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Growth Strategies for Professional Contractors

Using technology to Drive Growth and profit

Presented by Rob Johnson

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Who Is Sage?

Sage is the business management software company truly focused on the

needs, challenges, and dreams of small and medium-sized companies.

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Key Industries Sage ServesIn North America

Manufacturing Distribution Real Estate

HealthcareNon-ProfitConstruction

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Impact on Revenue

• Fewer jobs to bid

• Lower margins on jobs

• Increased competition

• Customers go under

• Or, seek cheaper alternatives

• Or, Defer work

Impact on Cost

• AR gets stretched

• Bad debt goes up

• Cost of Sales go up

• Inventory turns go down

• Inventory write-offs go up

• Equipment sits idle

• Employee morale goes down

The ‘downturn’ impacts business

How can technology drive growth & profitability?

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So what, and who cares?

How can

technology improve my business performance?

Profits

Costs

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McKinsey: The Impact of a 1% Improvement

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

Fixed Costs Variable costs Volume Price

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Operations

• Removes redundant data entry

• Shortens the timeframe to turn data into useful information for management.

• Reduces printing time and costs

• Improves workflow velocity

• Minimizes mistakes

• Improves employee productivity, performance, and job satisfaction

How can technology help my business?

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How can technology help my business?

People

• Employees are more productive and profitable.

• Higher job satisfaction reduces turnover.

• Tech driven innovation lowers accident rate.

• Fewer ‘human error’ mistakes

• Allows more ‘effective time’, as apposed to ‘non-effective time’

• HR & compliance issues

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Money

• Greater visibility into cash flow

• Better risk management

• Bonding

• Process payables faster

• Shorten time to bill and get paid

• Growth in revenue without growing cost

• Manage costs better

• Easier to analyze job performance

How can technology help my business?

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Marketing• Provide better image of

organization• Better communication with

customers• Execute marketing campaigns• Develop new markets• Reach more targeted

customers • Better analyze efficiency and

effectiveness of marketing activities

• Improve visibility into customer

How can technology help my business?

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Sales

• Win more work

• Win better work

• Improve personal productivity of estimators/salespeople

• Develop consistent processes across organization

• Forecast potential & backlog opportunities

• Win/Loss Scorecard analysis

How can technology help my business?

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Customers

• Communicate more effectively

• Make it easier for them to do business with you

• Improve reaction times to client issues

• Standardize customer interaction processes

• Centralize all customer contacts into a central location

• Classify, profile and analyze customers

How can technology help my business?

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Leadership & Management• Standardize aligned goals• Reporting ‘best in class’ metrics• Company identified ‘goal

metrics’• Improved ability to

communicate strategy • Better use of company

resources• Better decision making;• More efficient use of time by

making facilities available for longer working hours

• Allows for office decentralization so as to reduce rental costs.

Journal of Construction Research, Vol. 6, No. 1 (2005) 1{13 c World Scientic Publishing Company IS IT TRAINING IN CONSTRUCTION INDUSTRY USEFUL?

How can technology help my business?

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“Adversity is a fact of life. It can't be controlled.

What we can control is how we respond to it.”

Author Unknown

Famous quote

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You have a choice

• Hunker down

• Shed costs

• Don’t spend a dime

• Ride it out

• Hope for a miracle

• Look for new markets & opportunities

• Buy marketshare

• Go on a corporate diet

• Upgrade tech

• Prepare for the upturn

• Sharpen the saw

OR

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1. Perform an technology audit

2. Implement a paperless environment

3. Apply technology to strategy

4. Get Mobile

5. Ramp up Business Development

Five Things you can do

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1. Do people actually use the information?2. Where are the redundant data

processes?3. Is everyone in the organization properly

trained?4. What productivity tools could be

implemented?5. Where can we use technology to

innovate – and create differentiation?6. How do we improve our customer

connection?7. How do we reduce drag in operations?8. How do we improve our ‘time to

decision?’9. How do we reduce risk?

Perform a Technology Audit

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Get more value out of your current IT investment

Improve your employee performance

Improve competitiveness of the organization

Technology Audit - ROI11

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Implement a Paperless Environment

• Automate your Invoice processing

• Implement Document Imaging

• On-screen take-off

• Electronic RFI’s, RFP’s, P.O.’s, etc

• Electronic data warehousing

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Paperless Invoice Processing

Your BusinessRules

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Paperless –Return on Investment Improves operational velocity

Improves A/P approval turn-around time

Bill customers sooner

Approvers save time and gain control

Easier audits

No lost or mis-filed invoices

No photocopying

No overnight shipping

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Strategy Execution

“Knowing how to plan and execute, while overcoming ‘today’s surprises,’ is the most foundational capability any organization can have.”

