Has Anyone Seen the GC?

It seems way too many general contractors building offices on planet Earth, United States, have turned a deaf ear to quality and performance and are insisting on hiring the lowest bidders. And then to make matters worse, they let the subs fend for themselves, because their one supervisor is too busy handling e-mails and perwork to supervise.



That’s the message from two in every three contractors surveyed around the country (15 total).

Hmm, seems GCs got it into their heads a while back that the way to handle the problems relating to workers’ comp insurance and payrolls and so on was to let their own employees go.
GCs would then take on the job of acting
as middlemen between owners and
the new army of subs looking for work.



It’s a model that could work and no
doubt did when the GCs were actually
doing their job of coordinating and eye-balling
and getting their hands just a wee
bit dirty.


But then the greenbacks beckoned, and
they figured they could make more
money by always going for the lowest
bidder, the ones who often cut corners,
hired non-union or illegal aliens, made
a lot of noise slamming their trunks and
generally held up the scheduling.


Then the e-mails and paperwork started
to pile up, and they figured they could
save more money by having the supers
handle all that stuff too. And of course
the big bucks were in cutting costs and
the owners kept pressuring them to open
their new buildings faster, so cutting production
time lines by 20 percent made a
lot of sense. “‘A job they used to give you
300 days to complete now gets 250 days,
so everyone is on top of each other,” says
a subcontractor in Louisiana.



The result, according to the majority of
subs surveyed at random, has been subs
in each other’s hair because their schedules
overlap. And at a time when coordination
should be an absolute priority,
the supervisors are invisible (not to paint
with too broad a brush—many GCs are
on the ball, but too many of their colleagues
are giving the profession a bad
name, and the good GCs have not been
effective in policing their own).



What else has happened though? We find GCs are not plagued by high workers’
compensation premiums anymore,
but they are by ballooning lawsuits
“What is effective because sloppy workers and no supervision
are resulting in poor work. Sounds
in getting other like a solution to a problem that became
a new problem.



It Takes a Plan



Well, from the frying pan into the fire,
one wonders if GCs are really finding
more greenbacks or Tylenol in their
pockets as a result of their shift in job
description and strategy. One thing is
certain, however: Subs are being adversely
affected.




“We have some real good GCs we work
for, but you can tell when you run into
someone who doesn’t coordinate well.
They don’t spend the time to put a plan
together, coordinate it with everyone
and then follow through with it. I
should have walked out on some projects
when the GC was not taking the
trouble to coordinate properly, but I
didn’t. We lost money each time a
great deal of money sometimes,” says a
sub from Alabama.



And from a Florida subcontractor: “The
general contractors are more or less brokers
now; they’re not as proactive as they
used to be, so it all falls on the trades:
Because the GCs no longer coordinate
the trades, the guys in the field are stuck
with all the problems.”



Then there’s the contractor from Colorado who had a bunch to say on the subject: “The GC is the poor guy trying tractors and everybody else. You’d think to do the scheduling, but he’s at the mercy of the subcontractors not performing as they should. GCs set a schedule based on what everybody tells them they will be able to do. So when a sub doesn’t do what he said he would do, it screws
everybody’s schedule up right down the line.



“But then the GCs hire them again
because their organization comes in
with the lowest price on the next job even though they don’t perform and
even though it costs money to have everybody else delayed.
It’s one of our key frustrations.



“We strive to keep our schedules and
perform so we don’t mess up the contractors and everybody else. You’d think our reputation would land the job. But it
never works that way. When you try to get in on ht enext one, it’s all about the dollar, even when we are maybe 1 or 2 percent higher than the other guy. I’m not in the GC’s head or offices, so I don’t know what goes into their train of thought. But time and time again, they hire poorly performing contractors. We’ll go to a subcontractor meeting, look at the schedule and then at all the different subs sitting there, and say, ‘Okay, I’m going to add three weeks for
him, two weeks for him,’— because they
jack your schedule around and it’s the
same subs time and again.




“It’s bizarre and one of the mysteries of our industry, but the contractor is not
spending his own money, he’s spending
the owner’s money. If the owner looked
at it differently, as interest being paid on
a bank loan, and realized this subcontractor
cost him two weeks on a million
dollars, that would probably make a
pretty good chunk of change, and he’d
see it might be worth spending a little
bit more money up front to hire a subcontractor
with a record of performing.



“One might think it is the GC’s job to
look after the interest of the owner and that he might want to avoid all the
aggravation of a sub who isn’t performing.
He could advise the owner to spend
the extra up front to avoid the added
expenses at the end of the project. But
the owners probably think ‘This extra
expense up front is my expense, and the
aggravation is not mine but the GCs. I
don’t care about his aggravation; I do
care about my money. Hold them to a
schedule!’



“In a perfect world, that strategy might
work. But it never does and they end up
paying more in interest. Non-performance
and warning clauses exist in the
contracts. But to enforce them requires
attorneys and delays. So GCs threaten a
lot, but by the time everybody realizes
they’re going to jack with the schedule,
it’s too late and they are already jacking
with the schedule.


