Two Critical Things Every Business Must Do

The business of construction is both challenging and exciting, with days full of risks and rewards.

D. Brown Management Profile Picture
Share

Jack Stack calls it “The Great Game of Business.” In this book and his follow-up book called “A Stake in the Outcome,” he describes how to create a culture of ownership.  

Quote: People who run companies know that there are really only two critical factors in business. One is to make money and the other is to generate cash. Jack Stack. Book: The Great Game of Business by Jack Stack.

At the very foundational level, a business must make a profit and generate cash. While there is a lot more that a business could and should do, it is only with the foundation of strong cash flow growth that allows these other things to happen.  

Like Maslow’s Hierarchy of Needs, we can’t focus on self-actualization if we don’t have our primary needs of security, shelter, and food met.  

As a society grows, it is easy for people to lose connection with the basics required at the bottom of the pyramid. It can worsen as people take them for granted or become dismissive of them. A building will fall when the foundation is weakened. We can see this happening in today’s society in many ways.  

Here, Simon Sinek talks about current generations wanting to impact the top of the mountain without knowing the whole mountain:

Ensure that this does not happen in your business by connecting profitability and cash flow to actions and outcomes at each level of the organization. This is exceptionally challenging but also exceptionally rewarding if done correctly.  

Do you understand the importance of the Contractor Scoreboard?




Evolving Focus with Growth and Leadership Levels
All contractors are built on the same foundation, which starts with the amazing crafts people. With growth in the business, project size, and your level of leadership, the time you allocate to different layers of the pyramid must evolve.
The Contractor Scoreboard - A Contractor Must Do 3 Things
This outcome-based scoreboard keeps everyone focused on what matters. Avoid metric overload and diffusion of resources. All other metrics throughout all levels of the organization fall into a hierarchy below these with priorities changing over time.
Words of Wisdom for Leading Growth
Develop a clear market strategy and set guiding principles that creates value for your customers and your business. Nurture and promote those on your team that take initiative to aggressively execute strategy while relentlessly following up on details.