Friday, October 23, 2020

October 2020

A Tale of Two Jobs – Case Studies of Agile Construction® Usage

“Every construction project is different and you can’t compare one to another” – but are they? While every project is somehow unique in terms of contractual obligations and requirements, project characteristics, material requests, and sometimes equipment needs, they might not be as much when it comes to the management of the actual electrical work as it appears at first glance. How work is laid out and planned, and how a project is supported during and after the construction phase can make a huge difference for the success of a project. 

We examined two comparable size construction projects performed by two different mid-size electrical contractors in the Midwest (see project descriptions in Table 1) regarding their commonalities as well as the differences from both an operational and financial performance perspective. In particular, we investigated the impact of the depth of pre-construction planning and the degree of implementation and usage of Agile Construction® Principles and Tools, such as Job Productivity Assurance and Control (JPAC®), Short Interval Scheduling (SIS®), job reviews, and continuous improvement strategies.

Although winning those two projects may seem like a great position to be in but it also came with significant downside risk for both contractors. Both projects were considered large and both carried a significant amount of risk, however, the inherent business and bankruptcy risk for each contractor was quite different: Project 1 was about 40% of the contractor’s annual revenue, while Project 2 represents about 140% of the contractor’s past annual revenue. By taking on these large projects, both contractors faced obstacles with their supporting infrastructure and their ability to service their existing customer base, which the second contractor is now exposing their future revenue stream to the risk of a mega project – a potential killer job!
Table 2 provides an overview and comparison of the Agile Construction Principals and Tools used on both projects. After the buyout of the project, material costs for the project are essentially fixed, leaving the work and labor as the competing edge for every project. The main focus of Agile Construction® is managing the work and labor of a project. First, the work needs to become visible before it can be managed. Managing work also involves efficient labor usage, and to define Who does What, When, and Where!

Both contractors started implementing Agile Construction® when both projects were already in the construction phase.  Contractor 1 started about 4 months into the project, while Project 2 had been under construction for almost one year. While Agile Construction® was a completely new concept to company 1, some executives and project managers at company 2 had already experience with Agile Construction® from prior companies they had worked for. Both companies held individual training and workshops with the general foremen and foremen on Agile Tool usage and to develop Agile Construction® Power Users for not only for these specific projects but to continue implementing Agile Construction® Principles across the company and future projects.

Planning on Project 1 started with developing a partial Work Breakdown Structure™ for a few cost codes while estimates were used for the remaining cost codes. Creating the WBS™ helped significantly with making the work visible, which also led to better labor management and higher labor productivity. During the construction phase, the project team conducted weekly job review meetings to get continuous feedback from the field and to review the tracked on-site obstacles in SIS® as well as overall job and individual labor code productivity. In addition to the weekly job review meetings, strategic planning sessions were held to review, discuss, and plan money, manpower, and material related topics for both parts of the project. Collected data in JPAC® and SIS® brought issues with misplaced material as well as problems with lighting and fixtures to the attention of the project team. Collaborative actions were to improve the material process and to develop a fixture release schedule along with specialty carts for safe and damage-free fixture transportation to the job site.

On Project 2, the on-site foremen started with developing a complete WBS™ for all cost codes and project phases to break the project down into how they see the work with no reference to the estimates. The field leads kept improving and adjusting the WBS™ to accurately capture the status of the project (% complete) and to reflect the work and effort needed for completion. In addition to weekly job review meetings, the project team held regular project schedule reviews to identify scheduling conflicts, to discuss a 5-week look ahead, to address labor loading, resource allocation, crew mix, and material needs with the objective to define a clear path for the crews on site. While absenteeism has been a major issue just like on every other project, the issue exacerbated significantly with the outbreak of COVID-19. Once COVID-19 hit and the progress of other trades got impacted, the project schedule meeting’s focus shifted from a 5-week to a 2-week look ahead.

SIS® data immediately revealed that field personnel was spending an additional 1.5 hours/man/day to comply with the new health and safety requirements, totaling approx. 700 hours per week on the project. Quarantine requirements and closed work areas due to deep cleaning after positive test cases further impacted scheduled work and job productivity. It took about 5 months to recover and stabilize pre-COVID productivity levels due to the size of the project. Regular strategic planning sessions are used to develop clear action items that focus on what is at hand and what is coming at the project team next. Active crew and composite rate management together with monthly financial project updates helped to proactively manage the money side of the project.

