Tag Archives: construction industry

  • Getting Paid: How to Avoid Cash Flow Issues in Today’s Business Environment

    Posted on February 14, 2017 by FMI Corporation

    Getting Paid: How to Avoid Cash Flow Issues in Today’s Business EnvironmentAny principal of a construction firm will tell you that cash is king. There is little room for error when it comes to feeding the cash cycle. Why not apply the same focus and fervor to collecting the monies that are owed to your company as you do to installing the building components for which you bill? Often, too much of the responsibility for collecting receivables is shifted to the accounting department. When accounting investigates the nature of an account and the reason for delinquency, it is often determined that the client has withheld payment because it has yet to receive consideration for payment as outlined in the contract. Examples range from a significant deviation from the schedule of values to failing to deliver as-built drawings.

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    This post was posted in Consulting and was tagged with construction industry, Construction cash flow, Cash flow management, Relationship building, construction firm blog, collections construction, construction best practices

  • 8 Ways Construction Firms Can Plan More Strategically For The Future

    Posted on July 13, 2016 by FMI Corporation

    For many firms, financial regulators, and homeowners, the most recent housing bubble and subsequent Great Recession blindsided their confidence, cutting short an era of unprecedented growth and good fortune. But some people were prepared. Some even sounded the alarm. How was it they saw the downturn coming? Knowing what is going to happen is quite different than preparing for an eventuality. In a new era underpinned by sustained economic uncertainty, business leaders are learning to insure themselves against unpredictable futures. Keeping an eye on movements and events—both within the industry and beyond its bounds—can lessen the surprise factor. Put simply, leaders need to be a few steps ahead of the game. By looking at a range of possible outcomes and scenarios, and by developing a strategic response for each, companies can reduce the shock of industry shifts and minimize crisis-mode decision-making.

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry blog, construction industry, NRCI 2014 Q2, strategy construction

  • Building Your Digital DNA: Five Key Steps

    Posted on June 9, 2016 by FMI Corporation

    Today’s new technologies allow industry professionals to link up and share project knowledge across integrated teams, 24/7, across the globe. When the Internet was introduced in the early 1990s, no one really knew that complete industries, cultures, governments and businesses would be transformed by this innovative platform for sharing information, learning and transacting. Nevertheless, what started out as a novelty of sorts has since grown into a 3 billion-strong web that’s accessible via the desktop computer to the 5-ounce mobile phone — and everything in between. Technological advancements are also reshaping the engineering and construction (E&C) space, where the evolution of design and construction functions has taken a leap forward with the transition from electronic drafting to high-resolution digital modeling (also known as Building Information Modeling or “BIM”). Thanks to ubiquitous digital connectivity, cloud computing, and big data, the E&C industry is undergoing a historic melding of engineering, architecture, fabrication, construction, and other related disciplines, undoing 100 years of expansive industry fragmentation.

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    This post was posted in Consulting, Research, Technology and was tagged with construction industry blog, construction industry, NRCI 2014 Q2, engineering industry, engineering blog, construction technology

  • Your Hotline: Building a Better Reporting Mechanism

    Posted on June 2, 2016 by FMI Corporation

    A strong corporate culture and open lines of communication go a long way when it comes to developing and running an ethical organization. Ethics programs have been praised for the effect they have had on the engineering and construction (E&C) industry, shoring up the reputation of firms, and bringing stricter oversight and regulation of work practices. But all ethics programs are not equal. In a firm dedicated to promoting lasting cultural change through the ethics program, reporting rates will be higher, and incidences of ethical violations will be lower. Conversely, it is possible to have in place the facade of an ethics program, and yet harbor a dishonest and retaliatory culture that discourages ethics reports. In this case, your last line of defense is your anonymous hotline. The performance of your ethics program depends on how engaged your employees are with the company in general and ethics in particular. This in turn depends on how your company seeks out and responds to reports of ethical misconduct. Here’s a list of five ethics program best practices, and the reporting mechanisms that underpin them.

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    This post was posted in Consulting and was tagged with construction industry blog, ethics construction industry, construction industry, business ethics, construction ethics, engineering ethics, construction firm ethics, company ethics programs

  • Three Key Ingredients of an Accurate Cost-to-Complete Estimate

    Posted on May 20, 2016 by FMI Corporation

    Trade contractors live and die by their ability to estimate, manage and project labor costs. In most construction firms, few things are as misunderstood or as poorly managed as accurate projections of costs to complete (CTC)—particularly when it comes to understanding how to estimate the remaining labor costs on a labor-intensive project. Unfortunately, project managers don’t always understand what goes into a solid CTC estimate. On bid day, for example, estimators are expected to accurately determine how much labor cost will be required to complete an entire project with less than adequate plans and specs, absolutely no history of completed work on the current project, and a limited amount of time. Like any good recipe, failure to include one or more of the important ingredients will produce a less than desirable result. Since labor is the big wild card in the cost-to-complete estimate, the following ingredients will focus on the labor portion of this process.

