Contractors are always concerned about the parity between actual and estimated time. They are always second-guessing themselves to determine if they are over or under on man-hours. Consultant Gary Goldman says he, too, regularly faced this same dilemma when he was a landscape contractor. Here Goldman shares some simple processes that were made part of his company's SOPs (standard operating procedures) in order to get a better handle on crew time.
Breaking down labor
First of all, you should break the labor portion into functional operations when you estimate a project. This sounds pretty simple and most would assume that it is part of the estimating process. But Goldman says he has worked with numerous contractors who try to gauge the entire work function of a project without breaking it into segments. This business doesn't work that way, though. This business is very task-driven.
Once you begin to break down your labor, the same functions you use when you estimate must be given to the crew leader so he knows the expectation and can record the actual time to complete this work. There are now apps you can purchase for your iPad or other mobile device that can be customized so you can record and send the data right back to the office to be analyzed.
Whether you utilize modern technology or a pencil and paper, you have to remember a few things. First, the information could be biased, i.e. the crew leader wants to look good so he may not be accounting for the crew's time spent on cell phones or taking breaks. Second, you need to record this information on a consistent basis throughout the year, because weather conditions, day of the week, etc. can influence the consistency of these functions. Thirdly, you need to do this for each crew. Crews create habits, good or bad, that can affect daily production rates.
Also make sure to categorize the "degree of difficulty" of each job. For example, are you mowing on a hill or flat land? How far do you have to wheelbarrow the mulch? Are you planting an 8- or 12-foot tree? All of these factors cause variances in your production rates. Recording information like this should be part of your everyday job costing process. This type of information will help you become a better estimator and increase the efficiency of your crews.
Obtaining and analyzing data
Kevin Payne of TenderCare Lawn & Landscape in Derby, KS, says his company utilizes an industry-specific business management software package. Still, he finds that the best way to communicate job details to crews, and vice versa, is through good old-fashioned printouts.
"Our crew leaders take printouts with them every day," Payne relates. "Jobs are routed in order with instructions and notes on each. I've been hesitant to expand smartphone use by crews in the field. All of my crew leaders are provided with a cell phone, but they don't use them for things like this yet. We've discussed going paperless, but continue to go the printout route for now because it works just fine."
It's working just fine because crew leaders know exactly what's expected of them, and GPS technology helps corroborate what is being reported by crews to the office. "Employees write notes right on the job sheets, including the time they arrived on a property and the time they left," Payne explains. "We then compare this data against the GPS that is in all of our trucks. Each crew's paperwork is turned in daily, which includes this time reporting in addition to customer notes and requests which are then added to the customer's file in the business software."
To further analyze actual costs vs. estimated, including man-hours, Payne generates profit-and-loss statements on every job, regardless of job size—including maintenance. "This way we can track materials and hours against what was bid, and catch any discrepancies quickly," Payne says. "Sometimes we'll catch that a vendor has billed us incorrectly. But we also might find that a crew is moving slower than expected. If a crew is taking too long, we then check our tracking systems (GPS) to see if they were on a site the entire time; maybe they were having an equipment issue or we simply need to adjust how we are bidding a certain function.
"Similarly," Payne continues, "we might find that a crew is getting done too quickly. It sounds crazy, but we know what the times should be, and if someone's getting done considerably faster, we need to make sure that things aren't being missed, such as edging a certain part of the property. If we see this in the time reporting, we'll have a manager check the property over. It's really all about checks and balances."
According to Linda Rae Nelson, founder and co-owner of Greenscapes of Southwest Florida in Naples, it's also about getting your crews to understand what's in it for them. "As an employer or manager, if you want your crews to provide you with insights, you must provide education as to the importance of each task completed, how it breaks down to them, and how it will affect them in a positive manner," Nelson says.
At Greenscapes of Southwest Florida, a Senior Captains Council (crew leaders) meets quarterly to review the "little things" that go on with each property, such as truck staging, supplies placement, truck routing relative to traffic flow, etc. "The Council also reviews how each crew is set up in the way of equipment, and then provides insights into the performance and time allotments for each given task," Nelson explains. "We've been able to establish timeframe outlines for each task. This helps us stay focused and really helps with new employees." Greenscapes of Southwest Florida now has well over 300 employees.
"We all want to know what's going on with our crews, and why," Nelson goes onto say. "Landscape crews, generally speaking, are assigned a job and sent on their way. They never really know the why's, what's and how-come's. And rarely do they get feedback on the end results of their completed tasks. Again, they need to know why providing feedback is so important. By providing it, you can help them perform better. So make collecting this data a fun process, and turn it into an opportunity to raise your employees' skillsets."
Nelson says you can even incentivize this process. "If a team member provides all of the great insights you're looking for, how about a gift card for a job well-done? When our teams (crews) exceed our expectations, we issue each team member a $20 Walmart or Publix gift card. Gift cards can go a long way. We always use gift cards instead of cash. A gift card says 'gift' while a $20 bill looks like all of the others in their wallet."
There's no doubt that, when properly executed, you can gain invaluable insights from your crews themselves. However, you may also want to consider assistance from an impartial third party, at least from time to time.
"I do believe that every few years you need to conduct an independent time study of your crews," Goldman points out. "You need to acquire the services of an individual to record and video the time that your crews spend loading up in the morning, how they set up on a job, the job functions discussed above, and the time spent at the shop when they arrive back at the end of the day.
"Utilizing an independent party will give you a true picture of what is going on," Goldman adds. "There will be no bias because this individual will not have any ties to the crews. You should do this for as many crews as possible, at different times of the year to take into account how weather affects production rates. You can then study and compare the data that the independent person has accumulated against the times each crew foreman is providing. I can assure you that you will be amazed at some of the findings."
The objective of this process, Goldman points out, is to help with estimating and crew efficiency levels. Don't think of this as a spying mission, and make sure your crews also understand that. You do not want them thinking that you are conducting these studies to determine who the bad employees are. You are trying to make the entire company better—and your employees play a vital role in that.