At RIVET, we work with hundreds of self-performing electrical and mechanical contractors. Through that work and across thousands of conversations we’ve uncovered that across the country contractors are often experiencing a lot of the same problems, and have found many of the same solutions to those problems. In this article we’ll share share six common pain points that contractors experience in their labor operations.
1. Labor information is fragmented and siloed
- Each PM has their own labor forecast / manpower spreadsheet template
- Personnel information is stored in systems or spreadsheets and not easily available for labor coordinators / general superintendents when making decisions above labor moves
- Important context about people, skills and their development stored “in someone’s head”
- There is no centralized system where everyone can access the same information
- Real-time updates from the field don’t translate back to the office systems
2. Labor management is reactive
- Labor managers are frequently scrambling last-minute to find workers when jobs kick off
- PMs can’t identify overstaffing or understaffing on projects until it’s too late
- When schedule compression hits, it wasn’t identified far enough in advance to it’s shift work on other jobs to minimize the damage
- Frequent “scheduling to the wall” – not pulling workers off jobs soon enough, letting work expand to fill time and eroding profit margins
3. Communication failures are frequent
- Labor requests reasons and true project needs are often not aligned between foremen, superintendents, and project managers
- There is no clear feedback loop when labor requests are denied or unfulfilled
- It takes multiple phone calls and text messages to coordinate simple workforce movements
4. Visibility into labor is poor
- Executives can’t see peaks or gaps in work more than 8 weeks out
- There is no real-time visibility into where workers are supposed to be next week
- Labor managers cannot quickly identify available workers with specific skills or certifications
- The business frequently re-hires the same person immediately after a termination unknowingly
5. Labor processes are manual, when they exist
- Superintendents frequently waste time on manual data entry instead of solving problems for the business
- Labor managers have to reference multiple documents to make simple labor move decisions
- Foremen call or text each worker individually to communicate schedule changes, or hand out paper transfer slips on the job-site
- Operations relevant labor information is manually tracked or only in your superintendents head
6. Labor processes aren’t documented or standardized
- Business has difficulty managing workers across multiple states, regions, or union locals
- Some PMs forecast, some don’t. Some have regular conversations with the General Superintendents about change orders and changing labor needs, some don’t.
- Some Foremen request labor directly from the labor manager, some don’t. Some keep the PMs in the loop as they are doing this, some don’t.
- The business or division has a long term labor forecast, but you don’t trust it more than 4 weeks out
Why it matters: Hidden productivity costs
These problems typically compound each other, creating “chaos” that requires emergency meetings and fire-fighting rather than strategic planning that creates the best outcomes for the customer and the business. Contractors experiencing these in their day to day are likely experiencing consistent margin fade due to lost productivity from:
- Poorly managed change orders
- Dilution of supervision
- Overmanning
- Excessive overtime
- Loss of learning
Learn more about The 5 Labor Planning Productivity Killers
Data from thousands of projects has revealed that specific productivity killers are systematically undermining contractor performance
