Problem-Resolution Cost Pyramid - Earlier is Always Better

An easy way to visualize the cost of problem resolution at different stages of construction is with this pyramid.

D. Brown Management Profile Picture
Share

To illustrate this we will use a common example of a commercial kitchen equipment plan not being coordinated fully with the electrical plans.  

Field Productivity: Problem-Resolution Cost Pyramid.

A piece of equipment requiring a dedicated circuit is shown on the panel schedule but not the power plan so it was easy to miss in the estimate.  When the problem is identified determines the total cost of fixing the problem:

  • Before - some plastic conduit run under slab, some wire and a couple hours (max) of time.  
  • During - more expensive metal conduit run overhead and 6-8 hours of time.
  • After - remobilization time to the work area, protection for finishes, working above hard lid ceiling, etc. plus the customer is likely frustrated.  

The cost of the problem is the cost of the problem (1X).  Finding it ahead of time minimizes the costs and maximizes customer satisfaction.  Finding it during construction will cost about 3X and after construction 10X+.  


What systems do you have in place to find problems early?  

How many problems did you have last month that could have been found earlier? 

6 Pillars of Productivity

Workshop


Labor Productivity
Field labor is the often the biggest variable on a construction project - making it the biggest risk and opportunity....

Labor Productivity
Field labor is the often the biggest variable on a construction project - making it the biggest risk and opportunity....

Contractor Exit Strategy 6 of 6: Sale to Employees (ESOP)
Contractor Exit Strategy 6 of 6: An ESOP (Employee Stock Ownership Plan) is a qualified defined contribution employee benefit plan designed primarily to invest in the company’s stock.
Evolving Leadership Focus with Role Growth
All contractors are built on the same foundation, which starts with the amazing crafts people. With growth in the business, project size, and your career, the time you allocate to different layers of the pyramid must evolve.
Building a Systems Development Team - Time & Money
Many software projects are over budget, late, and hard to implement. These issues generally boil down to the same root causes.