5 Business Warning Signs and What to Do About Them
As a business owner, it's important to stay ahead of issues that could negatively impact your organization or worse, lead to failure.
Fortunately, early warning signs exist to help you preempt these issues before they start. Here are five business warning signs to watch out for, and what you can do about each of them before they get out of control.
1. Too Many Injuries
Construction job sites can be hazardous, and lives are on the line whenever there are safety failures. Claims add to the cost of your insurance premiums, so if you find your employees are experiencing frequent injuries, it's important to address the situation. Follow the steps below to halt claims in their tracks and help prevent accidents from happening again.
- Analyze all past injuries. This will help you identify any patterns. Your findings may show that most of the injuries are taking place on a particular piece of equipment or that they're all the same type of injury.
- Check your equipment and tools. Make sure they're properly maintained and that your employees know how to use them correctly and safely.
- Provide every employee with safety gear and the knowledge to use it appropriately.
With the right equipment, training and proper choices, you can construct a work environment that's safer for everyone.
2. The Wrong Superintendent
The wrong manager can hinder the progress of your jobs, make costly decisions and frustrate employees and subcontractors. Look for these warning signs in your superintendent.
- They're unwilling to change, or tend to get in the way of change. Managers that are set in their ways can be difficult to deal with. Your job sites — and the requirements needed to complete each one — are going to be a constant source of change, which means you need someone with a flexible mindset. You can offer assistance by showing them the goal and helping them understand that to get to the goal, certain things need to change.
- Naive managers that don't know what is going on. Inexperienced managers can make costly decisions by scheduling subcontractors out of order and not detecting mistakes in a timely manner. On-the-job training can help to reduce the number of errors made.
- Managers who blame. No one wants to be blamed for bad things. However, you need a manager who can learn from failures and start to spot what may seem to be an insignificant problem before it turns into a big one.
3. Uncontrollable Cash Burn
One of the business warning signs you shouldn't ignore: if your company is hemorrhaging money. Get a clear picture of where the money is coming from and where it's going. Consider the following things when reviewing your financials.
- Your suppliers. Do some comparison shopping to find out if you can get better terms and make sure you're getting the best provider for the volume of materials you're purchasing.
- Shop subcontractors. Consider having a new subcontractor bid the work against your current subcontractor. Look over the proposals to make sure they're both providing the same materials, warranty and timeline.
- Material waste. Make sure your managers are not making frequent mistakes when placing orders. If you find too many materials were ordered, then figure out if you can use them on a future job instead of throwing them away.
4. Fast Growth
Growing pains are a part of business. However, rapid growth can cause protocols and processes to go down the drain because you're just trying to keep up. This can cause little failures to become big ones. If you find yourself in this position, take a step back and make sure you're doing the following things.
- Have a clear vision of what direction your company is going in.
- Have the employees, superintendents, subcontractors and suppliers you need in place to accommodate your growth.
- Follow your protocols for each job.
- Set up a process to report failures.
- When failures occur, create a method to help prevent the same type of failure from reoccurring.
5. High Employee Turnover
It can be frustrating to train an employee and then see them leave soon afterward. Employees leave companies for many different reasons, but if you're starting to notice that you can't keep employees, start investigating why. A good place to begin is to conduct employee exit surveys, which will tell you and your managers what you need to focus on to keep employees around.