Sustainable Value

Premier contractors operate on principles that produce sustainable value, consistent quality and high return on investment.  Many lesser-quality contractors skirt the law, limit compensation and eliminate benefits, safety and training programs in order to hit the low cost bid.  How do construction leaders communicate their superior value so owners and developers can avoid the risks and hidden costs associated with second-rate contractors?

Often low price wins the job, but does it deliver best value and return on investment?

Recently, the United States Judicial Panel on Multidistrict Litigation centralized the six current class action suits to the Eastern District of Pennsylvania for further adjudication.

According to the panel of Judges, “On the basis of the papers filed and the hearing session held, we find that these actions involve common questions of fact, and that centralization under Section 1407 in the Eastern District of Pennsylvania will serve the convenience of the parties and witnesses and promote the just and efficient conduct of this litigation.”

The suits arose after the defendants, USG Corporation; United States Gypsum Company; L&W Supply Corporation; New NGC. Inc.; Spangler Companies, Inc.; CertainTeed Corporation; Georgia-Pacific LLC;  American GypsumCompany LLC; LaFargeNorthAmerica, Inc.; TIN, Inc. d/b/a Temple Inland, Inc.; and PABCO Building Products LLC. Read more » about Domestic Drywall Price Fixing Class Action Suit Update

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The Construction Career Collaborative (C3) recently held a Sponsors’ Meeting to provide an opportunity to update supporters on progress made toward advancing the principles of C3.

Jim Stevenson, Chairman of C3, provided some highlights of accomplishments to date.  These include:

  • Enlistment of two Beta Project Owners – Texas Children’s Hospital and MD Anderson – involving
    • Four Contractors
    • Numerous Specialty Contractors
    • Hundreds of Craft Workers
  • Development of a toolkit for participants
  • An application for accreditation (under development)
  • Development of an online C3-5 Safety Training
  • Qualification of 46 Safety Trainers at 23 companies
  • Development of a job description and funding model through a loaned staff member
  • Preparation of By-Laws and Policies in order to file as a 501(c)(3) organization
  • Continued spreading the word to add other project Owners

In addition, the C3 Marketing Committee members, John Stautner and Michele Buckingham, facilitated a discussion with sponsors on ways in which C3 supporters might engage and participate in advancing C3 principles to their members and to the community.  Read more » about C3 Supporters Come Together

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After the recent American Subcontractors Association (ASA) panel on the origins and current status of the Construction Career Collaborative (C3) movement in the Houston region, Construction Citizen caught up with two of the panelists to get their reactions and any additional comments they might want to add to the conversation.

Peter Dawson, Senior Vice President of Facilities Services at Texas Children’s Hospital, and John Roberts, Executive Vice President of Jones Lang LaSalle’s Project and Development Services Group, are newly elected to the C3 Board of Directors and have been strong advocates of C3 concepts such as paying construction workers by the hour as employees, paying appropriate taxes on the workforce and providing the construction workforce with the best safety training available. Read more » about Owners Explain Construction Career Collaborative

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Earlier this year, I sat down with Gregg Reyes, President and CEO of Reytec Construction Resources, Inc., to learn about his company and how it grew from a two-person contracting company operating out of a private home to the go-to company for specialty concrete work which it has become today.  Reytec is a provider of many types of concrete excavation and structural services, specializing in underground utility work, above ground paving and structures, and site preparation for both public and private projects.

Reytec was started in 1997.  At that time, Reytec was a general contracting company consisting of only Reyes and his wife, operating out of their home, and hiring subcontractors to help complete projects.  While working on a restaurant project, Reyes met an older man who was running a concrete crew for one of the subcontractors Reyes had hired, and the two of them truly hit it off.  Read more » about Contractor Builds Business on Hard Work, Versatility, and Compassion [VIDEO]

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The Houston Chapter of the American Subcontractor Association (ASA) recently hosted a luncheon panel that focused on the progress of the Construction Career Collaborative (C3), a local organization created to ensure a sustainable workforce for the construction industry. C3 is in its infancy, but has already made an impact on projects in the Houston region. This panel discussion gave an overview of the issues, the progress being made today and the plans for the future.

