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This is where PayCrew's owners share what they've learned in their combined fifty years of industry experience.

 
October 24, 2017

Knowing these ratios will avoid serious problems down the road.

Financial indicators such as the liquidity ratios, leverage ratios, efficiency ratios and profitability ratios can be used to gauge the performance of your business. With the analysis of these ratios, you will be able to make the informed and right decisions for your business. The following are the top four types; Liquidity Ratios These are used to determine a company’s ability to pay off its short-terms debts obligations. Generally, the higher the value of the ratio, the larger the margin of safety that the company possesses to cover short-term debts. Examples; Current, Quick, Days of Cash, Working Capital Turnover, Under-billings to Equity, Cash to Over-billings. Leverage Ratios Companies rely on a mixture of owners’ equity and debt to finance their […]
October 1, 2017

Can the WIP be in real-time?

Let’s start by defining this question. Can you simply post you’re over/under billings to the GL and view/print accurate financials at any given time? This means without major adjustments, phone calls to PM/Superintendents and working to get stacks of invoices entered into the system. Yes, by just running your WIP report in your accounting system and have it automatically post the over/under billings and know it is correct! This seemed impossible years ago when I first started doing the books for a concrete construction company. I could barely get the WIP built correctly with a spreadsheet. I finally started to get the “feel” or rhythm of the work in progress, but there were problems. One month a project was reflected […]
July 1, 2017
Skills

The Power of Skill-Based Pay Systems and Daily Evaluations

Performance has long been at the core of compensation management. The desire to pay more productive employees a greater wage is, in fact, a strong business strategy, but with the multi-faceted nature of jobs today, a simple measure of ‘performance’ is often very difficult to justify. More and more it is not just the effort put forth by the employee that makes them desirable, but also the amount of job based skills the employee possesses. Some of the potential outcomes of skill-based pay systems include a flexible workforce, lowered labor costs, and increased quality and productivity. Skill-based pay systems are based on the idea that employees will be proactive in obtaining new, job-related skills if they are compensated for such […]
April 17, 2017

Units of Measure? Teach. Teach.. Teach…

Have you ever tried to learn a new game? Like a card game or board game. Do you remember how many times you needed to play it before you “got it”? Look at the NFL and the game of football. If the scoring system and rules were more complex do you think the number of people would watch? Think about it in another way, what if there was no score even kept? All of these questions are to set your mind up for measuring field production in the construction industry. In my conversations with clients, the first response is that it cannot be done, period. Once I get past that roadblock then the next response is that it won’t work […]
February 26, 2017

What is a Work Code? – Part 2 Collective Intelligence

“The goal of standardization is to create a measuring system that increases the collective intelligence of the entire construction industry including the craftsmen and apprentices.” – Lee Clark In Part 1, the following points were proposed as a “standard” to what is a Cost Work Code? Phases = areas, floors, buildings, etc. (Schedule, Sequencing) Cost Work Codes = footings, CIP walls, slab on grade, etc. (Production Measuring, Skill) Cost Classes = labor, material, subcontractor, etc. (Cost) The above represents a “standardization” of terminology for the construction industry that I believe would greatly improve our industry. What we lack is a process to measure the collective intelligence of everyone in construction. When I say “everyone” I am including the new hire […]
February 13, 2017

What is a Cost Code? – Part 1 Standardization

“Until we “standardize” the terminology in our industry, the answer to the above question will be; Whatever any Accounting Software Company, Controller or Estimator wants them to be! Each one having different values.” – Lee Clark Before we try and answer the question, let’s briefly define the terminology. Cost Codes are specific types of work being done on a project. Examples of cost codes would be footings, CIP walls, and slab on grade. These generally resemble the CSI index in some form. The differences between companies using them will be in the amount of detail that they are trying to collect for these specific types of work. Generally I have found the detail is to complex for the field. Phases […]