If you are responsible for the operational and financial success of plumbing, heating, cooling and piping projects, chances are you’ve run into a situation where you just weren’t sure the team had a handle on its project. You may have a hunch that something is amiss, but you just can’t put your finger on it.
This can be challenging for project executives, as risks can get out of control quickly if not properly addressed. And the project team may not know when to raise their hands for help.
This scenario is, of course, stressful for everyone involved. Where do you begin?
There are countless strategies and methodologies for gathering perspectives and identifying project risks. I previously wrote about one approach we use focusing on using data to turn instincts into insights (https://bit.ly/3zNleIn). Some contractors may do this by word of mouth, walking the jobsite or tracking productivity. For others, it may be the result of a customer-facing check-in or some other method.
Any time financial risk is identified, a process we call an executive project review should be scheduled. Of course, completing a project review is one thing; acting on it is often a bit more difficult. With this in mind, here’s how we use executive project reviews to catch risk and address it using a collaborative, actionable approach that ultimately keeps everyone out of harm’s way.
At its most basic, an executive project review is a playbook designed to help project leaders and their teams work through potential risks in order to arrive at a recovery plan. Consider these four elements when initiating an executive project review:
1. What process will be used to identify projects potentially at risk?
2. How will projects be selected for a review?
3. What is required to prepare for and complete the project review?
4. How will you ensure the recovery plan is successfully implemented?
Identifying project risk
If I’m a plumbing and piping contractor and I get the sense the team doesn’t seem to be in control of their project — my project — I’ll want to lean in to determine how I can help. This should be an internally focused process. Because my instincts tell me this project could be a high-risk endeavor, I need to visit the jobsite — in an organized manner — and work together with the team to create a recovery plan.
Precisely what to look for in a project that may be at risk will vary from one contractor to the next. At McKinstry, for example, we look at the monthly superintendent and shop lead reports. Is there anything in these reports to indicate an elevated potential for risk?
These two reports will then feed into what we call a risk summary report. The risk summary and monthly business reports are gathered and reviewed by project executives, who will then select potential projects for review (or confirm that projects part of a previous executive review are due for follow-up).
Regardless of how you approach risk detection, make sure you have a process in place to identify projects rising to the top that require an executive review.
Selecting projects for review
Inevitably, someone will ask, “How or why did you pick my project for review?” Or, “Am I in trouble?” These are natural reactions, and that is why it’s important to list the criteria — or reasons — for selecting projects to include in a review.
While you shouldn’t feel compelled to state exactly why a project was selected, you should share something like, “We’ve identified these X criteria that apply to this project. We think you could use some help, and here’s how we’ll go about doing that.”
Potential project selection criteria will vary from one contractor to the next but could include some of the following (typically a combination of several):
Project has been highlighted in monthly business report as a potential challenge;
Project has been highlighted in a monthly risk summary report;
Project team has experienced turnover at key staff or craft roles;
Project team is currently lacking in key support functions (e.g., project coordinator, project engineer, senior project engineer, etc.);
Project does not include a labor plan;
Project is unique to the team or geography;
Project is carrying an unusual or unexplainable underbilling or negative costs in forecast;
Business unit is without regular or reliable monthly project reviews hosted by the operations manager;
Business unit is lacking a resource management tool;
Business unit is without adequate business operations support or operations manager;
Business unit is unable to staff the project with personnel who have appropriate subject matter expertise;
Business unit is missing revenue, gross margin or department overhead targets and, therefore, project performance might also be at risk.
Preparing for the executive project review
Now that you’ve established criteria for project risk and identified projects warranting a review, what does the executive project review look like? First and foremost, it needs to happen on-site — not via Microsoft Teams, Zoom or a telephone call. The key is to give the team — and yourself — a couple of weeks to prepare for the meeting.
Have the project team compile a prep package for review in advance, so you are adequately organized and briefed to lead the review. You don’t need to visit the site to discover any of these details, but you must review them — and status them — before going onsite to conduct the executive project review.
The prep package should not be a heavy lift for the project team. All the documents you need to digest in advance of the meeting should already exist. An example of documents that should be shared as part of the prep package could include:
Latest project forecast/estimate to complete;
Project lifecycle report with critical process tools;
Risks and opportunities log of any running issues that can swing a project;
Build plan (https://bit.ly/3J85L8S);
Project schedule (https://bit.ly/3Qiurj1), contract and specifications;
Baseline labor plan (https://bit.ly/3oFiOXD);
Scope clarification matrix;
Team organizational chart with roles and responsibilities matrix.
It’s worth noting that the prep package for mid-market or specialty projects might look a little different because you may not have some of those tools in place on a smaller project.
Once you arrive at the executive project review meeting, you don’t want to spend time talking through everything in the prep package. Instead, focus on discussing the known risks, challenges and opportunities. And be certain to build in some social time, whether it’s breakfast, lunch, happy hour, etc. (Remember, your team is probably nervous about participating!)
Most importantly, the review shouldn’t just be you talking at the team — it’s an opportunity to have genuine one-on-one time with them. For example, take time to walk the jobsite, and demonstrate some curiosity about the individuals and team doing the work.
Visiting the team onsite versus calling them into your office shows you care. This review meeting presents an opportunity for some honest, vulnerability-based trust that should lend itself to a recovery plan that is actionable, accurate and authentic.
Ensuring a successful
risk recovery plan
The prep work you’ve done and the discussions held with the team should prompt some questions that define next steps: What’s our mitigation plan for the risks? What’s our delivery plan for the opportunities? What’s the net result we think we can achieve? To turn the executive review meeting into something truly actionable, you need to build in appropriate follow-up.
Set out to establish a circular check-in process to ensure the recovery plan is moving forward every 30, 60, 90 days. Whatever the cadence you choose, ensure there’s two-way accountability to do something different to unlock the true value of a recovery plan. It’s just as important that you follow up on the recovery plan as it is the team executing it.
For example, the recovery plan may identify that you need to add staff to the project because the root cause of the risk is your team can’t do it all. If you don’t follow through and add more staff, the recovery plan is destined to fail.
You may only have time to do two or three of these reviews in any given month, depending on the scenario and your time commitment. However, follow-up on recovery plans must be a priority. It’s important to never lose sight of the fact that the project ended up at risk somehow. Leaving the review meeting and expecting to see change without building in a follow up process is a recipe for repeated failure.
While it wasn’t actually Albert Einstein who said it, the definition of insanity is doing the same thing over and over and expecting a different result.