How to Increase Construction Productivity and Profits
In Constructive Strategies’ “Improving Productivity and Profits”, Professor Roger Liska explains how your company can increase productivity and profits. While the construction industry calculates productivity, it does not do a good job of monitoring and improving productivity.
“85% of the problems are because of the processes and 15% with the people.” - Roger Liska
Studies have shown that the average construction craft worker today is only about 40% productive. The other 60% is broken down as follows:
• 20% due to admin delays, waiting for materials and other kinds of resources.
• 20% due to inefficient work methods.
• 15% due to restrictions in the workplace.
• 5% due to personal time.
Liska argues that workers are only as good as they are trained and they don’t produce as well as they could because they are not managed well. The factors, according to Liska, that contribute to poor employee retention, include:
• Not paying competitive wages and benefits.
• Job Security - cross training in other skills can keep employees working more than 40% of the time.
• Respect from the supervisor.
Most construction companies know what their productivity is expected to be but as the job goes on things go wrong. There needs to be a good process in place to monitor productivity and access it during the job in order to increase productivity.
Companies who have a 80% or better retention of craft workers are making profits on more jobs at or ahead of schedule and have better safety performance on their projects and this results in better productivity.
Liska suggests contractors start by taking time to investigate what is causing the administrative delays workers are experiencing. Eliminating these causes could lead to an increase in the time productively worked by employees by at least 1 hour. The impact of this increase would be huge.
Click here to listen to the entire interview.