Many companies struggle with margin fade due to decreased productivity and underestimating when planning jobs. Blauch Brothers, Inc. was determined to make significant changes to create a productive workflow for their team resulting in an overall margin gain and increased productivity. They invested in software from D Brown Management which includes a field dashboard that tracks quantity, field time, short interval planning and field reports. The software also tracks cost code breakdown, production, time entry, timecards and does forecasting. This software consists of several tools that each field employee utilizes; they are able to enter their time and also claim the amounts of pipe, ductwork, equipment, etc. that they install every single day.
The use of this program over the last year has completely changed how Blauch Brothers, Inc. manages projects. “Prior to utilizing this software, we’d let the field guys know how many hours they had to complete each cost code such as sanitary below grade, domestic water, low pressure duct, etc. when we were awarded a job. On a job that’s several million dollars, they might have thousands of hours per cost code,” said Blauch Brothers, Inc. Service General Manager, Matt Blauch. “We found that managing jobs that way typically led to margin fade at the end of the job. We now bust the job into logical areas so the guys have more bite size pieces to measure. The logical areas are something that we set up at the beginning of every job. Instead of looking at several thousand hours they’re now looking at maybe a couple hundred in several different areas,” said Blauch.
Blauch Brothers, Inc. was determined to cover all bases to ensure their team was on the same page. The lead mechanics on each job are required to come in prior to beginning the work and set up a control budget. “The PM on the job and our Field Ops manager spend, typically, about half a day with the foreman going over how long they (the foreman) think it will take for them to complete the job. We do this because our estimators look at a job different than a field guy might,” said Blauch. They have found that this method saves time, keeps the guys accountable and gives them the opportunity to mitigate a loss. Prior to this process, field guys often cut hours significantly during the control budget, but now this process has caused the hours worked to be more in line with the original estimates.
Because Blauch Brothers, Inc. thrives on keeping their crews progressing forward, the foreman no longer has the option to allow a crew to be thrown on their job unless they legitimately have something to do and know that the crew will actually work. “This was developed because in the past, if we needed work for a crew for a couple weeks, we’d just stick them on one of the larger jobs we had going at the time to help out; some just showed up for the job because they knew they were getting a paycheck and weren’t too concerned if the job over by a few hours,” said Blauch. This method has helped Blauch Brothers Inc. develop a better work force.
Blauch Brothers, Inc. decided to roll out a gain-sharing program where a percentage of the gain is shared over the original budgeted margin with each person that was on that job. “To date we’ve paid out about $80,000 in gain-share bonuses across the company over the last year. This change is working on making us more proactive and less reactive and we’re working on planning better both in the office and the field,” said Blauch.
As a result of rolling out the profitability measuring tools and gain sharing program, Blauch Brothers, Inc. has more projects showing margin gain, as well as increased productivity. “The guys are being extra conscious about material on their job sites, watching the hours on their jobs and they won’t allow just anyone on their job site. As we continue to move forward with these proven processes and word gets out about how we’re managing jobs, Blauch Brothers, Inc. is going to become more of a talent magnet which will be massive over the next several decades until our labor shortage issues are fixed,” said Blauch.
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