Keys to Business Operations Success for Trade Contractors

Running a service contracting business is an entrepreneurial journey that promises both challenges and rewards. Whether you are a seasoned contractor going out on your own or a newcomer in the service contractor industry with a passion for building, starting and managing your own service contracting business can be a fulfilling journey.

However, it is no easy task. According to data from the US Bureau of Labor Statistics, the construction industry has a business failure rate of more than 80%. And only 17.2% of service contracting businesses operate for at least 20 years.

A recent study found that poor operational management costs organizations an average of 9.2% of their annual revenue. These losses can be attributed to inefficient processes, lack of visibility and poor communication between parties. 

Maybe you are wondering if it is time to bring on an operations manager for your organization.

Key Elements to consider:

Automation

Take advantage of software to automate routine tasks like scheduling appointments, generating invoices and sending reminder emails, freeing up staff to focus on higher-value activities.

If you want to implement automation, start by identifying the processes that are repetitive, time-consuming and have well-defined steps. Determine what technology solutions are needed to automate each process, including software applications, custom scripts or even APIs. Then narrow down available automation tools to integrate with your existing software applications.

Automating the mundane tasks will reduce error and maintain team sanity. This will free up your team to focus on more profitable activities.

Process Mapping

The first step in streamlining your operations is to identify processes or tasks that are inefficient or redundant. This could involve conducting a thorough review of all your business processes or seeking input from employees who directly work with these processes.

By standardizing processes you eliminate variations and eliminate errors. This ensures consistency and quality in your services, leading to more satisfied customers. 

Investing in tools that help standardize processes can make the process of creating the processes easier for experienced employees as well as new employees.

Communicating More Effectively

In business there are both internal and external communications required for the business to remain efficient. 

In an organization your internal communication strategy determines how employees engage with each other and with management. Managing both up and down communications channels effortlessly, conveying the proper information to the proper person at the right time is critical. Your internal communications may include 1:1 chats, meetings or video conferencing to maximize information transmission.

Understanding that your clients are also a partner in the project and your communication with them is also critical. Sharing the status of contracted deliverables and even setbacks and updates will keep your clients happy because they know that status at all times. If the clients are happy with the communication they are more likely to become repeat clients and referrals. 

Mobile technology

Equip field technicians with mobile devices to access customer information, job information and schedule information in real-time.

Contract details being at the finger-tips of a field worker will help that work get completed much more efficiently. No need to track down the work order or work plan to verify the materials needed or the scope of contracted work.

Part of the efficient upward and downward communication mentioned above will include updates coming from the field technicians that can be communicated daily with the clients. Notifications of project scope changes or schedule changes are critical to keeping the internal team arriving at the correct project with the correct materials.

Data analytics

Defining key performance indicators (KPIs) aligned with business goals such as average job completion time, first-time fix rate, customer satisfaction scores and technician utilization.

Advanced analytics in operations focuses on real-time data analysis to optimize day-to-day operations, offering immediate insights for decision-making and process improvements. On the other hand, traditional analytics typically analyzes historical data to identify trends and inform long-term strategic planning.  While operational data analysis is action-oriented and time sensitive, traditional analytics is more strategic.

Real-time analytics are going to be very important in the area of workforce management and planning. Analyzing employee performance, shift efficiency and workload distribution is going to help a service contractor optimize productivity.

Resource management

In a service contracting organization your people are the most important part of your business. They are the direct representatives of your business to your clients and are often responsible for the brilliant outcomes that drive customer satisfaction. They also account for the majority of your job costs, so you need to use them wisely. 

Having resources under-utilized costs you money instead of making it. While over-utilizing resources can lead to bottlenecks and burnout. Resource utilization is about achieving the perfect balance so all of your people are earning you money and not burning money.

Some strategies to balance can be:

• Reduce waste by assigning work evenly between available resources
• Accelerate the flow of your projects and reduce bottlenecks from resource clashes or shortages
• Assess the demand for different roles and skills, so you can recruit and upskill strategically
  
  

Customer Relationship Management (CRM)

For a service contractor, the key function of a CRM is to centralize client information, manage leads, track project progress, streamline communication and provide insights into client needs. Ultimately this allows for efficient project delivery and improved client retention by maintaining a holistic view of each client across the entire service lifecycle.

A CRM will help many of your teams: for the sales team it will help manage leads, track sales opportunities and organize client interactions. For the sales team the appointments are tracked in a centralized database.For the marketing team drip campaigns can be automated and tracked. For the production team work orders and project level tasks. The admin will use the data to track invoices and payments and for detailed revenue and profit margin reports.. All of these teams use common data from the same database but at different times and for different reasons.

Employee Training and development

Regularly train your team on new procedures, technology updates and customer service practices. Employee training should help further your employee’s professional goals and your business priorities simultaneously.

LinkedIn’s workforce learning report found that 94% of employees surveyed would stay at a company longer if it invested in new training and development opportunities. Workers want to join organizations that provide education and professional growth opportunities, yet few companies offer employee training programs.

With the labor market continually upskilling your workforce will lead to increased productivity and performance as well as improve employee retention.

Employee training enhances both productivity and performance. According to a survey conducted by Talent LMS and SHRM Research 80% of employees find training beneficial for their productivity. Furthermore 51% of workers believe training increases their confidence and 41% say it improves their time management skills - both of which translate to improved efficiency and output. Companies are 17% more productive and 21% more profitable when they offer employee training. 

Employee training is the process of equipping workers with day-to-day skills and knowledge they need to perform their current jobs. Through training employees become familiar with your company's products and servers and how they can best serve customers. Long term training goals not only help the employees but can expand your company offerings as internal employees grow to know the advanced services that are being offered. 

Closing - Key to Business Operations

Making constant improvements in your business operations will improve your business efficiency and output.  

• Automate the repetitive tasks to keep your employees engaged in meaningful and not tedious tasks. 
• Implement electronic, mobile solutions for efficient document retrieval and electronic employee management and communication.
• Train your employees to help them grow and help your business offerings expand.
• Use data analytics to track efficiencies and expose what might need additional attention in your organization.
• Estimate Rocket can help you with your Key Business Operations