You learn your craft and then you get recognized and promoted. Now you’re leading a helper, an apprentice or a crew. Or running a job or a project.

And you find out that other people are not as passionate about what they’re doing as you are.

Welcome to management!

When you break down the word “manager”, it becomes “man-ager”.

And it works both ways.

Managing can both age you and the people you manage.

So the challenge becomes how to motivate, delegate, challenge and inspire.

Again, like your craft, it’s an acquired skill.

When I was first promoted to lead carpenter on a framing crew, I was driven and difficult.

One day at lunch time as we sat on the just framed second floor of a house we were building, one of my buddies on the crew said to me, “Why are you being such an asshole?”

I replied, “If I wanted to win popularity contests, I would have gone to work at McDonalds.”

And he responded, “Well, you wouldn’t win any prizes there either.”

He was right.

It’s taken me a lifetime to learn that good managers are like good coaches.

Don’t you find that the good coaches in your life build on your strengths? They don’t tear you down. They do let you know when you are capable of doing better. But they don’t pick you apart. They praise what you’re doing right. And you know what? 90% or 95% of the time, you are doing right. That’s pretty damn good.

Many, if not most, managers just see the 5% or 10% of the things that are not being done well and that’s what they harp on. That’s a great way to tear a person or a team down and destroy morale

But there’s a reason why so many managers are focused on that 5% or 10% that’s “wrong.” It’s because they are now getting a sense of the numbers that are involved in building. I’m talking about financial numbers.

Builder-managers are given goals and targets and deadlines to hit by their bosses. If they’re lucky that is. Because often times builder-managers are being managed the same way by their bosses… focused on the 5% or 10% that isn’t going right.

And that’s because the typical pre-tax Net Profit a contractor makes is 5%.

I’m not talking about gross profit. I’m talking about what’s left over after you pay your overhead and all your operating costs. 

Industry wide, the average pre-tax net profit over the course of a lifetime in the construction industry is 5%.  A great year is 10%.

A bad year is a negative number. So, an average year is 5%.

And that’s before you pay your federal and state taxes!

Here in California, with our high state income tax rate combined with the feds’, pretty much 50% of a contractor’s pre-tax Net Profit goes to the government. For that we get the privilege of building in a society where we take a lot of our day to day freedoms for granted. And for which I am grateful for.

So, if that 5 or 10% of a job goes wrong, that means the contractor has not made a profit. A profit is what allows them to stay in business. So I get the focus.

Yet, if you’re just being told where you’re missing the mark, but not given the opportunity to hit a target of productive performance, then that’s where the focus goes. 

So, let’s get to the point in our lives where we acknowledge and work to improve the areas that we’re capable of doing better on, while at the same time being  mindful and appreciative of the 95% of things that are going well.

That doesn’t just happen. People make that happen. They deserve the credit for that. Credit for work well done is cheap. It costs you nothing. It improves morale. And it makes the company money.

I once had a project manager say to me, “Bruce, if I dropped a box of 100 nails on the ground and picked up 97 of them, you would say something about the 3 left on the ground.”

I said, “You’re right, I would. Unless you mentioned it to me first. Because I see those 3 nails on the ground and that represents half of the profit on the job. So if you don’t say something about the 3 nails on the ground, it makes me wonder, if you see them. Because I do.”

“However,” I added, “if you mention it first, then I know that you’re aware of it. If you’re aware of it, then I believe that you’re going to do something about it. It shows me that you’re conscious of how close the numbers are.”

You can learn from that and take a different approach as I eventually learned to do.  As I mentioned, good coaches build on the strengths that you have and hold you accountable, respectfully, to a higher ability to improve and do good. In every sport and activity, the best ones work from that premise. It’s 90% praise and 10% advice. Now granted, that assumes you want to get better and that you’re a willing student.

So, if you have a crew member who wants to get better, it’s 90% praise and 10% advice. If they don’t want to get better, then at some point they’ve going to get cut from the team. The margins are simply too tight to keep non-learners on the team.

Find out more at Starting Your Business as a Contractor.