Category Archives: Success

Plan your budget for a new project

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When you are a part of an industry and are doing well, you are tend to get more work. It is probably you have created a reputation over the years that now people believe in you and therefore give more business to you. So whenever you are given a new task, you need to plan few things in advance. Do you have the required human resource to get the work done in time? Is your financial reserve sound enough to take care of any additional requirements that will come out from a new business and many more of such questions should be answered first. These are tough questions for any business and the answers can’t come out of one’s head swiftly. There will be a lot of pondering that needs to be done when there is a chance of getting some new projects.

Moving our focus towards the construction segment, a business owner has to go through the same set of questions but for him the answers are far more difficult as compared to any other person belonging to some different industry.

Basically he needs to plan his budget bit differently than people from other sectors do. He even has to estimate the estimates. Now this is really difficult and can be confusing to many. When we talk about estimating the estimate, it means that the owner of a construction company have to estimate some rough estimates of the cost to the company. For instance, he estimates the cost of raw materials may increase and if it increases then what could be the price. So what is the highest point can he take his estimation is estimating the estimate. So in the above example, he is already estimating that the price of the raw material will increase and then he is further estimating the highest point that it may reach. Similarly, he can have estimation on anything that concerns his business. These estimations are crucial as it takes you closer to the actual.

Once you have made a rough estimation, the next step is to align it well with your budget. You may know your financial position much better than anybody else and therefore preparing a budget based on the estimations will be highly fruitful. It will take you closer to your goal and slowly and steadily you will start seeing things getting more realistic. It is only because of your in-depth planning that you can come so close to the realistic figures. They may not be accurate but certainly will be well-defined.

After you match up your financial position to the market estimate, you get to understand if entering into a new venture is anyway going to be profitable to you. Getting it discussed with your team is a healthy way to move forward and you might come across some really valuable suggestions from your team members. Taking advices from the seniors of your company will help you take precise decisions. So by planning your budget for a new project, you understand if you should put your hands into it or postpone it for some time.

The first few years decides your future in the construction industry

Worldwide, construction industry shows an enormous growth potential. It is a good career option for those looking for job satisfaction and lifelong learning opportunities. It involves variations in jobs such as constructing a residential apartment/house, institutional and commercial constructions, heavy industrial construction and civil engineering such as building of bridges, dams and highways. The construction process can be summarized as comprising of design, construction, operation, maintenance, renovation and demolition. It is important to understand that construction industry is very different and complex as compared to other industries since it has a number of variables. Each project is unique with different nature of work, placed on different locations, involves different types of skilled and unskilled labours, and produce different types of products. In the modern era, the large scale projects make use of increased automation and more complex processes. Due to its extremely challenging nature of work, there is existence of hazard during every project. Thus, construction industry is regarded as a high risk work environment as compared to others.

 

Although this being the case, in last few decades construction industry has shown a speedy growth. The initial years are very important for ‘a beginner/starter’ in order to have good future. Since it directly impacts life of people, hence building strong and reliable structures becomes necessary to gain life-long confidence and trust of people. This leads to increase in number of customers and thereby generation of a brand name. However, this journey may not be easy due to number of variables.

The following are some of the important variables which need to be considered for gaining initial success in the construction industry:

  1. Good and ample financial resources.
  2. Study of the location and the climate conditions. Be aware of the potential dangers.
  3. Employing professionals with construction management degrees: they have knowledge about building a structure. They are analytical and have good problem solving abilities.
  4. Employing educated and skilled laborers with an aim to retain them permanently rather than on contract.
  5. Due to rapid evolution of technologies training needs to be imparted to the workforce (labor, professionals and management).
  6. Encouraging good partnership, leadership, and teamwork
  7. Investing in R&D activities to enable high quality construction
  8. Good planning and effective execution so that work progresses in a smooth way.
  9. Health and safety of construction workforce is important to avoid fatal injuries/deaths. This will benefit in terms of time, cost and daily operation. Hence, it is essential to set up a safety culture for good working environment.
  10. Affordability, delivery on time and few occupant related illness and injuries.
  11. Constructions should be environmentally safe, healthy and fulfilling human needs.

