Many factors impact our health. The same is true for construction business health. You can never be healthier long-term than the foods you choose to eat. The same is true for contractors and projects they choose to pursue. Sometimes choices for food and projects are limited by availability but that is often a false limit.
The Funnel
You can never win more work than what is available in the market(s) you choose to work in. Total available work in your chosen markets represents the top of the funnel.
At the bottom of the funnel is the outcomes - the work awarded to you. Targeting 25-30% market share is a very stable position in most markets. Achieving this should be part of your strategy, business model, and 3-year business plan.
Where you work is your choice. What gets awarded to you is your customer's choice. There are three major pieces to the middle of the funnel.
- Your business development systems and team. This function will know about all the customers, connectors, and opportunities in the market. This is the first limiting factor in the opportunities you will see. Never mistake the opportunities you see for the total available market.
- Your operational reputation in market with the customer's decision makers and influencers. This is the next limiting factor. The decision makers and influencers must see your company as a good solution for their needs with limited risk. This starts with a history of successful performance on projects of similar size, scope, and geography. This makes operational execution a prerequisite - that consistent performance history must be there. Beyond that, it is probably 20% marketing and business development with 80% being how effectively the leadership team connects with the decision makers and influencers. Creating a new reputation from zero in a new market is a challenge requiring discipline over time. Changing minds about a bad reputation is substantially more challenging.
- Your operational alignment with a specific customer and project opportunity is a critical filtering mechanism of your choosing. Go/No-Go is your "Middle Game" - optimizing your returns and mitigating risks. There is a direct correlation between a contractor's overall strength and how disciplined they are with their go/no-go process.
The 10 Questions - Starting at the Top of the Funnel
Questions 1-7 are general about your company and the market. Questions 8-10 are specific about a customer and project opportunity. The article links provide some additional context around the question.
- Are we clear on where we will and will not play? Five Strategy Questions + ABCs of Market Strategy
- Is it large enough for our business model to work? Market Share Economics + Business Model
- Do we know about all the players in the market? The Truth About Business Development
- Do we know about all the opportunities in the market? Business Developer and Management Hurdles
- How early do we know about the opportunities? Example - Bechtel's Philosophy on Business Development
- Do all potential customers in the market know about us? Winning Work - The Early, Middle, and Late Game
- How do they see us relative to their other options? Competition - What Do You Really Know?
- Do we currently align with a specific customer? Starting with Trust + Five Foundational Stages of Teamwork
- Do we currently align with a specific opportunity? Opportunity Evaluation (2 Critical Dimensions)
- What differentiating value do we bring to this customer and opportunity? Extended Value Stream + Creating Value
Team Exercise
Work through these in groups of 3-8 people. This group must be key leadership and management that know how to process the additional supporting information below including confidentiality and discretion on how to share the discussions you will have.
Additional Information to Put Together & Provide:
- Provide a list of all projects completed and in-progress during the last 3 years including customer, original estimate and either closed project or current projection information. Include details you normally review with the list possibly including schedule, cash flow, project type, location, project team, etc.
- Provide a list of all opportunities identified, pursued, and won during the last 3 years.
- Provide any other relevant information including strategy, business plans, and financial summaries that will put these detailed lists in context.
Prep Work - Give Everyone 1-2 Weeks to Prepare
- Answer questions 1-7 above while studying the information provided.
- Include information like quantification, timelines, rationale, and relevant examples where appropriate.
- Put answers in writing to help clarify thinking.
- Recommend time boxing the prep work to no more than four 90-minute sessions with at least one of the sessions for review and refinement of prior work.
Meet to Share and Discuss: Depending on number of people, likely two separate 2-hour meetings to keep everyone fresh.
- Roundtable verbal sharing of 1 answer at a time.
- Take notes of what other people are saying.
- Ask questions for clarification only - not to debate. This is just about developing common understanding.
- Make notes of information required to validate or invalidate assumptions.
- Time budget 5 minutes per person per answer including clarifying questions.
Notes and Action Items: Within 48 hours of each meeting.
- Key points of alignment on each question.
- Key points of information gaps on each question.
- Information to close those gaps - or timeline to get that information to the team.
- Key points of difference on each question - if applicable.
Meet to Debate and Decide on Next Steps
- Review notes and action items from prior meetings.
- Prioritize agenda around key points of difference.
- Debate points of difference where applicable being clear on who will decide differences can't be closed with debate.
- With everyone aligned, focus on a prioritized list of actions that will improve outcomes.
An experienced but unbiased 3rd party facilitator can be incredibly valuable for this exercise as they will allow top leadership to participate in the meeting rather than facilitate it.
