By Rudy Rodriguez

In the construction industry, many clients harbor a distrust of contractors because they’ve been burned by shady and unethical behavior in the past. Unfortunately, even ignoring the outright scammers who pose as contractors, many legitimate construction companies do engage in some practices that they shouldn’t.

Unethical Practices

In the roofing industry, many clients come to believe that leaks cannot be permanently fixed because they’ve never had contractors who actually do the job right. This isn’t necessarily because of incompetence. There are roofers who won’t make a permanent repair on a leak, as that makes it easy to secure guaranteed repeat business. Other contractors will use a change order to bill more during a project in order to cover mistakes they made, or simply to pad the bill because they want more money for a job. These are the kinds of practices that give the construction industry a less-than-savory reputation.

Why Ethics Matter

Without getting too much into high school philosophy, ethics are a fundamental aspect of a successful company. Without ethics as a value, your business is at risk of a bad reputation, and you may have difficulty retaining good people. As soon as prospective clients stop believing that your company will do a good, honest job at a fair price, the future of your company is in serious jeopardy.

Making It Right

In being an ethical company, your biggest obstacle is the potential disconnect between the owners and workers. Simply put, management can’t monitor every employee 24/7 to make sure they’re doing the right thing. However, you can – and should – still build your company on a foundation of ethics. Start by emphasizing the Golden Rule: treat others the way you would want to be treated. Encourage workers to ask themselves if what they’re about to do would hurt the clients. If so, they shouldn’t do it.


Company culture plays an important role in operating by a core value like ethics or integrity. Simply stating that you’re an ethical company won’t go very far if the workers are cutting corners, overcharging, or lying to clients. Make it clear that your company takes ethics very seriously, and then follow through on that promise. This also extends to management. Don’t work with unscrupulous vendors or suppliers, be ethical in your personal life, and serve as an example to be emulated. It’s not always easy, but it’s the right thing to do--and that makes it worth the effort!

Rudy Rodriguez is the owner of Castro Roofing, a leading commercial roofing company serving the Dallas-Fort Worth Metroplex. 

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This is the second of a two-part series.

By Mike Karlskind

In my previous post, I spoke some about the benefits of mobile technology for a dispersed workforce. Now, let’s consider the “device” part of the equation. 

Selecting the Right Device

To be able to leverage mobile apps and the efficiencies thereof, employees will need to be equipped with either a smartphone or a tablet; these generally carry the same user experience, the main difference being the size of the device. Form factor is an extremely important consideration in the construction industry, where it will likely be treated like another job-site tool. In that case, a tablet is probably too large for journeymen workers. The smartphone, however, is ideal clocking in and out of assignments, tracking mileage, getting details on a new job and completing forms when out in the field. Tablets provide greater flexibility to handle paper-based processes, and can handle more complex apps; they may be an option for your foremen. Also, if voice calling is not necessary for your workers, a tablet could be the better choice because you can avoid paying for a voice and data package through your wireless carrier. Interestingly, for many companies, tablets are replacing the clipboard; they can share up-to-the-minute data as well as manage paperwork. Construction firms could take a lesson from their peers in this regard. Another aspect to consider is durability. There are many smartphones that are built for rugged use, while tablets for harsh environments are not as common. There are a variety of cases available ensure that the smartphone or tablet will not be damaged, but those will add to the bottom-line cost of the device.

Service Plans: The Long-Term Cost Consideration

Many employers may only factor in the cost of a device when they think about equipping mobile workers, and often lean toward Smartphones because they cost considerably less than a tablet. But what businesses don’t always consider is the long-term, recurring costs related to using each device. While a smartphone may be less expensive than a tablet, the service plan, which would have to include voice and data, could cost $40 or more per person each month. On the other hand, many carriers offer tablet-only data plans for $10 to $15 a month, which give the workers the ability to be connected anywhere and everywhere and use the enterprise apps. If your employees already have their own mobile phone, it may be more cost-effective over the long-term for them to use their personal device for voice communications and for the company to provide a tablet with its lower-cost, data-only monthly service plan. Before making a decision on which device is best for your mobile employees, you will want to calculate the total cost of ownership, which is the price of the device and the monthly fees associated with the wireless service plan to support that device. As part of that calculation, do not forget to factor in the estimated savings you expect to achieve from leveraging a mobile application. In many cases, saving an employee a few hours per month through improved efficiency – such as requiring less time doing paperwork or eliminating the need to drive to the main office – will more than cover the cost of supplying a smartphone or tablet and the associated voice and data plans.

Mike Karlskind has more than 15 years of experience streamlining processes and optimizing decisions for service organizations in a wide variety of industries including computer services, utilities, telecommunications, capital equipment, home services, retail services, construction, insurance and medical equipment.

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This is the first of a two-part series.

By Mike Karlskind

The consumerization of field service offers a tremendous opportunity for any business that consists of a dispersed workforce, chief among them construction firms. The use of mobile devices and applications to streamline operations, reduce costs and enhance productivity of workers in the field is more than incremental.

Although these applications are helping individuals do their job better no matter where they are, they also require some thought from company management about which device is the best to meet employee needs in the field. Considerations about durability, efficiency and associated costs all factor into the decision. There are a lot of devices on the market to choose from (Notebook? Smartphone? Rugged PDA? Tablet? Some combination of all of the above?).

