Skilled Labor Shortage

2020 The Year of Solutions

2020

The Year of Solutions

 

This blog spent the entire year of 2019 identifying the business risks hidden in the complex opaque nature of the construction industry. 2020 will be the year of solutions.

Every week we will select a risk identified in 2019 and explain the mitigation process used by theBest-in-Class contractors that we have researched.

 

Risks Identified in 2019

 

Below find a partial list of the risks we identified in 2019:

 

  • Low-bid procurement risks
  • Catastrophic business failure caused by inadequate cash flow management
  • Ineffective accounting controls from isolated accounting departments
  • Company dissolutions as a result of poor succession planning
  • Missed profit objectives for lack of a written strategic plan
  • Unprofitable jobs caused by a scarcity of skilled labor
  • High risk contracts resulting from uncontrolled expansion
  • Insufficient managerial maturity exacerbated by uncontrolled growth
  • New projects requiring virtually new companies
  • Sustaining profitability over extended project time intervals
  • Flexible markets requiring flexible companies
  • Too little – too late when you don’t get paid on time
  • The deadly excitement of unbridled growth
  • Only lawyers win when you try to outmaneuver an owner or designer
  • How ignoring accounting could be your downfall
  • Fixed price contracts – RIP in 2020

 

Self-Analysis in 2020

 

Our self-analysis program will enable you to compare yourself to the Best-in-Class contractorswho have successfully mitigated the risks listed above. Using the self-analysis program outline, we will divide the Best-in-Classrisk-mitigation techniques into 4 areas:

 

  1. Accounting Proficiency
  2. Financial Reporting
  3. Cash Flow Management
  4. Debt Management

 

These four areas will be subdivided into 13 functional areas:

 

  1. Organizational Structure
  2. Record Keeping
  3. Receivables Management
  4. Overhead Management
  5. Change Order Management
  6. Subcontractor Management
  7. Project Selection
  8. Management Style/Personnel
  9. Multi-year Business Plan
  10. Succession Planning
  11. Control/Threats
  12. Risk Management
  13. Dispute Resolution

 

Solutions in 2020

 

In 2020,we will highlight solutions for 4 specific risks in each functional area, demonstrate how the best-in-class contractors mitigated these risks, and offer suggestions as to how you can apply their solutions to your unique business environment.

 

Welcome to 2020, the year we will work together to mitigate your business risks.

Read More (link to self-analysis article and the self-analysis program)