The construction management industry is a vast ocean of opportunities and challenges, and navigating through its treacherous waters can be daunting. For many contractors, the initial challenge arises when they transition from being on the ground, physically working on projects, to stepping into the role of a project manager. This transition is often termed as hitting the “first wall”. It’s about evolving from a hands-on approach to one that requires delegation, oversight, and strategic planning. But how do you make this leap without compromising the quality of work?
Three primary reasons for the failure of companies in this phase:
- Financial Mismanagement: A significant percentage of businesses falter due to poor handling of finances, leading to losses.
- Loss of Reputation: Customers are the backbone of any business. Losing them due to diminished trust or poor work quality can be a death knell.
- Attrition: The burnout is real. Many contractors feel overwhelmed with the demands of the job, leading to quitting or regressing to earlier career stages.
Growth Levels Defined
- Level One: This is the initial stage, where you’re out in the field, with tools in hand.
- Level Two: Here, you’re the project manager. It’s about overseeing multiple jobs, perhaps with the help of subcontractors or 1099s rather than W-2 employees.
- Level Three: Scaling up to hire W-2 employees. This transition requires a strategic change in approach and understanding of industry dynamics.
Hiring is often the solution contractors turn to when workload increases. But it’s essential to hire not just out of urgency but out of necessity and purpose. The common mistake is hiring someone similar to yourself, thinking that replication will lead to success. However, in reality, what’s needed is a counterpart—a meticulous, detail-oriented individual who complements your strengths and mitigates your weaknesses.
As your business stabilizes at one level, always be looking ahead to the next stage. Anticipate the new skill sets and processes required. Be proactive in establishing new roles, duties, and expectations for your team, ensuring clarity and minimizing confusion.
Scaling a construction management business requires foresight, planning, and adaptability. By understanding and anticipating the challenges ahead, you can ensure that your company not only survives but thrives. Stay tuned to “Contractor Cuts” on ProStruct360 for more insights and strategies tailored to the construction management industry, and ensure your business is built on a foundation as solid as the structures you create.
