Business Management

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Many of us enjoyed the news conference that NASA hosted post the spectacular SpaceX launch and that first dramatic landing on a mid-Atlantic barge. After a half-dozen try’s the organization was able to stick the landing.

Many in my generation (meaning the oldest farts in our industry) grew up watching NASA do the miraculous – and landing humans on the moon. As many of us were we were, and what we were doing that July day in 1969 when we first witnessed Neil & Buzz on the first moonwalk.

So the SpaceX news conference was really interesting on several points, first was the stark contrast between the old ones from NASA and the SpaceX guys today.

The 2 from NASA looked like the same guys that were reporting on the events that this author remembers from the Gemini programs over 50 years ago. Ill-fitting suits, unmemorable tie, and can’t remember anything else about them.

Elon, on the other hand, was wearing a tee shirt; the other was in a hoodie. Stark contrast, just the image will evoke Harvard Business review articles about culture

I watched the entire conference, not one question from the press was asked of the NASA guys, and only 1 question was asked of the VP of SpaceX. All the other dialog was directed to Mr. Musk.

The way that private organization has seized the narrative and our collective imagination – which we find astonishing. Big audacious stated goals (to start a manned community on Mars in our lifetime), to prove contrarian in their thinking (re-usable rockets, saving up a bunch of traditional launch costs), the very thought of landing a rocket on a boat barely the size of a basketball court and of course being transparent with failures.

Endlessly fascinating.

While addressing the previous failures, Elon was explicit about learning from each setback, and the org rigidly adheres to learning those lessons only once, if possible. They engineer systems and procedures to ensure they are never in that position again.

So what about us in the integration industry? Many of us are fighting through the same battles experienced on every job.

Time and again we hear about so many unfinished or mostly finished projects that integrators just leave for various reasons like the client had a change of mind, or the system did not perform as the designer (that might have been you) speculated, or some other conflict with the system or client.

At the end of these uncomfortable situations is that on many projects the last 10 or 15% does not get billed or paid.

Suggestions, design your onsite process and the whole project all the way through commissioning.

When we think about projects, and project management, what I find interesting is that some, or even many overlook the simplest of concepts, that would be starting with the end in mind, the outcome, the commissioning.

Our industry has so many resources to amplify your project management skills, from just a simple overview to full-day immersion sessions to equip and deepen understanding.

Having decent PM chops will assist your team in understanding the labor components within projects, budgets and the overall profit performance of the company.

What is the shortest line to a strong finish?

Joe Wallace, of Wallace Integration, in Palo Alto, CA, and one of the most experienced Project Management Instructors our industry has, stated that most integrators don’t have a good handle on what their real labor costs are.

Our industry, on average fails, when compared to other contractors when it comes to labor yield, in that we often hover below 35% and typical contracting firms are around 55%.

Nothing new here, but understand that if your labor pricing model says that it takes an hour and a half to cable and hang a 50 inch LCD panel when your install is a 90 inch on brick, it may take a bit more, and two guys…

Joe states that as you detail out your proposal and see that you have almost 38 hours of programming needed to get the gig done, resist the urge to shave that down so that the labor component does not look disproportional to the total amount on the proposal.

You might rethink the way you breakout pricing details on the paperwork your client sees, and understand, most of your compatriots don’t get this right. For instance, list the major components and interconnects, control and labor for each space, then post the total price for that room, then if questioned about it, you have a chance to justify the effort and skills necessary to execute.

Knowing that you need the project, resist the habit of “buying” the project with your labor. By discounting it.

Also, when each project is finished and you have banked the last payment, discipline your team to do what Joe, (a retired Lt. Colonel from the Army and in a logistics discipline) calls an “After Action Review” or what many call the project “Postmortem Analyses”. Just like Elon Musk and the SpaceX team does after each launch.

During these sessions, everything about the project gets reviewed to the proposal and agreement for the good, the bad and the ugly. These are best done without blame and tensioned to post better labor yield, and you will see how much room you have to improve upon with regards to your labor.

As most know our industry is infamous for having a low ability to properly estimate or just flat out our unwillingness to charge how much labor the projects will essentially take.

So from our position:

Hey, Dude…come on - figure it out, be relentless. The good news is that you are still here, now is the time to honestly look at your operation and decide to begin a transparent process with your team for continual improvement.

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