Among these, the construction quality and occupational safety and health are fundamental issues to be given priority. When all these variables are considered and accordingly work is planned, it will lead to 90% success in the construction activities and lead to safe and healthy constructions. This enables to win customer’s trust and will guarantee success in future of construction industry.

Keep yourself open to suggestions, it will help you grow

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While starting any new project, the company or any organization generally holds discussion to obtain views of its professionals and managers before it is executed. The senior management give suggestions to modify or improve the project in order to make it successful. Suggestions are always important so that the projects/tasks get executed in a planned manner and yield benefits. It is type of ‘caution’ taken before taking a major decision..

 

While embarking on any major task/project a person has to think analytically and plan well to execute it properly. A person can do it all on his own and many times suffer from failures. This is due to the ego and rigidity of one’s ideas leads to short-sightedness which fail to see the shortcomings in a project leading to failures. In case of failures of large projects, it causes permanent destruction of that organization.

 

In order to avoid this difficult situation, it is good if a person (or a company) takes suggestions for a project or task from trusted colleagues, mentors, seniors or hire a consultant. They may guide in proceeding of the project by giving their suggestions:

  1. Check if the aim and objectives of a project are clear. If they are not clear then will suggest how modify the aims so that the objectives are achieved
  2. Check for the loopholes/shortcomings of a project and suggest how to overcome them.
  3. May indicate whether the project is feasible or not. If not feasible then suggest to not go ahead
  4. May indicate about the investment to be done and if it is possible. If it is a huge investment and difficult to manage then suggest for decreasing the size of project.
  5. May show the underlying problems of a project and suggest desirable changes to be made to face or overcome those problems.
  6. May indicate the chances of success and failures of a project. To avoid failures some alternatives may be suggested.
  7. They may give strategies for proper planning and execution of projects/tasks

 

Many a time suggestions are not taken seriously due to ego problems. The person may not be confident that the suggestions will help and may yield any benefits. Although this being a case in 90% cases taking suggestions from experienced people has proved beneficial for the project work and made it successful. This ultimately has boosted one’s self confidence to perform better for the next projects. Further it leads to personal and professional growth of an individual.

 

 

Invest your money in construction projects globally

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When we think about investments, we come across all sorts of investment avenues that are liquid as well as non-liquid. However, not many consider investing in construction projects globally as a good investment option. There are strong reasons attached to it which is why people are usually deterred to invest in investment projects in a foreign land. One of the strongest reasons is that you do not have a direct control on the project and it may become difficult to monitor the progress of the work by being away from the jobsite.

Other than having a direct control, other reasons also include political turbulence, company getting dissolved. However, these reasons can’t be considered to be too big for one to deter investing globally and can always be worked out before you end up investing in one such project. There are of course few Do’s and Don’ts that needs to checked first before taking a decision of any major investment in foreign land.

Check the viability of the project:-

You can definitely invest in projects that sound to be viable. Alternatively, if the project has all proper sanctions from the different authorities of that country, there is probably no other reason why it may get blocked. Investing in such projects being in a distant place can still be a good option. However, you also have to check your benefit in it. You need to first measure your risk and the returns that you can expect from the work at its completion. It will be worthy to take such risks where you know that it will fetch good returns. There are many American investors that have invested chunks of money into various foreign projects. In this case they do not have to deploy their men for the work and if there is any hurdle that shows up during the tenure of the project that will be managed by the construction company who has undertaken the work.

Reputation of the builder matters a lot:-

When an investor has to invest his money in construction projects, he definitely checks the credentials of the construction company who has taken up the work. In the same way, while investing in a construction project outside US, you have to check the credentials first. Meet the representatives of their company, do some research on their previous projects. By that you will get to know how big the construction company is and if it is prudent to invest in projects constructed by them. The reputation of the construction company should speak louder than anything else and that should be the signal for you to go ahead with them.