Figure 1 and Figure 2 show the monthly productivity trend since the first month of Agile usage on the project. Despite absenteeism being a primary obstacle during the entire lifetime of the projects, the application of Agile Construction® Principles helped turn around the negative productivity trend with improvement becoming visible shortly after starting Agile usage. The achieved improvements and changes led to a financial recovery on the projects to avoid significant losses and financial risk and stress for the company.
Figure 1: Labor Productivity Trend - Project 1

Figure 2: Labor Productivity Trend - Project 2
By using WBS™ for planning, SIS® and JPAC® for tracking on-site obstacles and labor productivity, weekly review meetings, continuous feedback from the field, as well as strategic planning sessions and regular financial reviews, project teams can proactively manage their projects and can immediately address any issues at hand. Agile Construction® enables project teams to effectively and efficiently manage large projects, through early detection and correction for successful and profitable project completion. See also MCA Inc.’s publication “Managing Large Jobs” for more information on how to successfully run a megaproject.

COVID-19 – Impacts on U.S. Construction Market and Electrical Contractors Reactions

COVID-19 has developed into a global crisis affecting all countries and industry sectors worldwide. Evolving at high speed and large scale around the world, no industry is immune, and construction is for sure no exception. As one of the most cyclical industry sectors, the construction industry is highly sensitive to economic expansion and contraction, although for most subcontractors the impact from regular economic cycles typically materializes 3 – 6 months later. The COVID impact was different as the effect was rather immediate leaving construction companies and contractors little to almost no time to react and adapt to the changing construction market and the operational environment.

Figure 3: Pre- and Post-COVID Outbreak Market Developments

Figure 3 shows the time trend of the annual value of construction put in place (CPIP) from March 2019 until July 2020. Looking back one year from the time of the COVID-19 outbreak in March 2020 and before the consequences for the society and economy started to fully unfold in the U.S., the forecast for the annual construction industry spending was approx. +7.4% higher than it was at the same time in March 2019. However, since the outbreak, CPIP forecasts have dropped significantly within the first three months, despite government and public authorities’ effort to advance spending in infrastructure and public safety projects. While both public and private construction spending show declines, private residential and particular non-residential (commercial and industrial) construction spending have both dropped below 2019 levels.

Despite strong pre-COVID growth (+11.9), persistently low-interest rates and direct government support, high unemployment rates, and unchanged economic outlook have caused annual private residential construction forecasts to drop by more than -7% since March 2020. Similarly, the data shows that the non-residential construction market aggregate estimates (commercial and industrial) dropped by nearly – 4.5%, as most businesses in these sectors, will continue to cut, defer, or cancel investments, weakening prospects until the end of 2020, and likely into Q1 and Q2 of 2021. Although the industry saw considerable contraction and is still facing a less favorable market outlook, there is light at the end of the tunnel! Positive signals for the industry come from annual construction spending during July 2020 to be flattening out the annual forecasts along with the reduction of unemployment rates in the industry from 16.6% in April 2020 to 7.1% in September 2020.

Figure 4: Risk Management System

Contractors have taken efforts to react and adapt to the “New Normal” by developing policies and procedures to mitigate the risks and impacts of COVID-19 for their labor, their operations, and their business.   Contractors managed to adjust their way of operation, how to manage their job sites, and to perform their work. To help contractors to plan, mitigate, and manage the business, operational, and health risks associated with COVID-19, MCA, Inc. has started to offer COVID-19 Webinars shortly after the outbreak and as the second wave continues to unfold to help contractors share and build best-practices at both the business and operational level.

