Adopting ideas to kill Profits.
IF you run a smaller business, dealing with Tier One Companies (share market listed and $billion turnover), or maybe even an employee of one, it is easy to form the opinion they don’t like you.
Peoples frustrations dealing with tier one companies is changing from giving up to fighting back.
Once they had a fairly simple philosophy, make stuff someone needs and highlight the benefits of the
How hard was it? These day’s so many of them are run like a government department, or may I suggest it ? They try to be an extension of the government. Governments aren’t known for liking their customers.
It Takes a Special Talent
Gillette ran an ad campaign depicting how men should behave, it bombed badly, so badly it cost them about $8Billion in lost revenue.
It was already struggling to fend off other players that over the past few years had eaten away its market share from, 70% to 50%,
How they thought running a sanctimonious ad would boost sales is any ones guess. So much for any publicity is good publicity.
It is not the only company telling people how they should be behaving. All companies in the public domain have codes of conduct they call ” Mission Statements “.
Not all run public advertising campaigns, and of those that do, Gillette is not the only one to run ad campaigns driving customers away from them.
Pepsi and Kendall Jenner gave comedians plenty of fodder for politically correct jokes. Although Pepsi pulled the ad quickly, some things go viral in no time.
Luckily ( for share holders), many of these companies have other streams of income to help cover the costs of managers who try to link dots where there are none.
The policies that create rods for companies backs. One slip up in any area and it will cost companies big time ( if they get caught out), Health and Safety, Environmental, Discrimination and Harassment, have all received ongoing, mostly negative media coverage, both online and off, for years.
Big payouts for breaching their own mission statements has companies doing basically “whatever it takes” to manage their risks ( cover their arses! ).
Although Mission statements generally have a generic, fuzzy, feel good theme about them, they are a top down statement. The flow from feeling good to actually implementing a policy has a huge cost, and the ones who bear most of the weight of this, are those at the coal face.
Contracting Tier One Companies
Prepare to be screwed.
Site managers these days have very limited exposure to the day to day running of a job, that is largely left to leading hands or other experienced employees / contractors.
Tier one companies have a top-heavy expenditure commitment. Managing health and Safety had a cost component of about 6% ( 20 years ago), across revenues. What it is these days is known only to bean counters.
Over the years as compliance for risk assessments has grown, and become something that has to be all knowing and all seeing across every area of activity. Thus forcing more work down wards (with less personnel), and outwards, via the use of subcontractors.
The common assumption put out by managers is that workers determine their own work conditions, by agreeing to certain principles set by the company.
As they are free to agree, whether or not they accept the terms of employment, accepting means you agree to all WH&S policies, Environmental policies etc.
On work sites the questions often asked of WPH&S is, they dictate that there is only one way to do things. The logic being that if you agree to work for them you agree to every thing else they put forward as well.
The answer is often “NO”, but my experience is you are better off keeping your mouth shut. If anything goes astray, throw it back at them.
This goes for sub-contractors as well. “Your company signed the contract, you work under our rules. Tier One Contractors are over and above“.
Yeah, really? like a South American Bureaucracy ?.
I think this was the point where the saying “Common sense ain’t so common any more” was coined
Lets Play Games. Paper warfare.
Conflict does arise and often, particularly when a sub-contracting company, usually a specialist at a certain discipline set, and the principal contractor is a specialist at another.
In accepting a subcontractor’s quote, the principle contractor would also need to approve the sub-contractors SWMS, and if required make any changes in consultation with the Sub-contractor.
Winning friends and influencing people.
For a sub- contractor to arrive on site and be told the by the principle contractors manager, that the work method statements that were approved are no longer relevant, and all work on a particular task or tasks will now be done under the principle contractors SWMS (safe work method statements).
Plus we would rather start work in this area rather than the area discussed at the pre- construction planning meeting.
So much for the quote.
That is the beginning of a slide into political manoeuvring and a slow down of work progress as the sub-contractor has to forgo hard learnt lessons that would progress the work at a quicker rate, instead the focus moves to time and price variations.
This can be particularly telling if the Sub-Contracting company has been a principle contractor on similar work and has had years of experience putting its own, more efficient process’s in place.
it is unlikely to bow to any demands from a principle contractor without an argument.
Contracts, variations and more paperwork down to the most petty sheet of compliance, being shifted from one site office to another, and it is easy to see why a working relationship is not going to develop, let alone be harmonious.
Tier One Hiring.
This is responsible for some of the most head scratching moments by many Site Managers
One example:- A crew of bridge builders were having trouble adjusting to the SWMS being enforced by the principal contractors Safety Officer, to the point that threats were being made about his personal safety.
Some research revealed that this safety officer’s previous employment had been, as a hairdresser.
While this may have been ok for office ergonomics etc, he was way out of his depth when it came to scaffolding, concrete pours, working around heavy machinery etc.
The options available to the site manager are limited. No body wants to be responsible for a payout.
The one thing that can either make or break a project. If the level of commitment in one team is hampered by poor relations between different sets of managers.
Having a principle contractor with a manager who has little knowledge of the processes employed by the sub contractor, with no experience in the craft, and trying to enforce a top down approach, only leads to disharmony, distrust between groups, and slows progress.
The side effects of stress and absenteeism are other areas that compound further deterioration in work performance and progress.
The $ cost is only going to compound, and if the principle contractor cannot get payment for variations or able to claim extensions of time from the client they really start to find themselves between a rock and a hard place.
While some variations will be expected during the project, and be paid for by the client, variation claims by a sub- contractor against a principle contractor is a fight the client will want no part of.
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