Metrics and the C3 Business Case
Back in January, C3 hosted a meeting with members of its board of directors and other interested parties to establish new strategic goals. One of the primary themes that emerged was the importance of identifying and collecting metric data that validates the business case of C3.
Since that meeting, C3 has formed a metrics committee that includes committee chair, John Barnes of Rogers-O'Brien Construction, Art Canales of Chamberlin Roofing & Waterproofing, Pete Dawson who recently retired from Texas Children’s Hospital, Craig Peterson of Peterson Beckner Industries, Bud Walters of Pieper-Houston Electric and me to tackle this critical issue.
This committee met for the first time on April 17th with the initial goal of identifying metrics that are as broadly applicable as possible. The committee recognized that metrics collection is a complex topic that is affected by many variables, which can make the goal of broad application a challenge. Committee members focused on the identification of both “project-specific metrics” and “employer-specific metrics”. We also recognized that it would be a mistake to try to “boil the ocean” so we agreed that it is important to start simple, have success and build upon that success.
Please keep in mind that the committee has met only once with future meetings still to come, but these are some of the possibilities that it identified, several of which are like an onion and may have many layers of complexity.
One important item of note, similar to building a skilled and sustainable craft workforce, the story told by the collection of metrics data is like writing a book that never ends. It takes time, and it tells an on-going story that is perpetual if continuously updated. Metrics measure performance thereby providing feedback to those in control of the process, which enables them to make adjustments in order to continuously improve.
Similarly, we believe that metrics will establish the business case that will prove the value of C3 to all involved with it, but we must first correctly identify the proper data to collect, establish the collection process, collect the data, interpret the results and then communicate the findings.
The C3 Metrics Committee welcomes your input. If your company is tracking metrics that have proven to be valuable measurements of performance and you would like to share them, please contact me either by email at email@example.com or by phone at 713.999.1218. Please note that we are not asking you to share confidential information that is proprietary to your organization. We are interested only in the topic and method of collection.
April 4th was a big day for us at C3. We launched our first annual career fair for graduating high school seniors around Houston. School guidance counselors and the C3 People Development team put a lot of effort into preparing the students to meet hiring companies. Arriving at Wheeler Field House, resumes in hand and dress shoes shined, the students were ready. As they wandered around the display booths, I stopped groups of students and asked what I thought would be a simple, logical question to help point them to the right C3 hiring companies. After all, how hard could it be for a student to answer, “What do you want to do after graduation?” Repeatedly, I was given a stunned and bemused look of incredulous disbelief. As students tried not to roll their eyes, they answered “hmm, Construction?” How could I not already know that answer, after all wasn’t I the one who recruited them to come to a “construction” career fair. Students didn’t understand that drywall is not masonry, and neither are working in roofing or fire protection. This lack of awareness about the wealth of options construction has to offer its craft professionals is one of the hurdles that our industry must aggressively address in the upcoming years. While the students may not have known the differences between General Contractors and Specialty Contractors, they all shared one thing in common, a desire to work.
I also get similar reactions of awe and disbelief when I talk to their parents. Ears perk up and light bulbs begin to come on when we talk about how the industry can provide a standard of living that is equivalent to what college provides without the debt. The “No Child Left Behind” movement, of the last 20 years, has parents telling kids that college is the only road to success and school counselors are echoing that through the halls of the high schools. Honestly, until my work at C3, I would have been right there with them. Even though Texas House Bill 5, which requires all graduates to have a career or college readiness endorsement, has made strides toward educating parents and counselors about non-college routes and preparing students for construction careers, they still think in small limited terms. Watching career fair students interact with companies, either in demonstrations or discussions, it was clear that we cannot give them too much information. Like sponges, they soaked up the idea that masonry was relevant and engaging, working from heights was dangerous but exhilarating, and interiors is more than just hanging drywall and painting. These students and their peers are begging for us to come to them and tell them what they can dare to dream and build.
Wells Fargo’s 2019 Construction Industry Index highlights that 47% of the contractors in their survey indicate their “utmost concern is the ability to hire qualified workers.” Reaching Generation Z, as they prepare to enter the workforce, closing the knowledge gap about construction careers for parents and high school counselors, and skilling students in order to mitigate the rising risk of debilitating workforce shortage, must become the most important thing for our industry’s long-term survival. FMI executive, Pat Kiley, offers a conservative estimate that the revenue from the built environment will double in the Greater Houston Area by 2045, as long there are workers to build it. Attracting workers to the industry and educating them on the benefits of a craft profession is at the heart of creating a sustainable workforce. C3 is committed to continuing the dialogue with schools, parents, counselors and students. To join the conversation and make a difference in the future of the industry, contact C3 today. Together we can influence a generation to build Houston forward using the hands of safe, skilled craft professionals recruited from our very own local high schools.
By Chuck Gremillion, Executive Director, Construction Career Collaborative (C3)
Recently, C3 board member Tom Vaughn of Vaughn Construction emailed me a scan of an article that he cut out of the March 4/11, 2019 edition of ENR Magazine on the subject of Workforce Development entitled CURT Rolls Out Program to Grade Contractors on Training. The article tells the story of the utility Southern Company sending “its primary contractors a letter quizzing them on the level of their workforce training”. It went on to say that “the questionnaire is Southern’s first step toward prequalifying and hiring only contractors who invest in worker training”. This was done in response to a recommendation from the Construction Users Roundtable (CURT), of which Southern Company is a member, at its annual conference in Orlando in February. What makes this significant is that it may foretell a shift in how contractors are selected by those companies, like Southern, that purchase construction services.
The reason that I share this occurrence is that CURT, a highly respected organization of construction users, has data that proves the value of training for the construction workforce and its impact on construction projects. The article goes on to cite the results of a case study that was profiled at the CURT conference referenced earlier, where training costs of $234,239 incurred on a project generated a labor savings of $664,364 on that same project. This is in addition to data gathered by the Construction Industry Institute (CII) which confirms that every dollar invested in workforce training generates a return of $3. The chart below published by CII, also referenced in the ENR article, illustrates these findings.
Return on Investment for Committed Workforce Development
If 1% of the Project Labor Budget Were Invested in Training…
Expected Average Improvement
Capital Projects Maintenance Projects
Productivity 11% 10%
Turnover Cost 14% 14%
Absenteeism 15% 15%
Injury 26% 27%
Rework 23% 26%
$1.00 invested in training = $3.00 ROI
The shift to prequalify contractors on the basis of the quality of the training of their workforce is not a surprise. It is driven by data and common sense. Trained, skilled workers are safer workers who produce high quality work, and more of it, in less time with less rework. The employee retention rate among workers in a company with a robust culture of training is much higher than those who companies without such a culture, and absenteeism is markedly lower. The projects produced by these companies also have much lower maintenance costs over the long term.
It is not a coincidence that woven into the highest performing construction companies is an evergreen culture of workforce development. This culture of training helps make these companies more profitable, which in turn enables them to continue to reinvest in training and their employees. Very importantly, it fuels their growth and makes them much more attractive to individuals considering a career in the construction craft trades or to those who are considering a change of employers.
Owners are changing their process for the selection of contractors and are including training as a basis for that selection. Don’t get left behind. C3 has seasoned training professionals on staff who can help your company design and develop its craft training program, and its free of charge for C3 Accredited Employers. For more information, please contact C3 Associate Director, Angela Robbins, either by phone at 713.999.1032 or via email at firstname.lastname@example.org.
Construction Industry Institute (CII)
Construction Users Roundtable (CURT)
National Center for Construction Education and Research (NCCER)