly job meeting • Two week look ahead report • Management dashboard report 22
  15. 15. Perform, Produce and Prosper• Fundamentals of Productivity Improvement – Increased productivity = increased margins – Firm-wide best practices = improve efficiency – Proactive processes > reactive individuals – The greatest challenge is changing individual behaviors 23
  16. 16. Perform, Produce and Prosper• For Introspection – Do you have these processes in your organization? – Are they consistently applied? Are they the same or does each person have their own way of managing? – As your customer base has changed, have your processes changed? – How do you ensure they are being followed? 24
  17. 17. Perform, Produce and Prosper State of the Industry 3
  18. 18. Perform, Produce and Prosper 4
  19. 19. Perform, Produce and Prosper 5
  20. 20. Perform, Produce and Prosper 6
  21. 21. Perform, Produce and Prosper 100F M I N C R I S c o re 50 52.6 47.7 48.47 54.5 51.3 53 46.1 46.5 44.7 45 44.8 34.1 35.6 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 20 20 20 20 20 20 20 20 20 20 20 20 20 07 08 08 08 08 09 09 09 09 10 10 10 10 7
  22. 22. Perform, Produce and Prosper FMI 8
  23. 23. % Clha:ng:eIllndli·c::atolF :2:009 20--:1 0 :2:0 1 "I .. :20"10-:20-1 ., .S- CEln _ Bu"-_"""""<" $557 9
  24. 24. Perform, Produce and ProsperWhy Focus on Productivity? 10
  25. 25. Perform, Produce and Prosper Bonded Construction Work as a Niche 25
  26. 26. Perform, Produce and Prosper• Why pursue a niche? – 1960s - 800,000 Contractors – 2010 - 2,700,000 Contractors – Adjusted for inflation, the amount of work put-in-place is about the same – Both competition and customers are more sophisticated 26
  27. 27. Perform, Produce and Prosper• What is a Niche? – Focusing on types of work, customers and locations that reduce your exposure to competition • Inner-city work • Rural work • Special technologies • Demanding customers, etc 27
  28. 28. Perform, Produce and Prosper• Why a Niche? – Differentiation – Reduced competition – Expertise improves productivity – Sophisticated customers seek value more than price 28
  29. 29. Perform, Produce and Prosper• Why bonded work? – Reduced pool of bidders – Bonded contractors are better competition – Sharing bonding capacity with a new client shows that your firm • Has financially strength • Understand your costs • Manages risks 29
  30. 30. Perform, Produce and Prosper• Why bonded work? During an economic downturn a higher percentage of work tends to be in sectors that normally require a bond 30
  31. 31. % Clha:ng:eIllndli·c::atolF :2:009 20--:1 0 :2:0 1 "I .. :20"10-:20-1 ., .S- CEln _ Bu"-_"""""<" $557 31
  32. 32. Perform, Produce and Prosper M. Scott Hursh, CPA, CCIFP Stambaugh Ness, PC 2600 Eastern Blvd York, PA 17402 717-840-6116 direct shursh@stambaughness.com 32

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