I was interested to read the recent BRANZ report on small construction firms in NZ.
A lot of interesting stuff in there. One statistic I found particularly interesting was a possible source of easy additional profit for construction company owners. That statistic is the number of hours that owners and employees waste each week. Just looking at employees for a second, the average number of hours lost each week per employee is about 6. That includes weather delays, so when weather is taken out (bit more difficult to control) the net hours lost is still in excess of 4.5 per week. That is more than half a day per week being paid for waiting around or doing other non-value-add tasks.
You can do the maths. How much is that costing you per year? Maybe $7,500 to $8,000 per employee?
It is probably impossible to eliminate al of the wasted time, but how much would you save per year in your business if HALF the wasted time could be eliminated? Areas to tackle: collecting or moving materials, H&S accidents or measuring, waiting, rework (amongst others).
This is an example of LEAN CONSTRUCTION. The elimination of waste and activities that do not add any value to the customer. This can be a complicated subject if you want it to be, but in it’s simplest form, finding ways to achieve a bit more with a little less is a great way to increase profit in a company at little or no cost.
Andy Burrows – The Trades Coach