Industry Firms Should Focus on Building the Business

Construction industry companies can build success by making sure they are operationally sound, strategically prepared, and properly focused on the business factors that can influence the bottom line.

By Carl F. Simmons

In today's market, construction industry firms face many contradictions. Government-funded projects offer wildly inconsistent rewards for contractors, in light of budget constraints and a deteriorating infrastructure. And yet, initiatives for homeland security, mass transit, and telecommunications projects, as well as the possibility of hosting the Olympics in 2012, provide the region's industry with reason for optimism that substantial work is on the horizon. Likewise, commercial development, particularly elder-related, environmental reclamation, and marine projects, appear to be growth areas.

This is a time for strategic thinking and a flexible approach to pursuing work through stand-alone jobs, joint ventures, or strategic alliances. Project type, size, and scope must be consistent for success in the 21st Century. Do you control your destiny, or are you controlled by market conditions?

It's also a time that calls for consistency and stability within the corporation, in order to accommodate changing market demands and conditions, and to seize opportunities. Organizational strategy, systems, structure, and support must be in place with understanding and acceptance from all employees to ensure consistency, quality, and sustainable results.

As a consultant to architects, engineers, and construction companies for the past 20 years, I have participated in and observed many changes in the methods, materials, and management of projects and corporations. The message here is that building your company is your most important project. It involves a strategic approach and an operational infrastructure to balance and promote performance and performance capacity in and between the field and the office.

When confronted with the question, "Is there one right way to run an organization?" Peter Drucker answered with a resounding and unequivocal "Yes!" This is a perplexing answer for many people, especially in the construction industry. How can there be one right way to run a multibillion-dollar, multinational conglomerate, or a local business? Don't size, scope, industry, development level, market conditions, seasons, and cycles each have a distinguishing impact? What about projects and services, mission, culture, and organizational history? Every time I deal with new clients, they state - with great conviction - that "our industry is very different than other industries, and our company is very different than other companies, even in our industry." They go on to cite customer demands, market conditions, regulations, environmental issues, and a host of other concerns as "unique to our organization."

In truth, there is validity to this point of view. In fact, every organization should have something important that distinguishes it from its competitors, making it unique. However, three key dynamics - three imperatives - bind them all together, regardless of their industry, location, size, or type. Every organization, from a family-run business to a public corporation, must:

• Promote and grow the top line. Sales reflect an organization's ability to execute its mission, vision, values, and strategy.
  
• Promote and grow the bottom line. Profits reflect an organization's responsibility and effectiveness as stewards of resources, such as time, money, people, or equipment. They have a direct bearing on future innovation, quality, sustainability, and growth.
  
• Inspire a sense of satisfaction among all internal and external stakeholders. Every organization has customers, staff, suppliers, and financial relationships, each with their own set of interests and needs. Each group must have faith in the services provided to them, confidence in the integrity of the organization, and access to opportunities and conflict resolution.

Organizations in the construction industry must be on a constant vigil for continuous improvement and innovation, always seeking new strategies and tactics to sustain growth. In the construction industry, this refers to means and materials for all projects in the field, and to systems and structure in the office. Both the field and the office can benefit from my "power of positive management" formula that equates actions - the people, planning, and process - with corresponding results of greater predictability, better performance, and higher profits. The actions on the left side of the equation equal the results on the right, just like in another core business equation: Focus plus execution equals results.

Carl Simmons is president and CEO of Global Performance Solutions of Ridge, N.Y., and is author of The Power of Positive Management.