Why We Should Become More Like GCs

BACK IN THE DAYS of King Arthur and His Knights of the Accidentally-Oval-Because-the-Specs-were-Screwy Table, a general contractor was first and foremost a master builder, carpenter or mason who had worked his way up through the ranks from apprentice to journeyman to master craftsman before actually striking out on his own as an independent general contractor. This years-long process ensured that

BACK IN THE DAYS of King Arthur and His Knights of the Accidentally-Oval-Because-the-Specs-were-Screwy Table, a general contractor was first and foremost a master builder, carpenter or mason who had worked his way up through the ranks from apprentice to journeyman to master craftsman before actually striking out on his own as an independent general contractor.

This years-long process ensured that if he didn’t have the necessary intelligence, drive and leadership skills, then he would be washed out of the trade somewhere along the way. If he didn’t know every detail of his trade at one level, he simply wouldn’t be allowed additional responsibility and promotion to the next level.

Before he struck out on his own, his personal sense of honor and ethics would be his calling card to help develop those first few vitally important business and personal relationships with the princes and kings, the architects and owners who would allow him to bid on his first batch of work. Then he would become a freeman, an independent business tradesman.

Today, over the course of centuries, the needs and demands of the profession have changed. This prototypical general contractor was forced to evolve into more of a subcontractor aggregator and construction-at-risk-manager-broker. He doesn’t need to be a master craftsman. His possession of actual knowledge of each part of each respective subtrade becomes less and less important. What becomes important is his ability to squeeze efficiencies by breaking down each trade into tinier subtrade components and then finding enough fools, pardon me, subcontractors willing to work for day wages and letting him, the GC, pass all the labor risk onto them while keeping the rewards, the margins on the equipment and materials.

In this day and age, many if not most owners, principals and mid-level managers of general contracting firms have never driven a nail, set a door, poured a single yard of concrete or built a single masonry wall themselves. They have been schooled by greed and necessity in the means and methods of using their working capital and expertise in being able to sit at the center of the job-table. They become the pivot point for a job because they know at-risk management procedures and somehow by hook or crook (a lot of times crook), they are able to present a completed building to They Who Ultimately Sign The Checks, on budget and on time.

This is how they stay in business: They are ruthless in finding every bit of fat in a subcontractor’s subcontract, and then finding a way of extracting that, keeping part of it, but passing most of the fat, i.e., potential profit, back to the owner in the form of a lower initial bid, which will enable them to get the job on bid day.

Not that GCs have been altruistic by nature, at all. Even back in the good ol’ days when 99% of those who owned contracting firms across all trade lines were honorable and honest, GCs were still more bottom-line oriented as a matter of course. Usually they were just greedier than their fellow tradesmen.

But building a building has evolved from redesigning the wheel every single time from scratch and custom building it using master craftsmen to more of a textbook and plug-and-play modular engineering and design/build concept. GCs have led the way in the execution of this bottom-line efficient cookbook way of building, which has led us in the mechanical contracting industry kicking and screaming down the path of becoming more process managers than project managers.

No, we in the plumbing, HVAC and piping trades don’t have to sell our souls to the devil. We don’t have to sell out our morals and become blinded by profit like many of our GC colleagues. But we must learn how to break out individual processes from our traditional way of selling and installing systems. Then we have to figure out who can do that individual component process better — our own guys or a sub-sub-contractor.

Reality has changed the paradigm, even if the GCs themselves didn’t like it. They used to do as much of a given job themselves as possible and used subcontractors only when required. They have become labor and equipment and material brokers, salesmen and managers of turnkey bundled processes that get a building built more quickly and cheaply than the old way of doing things. If we don’t change the paradigm of our being master craftsmen first and businessmen second, then we won’t be businessmen or in business ourselves much longer.

H. Kent Craig is a second-generation mechanical contractor and project manager with unlimited Master’s licenses in boilers, air conditioning, heating and plumbing. He can be reached by calling 919/851-9550, or via e-mail at [email protected].