Stay away from countries that are politically unstable:-

You investments in a foreign land will bear fruit only if you put your money in a country that is politically stable and there is no fear of the government getting overthrown by rival political powers or the army of that land. Investment of any kind in a politically unstable country is too risky and not even worthy to take the risk.

Success in construction business is dependent on your foresightedness

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Things do not always move in one particular direction. You will see a lot of changes in things from what it is now and what it was in the past. Changes are bound to happen and when it does happen, it turns out to be good for some section of the population and bad for the rest. There is probably the third section which is not affected by it at all. The one who manages to taste success are the ones who are able to make right estimates at the right time. So the people whom you see at the top of various industries have managed to reach to that position by laying down their strategies after taking some very accurate estimates. Now the estimates are not something that is taken on air but are in fact made on the basis of precise information, some general calculation and most importantly foreseeing opportunities and threats.

One such industry that requires its men to be highly foresighted in order to become successful is the construction sector. This particular sector is indeed dependent on various other sectors and any rise or fall in the prices of the associated sectors can have a major impact on the overall construction sector. So a person who can foresee a challenge or an opportunity will take decisions accordingly and will keep his company safeguarded from any market threats.

Likewise he also will be able to make good money for his company in the same manner. This does not imply that a person who is foresighted never makes an error. Nobody is able to read the market correctly. They can all make some very close estimates but that does not mean that they will be correct at all times. There are also chances that they will end up making a mistake in calculating some facts or taking some accounts into consideration and which will cost them big chunk of capital. There are many instances where construction companies have taken incorrect judgments which have cost them dearly. But these are parts and parcels of the business. If the business owner hits the right note, he makes a bounty but if he somehow fails to get it right, he should be ready to face the music as well.

Strategy makers are ideally people who knows the in and out of the construction segment and therefore they are in a position to foresee things which others can’t. They are considered to be the highest paid in the industry and many even open their business as they do not see any reason not to have a business of their own. If they generate the quality to foresee things as it comes their way, they are able to take better decisions and this can really pay him off well in the construction business or any business that is linked with the construction sector.

Foresightedness has always been considered to be a virtue and people who possess this quality never have to look back at things. They only aim for bigger aspirations in life.

 

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Acquiring a construction business is always a viable option

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When you are looking to expand your business, the most viable option that you have in your hand is to buy someone else’s business and manage his clients. This helps you to get some readymade clients, resources and all the other necessary equipment that are required in this industry. But the hard part is to get a company that is ready to sell its stake to you. No one will ever want to sell a business that is making profits. It just does not make any sense to him to give it off to someone else so that he can make money on your hard work. Simultaneously, you will not be interested in taking companies that are running into losses. They may turn out to be a liability on your company.

Moreover, you have to spend more of your time focusing on the sick unit and getting it back from the scratch. It is sometimes not worth of your time and energy and to a larger extent your hard money earned. So how can one get hold of a company who wants to sell their business to a bigger company is something that we will talk in detail.

Talking about the construction industry, acquisition does happen in this industry and also at a slightly higher rate as compared to other industries. Here you will come across many contractors who have tried their luck but due to market fallouts are unable to sustain. Such small scaled companies may not be called as sick units as they are just out of business and not that they are incompetent workers. They can bounce back anytime and can take it from there. So if ever you get the opportunity to buy such a company that is run by a contractor who is now not willing to continue the business, you can pay him the amount and acquire his business. It means that you are now the owner of his resources and you decide the salary of the employees of his company.

In case of acquisition of a construction business, you not only get the resources at a lower price but also get experienced and competent workforce which can be utilized in different jobsites. You may wish to pay them a bit more so that they can be content with how things are moving. Remember, if you hire new workforce from out, you have pay them more for their services but in case of acquisition, you play safe and do not have to increase the package of the existing workforce.

You can get hold of a broker who has news about small sized construction companies and contractors. They will check and let you know if anyone is looking for selling their unit. You also need to do your homework well. Check the reason why the company is ready to sell its stakes. Is it because they can no longer afford the operational expenses or they have some other reason that you should know before you go for the deal. Check the history of the company before you finalize anything and only if you see no hurdle that you should be signing on the dotted line.