A critical immediate action in response to a disaster event like this pandemic is to quickly assess and quantify the risks, as well as the impacts on construction work along the three dimensions: Effort, Work, and Time. Contractors using Short Interval Scheduling (SIS®) and Job Productivity Assurance and Control (JPAC®) were able to categorize and quantify the impacts on scheduled work, additional effort, and labor productivity in a matter of few days. National data on over 290 active construction projects and roughly 13.2 million man-hours reveal the following impacts (Data from March to September 2020):

  •   EffortAbsenteeism more than doubled, 49% of scheduled work is not completed, 52% of  reported impacted hours due to COVID
  •    Work: 30-60 minutes per day per labor to comply with CDC and company-specific guidelines
  •    Time: Significant delays, schedule compression, leading to higher peak manpower loading

These impacts also affected productivity. Figure 5 displays the aggregate productivity trend of jobs tracking COVID-19 impacts between February 2020 and September 2020. Industry-wide measurements show that after an initial loss of productivity immediately following the COVID outbreak, on-site labor productivity has increased by approx. 7% until September 2020.  These overall trends appear reasonable given the changes in the way contractors have adapted their operations in both the office and on the job sites.

Figure 5: Productivity Impact for Projects Tracking COVID Impact

Additional supporting data
[1] shows that nearly all contractors have made changes to how they operate their business in response to COVID-19:

  • 92% have changed work procedures to increase social distancing
  • 39% have asked project owners to adjust work/delivery schedules
  • 34% adjusted employee salaries furloughed or laid-off employees
  • 8% have adopted more automation to enhance social distancing

Further, many contractors believe some changes to their business are here permanently, such as:

  • Adjustments to safety procedures and work processes
  • More remote meetings/use of collaboration tools
  • Force Majeure Clause to avoid liability for extraordinary events and circumstances
  • Increased attention to site/office sanitation

To reduce the risk for further impacts and business disruptions, contractors recognize the importance of taking steps to build their backlog, diversify types of work, and build relationships with customers. By understanding their market, and available types of work around them as the industry evolves, contractors are better able to get ahead and make data-driven decisions on where and how to diversify. MCA, Inc.’s unique market study methodology can help to allow contractors of any trade to understand and evaluate the overall available market size in any geographic area of interest as well as a breakdown into residential, commercial, and industrial segments, and further trade-specific detailed market categories. Contractors must stay aware of the changes happening in the industry and their specific markets, as well as how the changes they are making in their business and on their job sites are impacting their project labor productivity.

Research Corner

MCA, Inc. was established as a research company in 1990. For more than 20 years, MCA, Inc. has been involved with ELECTRI International, providing innovative research and expertise to the construction industry, and financial investment to the Foundation. Dr. Perry Daneshgari and Dr. Heather Moore were interviewed on the interaction of research and financial investment by ELECTRI.

Read the full interview onResearch and Investment can go Hand-In-Hand”! 

  • Industrialization of Construction®: Signal or Noise? Threat or Promise?

The three-phase research project is currently underway. This research project investigated how Industrialization will continue to unfold in the construction industry and provided ELECTRI and its members a means of getting and staying ahead. The first phase of the research, completed this summer, focused on understanding the current state of the industry and providing a means for contractors to evaluate themselves in terms of how industrialized their company is and assess the gap between their current state and the industry. During the 2nd phase of the research, MCA, Inc. developed a guidebook for contractors to use to move the needle forward in their company, working with three electrical contractors to test the applications, collect their results, learning, and feedback. The 3rd and final phase of the research is currently underway, as MCA, Inc. develops a full framework for the future of Industrialization of Construction® across the industry, including collaboration among associations and standards-setting regulatory bodies.

  • Estimating with and Pricing of Prefabrication

This ELECTRI research project was targeted to identify electrical contractors’ current prefab usage as well as the practices in pricing with prefab, and to help electrical contractors move forward and to accelerate the industry-wide usage of prefabrication by developing a practical calculator tool to quantify the aggregate labor savings potential and composite rate (crew mix) impacts from Externalizing Work®, including Prefabrication and Vendor Services, and a method for “pricing” their estimates with prefabrication.

  • Publications

In addition to completing two ELECTRI research projects, we have put a special focus on MCA’s publications. Over the past five months, we have published 7 brand-new articles in EC&M Magazine and Construction Financial Management Association (CFMA) on Industrialization of Construction®, Externalizing Work®, Prefabrication, and Modular Construction, Integrated Project Delivery (IPD), and Jobsite Intelligence Gathering. We are proud to share the latest experience, insights, and trends on these topics to help you and the industry advance and progress. Progress and change might be even more important and needed than ever, particularly during or because of these difficult and uncertain times.


Visit to view and read all of our latest articles and publications (and more)! 

