Find Three Advantages

Hello everybody. Dennis Engelbrecht with Digging Deeper. The Family Business Institute series, Digging Deeper into
specific construction issues and problems that we see throughout our round table program across the country.

I'm really in a privileged position. I sit with some 120 construction executives twice a year and I have the ability to listen
to and learn all of the great things that they do right and to learn from 120 terrific, but in some cases, slightly flawed
leaders as we all are. We're all flawed leaders, right? And all trying to get better. And probably the reason people are in
our program is because they all do want to get better as leaders.

So, every once in a while though, you really come out of here with some gems. And there's one fellow in particular who
built his company from scratch over about the last 20 years to a very successful construction company doing about $200
million a year in revenue.

And he said something, I think in the very first meeting I was involved with him that just stuck. And, of course, in our
program we share these best practices, and this has become a mantra for companies across our program. And the simple
statement was, "If you're going to bid something, find three advantages." All right? Just think of the power of that phrase.
Find three advantages.

If you're going to bid and you're living in a bid world, right? The way you can win a job versus somebody else, if you all
have the same suppliers, same subcontractors, the only way to win a job is to reduce your fee, right? Reduce the profit
that the company potentially can make, but not if you can find three advantages. If you can find three advantages that
you think you have, maybe it's in how you sliced and diced the drawings and figured out a better way to do something or
maybe you think there's a value engineering piece I can get here with the owner and you have a discussion with them.
Maybe you asked more questions. Some people look at the drawings with a cursory look and think that they have to cover
things that they don't have to cover. But maybe you ask better questions and you get information that the others don't
have. Or maybe you get a supplier or a subcontractor who's willing to give you a preferred number over the industry.

However you find those advantages, the key is really to take the time on each bid that you're going to participate in to
find those three advantages. And if you do so, you're going to find yourself being able to maintain your fee or possibly
even up your fee and still win the amount of work you need to keep your company going forward and keep your people
employed.

The other side of this, just the downside of this is if you're biding too many things and you don't take enough time on the
project to find your advantages, well then you may find that you end up with a win ratio of let's just say 10% to 20%. And
again, the fee or gross margin you're getting from that being unsatisfactory.

Think about this. Bid less if that's what you need to do to find your three advantages, but always find three advantages or
don't waste your time. Don't go through the process.

Now, a few exceptions, obviously. Sometimes you have to respond to customers because they're your customer and things
like that. But you may be full and not need the work and those sorts of things. But if you truly want to win, find your three
advantages. Work them hard and I think you'll have a market successful construction company. Thanks for tuning in.
Dennis Engelbrecht, Digging Deeper.