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Design Principles for Residential Comfort Advisors
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Once upon a time there was a small bunch of young engineers in Silicon Valley. They'd gone to the best engineering schools and created designs that were the envy of other engineers. They formed a company, and soon brilliant products started rolling out, and the money began rolling in.
Before long their little company was not so little and became more complicated to run. It became clear that their company needed a president. These are smart guys, so you'd think they'd look around for a pro who really understood management and leadership. Those things are, after all, what business presidents do.
But they didn't. They appointed one of their own, Jason, as the president. Jason was a really good engineer and a really bright guy. He could manage the place in his sleep, so they thought.
A year later, the company was floundering. Jason was working killer hours, but the place was barely hanging on (even though they had lots of orders). The financial situation was a mess, there was no long term plan, turnover was sky high, departments and projects were badly coordinated, communication was lousy and even the engineers were fighting with each other.
The engineers decided that Jason was the problem, so Jason was demoted back to being an engineer (he was delighted), and they elected another engineer as president. Before long the company fell apart for good.
What happened? Were Jason and his successor not as bright as their buddies thought? Not at all. They were really bright, but all their expertise was in technical engineering and nobody had trained them in the management skills that are required to run a business effectively. So the company was being run by bright, but totally unqualified managers with predictably bad results.
Whether it's engineers, plumbers or HVAC professionals, being a proficient tradesman has almost nothing to do with actually running the business, but that's exactly the trap that many contractors fall into.
Thousands of expert tradesmen go on to become contractors, but (like Jason) they've crossed into territory that looks familiar, but is really a whole different world. Trouble is, when the business is still small, the shift is so subtle that the contractor misses it. A few more hours here and a few more headaches there are no big deal. But when the business gets up around $1,000,000 in revenue, and you’re working 70 hour weeks and eating Tums by the handful, it should be clear that seat-of-the-pants management skills don't cut it.
For every trade, there's a specific set of skills and knowledge you have to have before they'll let you out the trade school door, and into the union and on the jobsite. You could make a list of a dozen of these essential items, and you wouldn't hire anybody who didn't have them as well.
Management and leadership have a list of specific skills and knowledge too. They don't often teach these skills in trade school because that's not what trade school is for, but unless you get yourself trained and adept at them, you're putting an unqualified person at the controls of your livelihood.
What exactly are the skills that they didn't teach you at trade school? The following are some necessary management skills needed to run a successful business:
- You must think strategically. You need to know how to make long-range plans and tie them to short-term operating targets.
- You need to know how to get results through systems rather than people.
- You need to know how to hire, train, develop and keep great employees.
- It is a must that you understand financial statements and have a cash management system in place.
- You need to communicate clearly to employees.
- You must be a positive role model for your employees.
- Delegate projects to employees.
- Performance monitoring, feedback and control must be done, so you can change management strategies if you are not meeting business goals.
These skills may sound vague or intimidating, but they're no harder to develop than the ones you learned in trade school. They're different, but not harder. And having trained a couple of hundred contractors and other business owners, I can tell you that if you've built a successful contracting business, you've got plenty of the horsepower needed to master these skills. The key is recognizing and accepting that these skills need to be developed, using a solid training program, and having a good trainer who'll keep you honest and knock you upside the head when you get off track.
You didn't go into business to work 70 hour weeks and continuously fight fires. There's no reason to put up with it, and the difference between the contractors who are killing themselves and those living the good life is often just a matter of who's moved beyond being an expert contractor to being an expert manager and leader.
If you're trying to manage a contracting business on the skills you learned in trade school, you're expecting too much and making things unnecessarily hard for yourself. It did its job and gave you a solid technical foundation, but now it's time to learn the skills that match your current role in your business if, that is, you want the role of the expert president or manager.
Jayme Broudy is the founder and principal of Contractor's Business School, a coaching, training and consulting firm, specializing in helping contractors produce more profit in less time. Since 1993, Jayme has worked with hundreds of contractors in many specialty areas to build successful stand-alone businesses. Visit www.contractorsbusinessschool.com or call 800.527.754.