 |
|
Buy the Bucket Boss Employers, Post your Job for Free on our Listserve Need a Job, Post Your Resume Free Online Approved Continuing Education Courses National Real Estate Listings without the Commissions! Click
Here to Bid on Construction Projects SAVE MONEY on engineering, surveying, and construction supplies - Click Here
 Construction Master Pro Trig Plus III Calculator 4075 Construction Calc Software: The Power Tools of the Building Industry
E-Background Checks for Employers or Job Applicants
Free Construction Email
Construction Add
Your Construction
Materials Construction
Construction
Projects Pre-Screened Construction
Journals Construction
Codes, University/College
Construction Distance
Education Earn a Masters Degree in CM completely online Student Construction
Construction
Jobs Resumes of Cost of Living Educational Research
Free Financial Aid Construction Books
Construction
Construction
Research ASTM UNIFORMAT II
|
ENHANCING FIRM PRODUCTIVITY Howard Birnberg Engineers and architects place their confidence in many myths. And, when it comes to ways to increase productivity, they are ready to believe in nearly any myth. One widely held belief is that higher staff utilization rates will yield higher profits. This is largely untrue; no statistical evidence exists that finds a correlation between these factors. Admittedly, to have any hope of improving profitability, staff must be aggressive in charging all appropriate time against projects; however, management must be equally aggressive in billing for this time and in collecting the resulting accounts receivable. A system that is well-planned, properly administered and effectively monitored is required. Clearly, productivity is a result of a total appro "A pressing need in design practice is a meaningful measurement of productivity." Designers need only look at their own experience. For example, if your marketing staff is unable to bring in a steady flow of new work, it is of little consequence that the technical staff is highly efficient. Another problem results if project managers or principals are poor negotiators or if they do not carefully manage the scope of services. As a result, projects may reach maximums more quickly than if project administration were more effective. In addition, a highly productive staff may not generate profits if project fees are set at a level insufficient to cover the firm's cost structure. Using utilization rates as a statistical measure of productivity is doomed to failure unless your total system is examined first and you are absolutely convinced that all other parts of the machine are fully functioning. Another myth is that higher paid, more experienced staff will complete a task more quickly and accurately. Hence, an experienced engineer paid $20.00 an hour must complete a task twice as fast as a draftsperson paid $10.00 per hour. Of course, the more experienced individual must complete the task with fewer errors and avoid the redrafting process that might result from the actions of the less experienced individual. Not only must speed and accuracy be measured, the alternative use of the experienced individual's time must be considered. If this engineer's time is better spent on marketing and/or management, then a critical price is being paid by the firm, mitigating any productivity gains on a specific project. A far better approach would be to improve the total system, incorporating regular training, improved project management methods, enhanced communications and many similar activities. A pressing need in design practice is a meaningful measurement of productivity. Determining the productivity level of design offices is extremely difficult. For years, many CADD equipment vendors and software developers promoted the productivity gains achieved by using their equipment and programs. These claims were often based on vague measures. Typically, the time required to produce a detail or sheet of drawings has been the yardstick. Unfortunately, this fails to measure the time and effort required to achieve the capability to complete the drawings on CADD. They also do not directly relate the economic value of that accomplishment to the firm. Many engineers and architectures try to relate productivity to economic value. The most common method of achieving this relationship is to use net revenues per total staff. This factor relates the net (without consultants and reimbursables) dollar amount of revenues billed (not necessarily collected) per each total or technical staff member. According to the "1997 Financial Performance Survey For Design Firms", conducted by Birnberg & Associates, this number is currently $72,868 (median figure). Based on net revenues per technical staff only, this measure stood at $91,522 (median) in 1997. (The survey report costs $75--call (312) 664-2300). Some designers believe that increasing profits are a clear indicator of the success of techniques such as increasing the use of technology, developing a better work flow process and improving employee motivation. But profitability is affected by many factors including contract type selection, marketing success, change order management, client type selection, etc. Improved productivity may or may not contribute. While I agree that, intuitively, the techniques suggested above seem to be beneficial to both a firm's productivity and profitability, it cannot easily be proved. But, talking about techniques to improve productivity is only an interesting exercise and not an altogether satisfying undertaking. Currently, all that is being done in design firms is measuring "the symptoms." Only when a firm develops a total system of continuous improvement and highly effective project management and the industry develops a meaningful statistical measurement of productivity, can the benefits of these techniques be proven. Howard Birnberg is Executive Director of the Association for Project Managers. Return to the List of Articles |
 |