Dear Builder’s Engineer,

My 15-year-old small business is barely getting by even after I’ve done everything I can think of to streamline it. I know there is enough work out there and that I could be profitable, but I also know that my company has problems that are keeping me down. My question is, how do I get good advice? Asking my friends seems like the blind leading the blind.

Ken W., Denver


Tim Garrison is an author, public speaker, and professional engineer. He welcomes correspondence via his blog at ConstructionCalc.com.    
Tim Garrison is an author, public speaker, and professional engineer. He welcomes correspondence via his blog at ConstructionCalc.com.    

Dear Ken,

I applaud you for seeking quality advice. Many small business owners don’t and instead make the same mistakes over and over, with the predictable result of implosion. I’m reminded of the saying, “You can lead a student to knowledge but you can’t make him learn.”

In my opinion the best way to get meaningful help is to bring in an expert. My definition of an expert is someone who:

* Has been successful in your line of work or something close to it;

* Is a good leader;

* Is a good teacher;

* Understands how others have succeeded; and

* Has experience consulting and mentoring.

For a few years in the early 2000s I worked as the land development manager for a medium-sized builder. It was a family business with the dad phasing out and the son taking over. The two did not commingle well and thus critical knowledge was not being passed along. To the son’s credit he brought in a nationally known consultant once or twice a year to help guide the company. I sat in on those meetings and was shocked at how much we all learned; myself included even though I’d written a white paper on the subject of profitability several years previous. (Here is a link to that white paper, originally written in 2000 and revised in 2009.)

This expert did not come right out and spew forth stunning knowledge. Instead, he prodded and poked with tough questions. He held everyone accountable including the owner. He didn’t hesitate to jump on a computer and create spreadsheets while we provided input.

In the past few years I’ve done a bit of this type of consulting myself. Here are the steps I used recently with a 20-person company in California.

1. Debrief with the owner. I had the owner write down his personal mission statement and three short- and long-term goals. Most owners are so caught up running their business they’ve lost sight of what they are trying to accomplish.

2. Debrief with key employees. I talked privately with each key employee, taking notes of their responses to this question: What are the top three things this company can do to increase profit? You would be amazed at what I learned from this and where this one question led.

3. Discuss the problem areas with the owner. Steps 1 and 2 revealed the problems. I distilled them into bullet points and discussed each with the owner. Swirling, unmanageable issues gained clarity.

4. Lead breakout group sessions with the owner and key employees, discussing:

  • a. The two main underpinnings of any company: integrity and profit.

  • b. four types of employees required in all companies: finders, minders, grinders, and supporters.

  • c. Why there are A-level companies and everyone else.

  • d. The difference between the whip and the carrot when it comes to motivating people.

  • e. Specific solutions.

  • f. An action plan.

5. Create a spreadsheet solving a long-standing management problem.

6. Follow up. With the owner’s permission, I keep in touch, checking on progress and helping when processes bog down.

One thing I do not do is create a massive report. I work from notes and bullet point lists. In my opinion, big, bulky reports are like the International Building Codes—they’re unusable and wind up gathering dust on a bookshelf.

What’s the cost? You should expect to pay at least $1,500 a day plus expenses for an expert’s time. With consultants, like most things in life, you get what you pay for.

How much time is required? My initial consultations with the aforementioned 20-person firm took three days. Smaller companies will require less time, larger ones, more.

In summary, if you study successful people you’ll find that none of them got there alone – much help was provided along the way. Any businessperson who’s a Lone Ranger is guaranteed a tough, tough go. Myself, I trade stories with mentors and business associates all the time; I read incessantly; I’m active in business groups. If you’re not doing these sorts of things, you should be. Running a successful business takes many skills, one of which is the ability to learn. Smart businessmen were not born that way, they work hard at it every day.

Tim Garrison is an award-winning author, public speaker, and professional engineer. He welcomes correspondence via his blog at ConstructionCalc.com.