Ideas To Boost Productivity

May 27, 2004
/ Print / Reprints /
ShareMore
/ Text Size+
Tony Italiano
NASHUA, N.H. - Tony Italiano said there are many reasons why contractors miss their labor estimates when costing a job. As a result, this can cause contractors to lose money.

According to research recently completed by the Building Services Institute (BSI), contractors miss labor estimates because of equipment failure and human error; poor estimates; poor project mobilization and staging; poor coordination of resources; failure to communicate to the installation team the job's scope and tasking schedule; and poor field labor management practices.

"For one thing, you need to set everything up on the job for the installers," said Italiano. "You don't want your techs coming into the office. Productive time is lost."

Italiano added that labor cost overruns should be figured into the contract and any savings on these overruns should be shared with field personnel or given back to the customer. He said that this procedure adds to motivating employees to move the jobs along faster.

"We remove obstacles to the employee's success by implementing proper business delivery processes," said Italiano. "I even handed out cash as awards for such things as ‘best dressed employee.' These were great motivators."

He highlighted a field incentive plan, noting that it typically involves a 60/40 split, with 60 percent going to the team.

According to Italiano, average positive labor variance gains can run from 2 percent to 15 percent of the labor, which provides huge motivation to be more productive to achieve profits.

Italiano suggested that payouts from this plan be on a weekly, and not quarterly, basis. "The sooner you pay out money, the better," he said. "Cash is king."

He also added that non-field labor should have an incentive plan, too.

"These people are a true cost," Italiano said. "We have to pay them a little differently. Incentives should be based on a rating system."

Having a good rating system goes back to having an organization with job descriptions, according to Italiano.

"If you have a job description, you can formulate a rating system for merit increases," he said.

Publication date: 05/31/2004

Did you enjoy this article? Click here to subscribe to The NEWS Magazine

Recent Articles by John Hall

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

2014 Energy Efficiency Forum

Highlights from the 25th annual Energy Efficiency Forum in Washington, D.C.

Podcasts

NEWSMakers: Mark Satterfield

Mark Satterfield, founder and CEO of Gentle Rain Marketing Inc. and author of “The One Week Marketing Plan” talks about his book and the importance of HVAC blogging. Posted on Sept. 19.

More Podcasts

ACHRNEWS

NEWS 09-15-14 cover

2014 September 15

Check out the weekly edition of The NEWS today!

Table Of Contents Subscribe

Venting R-22

The NEWS reported that a man received prison time for venting R-22. Should EPA step up enforcement?
View Results Poll Archive

HVACR INDUSTRY STORE

plumbing-hvac.gif
2014 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

 

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications, Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

DON'T MISS A THING

Magazine image
 
Register today for complete access to ACHRNews.com. Get full access to the latest features, Extra Edition, and more.

STAY CONNECTED

facebook icontwitter iconyoutube iconLinkedIn i con