Recap of Education Sessions at CONEXPO CON/AGG
I attended Conexpo/ConAgg show in Las Vegas last week. I went to a few education sessions as part of my time there. I don't know if it's because I'm relatively new to the industry, but these sessions were good. I've attended tech conferences before and felt almost neutral about the content offered in their education sessions. These were on another level, and I really walked away with new perspectives and practical ways to implement what I learned into my business. I included links to the speakers' Linkedin profiles as well as different resources they shared.
Eliminate your construction business challenges, and raise ROI: Selecting and Implementing Empowering Digital tools that work
“technology enabled construction company”
Capitalize software the same way we capitalize equipment
Job to be done | don’t get bogged down by features, maintain focus on the job to be done. Customers don’t care that you’re a 3rd generation contractor. Instead, paint the picture of job to be done in marketing. Example he used was a skateboard. Some companies will spend time telling you about the components while others attach themselves to celebrities like Tony Hawk. The latter are tapping into the unspoken reason a customer would purchase a skateboard to begin with.
Economic Trends in the Industry
Speaker: Danny Richards
Short story is that Energy & Utilities, Industrial and Infrastructure sectors will offer increased opportunities with cash flow from Infrastructure Investment and Jobs Act. The obvious lever for residential decline is the interest rates. As we see those rates improve, we will see more opportunity in that sector as well.
Renting vs Buying Equipment – Benefits of a data driven approach
Maintain flexibility to economy with regards to long term debt.
The weight of downtime is different across machines, proactive measures should carry the same weight.
Benefits of Renting
· reduce long term debt & increase bonding capacity.
· economies of scale- multiple rental sites means it’s likely closer to your job site. Rental companies can maintain equipment cheaper than we can.
· Total maintenance repair contract- determine an hourly rate/ fixed cost monthly
Don’t make financial decisions based on peak availability. “Oh this was hard to find during this peak month, I better buy at first opportunity”
Internal rental operations – charge to job. Equipment department should be a profit center. Randy had a very creative program to engage operational department to adopt this new mindset. The 2-3% profit that the equipment department ended with was given back to operations as bonuses at the end of year. The entire team stays motivated to keep equipment department profitable, and really charge the jobs accurately throughout the year.
Added this book to my reading queue: Equipment Economics v2
Rates meeting- what are we renting/ look at historical invoices versus what we estimated for job
Be a Better Insurance Buyer
Speaker: Chris Mikolay
I was a bit late to this session because I waited 45 minutes for a bagel with cream cheese for breakfast.
Luckily, I made it in time for some key takeaways that shifted my perspective on buying insurance. “Managing risk rather than buying insurance” We should look at buying insurance as more of a strategic decision versus a commodity purchase. He introduced Reptile Theory and cautioned that in the end, your safety practices will be what might save your ass if it ends up being named in a lawsuit.
Know your BATNA and ensure your policy actually indemnifies the loss rather than checks a box
Top 10 Use Cases using Advanced Machine Data
This was easily my favorite session. The talking points were straightforward, and the speaker listed requirements for each initiative so you could know out he gate if this application was viable for company. If you don’t know, I also work as a full time IT Business Analyst for a telecom company. I thoroughly enjoy what I do with data in this position, but to see this technology and strategy being applied to the construction industry was very exciting.
No easy way to differentiate idle hours from working hours- both add to hour count used to depreciate an asset. Identify where idle hours are coming from
True Remote Investigation- first step for a rental company when a customer calls into say machine is acting up, log in to machine to remotely triage before dispatching mechanic
Batteries- we all know these buggers are expensive. Machine monitoring might highlight a trend before failure so you have time to intervene and leverage warranty
Data driven billing- reduce the back and forth and rely strictly on output from connected equipment.
Distributed access- have data available across departments.
Drive R&D through data- examine duty cycles. The example he spoke on was when you notice a 19ft scissor lift never goes beyond 13ft. You realize that ‘feature’ of extending to 19ft is not valuable, influences future development
Level up with connected service. Practical application is having two monitors open at same time- first with ticketing system, what issues. Second is full fleet visibility. As simple as copy+paste vin from ticketing system to diagnose efficiently.
Provide insight to fleet customers. Output needs to slot into business process.
Safer machine on jobsites with access control. Move from key working on multiple machines to only providing access to machines to certified operators.
Service Plan management and visibility- warranty claims, connected machines make that process easier.
Financial Essentials for Non-Financial Leaders
Speaker: Tamara Kilty from All-Bry Construction
This was one of those buckle up, there’s a lot coming at you type session. She did indicate the full 4-hour course was available on https://cfma.org/courses
If you can’t mitigate the risk, then transfer or insure it.
Send contract to insurance resource/ what will it cost me to be covered?
Take note of notice requirements, specifically for change orders. She went on to say later in the session that unbilled change orders account for some of the biggest ‘losses’ on a job.
Front load billing schedule, don’t be afraid to ask who pays the bill and ensure you are following the instructions in the contract to get paid.
Keep line items vague, offer detail when requested
Went through Over Under Billing Report in detail. Looking forward to the promised resources emailed that incudes this template.
Strategic Decision Making for Increased Margins
Speaker: Jeani Ringkob
This session was filled with acronyms, frameworks, and high level strategies. The main framework she shared was Investigate, Identify, and Implement.
Investigation is the most lengthy, and could mean surveys, interviews, or market data. In this stage you determine whether the price should increase or the perceived value should increase. The difference between the Ford Model (Blue Ocean Strategy) of reducing costs to the Lamborghini model (Pumpkin Plan) of increasing perceived value. This differentiation aides in answering your why before you begin investigation. In short, find your sweet spot. She introduced the Clock Model phases of Pre-Purchase, Purchase, and Post Purchase. The Post-Purchase phase is where you can really differentiate your brand from the others which organically feeds into the next cycle’s Pre Purchase phase.
Identify- litmus test considers differentiation, relevance, and sustainability. This is the area I often struggle with. Our success to date has really been following the money, then catching up on the backend to legitimize the revenue stream.
-bookmark to research Business Hierarchy of Needs- MIKE MICHALOWICZ
Implementation- litmus test here answers the questions, How can you measure progress? Can you recruit and maintain stakeholder engagement? And, Is it process oriented? Part of this phase includes creating an actionable mission statement- we will do ‘x’ by ‘y’, because ‘z’
Automation when finding labor is laborsome
Speaker: Scott Dugan
I really had no business attending this session, but was curious nonetheless. I was genuinely interested in seeing how the trucking industry was leveraging opportunities for automation.
Scott went into detail on how injected steps during the check in process of a truck can really save several minutes in the trucks average time in the lot. In his discussion, he pointed out that the self pay feature of the hundreds of individual gas pumps at a Buccees is just as significant as the self pay feature of a single gas pump at a standalone store on the side of a road. This analogy was meant to encourage smaller yards to adopt parts of the solution he introduced, but it carried an even higher significance with me.
I often wonder what the inflection point is to implement a better way of doing things for our small startup. We are a small shop and oftentimes I catch myself saying "I see the value in this technology, and can't wait to use it- when we're big enough" or "Cost coding is so important to track profit in a singular category, maybe next year our volume will be high enough to start this practice" At the end of the day, the advancements we make as a small shop will naturally grow with us as we mature. The importance we place on these strategic decisions today, impact our ability to scale tomorrow.