- Gary Harpst

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I.DECIDEWHAT’S

IMPORTANT

Strategy

II.SET GOALSTHAT LEAD

Plan

III.ALIGN

SYSTEMS

Organize

IV.WORK

THE PLAN

Execute

V.INNOVATE

PURPOSEFULLY

Innovate

VI.STEPBACK

Learn

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Six DisciplinesSix Disciplines

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The Problem with Strategy Execution

You consider your health issues and you determine that doing nothing could result in the following;

• Lack of energy• Poor Self-esteem • Fear of High School reunions• Possible health complications

You’re this one

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33 You buy a treadmill

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What Happens Next? Not Much

Actually, there is no R in the Return on Investment in technology if you don’t actually use it.

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"A half-baked strategy well executed will be superior to that

marvelous strategy that isn't executed very well."

--Allan Gilmour, vice chairman, Ford Motor Co.

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Etrak 700 series treadmill horizon - $800 (readville)

Date: 2009-03-04, 3:57PM EST

etrak 700 series horizon bearly usedlike new $800 cash only we aremoving and dont have the room toexpensive to give/through awaygreat investment for someone whocant get out to exsersize 1000-1200at dicks sportung goods

again great condition never had aproblem have more pics if need be10 incline 10 speed awesomeworkout mp3 / ipod ready built inspeakers

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NordicTrack E3800 Treadmill - $900 (Tyngsboro)

Date: 2009-03-03, 2:10PM EST

Gym Quality treadmill,

Computerized Workouts, Pulse

Sensor, Aromatherapy Bottle

Holder, Water Bottle Holder,

Book Holder, Fan, Key/Clip,

Calorie Counter, Distance

Display, Speed, Grade %

Time/Pace, And much more,

Like New. Hardly Used

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Six Disciplines Program Components

1. Repeatable Methodology

2. Accountability Coaching

3. Systems/technology

4. Shared Learning

RepeatableMethodology

Accountability Coaching

Execution System

Shared Learning

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Six DisciplinesSix Disciplines

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Go mobile Direct field access to update

information, approve invoices, bill customers, streamlines processes

Facilitate Customer Self-service reduces costs

GPS improves fleet management

Handheld access for job and time costing reduces errors & saves time.

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Mobility applied in construction

Project Management

o Capture field notes on electronic floor plans and distribute the information in real-time to all involved

o Streamline work list, punch list and other field processes to increase productivity and enhance work quality

Collaboration

o Enables effective and continual communication among owners, contractors, and architects, crucial to complete projects on time and within budget

o Problems that took days and weeks to resolve now are cleared up within minutes

Supply Management

o Monitor construction materials continuously to prevent supply shortages and associated project delays

Risk Management

o Reduce litigation risk through standardized documentation including field reports, safety inspections, work lists, punch lists, schedule updates and many other critical field activities

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Ramp up business development

• Get a CRM system– Automate your marketing programs

– Improve your sales effectiveness

– Reduce ‘time to close’

– Reduce errors

– Track customers information

• Get all over the WEB

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• Focus your greatest strengths on your highest potential opportunities

• Define and blueprint your ‘ideal customer’

– Demographic

– Geographic

– Psychographic

SIC Annual Geographic Construction Ownership Associations CPACode Revenue footprint type Group Firm

Develop a niche’55

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Improve your visibility• Create an outreach

program. • Develop a in-reach

program. • Expand your web

presence.

Get your website noticed– Website Grader:

www.websitegrader.com– SEO - Duct Tape Marketing

Local Profilewww.ducttapemarketing.co

m

Give them a reason to come back– RSS feeds– Zift Solutions:

www.ziftsolutions.com– Blogs: www.technorati.com

Create online networking community

www.linkedin.com

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Final Thought

• Technology is a lot like a treadmill. Huge ROI potential, but you actually have to use it.

• Invest in an Technology Audit

• Focus on improving what you already own.

• Invest in strategy execution

• Ramp up business development

• Look for additional technology that will support your strategy, and you’ll implement.

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Next Steps

• To get the Presentation, go to: www.linkedin.com/in/robjohnson38

• Go to www.u-s-i.com and request a technology audit.

• Go to www.sixdisciplines.com and buy a copy of Execution Revolution