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Improving Jobsite Productivity

If you’ve been in construction awhile, you’ve discovered there’s more to jobsite productivity than worker ability alone. You’ve also likely found that it’s often this productivity—good or bad—that determines whether your project is profitable at closeout. Profit is the primary goal, for without profit to cover overhead and spawn growth, there is no business. So it follows that if one can control productivity, one can better control profit.

But that’s the problem: Productivity isn’t tangible. It’s a mercurial beast that appears and disappears without warning; manifesting itself in endless forms and often triggered by what (at the time) appears to be the least threatening of circumstances. To make matters worse, when it is identified, it remains almost impossible to quantify. Variables such as work environment, weather, project communication, worker skill, document quality and much more insure that productivity remains stealth. Indeed, many owners may not even know there’s a productivity problem until after the job is closed out—and then it’s too late.

A Call to Arms

But we contractors are a tough bunch, and backing down from challenges didn’t get us where we are today. Although the productivity puzzle can be difficult to “wrap your arms around,” it can’t be left to chance. It’s simply too important. So to the best of our ability, it becomes incumbent upon us to attempt to identify and gain control over productivity on the job site and go on to develop a workable and effective onsite productivity program.

That’s where this article comes in. Below is a Productivity Checklist, a tool that contractors can use as a benchmark to begin to build their own customized productivity program. The goal is to help better identify, quantify, and eventually even anticipate the red flags of negative jobsite productivity. Anticipation is important because through recognizing in advance the environments that historically spawn productivity lapses, pitfalls can hopefully be avoided, thus increasing the bottom line at the end of the job.

Measuring Productivity

A simple method for expressing productivity is a ratio found by dividing the number of worker man‑hours actually spent on a specific jobsite task by the number of man-hours earned (billed or estimated) for that same task. Of course in an ideal world, the amount earned would equal (or better) that originally budgeted, but we all know that’s not always the case. If a worker spends eight hours for a task originally budgeted for six, our ratio is found by dividing the actual number of man-hours (eight) by the budgeted (six) to arrive at a ratio of 1.25. Obviously, the lower the number, the better it is, and being under a one is best. Albeit simplistic, being less than one indicates productivity is good. A number greater than one (assuming all other criteria are trustworthy) may indicate a productivity decline and a cause for concern.

Determining actual man-hours spent on a task (direct cost) is relatively straightforward and can be monitored via jobsite field reports, time sheets and payroll records—assuming the tasks in question have been broken down and allocated to the proper cost codes. If that isn’t the case, then I believe we’ve stumbled upon our first lesson: Always (and I mean always) track and maintain thorough and accurate labor records in the field. Besides benefiting the contractor in ways such as legal and future estimating, this documentation is absolutely essential if the contractor is going to seriously tackle the productivity issue.

But I know what you’re thinking: “Well, it’s easy to calculate all this at the end of a job when all the numbers are finite and known. It’s trickier in the middle.” Well, don’t panic. In this case, it’s common practice is to arrive at a percentage of work completed (“Is the actual work in the field 20 percent, 50 percent or 80 percent complete?) for each line-item for that billing period (normally one month). In these cases, some on-the-fly extrapolation will be necessary to properly compare “real” to “estimated.” Yes, these percentages should be justifiably suspect because they include the human element, but at least it gives you a benchmark of the productivity for a particular job.

Indeed, the best use for productivity ratios may be from job to job, where you take what was learned from the last job to put against the next one being bid/built. Arriving at these extrapolations is no simple task, and no place for amateurs. It’s quite common for judgmental factors to creep in to skew these numbers, so only experienced and skilled construction managers and estimators can even hope to come reasonably close. Therefore, lesson #2 would be this: Hire and pay for the best people. The extra $10,000 to $15,000 you cough up in salary now will more than cover the revenue generated over the long haul.

Productivity Thieves

So now that we know how to track it, what is it exactly that we are tracking? Many things adversely affect productivity on the work site—too many to address in such a short article—but here are some common culprits to watch:

Weather (non-winter). Of course, the wrath brought on by Mother Nature is simply out of anyone’s hands, but there are things the contractor can do to work with weather rather than against it, such as carefully monitoring the next day’s weather and planning and positioning workers/resources accordingly to take full advantage. (Did you know there are weather/Doppler networks readily available for free on the Internet?)

