Is Your Project Manager a Professional Errand Boy?

By Breakthrough Academy.

Learn from business coach, Paul Atherton, about how to tell if your project manager is an overpaid errand boy.

In the world of contracting, we find that anyone can say they are a project manager, but few fit the definition of what project managers actually are. We recently spoke with a Breakthrough Academy (BTA) Business Coach Paul Atherton about who fits the proper definition of a project manager and what good project management looks like.

During his lengthy career as an engineer and project manager working on large construction projects across the world, Paul Atherton, our guest on this episode of Contractor Evolution , has seen it all after coaching 100s of high-performing contracting companies.

A cornerstone of Paul’s philosophy at BTA is the implementation of World Class Project Management Systems.

Paul offers some fascinating insights. But let’s start at the beginning.

What does excellent project management look like?

Early on in Paul’s career he worked on a massive cogeneration plant construction project. A seasoned engineer/project manager led the project and despite having 100s of people working under him, was always chill. Paul asked a colleague how he kept his cool. He responded: “The reason is he planned everything to a T; he knows how to manage projects and people.”

This PM had built and sustained relationships with all the people on the job and ensured they worked together smoothly. He also refused to accept the status quo or make excuses. "Trades business and general contracting exist in a space that's quite fragmented, and the majority of businesses you're in competition with are lacking in how they execute, plan, and manage projects,” Paul says. “As a business owner, if you take the time to get good in this area, you will see accelerated gains as most of the people you are competing against won't be doing this.”

Red flags that project management is an issue in your company 

First, look at your net profit. If it’s negative 2-4%, then there’s a lot of ground you can make up, and it’s usually in the area of project management; second, consider your gross profit relative to your goal; and third, consider how long the project took relative to the planned schedule. If these are off, there’s a problem.

If Paul asks a project manager to break down what (s)he’s doing and the response is, “we are slammed,” he knows something is up. If he then asks where the budget is and the response is that it’s handled by the owner or accounting, this sets off alarm bells. A project manager can’t be a leader without having a handle on all these elements.

How a world-class project management system can help

When Dave Stevens, owner of LIDA Homes Inc., joined BTA 18 months ago, he had great processes in place, but he asked Paul: “What does ‘perfect’ look like?” He wasn’t willing to settle. Working closely with Paul, Dave spent nearly a year refining his project management processes by undertaking a five-step program:

• Step 1: He implemented detailedemployment agreements, from labor to project manager level.
• Step 2: He injected a performance-based point system into the company.
• Step 3: He developed resource training manuals for all roles.
• Step 4: He designed a communication plan to determine what ‘good communication’ looks like.
• Step 5: He introduced goal setting and review meetings.

As a contractor, it’s easy to get lost in what the fundamentals of project management actually are because a Google definition doesn’t apply, so to simplify, Paul breaks down the four project management fundamentals that will improve net profit:

1 - Have a good project plan in place

This includes developing a good estimate so there aren’t any surprises along the way, and developing a good material management plan that takes into account all factors.

2 - Manage the budget

A good project manager needs to know how each line item is performing, what the forecast is for gross profit, the fixed price jobs and what are the over/under billings etc.

3 - Manage the schedule

Companies doing extremely well are the ones that can hammer through projects faster. Cutting the project time by two months saves overhead and allows you to hit double digit net profit percentage.

4 - Have a good communication plan in place

99% of issues onsite are due to communication breakdowns. A communication plan needs to list the stakeholders and outline the meetings that are happening externally and internally, among other things.

Three characteristics of great project managers

ONE - They come across as capable and competent. You don’t want someone who crumbles under pressure. 

TWO - They are good problem solvers. You can train staff to become great problem solvers by asking them three questions: What is the issue? What are three ways to solve the issue? What path would you take to solve this problem? 

THREE - They are tenacious (don’t mistake this for perfectionism – contracting has no time to be perfect), and get through projects quickly.

This article is not the be-all, end-all when it comes to Project Management, but it should give you a good start to get your PMs on the right track.

Hear from 2 industry heavyweights as they hand over their internal secrets for faster projects, happier customers, and fatter net profits. 

Watch Here!

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Original article source: Contractor Evolution, presented by Breakthrough Academy