« Yellow Pages Advertising | Main | Why Employees Are Sick »

Do The Math!

Just do the math - why is this so hard for people to understand?

Quality Digest magazine has a regular column called "Do The Math" and in December they make some great points about how widespread the mis-use of numbers and statistics really are.

The problem is that most people do not ever take the time to do some simple, back-of-the-napkin math to determine if what someone is saying is BS or not!

When someone can not read we have a word for it and talk widely about it as being a problem - why don't we feel the same way about the problem of Innumeracy (when people can't do basic math!) John Allen Paulos makes some great points in this book.

So, what does this have to do with construction?

Well, if you are asking this question then you should definitely go out and buy this book and read it 3-4 times!

Most contractors place large bets on assumptions (estimates) about how long it will take a field crew to build something.

Huge losses occur when these assumptions are wrong and often this is not known until the job is mostly complete and the PM realizes the job has used 120% of the man hours and still has another 2 months to go!

On the other hand huge, windfall profits are often realized when the field crew sees a different way of building the project that results in a substantially lower cost.

If field foremen, superintendents and crew leaders all understood the math of production a little better they would be able to "Do the Math" prior to starting work and during the process to see if their assumptions were really correct.

Is it really cheaper to consolidate homeruns?

How much cheaper?

Are we installing pipe at the same cost as what was in the estimate?

Are we better off working overtime to finish this phase today or to come back tomorrow?

We've been digging for 2 hours - what is our cost per foot and how does it compare to the estimate?

What if we added a full-time material handler to the crew?

Sometimes these questsions are not asked at all. Other times these questions are answered by "Experience and Gut" which may or may not be correct. These questions can all be answered simply by "Doing The Math" which is what the best performers do.

When you are planning your construction jobs focus on teaching your team how to do the math and ask the right questions rather than just giving them some minimum production level or worse yet, just telling them to work as fast as they can. We focus heavily on teaching people to think about production during our Project Pre-Planning facilitation. This approach starts slower but eventually builds a project team and company that is virtually immune to losing money.

Posted by David on January 11, 2007 10:18 AM|Permalink

TrackBack

TrackBack URL for this entry:
http://www.dbrownonline.com/mt/mt-tb.cgi/251