  •  Recently published articles

§  The Operational Model for Modular Construction 

§  From Jobsite to Garage: Changing the Mindset of Prefabrication & Modular Construction 

§  Industrialization: Is Construction Next? 

§  COVID-19: Another Tectonic Shift in Business Operation Models

§  The Ins and Outs of Integrated Project Delivery

§  Make Data Work for You 

§  The Key to Gathering Job-Site Intelligence 

Release Announcement

MCA, Inc. is proud to announce the release of the 2nd Edition of our best-selling book “Agile Construction® for the Electrical Contractor”.
What is new?
 -  Work Breakdown Structure (WBS) Deep Dive
 -  Additions on Project Planning & Project Management 
 -  More Details on Externalizing Work®
    through Prefabrication 
 -  Agile Construction Tools® updates and new features 
 -  Updated Safety Study for the Construction Industry

Outreach Corner

MCA Symposium 2020 Highlights

2020 was the first year ever that MCA’s symposiums went virtual and with great success! In our Spring as well as Fall Symposiums, MCA was able to provide the connection between several contractors across the United States to exchange on the great benefits of Agile Construction® usage, in particular during this unprecedented time. In 2020, we held two out of our series of four symposiums on Agile Construction® – A Path to Industrialization:  Data-Based Project Management. In our 2020 Spring Symposium, we focused on the Planning phase of a project while the 2020 Fall Symposium dealt with the issue of Data-Based Agile Procurement®.

If you are interested in our next 2021 Spring/Summer Symposium on Data-Driven Installation Phase, make sure to reserve your spot and sign up here: MCA Symposium

Agile Classes Highlights and Upcoming Events

We have been successfully expanding our online workshop and seminar offerings during 2020 with great success. With travel limitation in place and social distancing, we were facing this year, MCA successfully expanded the virtual workshops into three to four-hour seminars as well as one-hour webinars. Besides, MCA has worked hard to simplify registration for our online seminars as well as workshops! We offer a large number of classes regularly multiple times each year as well as individual company workshops. All courses and workshops can be found in our new addition to our MCA-soft website – our Course Catalog. Make sure to visit our Course Catalog and check out all MCA’s course offerings - ranging from Agile Construction®, Procurement, and Prefabrication to Project Management and Business Development!

Hundreds of contractors have already participated in our Agile Construction® Events in 2020. While most of our offerings have been virtual, breakout sessions, active involvement of participants, and discussions among contractors are still a focal point in all training and educational classes. Information about the latest ways on how to deal with the increasing time crunch on job sites, how to ensure you get paid for your change orders, as well as how to continuously improve your communication with the General Contractor are just a few of the long list of discussed topics. Our next upcoming events are:

·    And many more:
Link to future Workshops and Seminars

New Website

MCA has been working hard to develop an easier way for you to interact with us and benefit from our products. We are proud to announce that our redesigned website is finally live! You will find our latest books, publication, create your shopping cart for complimentary reading material, and for purchasing MCA’s books, as well as an all-new sign-up process for our workshops, classes, and online seminars. Visit, and take a look!

Customer Corner

Dixie Electric has devoted 2020 to fully emerging itself into Agile Construction®. The company is implementing Agile Construction® throughout the entire company with the help of Process Implementation Teams. Focusing on increasing usage of Agile Construction® Tools, increasing application of prefabrication, and improving processes through their Design Teams, Dixie is prepared to repeat and build upon their success from 2019 along with setting a foundation for years to come. 

Electric Company of Omaha (ECO) recently conducted a project audit/review session on their largest project to date, with the project reporting continued gains in productivity for 11 weeks straight, despite the significant impacts of COVID-19 on the job.  By implementing Agile Construction® on this project and across the company, the project team can make visible the obstacles they are encountering daily and proactively allocate the resources to address them.   Besides, ECO has added about 20 new projects to Agile and continues to learn and expand on the processes to support Agile through their two Design Teams led by Kelsey Ahl and Glenn Biehl.  Year-to-date, ECO have had 10 graduates from Agile 101 Class and additional 6 participants attending each three Agile Basics Training Sessions.

