Use Your Workplace Layout to Attack Slippage

Here at Remodelers Advantage we set aside the month of June to focus on an issue that plagues most service-based businesses, but can be a critical metric in looking at the success of a remodeling firm. This is our third annual “Slippage Awareness Month” and this year you’ll see content submissions from our consulting, sales, and production experts here at R/A. Enjoy!

Slippage, on each and every job, is the difference between the profit margin expected at the outset of the project and the actual profit margin achieved.

The difference can be found in the wastes inherent in almost any process, and they can be easy to find in the course of any remodeling project. LEAN is an excellent tool for combating slippage by finding those wastes and developing strategies for getting rid of them.

There are really three components to successfully implementing LEAN. They are: workflow, workplace, and culture. To be successful, you need to work on all three — and they need to reinforce each other.

Workflow

To optimize your workflow, you have to look at a process from end to end, mapping it out, finding the waste, and eliminating the waste — creating a better way to get through the process.

Culture

Culture is about fostering open communication, creative thinking, and having a willingness to allow ideas to come from your team — the people who actually do the work.

Workplace

You can tackle slippage by looking at your workplace. Analyze the  physical layout of your office, your vehicles, the job site, and even your network drive. Minimize wasted steps, group people who need to communicate together, and create a more harmonious flow. There are areas which can either make it easier for work to flow or more difficult.

As I’m sure you can imagine, be better layout can do wonders to make work flow more smoothly, to waste less time trying to find things and lessen the burden of work on those doing the heavy lifting.

Using LEAN principles, workplace organization is done through the 5-S process.

  • Sort: Remove items you don’t need from the workplace
  • Straighten: Put things in their place and have a place for everything
  • Shine: Keep the work area clean and uncluttered
  • Standardize: Make it company policy to set things up that way
  • Sustain: Keep it looking that way over time.

Often, a LEAN effort can begin by having a group or groups work on a 5-S project. Clean out the warehouse, organize it, label the shelves, and develop a reorder process. Or maybe you could do the same with company vans or trailers. If you spend too much time looking for files, take the same approach with your network hard drive or cloud-based data storage like Dropbox or Google Drive.  

When you can clearly see what you have, when and where you need more, what’s missing, and know where things go, we start to realize time savings. By eliminating work time spent searching for a file, the run back to the warehouse for a tool, or cleaning up things that really should be removed, you can run more efficiently, reduce slippage, and run LEAN.

Key Roles Sales Can Play to Reduce Slippage

Here at Remodelers Advantage we set aside the month of June to focus on an issue that plagues most service-based businesses, but can be a critical metric in looking at the success of a remodeling firm. Last year we named June “Slippage Awareness Month” and this year you will see content submissions from our consulting, sales and production experts here at R/A. Enjoy!

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One of the riskiest maneuvers in your remodeling business is the handoff of information from Sales to Production. Too often, it’s where slippage begins.  

Slippage happens at the beginning of the process because details of the project are hazy. Without clear background information, the Production team must diagnose a problem on the fly or ask the client questions that should have been answered well before. Taking guesswork and hesitation away from your Production Team is critical to reducing slippage and boosting profits. 

Knowing the roles your salespeople must play can help. Those roles go well beyond a static job description of duties and responsibilities, it’s how an effective Salesperson functions within your company. Like an actor, an effective Salesperson slips in and out of roles seamlessly when working with clients. Understanding these roles is key to properly executing the crucial hand-off from Sales to Production. Here are a few of the roles your Sales staff must play.

Therapist 

Like a good therapist, it’s essential to listen, not just hear, what clients are saying. Salespeople need to understand the “why” of the project. If Production knows why the client is remodeling, it enables better decision-making when faced with roadblock.  

For example, if the team knows the clients are renovating to sell the home in a year, they’ll be better prepared with a suggestion if they discover a hidden condition — advising the best solution when it comes to resale value. 

Knowing the why behind a project will ultimately empower the Production team to be more efficient and adaptable. 

Detective  

It’s time to put on the Sherlock Holmes hat — Sales has to solve the ultimate mystery within the project. The constantly lurking question of “what could possibly go wrong?” 

Sales needs to ask questions, discover clues, and solve mysteries to make sure the Production Team don’t discover things at a later date. 

That could mean finding information about similar houses in the neighborhood, perhaps talking to a neighbor that has recently had a project completed. Even with the walls up, and the house intact, a seasoned remodeling detective will know what to look for above, below, and around the home to uncover a looming disaster. Let the Production team bring the house to justice, the Salesperson has to find the evidence.  

