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  • John Macedo

IS YOUR COMPANY LEAKING MONEY ON LABOUR?

Updated: Jul 27


As a Project Manager, your attention may not be drawn to this because it isn’t expensive enough to be reported, but poor communication slowly costs construction companies huge money.


At first, slight mistakes that result in wasting half an hour of a labourer may cost $20, and this isn’t worth anything to a company. However, if those mistakes continue for a whole year, it grows into thousands of dollars.


In this article you will see how avoidable errors such as these could have said the company loads of money. Or, they could have been used for other sectors of the company. Poor communication is responsible for the majority of the errors construction companies make as well as labour hire companies in Sydney and in the rest of the world.

IS IT REALLY AVOIDABLE?

Imagine a Foreman that notices that his workers are having a hard time proceeding from the ground to the slab.


The reason for that is because the slab is higher, so the workers have to move up and down all day with materials and tools in their hands.


To ease their workflow, the Foreman instructs one of his Skilled Labourers to prepare a two-step stairs from the ground to the slab


However, as he passes by after a few hours, he notices that something is not right.


The stairs were built, but they were not robust enough to bear the heavy load of men carrying material and equipment. More so, the stairs were nailed to the ground and not movable. What was even worse was the fact that the stair was in a bad spot, hindering the movement of the scaffolders in the area.



Being annoyed and frustrated, the Foreman calls his Skilled Labourer and inquires about all the issues. When asked, the labourer who was responsible for the preparation of the two-step stair, answered that he thought of the scaffolders to be necessary only for that area. He also thought that the stairs would remain in one place until the end of the job, so he focused mostly on strengthening them.


After understanding what the builder wanted ever since the beginning, the worker starts to grasp the purpose behind the stairs, realising that a strong plank with some loose earth under it would have been a quicker, cheaper and easier solution.


As you can imagine, at this point, both of our characters look silly.


HOW MUCH DID IT COST?

Consider the total cost of a skilled labourer as $50.00ph (hourly rate + allowances)



WHAT DOES IT MEAN?


It means that you would pay $250 for a plank with loose earth under it. More so, $220 from the total amount will represent the lack of good communication and a more complete 5-minute briefing.


I know that some of you reading this case might think it is an exaggeration, but let me reassure you that I speak from true facts. I was the labourer and this is my real example.


This "small" mistake, understandably, didn't cross the threshold of being expensive enough to be informed to the Project Manager. I am also aware that there are accounted for in any project estimation. However, there is no reason to not tackle it as a possible area of improvement and make better use of resources.


The sole reason I decided to write this article was to prevent others from wasting time and money needlessly as I did. Furthermore, I want to open your eyes to the fact that poorly briefed two-step stairs may cost $250.00, you may have lots of invisible money leaks that may costing your company thousands of dollars, which could be used as an incredible business advantage.


Here are some other examples that I've witnessed --->


This being said, before moving on, I want to ask you to reflect about which ways your company may be losing money right now due to poor briefings and miscommunication? And how much?


As a suggestion: investigate how much your field workers think is being wasted and think of procedures to make these mistakes more avoidable. Need a hand?

HAVE A LOOK AT THESE 3 ARTICLES:

They will make a huge difference in your long run


  1. If you think yo have bad lucking picking your labourers, It may have been "cursed by knowledge". Learn more about it here.

  2. Learn more about how to think long term for your construction company by clicking here

  3. Understand more about how to communicate with your staff by clicking here


LAST THOUGHTS


In the end, you realise there’s a significant need for better briefing practices in companies. This is to ensure avoidable mistakes like the ones I mentioned are avoided. Doing this will save you time, energy, and money.




Spades is a Labour Hire company based in Sydney. We are proud of offering skilled, competent workers for fair prices - while making the hiring process as easy as possible. Learn more about our company by clicking here.


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JOHN MACEDO

Founder and Director.
I believe together we can create a "people first"

Australian Construction Industry 

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