Lemberg Electric has made great headway this year in expanding Agile Construction® throughout their company. This summer, Lemberg completed successfully several fast-paced projects, and despite impacts from COVID-19 that left no job untouched, Lemberg completed these projects with high productivity. As Lemberg takes on new work, project teams are practicing Agile Construction® across Construction and Data jobs, allowing project teams to pro-actively respond to job-site obstacles and improve labor productivity on the job site. Effective November 2nd, 2020, the Board of Directors has appointed Mark Chappel as the new President and Tim Scheid as the Chief Executive Officer (CEO) of Lemberg Electric.

Staff Electric has been taking full advantage of the opportunities provided by the pandemic to focus on internal development as well as positioning themselves financially to make 2020 a benchmarking year.  Design teams held Kaizen events to address productivity struggles with some high project impact labor activities and developing checklists to help push labor productivity up by 5% to 15%.  Project managers began incorporating the WEM® process from project schedules to do an accurate 3-week look ahead to allocate manpower on the job, which became essential as COVID-19 was impacting not only productivity but the overall availability of labor. Committed to Agile Construction®, to-date Staff has had a total of 95 graduates from Agile 201 Classes. Besides, Staff became the first customer to use Agile Construction® Tools to visually track their annual departmental budget and expenditures.

Aldridge has crossed the mark of 400 active users and over 60 active jobs tracked in the Agile Construction® Tools. Aldridge is continuing to embrace and benefit from the Agile Principles. Aldridge is taking the Agile use to the next level. With MCA’s help, Aldridge has been focusing on expanding and improving its Prefabrication Process, as well as expanding the focus of WBS in its Drilling business operations to improve mobilization and overall job planning and visibility from the field. Looking into 2021 MCA and Aldridge will focus even more on developing a Strategy for company-wide utilization of Agile Construction® principles and tools, including Externalizing Work® through prefabrication and a company-wide Procurement and Logistics strategy.

Thursday, May 28, 2020

SOTI Special Issue (May 30th, 2020)

Disaster Plans and Preparation – What did the COVID-19 pandemic reveal for your business?

No doubt that it is an unprecedented and unique time for all of us. We have all been impacted by the recent events of the COVID-19 pandemic in various ways, either personally, professionally, or even both. The uniqueness of the current situation is its global and world-wide impact. It’s not any different than any other significant events that would strike locally, regionally, company- or even project-specific. When such events hit, many businesses suffer not because of the symptom of the event but rather because the root cause has existed long before. The strengths and weaknesses of your business become scarily visible during such events. Perspective is critical during such times and it is important to resist the urge to victimize yourself.

The truth is, the possibility of such extreme events is always there, no matter how unlikely. We deal with uncertainty every day when making decisions. However, unless we deliberately think about these scenarios, our choices tend to be based on experience, leading to underestimating or even ignoring such rare events and their impact. Planning has always been a challenge in the construction industry. While most contractors are great at what they do as a craft, many lack experience and knowledge on how to plan and prepare for disaster events, or how to apply the preparation to the business environment. The ability to plan and prepare to mitigate the risk and impact of such disasters is always under your control. Proper planning is becoming the norm - it requires deliberate thinking and the investment of your time.

Figure 1: Work Breakdown Structure to Minimize the COVID impact

As soon as COVID-19 appeared as a looming impact on construction, MCA, Inc. began working to help contractors prepare to mitigate the impacts on their businesses. For over two months, we have developed plans and collected information from more than 100 companies virtually every week to aid the industry’s recovery. MCA, Inc. developed a ‘Minimize the Impact Breakdown’ for contractors to be able to focus on one phase at the time. Figure 1 shows a high-level breakdown that separates out 4 main phases:

          1. Ramp down                 2. Stay at home                 3. Reopening                 4. Recovery 

Figure 2: Risk Management System (Swiss Cheese Model)
Each phase has a unique focus and requires managing different risks. To mitigate the risk and to prevent adverse impact, it is important to follow a structured approach, like FMEA (Failure Modes and Effects Analysis), to identify potential failures that may exist within your business at different layers (see Figure 2). To address these failure modes, standardized written policies and guidelines, checklists, and How-To’s or work instructions for the current work environment need to be developed and aligned with employee training. Further, a clear communication structure and responsibilities for the field and the office need to be established using existing or new technology to facilitate quick and frequent exchange of information.