Journalist   

Like any great journalist, the Salesperson’ goal is to gather the details to make a great story. Ask questions to discover the clients’ personalities and goals. Find out where they’re they from, where they went to college, what they like to do in their spare time.  

Ferret out the details of the house, the clients and their lifestyle, learn about their pets, the neighbors or the neighborhood. When putting together a Client Book or a Production package, tell a story your production team can’t put down. They have to know what happens to the dog on Tuesdays, and why they can’t park on the street on Wednesdays. When Production’s able to vigorously work through the project with limited issues, slippage will go down.  

Doctor  

There are many ways that a Salesperson can look at themselves as a doctor in a remodeling project. The first attribute of any good doctor is knowledge.  

Dr. Salesperson must understand how a house works, and what to look for based on the symptoms at hand. They also need to be able to listen. This could be the most valuable skill to possess when working with a new client. To properly prepare their Surgical Team (Production), Dr. Sales must to use active listening, then properly diagnose what’s ailing the house.  

Dr. Sales also needs a good bedside manner — able to comfort, set expectations, and make sure the client is prepared for a successful project.  

Going Beyond the Job Description

Take a closer look at the roles your Sales Team plays, and how to build on them. Look past the formal tasks and responsibilities set out in a job description and work with your team to expand their roles based on individual capabilities and talents. By adapting these roles and playing the parts, the sales process becomes the catalyst for reducing slippage.

4 Ways to Battle Slippage Mindset in Production

Slippage! Wow, when you look at it from a production viewpoint it comes from everywhere! It’s a battle that all remodelers face on a daily basis; win the battle and see higher profits… lose the battle a few times and it can affect team morale, customer satisfaction and ultimately, the bottom line.

Sometimes it is just a mistake we make along the way, but in many instances it boils down to the way we think.

Mindset

One of the thought processes that leads to much of our slippage is what I call the “either/or” mentality.

A good example occurred just two weeks ago while I was working with a company and we were discussing lumberyard runs. One of the Lead Carpenters raised his hand and said something like “Do you want me to order the materials and then have to make the lumberyard run to return what I can’t use OR just go get what I need the first time?”

So, we had a discussion of all the alternatives including a different yard, order more than you need and pick out the bad and send it back, and working out a deal with the yard for better lumber.

Other places where this exists is in change orders and start of day. In many cases changes really do have to be dealt with quickly. The tendency is to believe that a change order is a slow methodical process therefore we do not have time to complete one and just move on. And we lose the income for that work.

With regards to start of day, some companies are still having the entire production team come in the office and get their assignment for the day. In discussing this everyone knows that it is a huge waste of time but they revert to the fear of chaos or lack of control thus continuing the problem.

The solution?

 

1. Face the Facts

Be willing to admit that there is a problem and the problem is part of your slippage. In some cases, and this helps me a great deal, do the math. Be realistic but also look at every cost you are taking on. For example, if we look at the scenario where everyone comes into the office for a meeting.

They start getting paid when they arrive, mostly by the hour so labor burden and benefits are adding up. You then pay for the drive time to the job. Once there, then they set up, losing vital production time and adding to the cost of the project.

2. Point Out the “Either/Or”

Go ahead and address that we are essentially only looking at two extremes. By doing this it helps us see the issue. Perhaps even do it graphically by writing one at the top of a white board or flip chart and the other at the bottom.

3. Brainstorm Other Solutions

Probably one of the biggest mistakes project and production managers make is to simply tell people what to do. This always leaves the option for excuses if it doesn’t work and then the ability to dismiss it since “you have never dealt with this”. Get the team together to brainstorm. By getting everyone involved several things happen. You eventually get to the best solutions.

You also get a variety of solutions. By doing this, person A may use idea D but person B likes and will actually use idea B. The people that do not believe “either/or”, will help convince those that do. There is nothing more powerful than peer influence. And finally, you can stay out of the bad guy role.

4. Always follow up

Just because we discussed it, agreed to change, and all go away happy, doesn’t mean that things will change. Because habits are hard to break, help each person figure out how they will do the change. If Person A is going to use idea D then what do they need to do to actually start using it.

Perhaps it is as simple as always having a pad of paper on site for notes. Or it may be more complex like setting aside planning on a daily basis. In general, if someone does not follow up most everyone will fall back into their old habits.

 

Summary

So, in dealing with slippage it is about not making mistakes either in sales or in production but it is also about seeing the problems and finding and implementing viable solutions.