Winter Weather. I’m from Wisconsin. We have winter … big time. Needless to say, winter weather is an important part of our costing equation up here. But there are different ways winter affects a project. Here are just a few (and to be clear, yes, assuming an upfront contingency can’t be worked out, EACH of these items should be assigned a line item with appropriate costs during estimating!):

Heated enclosures. This can range from full blown air-supported structures to overlaying scaffolding with visqueen. The idea is to encapsulate the exposed work at hand inside a “warm” envelope where temperatures are high enough to accommodate workers, ensure application procedures and maintain product warranty (most product warranties are void if applied in other than factory-stated conditions).

Fuel and heaters. In many winter weather enclosures, common “torpedo” heaters bear a lot of the heating brunt. Often, they’re fueled by LP gas that requires ordering, setting and refilling—all costs, and don’t forget the guy who stops in late at night or early morning to ensure they’re still running!

Snow removal. From trucks with plows to shoveling by hand, all are costs and chip away at your bottom line. Lanes need to be cleared, materials stored outdoors need to be uncovered and what about that slippery ice patch under the laborer carrying a bundle of reinforcing wire? Suddenly, OSHA and safety programs are impacted as well.

Traffic, temperature and clothing. Studies are out there that report on the effect of temperature on the average worker. In general, the findings are that 60 degrees is about optimal for work with a notable slowing of productivity happening at about a low of 35 Fahrenheit and a high of 89 degrees Fahrenheit. Then, go on to add the additional encumbrance of heavier, bulkier clothing in the winter, slowing the process even more.

Equipment. We all know most equipment—big or small—doesn’t perform as well in the winter. Should this be accounted for? Yes.

Height and levels. The formula for this can be tricky, but the theory is relatively easy to understand. The higher the contractor goes, the more likely they’ll require additional scaffolding, staging, hoisting, craning, etc. Yes, the cost for these items is often assigned when calculating general requirements, but seldom is the actual loss of worker productivity taken into account. In short, a mason is not going to lay as many bricks in the same period of time on the fourth floor as he would the first.

Work repaired or re-done in the field. This is a productivity killer because the contractor loses both productivity and credibility. Poor quality is the easiest way to lose the next sale. Insist on quality from your people. It isn’t just a hollow business mantra. It directly affects profits, present and future.

Poor architectural documents or detailing. When a worker has to stop to clarify (or even find) a detail for work he’s performing, job continuity is interrupted—and productivity negatively impacted. In my experience, this is one of the greatest (if not the greatest) causes of productivity lapse on the site. Since back-charging the A/E for this lost time is seldom reality (it should happen more often), the onus falls on the contractor to flush out needed details and information early on and preferably even before workers hit the job site.

Poor supervision, planning and scheduling. Lack of planning is another leading cause of poor productivity. The cure is sound construction management. Project schedules should be created with input from all effected trades, and the schedule should be constantly reviewed throughout the course of the project. Besides overall project schedules, smaller interim (such as weekly) man-power schedules should be created to enhance continuity.

Learning curves. Bringing on new people means training periods, and when people are being trained (or doing the training), they’re producing less. Learning curves coincide with employee turnover, and the only way to quell turnover is by offering good wages, benefits and staying in tune to the employees’ needs and morale.

Client/A-E cooperation/participation. This includes such things as responding to requests for information, approving change orders, being available and responsive when issues arise and even meddling too often in daily affairs

Closing: Change Orders

So far so good, but what happens when our budgets are altered due to change orders?

Don’t panic!

The process is essentially the same, but with an added step. When a change occurs, select the line-item that best represents the scope of work required by the change order. Yes, this may involve breaking the change amount down into the different trades (for example, plumbing, saw-cutting and concrete patch for the added sanitary line), but you should be doing this anyway. Once broken down, add the new budgeted amounts for the changes to the original budgeted dollar amounts for that line item, and use it when calculating the new percentage-complete.

Now, you actually have a budgeted amount of revenue to apply to the additional work. Work performed that isn’t assignable to any original budget is plain and simply charity and as benevolent as it may seem, construction isn’t a not-for-profit enterprise.

I’m sure you can think of more productivity killers. Just remember that the greatest tool you own is your own willingness to tackle the issue head on.

Good luck!

About the Author

S.S. Saucerman is a full-time commercial estimator/project manager based in Illinois.

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