For the Reopening Phase after COVID-19, items to consider might for example be:
  • What policies and procedures do we need to keep our employees safe and healthy?
  • What is needed to comply with the new additional regulations?
  • What are the additional direct and indirect costs associated with COVID-19?
  • What additional planning effort is needed to manage the projects and work?
    • Manpower plan (Distancing requirements, Management of absenteeism, etc.)
    • Material plan (Material delays, alternative sourcing, reducing vendor contact)
  • What equipment and technology are needed to ensure efficient project and office operations

This year’s disaster was the COVID-19 pandemic, but what is the next unexpected event that could put your business at risk? Next time it might be regionally or locally like a hurricane or a flood. Taking deliberate actions to put a risk management system for disaster planning and preparation in place will help you sustain and prevent the impact of the next disastrous event for your business. Doing so will provide you a competitive advantage and the opportunity to expand, when others struggle. Be prepared!

Quantifying the Impact of COVID-19

“Measurement is the first step that leads to control and eventually to improvement.” 
~ H. James Harrington

As you start to reopen and bid for new projects to fill your backlog, you should first start to measure and quantify the impact to date and create a solid understanding of the additional costs that your projects and business are facing and need to manage. This requires consistent tracking, documentation, and measurement process that will house and quantify the impacts allowing you to adjust for the “new normal”. Failure to do so can be disastrous for current and upcoming projects.

Knowing the Ins and Outs of your projects and business is important. The importance becomes even more visible when unexpected events like the COVID-19 pandemic hit, which call for quick and informed actions. With obstacle tracking and labor productivity tracking systems like SIS® (Short Interval Scheduling) and JPAC® (Job Productivity Assurance and Control) in place, Agile Construction® Contractors are able to instantaneously track, document, and measure the additional effort needed as well as the immediate impact on productivity. To quantify the impact of COVID-19, MCA, Inc. has also created and published Agile Construction® Measurement Guidelines on MCA’s Agile Construction® Forum to provide all construction companies with best practices in tracking, documenting and measuring the COVID-19 impact.

The following three items are critical:

  • Quantify the Effort Impact: Detailed reasons and impacted time (with SIS®, Figure 3)
  • Quantify the Work Impact: Track the extra work needed on-site to comply with the new requirements and capture it as part of the actual work in the Work Breakdown Structure (WBS) of your project (with JPAC®)
  • Quantify the Time Impact: Add a summary task and related COVID-19 activities to your schedule, and connect them to your obstacles (SIS®) to capture schedule delays
Figure 3: COVID-19 impact measured through SIS®

Figure 4: COVID-19 Impact Examples
MCA Inc.’s proprietary data collected from COVID-19 impacts on job sites of Contractors across the U.S. using SIS® and JPAC® reveals two interesting findings: First, productivity for the actual planned work on-site has actually been continuously increasing, showing that on-site labor got more efficient in what they were doing. This might sound like a surprise but is fairly easy to explain. Fewer people and trades on-site immediately translate into less crowded job sites with less interference and obstacles, reducing the wasted time, which can otherwise only be accomplished by Externalizing Work® (Prefabrication), and the use of vendor services. Second, despite the increase in productivity, total reported accounting hours actually exceed pre-COVID-19 levels reflecting the additional effort needed on-site to comply with COVID-19- related prevention measures and restrictions (see Figure 4). Overall, jobs are using more labor hours, and projects will ultimately lose money on activities that were not expected when the project was estimated, planned, and the expected work was broken down and visualized in the Work Breakdown Structure (WBS).

MCA Inc.’s data further reveals that each worker spends on average up to one hour per day on additional required tasks to comply with the COVID-19 safety requirements, such as temperature checks, filling out medical screening forms, sanitizing equipment, tools, carts, and work areas, or social distancing requirements that alternate the planned workflow, on-site movement, material delivery, or other logistical tasks. Contractors can’t expect customers to take the cost of additional time, delays, or impaired productivity. Instead, contractors have to improve productivity through the increasing use of prefabrication and vendor services to compensate for the additional hour of COVID-19 impact just to remain at par in the short-term. However, in order to meet future objectives, contractors will have to increase the effective installation time from now 4 hours per worker per day to at least 5 in the long-term. 

