High performance is the result of building on a solid foundation of the basics. But to build upon them, you must first master them. The basics are deceptively simple, and therefore easy to forget — especially in today’s tough economy where remodelers have returned to wearing multiple hats. Your “busyness,” if not managed well, will result in frustration and losses rather than satisfaction and profits. The solution lies in a recommitment to the basic steps of management.
- Set goals: Start with a measurable goal. This is true for something as simple as arriving at a jobsite on time, and for something as complex as increasing profits by 30%. Goals help you and your employees prioritize. One Seattle remodeler’s goal was a 95% conversion rate for changing design clients to construction clients. Knowing his average job size, he could determine how many design clients he needed to generate the construction contracts goal.
- Monitor: Set a regular schedule of monitoring and review to compare your actual performance with your goal. Without this feedback step, you’re left to rely on intuition. With no way of checking the time en route to the jobsite, how do you know if there’s time for a quick stop at the lumberyard? The Seattle remodeler I mentioned above was surprised to find that his actual conversion rate for the first six months of 2011 was closer to 70% than his goal of 95%. How could this be, he wondered, when he was sure “almost every” design client went on to construction?
- Given the selectivity with which we interpret data, intuition is a notoriously unreliable basis of analysis.
- Adjust: Setting goals and tracking progress is a great start, but to realize the benefits, you must analyze and act upon the data. Adjustments and course corrections are where management rubber meets the road of reality. If halfway through the year you realized that your closing rate was 25% below your goal, what adjustments would you make? Would you invest in sales training? Increase marketing to attract more targeted leads? Our Seattle remodeler focused on sales practices — setting more accurate up-front budgets and setting a series of sign-off points during the design process to better monitor client buy-in and avoid big surprises at the end.
- There is no single correct response, but it is critical to do something. Your best judgment is needed. Sometimes, the goal itself needs to be adjusted. It can be tempting to focus on step three and make adjustments on-the-fly. However, effective management requires all three steps, ensuring that course corrections are grounded in objective data.
—Richard Steven, president of Fulcra Consulting, helps remodeling companies create and use effective management plans. email@example.com