Profitability Trends

When you are looking at your scoreboard, remember that industry average benchmarks and single points in time only tell part of the story.

D. Brown Management Profile Picture
Share

When you are looking at your scoreboard, remember that industry average benchmarks and single points in time only tell part of the story.

Scoreboard: Invoice and Graph representing Company Profitability and Trends.

Just like physical training, what really matters for your personal health is that you are consistently improving.

  • Graph your key metrics over the last five years and look for relationships.
      
  • Analyze your data and look for outliers to help the trends make more sense. For example, did you have one super good or bad job in a year that completely skewed the metrics?

  • Be cautious not to over-rationalize “outliers.” If you have a bad job every year, remember that is more likely to be part of the trend rather than due to an outlier. For example, Motorola had something like 24 consecutive quarters of “one-time” expenses. If they occur that consistently, they are regular expenses and not one-time expenses. Also, Motorola is no longer around. 
     
  • What do those metric trends look like if you project them another 2-3 years into the future?

  • Which metrics are trending in the right direction?  

  • Which metrics can you improve?  How?  


Want to talk about it? Contact us for a conversation.




Problem Finders vs. Problem Solvers
Patty McCord represents the shift that construction contractors must make in how they view HR’s role as it integrates with the company’s strategy and execution.
Jack Welch - Any Jerk Short-Term Earnings
The ultimate measure of a leader is how well their business unit performs AFTER they are gone. With the construction industry talent shortages leaders must focus on building other leaders at an accelerated rate just to maintain market position.
Evolution of Project Delivery Methods
Project delivery methods for contractors will become increasingly more integrated from project owner through all key parts of the supply chain, which is a return to models used in the early 1900s with some modernization improvements.