To help contractors draw a financial picture for their businesses, MCA, Inc.’s has developed a customizable recovery calculator, which allows contractors to determine their annual financial projection based on the company-specific cost impact due to COVID-19, any granted PPP or other Cares Act loan, as well as various levels of productivity improvement. Once you have quantified the impact and challenges you are facing, and you know what you can control, you can start creating a plan for improvement and to prepare for reopening and recovery.

Successful Reopening and Disaster Recovery 

There is no question: every construction company has taken a hit. The loss is there, now it’s time to pick ourselves up, and plan for effective reopening and recovery! After having quantified the impact and the additional cost, it is important to understand and plan for what needs to be done from a business, medical, and social perspective to master a successful reopening of your company as well as the whole economy that will bring your business back on track.

Figure 5: Reopening Plan Structure
As tempting as it might sound given the current situation, but lowering restrictions and reopening does not simply mean getting back to the job site and continuing as before. Getting back needs planning and adjustment for the “new normal” in construction. The bad news is it doesn’t happen by itself. It requires a structured reopening approach with clearly defined company-wide, job-specific, as well as work-area plans, policies, guidelines, checklists, and procedures in place to successfully manage manpower, money, and material (see Figure 5).

Figure 6: Breakdown of Extra Work due to COVID-19 (exemplary)

The impact that new COVID-19-related restrictions pose on construction sites will carry on and will force contractors to change the traditional workflow, logistics, and material delivery, as well as on-site interaction and project coordination processes. PPE requirements and preventive measures such as health checks, cleaning, and sanitizing tools and equipment, access, and site movement restrictions, as well as spacing requirements, will require and consume additional non-installation time (see Figure 6). 

MCA Inc.’s proprietary data from jobsites of contractors across the U.S. shows that the direct impact of new tasks to comply with the COVID-19 preventive measures, such as health checks, cleaning and sanitizing, as well as completing required paperwork, adds up to almost one hour per person per day. This does not even include the time or productivity loss due to on-site manpower limits, material delays, delivery restrictions, additional site movement, and coordination, etc. This will likely vary across contractor, location, and type of work, so it’s important to track and measure the effort and impact for your specific situation. Not only for the current projects but to know your true cost when estimating and bidding new projects.

Figure 7: Dimensions of Work (Who does What, When, Where)
Once you have quantified the impact, MCA, Inc.’s recovery calculator will help contractors to estimate the additional annual financial burden for their business that needs to be covered during and most likely beyond the reopening phase. This is an additional cost and lost labor productivity that contractors should not expect to be compensated for beyond what they bid and are awarded in new contracts. Without change, this will cause significant cash flow problems as well as profitability losses and will put your business even more at risk. The most sustainable solution to get back on track, and at least restore the expected productivity at your projects is to rethink and breakdown your work in a way consistent with the dimensions of MCA’s Work Cube (“Who” does “What”, “When”, “Where”) to visualize and identify improvement opportunities (see Figure 7). 

You don’t have to be overly creative, innovative, or need to invest in expensive software and technology to achieve this – stay on the road to Industrialization of Construction®. Agile Construction® Principles and Tools, such as project visibility, work breakdown and planning, productivity measurement, and tracking using WEM®, Externalizing Work® through prefabrication, as well as vendor support in logistics and services will all help lower your cost, improve productivity and profitability.

We have all taken a hit, but our perseverance is what separates the good form the great companies. Focus on reducing your cost and planning your jobs to improve productivity and profitability. Breakdown, plan, and identify as much work as possible that can be taken away from the jobsite to expand your level of Prefab and VMI. The cost and productivity improvements you will see from these actions will not only help compensate you for the financial and productivity impact you are feeling, but they will turn into a competitive advantage for your company in the long run once they become ingrained in your culture.

Research Corner

MCA Inc. is proud to share the recent publications and industry media coverage:

Release Announcement

MCA, Inc. is proud to announce the release the 2nd Edition of our best-selling book “Agile Construction® for the Electrical Contractor”.

What is new?

 -  Work Breakdown Structure (WBS) Deep Dive
 -  Additions on Project Planning & Project Management 
 -  More Details on Externalizing Work® through Prefabrication 
 -  Agile Construction Tools® updates and new features 
 -  Updated Safety Study for the Construction Industry

Pre-Order the new edition now at a discount for $79.00/ea. (+ tax & shipping)