What are some ways that you have minimized Slippage in your production environment or process? We would love to hear constructive advice and tips using the comments section below… or maybe a question that we can answer for you.
 

And Don’t miss The Tim Faller Show! A Podcast To Help You Improve The Bottom Line Through Production Training, with new episodes every Monday.

 

Reducing Slippage with Process Improvement

Here at Remodelers Advantage we set aside the month of June to focus on an issue that plagues most service-based businesses, but can be a critical metric in looking at the success of a remodeling firm. Last year we named June “Slippage Awareness Month” and this year you will see content submissions from our consulting, sales and production experts here at R/A. Enjoy!

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“Slippage” is the percentage of gross profit on a remodeling project that is lost between how the job is budgeted and how the job is completed.

As an industry, we work to continually find ways to get jobs done on-time, on-budget and at the level of profitability we seek, and yet for many, despite this effort, this remains an elusive goal.

As Paul Simon had us all singing in the late 70s, “You know the nearer your destination, the more you’re slip slidin’ away!”

LEAN is a method for continuous improvement that reviews processes from end-to-end, identifies WASTE in the process and engages those who are actually doing the work to find ways to eliminate that WASTE. This is done by separating all steps in a process into value-added and non-value-added in the eyes of the customer.

The result is a process that is easier, better, faster and cheaper. Customer satisfaction goes up. Employee frustration goes down. And, the cost of the job goes down, which therefore means less slippage.

The WASTES in LEAN that are continuously sought for elimination can be remembered with the acronym D-O-W-N-T-I-M-E. This stands for:

  • Defects
  • Overproduction
  • Waiting
  • Not Using Human Talent
  • Transportation
  • Inventory
  • Motion
  • Extra-Processing

LEAN consists of principles, practices and tools designed to give any company the ability to continuously improve their processes with strategies for workplace organization, workflow and culture.

So, let’s look at the job-site. When we have challenges scheduling trade, inspections or the delivery of materials, we create WAITING. When we make several extra trips to the lumber yard we create TRANSPORTATION.

When we miscommunicate in the “sales-to-production” hand-off, we can easily create DEFECTS. And when don’t properly capture the paperwork and pricing on change orders, we can create EXTRA PROCESSING.

Summary

Now, imagine having a company culture, workplace organization and workflow to continually look at your processes and eliminate waste. Many small changes in a process can have great impact on the overall process and that’s how LEAN can help you make sure that it’s not your gross profit margin that’s “slip, slidin’ away”!

[notification style=”success” font_size=”12px” closeable=”false”] If you would like to learn more about how LEAN Process Improvement can help your remodeling business, visit https://leanremodeling.com and take a look at the LEAN Masterclass we have coming up on July 10-11, here in Baltimore. [/notification]

 
 

PowerTips TV Throw-back Thursday: “How a Job Autopsy Can Save Future Profits”

In our last throw-back episode of the season, we take a closer look at Slippage and how it can destroy the profit margin your team works so hard to obtain.

In order to keep it from becoming a recurring problem, we cover how to perform a “Job Autopsy” or a break-down of where things went wrong… where costs started to invade your production plan.

[notification style=”success” font_size=”14px” closeable=”true”]We’re excited to launch our new season of PowerTips TV next Thursday with all new episodes! If you have ideas for topics you would like us to cover, please suggest in the comment box below… And if you haven’t subscribed to our YouTube Channel, Click Here.[/notification]


This week I’ll share some examples of how slippage can destroy your profits. More importantly, you’ll see how performing a thorough job autopsy can prevent future slippage.

So if you’re looking for ways to increase your profits, look no further than this week’s episode of PowerTips TV and learn one very effective technique for eliminating waste and ramping up profits.

5 Ways to Reduce Slippage [Infographic / Poster]

As we bring Slippage Awareness Month to a close we look back on some solid information provided by our team here at Remodelers Advantage. Tim Faller led us off with a blog post on The Team Approach to Preventing Slippage and an in-depth webinar, “From Slippage to Grippage: How to Raise Profits Without Raising Prices”. We added some thoughts on how to assemble your slippage reduction team and Steve Wheeler brought us his thoughts on how to avoid slippage from a sales perspective. Last week we launched re-runs of our PowerTipsTV series and brought you an episode dedicated to “How to Stop Losing Money on Change Orders

To wrap things up this week we wanted to present an Infographic that provides additional thoughts on ways your company can reduce and eliminate project slippage on your road to greater profitability. If you would like to print this information out and share it with your team, here is a link to a PDF that can be printed out on 8.5” x 14” paper on your office color copier.