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    This post was posted in Uncategorized and was tagged with construction industry, NRCI 2014 Q2, cost-to-complete estimate, cost-to-complete, project labor costs, estimate costs

  • 10 Ways to Program Customer Loyalty into Your Work

    Posted on April 21, 2016 by FMI Corporation

    Understanding client behavior – what makes them tick, how they make decisions, how they buy work, and so forth – has become a critical element in today’s business dealings, particularly in the AEC industry, where people and relationships play a key role. The following recommendations describe crucial, practical steps toward building a solid foundation for a successful customer loyalty program. This information was gathered from interviews with both industry executives as well as senior FMI associates.
    1. Find the right match. Building a long-term relationship starts with identifying the right match. If a client’s culture and values match with your company’s culture and values, the chances for establishing a mutually beneficial and long-lasting relationship increase immediately. As part of this reconnaissance phase, it is also important to consider whether a client’s work matches with your company’s core competencies and whether they complement your working style.

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry, Peer Groups, NRCI 2014 Q2, construction blog, customer loyalty, relationships construction

  • Six Things You Need to Know About Public-Private Partnerships

    Posted on April 11, 2016 by FMI Corporation

    Through in-depth interviews with more than a dozen public-private partnership (P3) industry leaders, as well as FMI experts, we uncovered several tactical strengths that help contractors get started with P3s, from both a business and operational standpoint. Here are six things you need to know about P3s: 1) Build your expertise through strategic joint ventures. Pick your partners carefully. Most interviewees described P3s as a completely “different animal.” What you learned in previous construction jobs does not necessarily apply to P3s. Therefore, it is important to start cautiously, educate yourself as you move along, and work with experienced project partners – ideally, trusted partners with whom you’ve had successful prior experience. When selecting the right partners, the lowest bid is not always the best choice when you are hoping to form a long-term relationship in which both your futures are invested.

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry, Design and Construction Industry, P3s construction, construction blog, construction public-private partnerships

  • The Data Sprint: Construction Can Catch Up!

    Posted on March 10, 2016 by FMI Corporation

    It’s all around us. Doctors are looking at patterns of effective care; retailers are watching how customers move around their stores, looking for merchandising clues; and taxis are unsure what to do about Uber’s algorithm-driven pricing model. If the construction industry thinks the status quo will leave it alone, it needs to think again. At the very least, the industry must hire up-and-coming next-generation employees — individuals who are already living 100% in a data-driven world. They expect nothing different from their workplaces. Of course, there are other imperatives too, including: Profitability. Pennies add up to real profits. Construction is still notoriously inefficient. Why, for example, do mom and pop retail stores have sophisticated real-time inventory processes and technology, and construction companies rarely have any? That type of data control is basic for leveraging daily productivity and increasing profitability.

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    This post was posted in Consulting, Center for Strategic Leadership, Technology and was tagged with construction industry, construction industry future, data and construction, data construction industry, data increase profitability

  • Must-Have Skills for Today’s Leading CEOs

    Posted on February 22, 2016 by FMI Corporation

    When companies go looking for a new CEO, they either turn to professional search firms or develop their best candidates within the organization. The company — often the board of directors and major shareholders — is looking for a very special individual who will not only have the capabilities to perform certain responsibilities, but will also fit the specific needs and culture of the organization the next CEO will be hired to run. While the CEO doesn’t (and shouldn’t) operate in a vacuum, the decisions he or she makes can mean the difference between the success and failure of the organization. In general, we find that many of the characteristics of the CEO are the same in any organization or industry, but there are some significant differences to consider for the construction industry.

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    This post was posted in Consulting, Center for Strategic Leadership and was tagged with construction industry, NRCI 2014 Q2, CEO, CEO in construction, ceo skills

  • Your Next-Generation Leaders: Are They Ready?

    Posted on February 8, 2016 by FMI Corporation

    Many construction leaders assume that leader development and succession issues have blown over since the recession put a swift end to the boom years’ war for talent. However, these issues have not gone away; on the contrary, they have become even more acute as a result of the Great Recession thanks to these four key developments:
    • The demographics bubble of retiring baby boomers followed by a much smaller Generation X.
    • The construction industry’s inability to present itself as a desirable industry for future generations.
    • The impact of long-term unemployment, which has driven many young workers out of the construction industry for good.
    • Owner and/or company capital bases, which have been reduced by the recession.

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    This post was posted in Center for Strategic Leadership and was tagged with construction industry, Ownership Transfer, Management Succession, FMI's Ownership Transfer and Management Succession 2013 Survey, Construction transition and succession plans, NRCI 2014 Q2, succession construction

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