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In looking where to invest limited dollars these days, it is critical that every penny spent provides a return on investment (ROI) above what other investments could deliver. Every dollar spent on one part of the business takes away investment in another. Each employee hired must contribute to the bottom line of the business, and measuring how they contribute can be a difficult yet critical aspect of successful business management. Improvement in employee skills can provide a significant improvement in profitability if combined with a program of business management improvement and learning methodology that ensures that the employee is employing their new skills on the job.

Profitability by Project Manager can be measured – yet many firms don’t track individual performance, or teach project managers the skills necessary to deliver profitable jobs. Where money gets lost is often elusive – it is often in many small places every day. From poor estimates, to scope creep – not recovering contract extras – to poor control over subcontractors– money gets lost in many phases of the project lifecycle.

What is missing in many cases is awareness, focus and knowledge about how the business makes a living by the employees controlling the project costs. Giving them this knowledge, and changing their behavior,  requires a special type of training focused on developing business skills in project managers and firm leaders that have control over the business management aspects of project pursuit and execution.

Many AEC firms have tried training as a way to improve project success, but without a true focus on profitability, and a real assessment of how money is being lost in the firm, it is difficult to make changes in processes and behavior that have a positive impact on the bottom line.

Measuring the ROI from improving employee business skills is not an exact science. In some ways it is possible to measure the benefit of training by assessing employees before and after the training. But the real question that must be answered – does their behavior change when they get back to the job?

Accountable Learning Framework

Training alone is not the only answer to improving employee and project performance. What is needed is a framework of “accountable learning” – a way to change employee behavior with a more structured approach. This is a phrase that I coined to describe a process of learning that ensures that behaviors change. An accountable learning program should include the following critical aspects in order to ensure improvement in employee skills and behavior:

  1. Communication to all employees about the importance of the training program and “why” the company is investing in it.
  2. Establishment of a set of goals around the training that can be measured. These goals should be documented for both the company as a whole, (e.g. 2% increase in project profits, etc.), as well as specific goals for each employee. Each individual should be measured according to how they are achieving the expected goals.
  3. Agreement on specific behavior changes expected from the training.
  4. Development of new processes to support the new skills. This may require further analysis of issues that are slowing down or impeding their success.
  5. Creation of a training schedule that encourages or mandates group discussion after specific courses to reinforce what has been learned. This would include discussion about the specific behaviors expected and encouragement when new skills, awareness and behaviors have changed.
  6. Regular group discussions or “coaching” sessions after each course.
  7. Measurement and regular monitoring of key performance metrics.

Get Results from Your Training Investment

This type of training is geared towards getting solid results. It definitely involves a much greater commitment by your company to ensure that training is delivering results. Providing incentives and rewards to achieve specific goals can improve performance in the right setting.  And having outside facilitators to guide the learning process can make up for over-extended internal resources as well as provide a more objective approach.

One other obvious factor is the business training itself. Make sure that it is developed specifically for the AEC industry, and taught by experts that really understand your specific challenges. This will provide the best likelihood that the training will be applicable to how the business really operates. Non-industry specific business training can include recommendations that do not apply to how profit is really made in your firm. Ensuring that the training is teaching the key business skills to change employee behavior will deliver the biggest ROI.

When considering where to invest to increase project and overall company profitability, a well thought out and structured plan will produce the best results. Business training of key staff can add several percentage points to the bottom line – if conducted with intentional focus on measurable outcomes.


Cash is King Webinar

Managing Cash Flow in a Down Economy

Date: Wednesday, August 19th, 12:00pm ET

The average days to collect cash in the AEC industry is between 60 to 120 days. In this web training we will examine the complete project lifecycle to understand how cash flow can be increased when the economy is uncertain. Participants will gain valuable tips to improve cash flow by improving timesheet practices, reducing the billing cycle, and improving client relationships and collection practices.

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