The panel consisted of Jim Stevenson, the President of McCarthy Building Companies, Inc. in Houston and the current chairman of the C3 Executive Committee; Peter Dawson, the Senior Vice President of Facilities Services at Texas Children’s Hospital and the owner’s representative for one of the C3 pilot projects under construction today; John Roberts, the Executive Vice President of Project and Development Services for Jones Lang LaSalle and member of the C3 Executive Committee; and Danny Thompson, Construction Director of Vaughn Construction and contractor on one of the five C3 pilot projects. Read more » about Subcontractors Hear C3 Update

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We recently interviewed Katrina Kersch, the Acting Executive Director of the Construction Career Collaborative (C3), to better understand the origins and the current status of the overall program.

In this video, Katrina tells us that the C3 movement developed out of The Associated General Contractors of America (AGC) studies in 2008 and from the US Bureau of Labor Statistics projections that predicted a major shortage of mid-level construction workers in the middle of this decade. Read more » about C3 Director Describes the Program

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One of the trends we've been watching closely at Construction Citizen is the shift in attitudes when it comes to the "college for all" mentality that has dominated public policy in recent decades. Now, a plan in support of that shift is picking up steam at the Texas Legislature. 

Workforce Commissioner Tom Pauken, who has been sounding the alarm about the need for more skilled workers, says the plan "is clearly going to pass the House. There's a recognition in the importance of multiple pathways to a high school diploma and the value of career and technical education." 

While Pauken believes the plan will pass the House of Representatives, there may be more of a fight in the Texas Senate. If it passes both houses and Governor Perry signs it, "We're going to be saving a lot of kids who would otherwise drop out of school," Pauken said. Read more » about Pauken: A Plan to Re-emphasize The Skilled Trades in High School Should Pass Texas House

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We've been telling you about the push in Austin to bring balance to the Texas education system. Many feel there's too much emphasis on sending every single student to college and not enough recognition that the skilled trades are a great option for many. The Texas Tribune reports on Houston Sen. Dan Patrick's bill to move the state away from the "college for all" model of education. 

Patrick would like to see the skilled trades presented to high school students. He thinks there needs to be modern training in areas like plumbing, electrical work and auto repair. Read more » about Putting the Skilled Trades Back in Texas High Schools

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“I don't need training, I don't have time for that!  Get me a job and then I can show them what I can do!”

I hear this all the time when I recruit small and minority contractors to sign up for leadership/management training.  After spurning my invitation, the contractor eventually wins a job, fails to perform, and is either struggling to keep the business afloat, or has quit altogether and moved into a different industry.

I've seen this happen many times and had to bail out many a contractor in my career as a consultant to the construction industry.  The question we must ask is, “What can we learn from other people's mistakes?”

Actually, everyone needs strategic training and planning, and here's why.

I recently read an interesting Construction Lending News article entitled, Why Do Contractors Really Go Under? by Dev Strischek and Kevin McLaughlin that provides insight to this issue.  Strischek and McLaughlin indicated that a study identified 80 construction firms with revenues over $300 million annually that went out of business or experienced significant financial distress in the past 25 years. Read more » about How to Stay Afloat in a Recovering Economy

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The phenomenon of a high unemployment rate coupled with a skilled labor shortage continues to baffle many people.  Construction executives know exactly why people looking for jobs in the trades cannot find work – it is the skills gap, which is not just confined to America.  Construction Citizen has also told you many times about the shifting attitudes on whether college should be for everyone. More and more experts say “no”.

Now, NPR has taken notice of the problem.  NPR National Desk Correspondent Yuki Noguchi reported on the issue on the news program All Things Considered.  Here is the audio of her report, Homebuilding Is Booming, But Skilled Workers Are Scarce.  Noguchi spoke with a couple of construction executives in the Houston area: Jan Maly, the President and CEO of J.M. Maly Inc., and Mike Holland, Division President of Marek Brothers Systems.

From Noguchi's report:

Maly pins much of the blame on the fact that young workers aren't coming into the field to replace all the boomers who are retiring.  He says that's due to a cultural and political bias in favor of sending all kids to college, and that there's a stigma against blue-collar work. Read more » about NPR Reports on the Skills Gap

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