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Why Their Solution Didn't Work In Your Company

Jan 2, 2008
This past week I was reading through contractor discussion boards. I just wanted to see what's got the market riled up. Do you ever do that?

Well, anyway it reminded me of an important issue that rarely gets addressed: the difficulty of successfully implementing an off-the-shelf solution.

Here's the core problem, solutions that work well in one company often fail to work in another. Here's why: most solutions are not robust. They only work well in specific circumstances.

Think of your business as a big jigsaw puzzle. You don't need all the pieces in place to reveal the picture, but you do need the right ones in place. Your friend's company probably isn't missing the same pieces you are. So when he slides in the last piece he needed - Eureka!

His business comes into focus and he's convinced he has everything figured out. So he gets on his soapbox and says "If you'll just do it my way, you too will enjoy great success." It is SO tempting to believe you can just grab his solution, follow his lead, and receive the exact same incredibly results.

So you try it and nothing improves. It might have even gotten worse. How can that be?

Simple. Your business and his business are radically different. He has different skills than you do. He has a different mix of employees than you do. His clients have different expectations than yours do.

He's probably even in a different trade than you are. Yes, you're both in construction but that's about where the similarity ends.

Your jigsaw puzzle and his jigsaw puzzle have nothing in common other than each contains dozens of oddly shaped pieces with a wide variety of colors. When completed, your puzzle looks different than his puzzle.

This is why solutions successfully applied by the owner of one company frequently fail when transferred to another company. The second company has a different set of business practices, a different breed of employee, and a different class of customer.

My years of developing and implementing solutions inside real construction companies who are staffed with real people has taught me that no matter how brilliantly simple the solution, it MUST be tweaked for each company.

Two classic examples come to mind: sales commissions and employee bonuses.

I strongly believe in paying salesmen commission on gross profit. My recommended commission system is the simplest of all business solutions I know, yet even it MUST be customized to each company. Two questions must be addressed in each deployment.

1. What is the proper commission rate?

2. What should be considered a direct job cost?

The two answers are interrelated and change for each company based on its business model, competitor aggression, and target market. So even with a solution as simple as sale compensation, customization is required in order to achieve the desired selling behavior.

Employee bonuses are trickier yet and are what stimulated this article.

Right now, the discussion boards are filled with questions and recommendations regarding employee bonuses. Every possible approach is being thrown out and then being heavily defended and panned. There is minimal agreement and certainly no consensus among the owners participating in these discussions.

It seems like everyone's had a bad experience paying bonuses. The typical conclusion is throw the baby out with the bath water "Just don't give bonuses."

The reason people keep trying to come up effective bonus plans is pretty obvious. Bonuses are great at getting workers to do something desired (work hard, be productive, show up, work safe, etc.).

To anyone who truly understands employee motives and behavior, sound bonus systems are not that hard to create. All you have to do is abide by certain fundamental truths about people AND fine tune the plan for your exact situation.

Trust me. No consultant has MAGIC solutions. We all use the same tricks and techniques. The secret to our clients' success is our clients' skills and drive. You apply the solutions. You make them go on a daily basis. You - not us. All we do is keep you on the right path.

I'm begging you to never apply a solution to your company without adjusting it to accommodate your world. If you have been looking for off-the-shelf, put-in-place solutions you have been wasting your time. They don't exist.
About the Author
Ron Roberts, The Contractor's Business Coach, teaches contractors how to turn their businesses into money making machines. To receive Ron's FREE Contractor Best Practices Newsletter visit http://www.FilthyRichContractor.com.
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