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Knowing the nitty gritty of construction business is super crucial

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Before you try putting your hands into any kind of business you need to first have at least some basic knowledge about the trade. Only if you learn the trade well that you will be able to do it well and also taste success or else it will be an utter debacle. You will only experience losing all that you have, right from money to people and eventually your business. So keep your facts straight and give stress to learn the business well before you really pump your energy time and money into it. The people who will be associated with your business will look how confident you are and your confidence will come up with the kind of knowledge you possess. If you do not know much about your business, it will certainly reflect on your persona and that is going to be really bad.

Speaking about the construction industry, it will just not let you run the business if you have very little or absolutely no knowledge on how to function. There is high level competition in this business and more people are getting in into the rat race. So in order to outsmart them, you got to be a bit smarter first. Therefore, it is recommended that you work with some construction company for the first few years so that you understand the nitty gritty of the business. It takes time to learn something new and therefore you got to stick with the company for few years and not months. Check how to behave with the laborers, what compensation you are supposed to pay them, how things are coordinated and how people are hired. You also need to understand a bit of managerial and admin part where you learn the work of managers and know what they do to manage things so that it all moves so smoothly.

Knowing the work of admin will help you understand how the payroll things work. You do not have to know everything in detail. Just the basic understanding will do. You learn these things and can incorporate it in your business. Ideally big construction companies have people who advices the owners on these things. You may also need advices when you reach to that position but in order to understand their suggestions, you need to know what they are talking about. So knowing these things becomes crucial. Another important area that you need to touch is the procurement of heavy equipment and other raw materials. Also knowing where to dump the debris is crucial.

If you know someone who owns a construction business, you can start working with him to learn things. So work with him for few years and gain as much knowledge as you can and once you feel that you are confident enough to start a business of your own, you should take the initiative and give it a shot. You will get to know more things once you head up for your own business and may find the journey interesting and joyful.

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Be generous to pay operators with talent

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Companies normally pay more for talent. So a person who has acquired talent through years of experience and hard work should be definitely rewarded and he rightfully deserve every bit that he is paid. The construction industry is also known as a paymaster for people who knows the in and out of the industry and also termed as an asset to the company.

Through their experience they will be able to steer the future as well as the fortune of the company. They have seen different phases of the business and may know what to do under a given circumstances. When we look at the different levels in the construction industry we may find many people across genres who can be termed as efficient and people with immense talent. Right from a labor to an engineer every person has a role to pay and their talent is displayed by their work.

The talent and experience of an operator is nevertheless of immense significance to the construction company. The operator handles one of the most important parts of the business. He works on earth moving equipment and at the same time also takes care of it. He is the one who reports about any issues with the machine which is then rectified by a mechanic. He is also taken to task when a machine just stops working. His manager will want him to answer why he did not raise a flag when there was an issue with the machine. This means that he is suppose to take onus if anything goes wrong with it. So the operator who takes care of such vital things deserves to be paid more. The company should think about this seriously in case if they are of the opinion to save money on them.

Demand for talented operators does not perish:-

Since operators handle such an important department, the demand for their talent does not perish. Construction companies are always in the hunt talent with some years of experience in hand. They also check for candidates who have the will to learn more about his work. Someone who just does not want to stop learning is probably the man they want to have in their organization. Such men will always be in demand for what they owe and how they can shape up the future of the company.

There are few operators who take charge of the entire fleet of heavy equipment and ensure that nothing goes wrong on any given day. So if you ignore their hard work and pays them less than what they deserve, they may soon switch to a company that acknowledges them for their talent and hard work.

Companies who pay well have performed better:-

It has been noticed that companies who pay well to the deserving operators perform better than others. Their growth structure is on the upwards scale. If your operators are content with their salary, they may go out of their way and may give suggestions that will prove to be highly beneficial to the company.

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