“And then the GCs hold us to our schedule
to make up for the other contractor’s
delays—we’re supposed to start on such-and-
such a date, so we do but the other
guys aren’t done and they’re in our way!
We come into a 50,000 square feet office
building and they tell us, ‘You can do a
1,000 square foot office at the end!”’



“That’s probably our key frustration.
The related frustration being that it’s not
about performance, quality or service,
but the bottom dollar. A company that
focuses on performance, quality and service
rare bids the bottom dollar because
all of those qualities cost money. It’s a
false economy that is going on.



“There are two sides to every nickel, and
that’s my side. If the owners and contractors
don’t want our service, quality
and performance, then we need to know
that and we’ll be like everybody else and
give them the lowest number, delays and
poorer quality.”


How to Cope



Certainly, subs can deal with GCs diplomatically, and here are several suggestions from subcontractors.



From Louisiana: “The problem is with
the superintendents of the GC’s not
scheduling the other contractors properly.
We try to deal with it diplomatically. If they don’t want to resolve the issue, then we’ll go to the owner, and that usually handles it. Otherwise, we say, ‘We’ll proceed as instructed by y’all’ and have
them sign a piece of paper.”



Certainly one should work with GCs, as
suggested by a sub in Massachusetts:
“While we’ll take the schedule from the
general contractor, we’ll also schedule it
internally to meet the GC’s needs. In
doing so, nine times out of 10, we’re able
to see if there is an issue or a coordination problem with the GC’s schedule, and so we address that with the GC. They are responsive and take action 50 percent of the time.”




And from Illinois: “What is effective in
getting other trades to stay on schedule
is developing a relationship with the
general contractor, because he’s the guy
who has the power over them. Unless
you have a good relationship with the GC, they will no more look out for you than you for them. These large jobs are dog-eat-dog.




“As one of the last major trades to go
through these jobs, we can really be the
locomotive that drives the train. We can
really be the guys that push the sched-ule.
Because if we frame them like a batout of hell and push on these other
trades, it forces the schedule.



“But you get these GCs who want you
to hang one side of walls and then come
back and hang the other side. It means
remobilizing, you’ve got to bring back
your screw guns, your scaffolds nobody has enough scaffolding to leave
it set up on every floor of a 50-story
building-and you’ve got to have a
supervisor there telling the guys exactly
what needs to be done and supervising
them again. It’s a double remobile and
demobile. Good GCs allow you to
make more money; bad general contractors
can kill you.



“So building relationships is more
important in construction than any
other industry, especially in a market
like Chicago, where half a dozen guys
do what we do. A lot of the time, if
your numbers are that close, it’s who
does the GC want to work with? Who
makes their job easier, who do they like
working with, who do they have a good
relationship with? I mean, green is gold
and the money obviously matters—if
the other guy is 10 percent below
yours, it doesn’t matter how much the
GC likes you! But if the numbers were
right there, you’d like to be the guy
they’d like to work with. So, your relationship
is paramount with these guys.
It’s as simple as having your guys having
a great relationship with the elevator
operator, because that guy can kill
you! So, I always tell my guys to bring
the guy an extra cup of coffee or a
doughnut, you know?!” We can be an
asset to the GC when we run the job
correctly, but he’s also got to be an asset
to us. He can keep people out of our
way and put the hammer down on
them, too.”



Then the least a sub can expect is to be
remunerated for any delays, but this is
not always the case, as the same two
contractors point out:


“We document any delays and typically
at the end of the job, we sit down with
that GC and plead our case to him for
any monies owed. Fifty percent of the
time, that is successful. If you document
everything properly and can show them
that you’re not just trying to get money
that is not deserved, they’re willing to
help. But there are some that you’ll wind
up either going to court, or you have to
determine, is it worth suing these guys
and not ever doing business with them
again?




“We tend not to do business with those
25 percent who don’t play ball. I don’t
want to name any contractors, but there
are a couple we would not work with.”



“When the other contractors fall behind,
it’s always a war to be paid back
that money, because it’s a proven cost to
us. How often we are paid for those
comebacks depends on the GC and the
precedent set. You have to weigh your
options as to how hard you’re going to
play with them. If you’re going to hold
off on doing things until it’s ready to
complete, or if you’re going to go in and
piecemeal everything which is definitely
going to cost you.”




In a Perfect World




But wouldn’t it be so much simpler if the
GCs gave the supers a secretary so that
the supers could get off their duffs and
be all over the site supervising and kicking
butt!? … and if the GCs explained
the facts of life to the owners, so the
owners would relax a bit on the schedule
and be willing to pay a bit more
upfront to hire the best subs for the job
. . . and so have the quality that will keep
everyone out of court later on for shoddy
work and delays . . . and save on all
those delay related costs?



One can always find ways to cope with
an existing scene, make the most of a
bad job, but maybe it’s smarter to get to
the bottom of the bad job and sort it out
with common-sense action. If this high
a percentage of contractors is struggling
with this issue, wouldn’t it make sense to
work together to reverse the trend and
resolve the source of friction to everyone’s
advantage?



About the Author


Steven Ferry is a freelance writer based
in Clearwater, Fla.

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