The Savings Associated with Going Mobile Whether you choose to equip your employees with a smartphone or a tablet, the proven savings come in the mobile apps. For example, let’s look at a scenario featuring a plumbing company with 50 employees in the field, who each earn an average of $20 per hour.

With a mobile app that automates employee time tracking, provides documents in the field and allows instant customer signatures for completed jobs, thus reducing the paperwork and associated time components of these tasks, the company will eliminate 2 hours of overtime per employee each week, for an estimated savings of $37,500 annually. By not having to constantly come back to the home office to file paperwork or pick up assignments, the company is able to reduce mileage each week by 100 miles, saving about $21,000 a year. Simplifying the back office tasks of processing payroll and managing paper could save another $22,500 a year. And these productivity increases may also allow workers to complete more jobs per day, which could add revenue of $62,500. Under this scenario, when calculating the impact of these various improvements associated with equipping your employees with mobile devices and apps, this company achieves a positive impact to their bottom line of more than $143,000 annually. Not too shabby. Because the productivity and financial benefits of mobile apps can be material, the investment in upgrading to smartphones and tablets is fairly easy to justify. However, as you put a plan in place, it is important to make sure that this investment can grow with your business. Once employees see the benefits of the first app they use, they will want to use their mobile devices for other daily business activities. For this reason, it is vital to “futureproof” devices and service plans to handle the current and future needs of your employees and your customers. In my next installment, I’ll dig a little more into the nuances between smartphone and tablet computers.

Mike Karlskind has more than 15 years of experience streamlining processes and optimizing decisions for service organizations in a wide variety of industries including computer services, utilities, telecommunications, capital equipment, home services, retail services, construction, insurance and medical equipment.

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By Ryne Landers

A series of new reports released by TalentClick, a Vancouver, British Columbia, employee assessment and safety management training company, and prepared by the late Dr. Rick Iverson and Rand Gottschalk, MA, Industrial Psychology, explore the relationship between common employee personality types and risk of incidents in industrial work environments. The reports’ findings distinguish between individual and crew incidents and provide a reliable figure for the average number of incidents and cost to companies that could be reduced through more careful screening of employee selections during hiring and through the use of coaching to improve on-the-job safety records.

What’s The Data Based On?

The study is primarily comprised of two sets of data. One is comprised of employee personality assessment results, called the Safety Quotient™ employee assessment, which was performed on over 645 company employees. The other data set used in the research were existing safety incident reports provided by the industrial mining company in the study. A link to the report, with full definitions, takeaways, and notes about the collection of the data, can be found at the TalentClick website. The study was based upon personality risk assessments, which measure 5 personality traits, collected on 645 employees; 71 personal incident reports; and 197 crew incident reports.

Findings of the Research

The results of the study provide information that can be acted upon by nearly any company in industrial fields, showing statistically significant correlations between several common personality traits that many of us can identify with in our work life, from one time or another. Using the standard Safety Quotient™ employee assessment, Dr. Iverson and Mr. Gottschalk found that personality traits play a large role in on-the-job safety. Among front-line industrial workers who are employed in the field (those whose day-to-day job involves the actual building, engineering, and working on industrial projects) four personality types were shown to be more likely to have accidents on the job, causing injury to themselves or others, as well as causing property damage to equipment or premises. Those personality types are thrill seeker, impulsive, reactive and resistant. Here are some highlights: Key Takeaways

Based on the research, the following takeaways could be applied at the studied mining company:

  • Screening employee hires for “impulsive” personalities could result in 10 fewer personal injuries.
  • Screening foremen and supervisors for “resistant” traits could result in 19 fewer crew injuries.
  • A 25 to 50 percent reduction in annual personal injury rate.
  • A $76,000 average savings for 100 hires.

Screening out risky employees and screening in safe ones provides a safer workplace for everyone and provides measurable cost savings. Proper safety training of current employees can help reduce risks and their associated costs by as much as 25 to 50 percent Isn’t it time we took safety seriously?

Ryne Landers ( works with clients across a variety of industries. He lives near Dallas,  writes for eBay, and would eat Torchy’s Tacos every day if he could.  In his spare time, he’s a technology enthusiast, idealist, and sometimes traveler. Find him on LinkedIn or email him.

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By Kent Goetjen and Mike Sobolewski

A significant increase in required disclosures is among the key changes resulting from the long-anticipated new converged standard on revenue recognition released earlier this year by the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB). Engineering and construction (E&C) firms subject to US GAAP or IFRS financial accounting standards have long followed industry guidance for construction contracts to account for revenue.

The new standard is principles based — a big shift from today’s industry-specific guidance. Changes resulting from the new standard will vary by industry and certain areas will likely create significant challenges for E&C companies. The new standard will require a five-step approach:

  • Identify the contract: When it comes to whether contracts should be combined, major changes aren’t expected. Construction companies that segment contracts might not be significantly affected because of the requirement to account for separate performance obligations. There is an expected increase in significant judgments on  how organizations determine when to include unpriced change orders and other contract modifications in contract revenue.
  • Identify performance obligations: Contractors often account for each contract at the contract level. Under the new standard, contract promises must be for distinct goods or services to be a performance obligation that requires separate accounting. Some construction contracts may have only one performance obligation.
  • Determine transaction price: Under the new standard, revenue related to variables including awards and incentive payments might be recognized earlier. A significant change in practice as it relates to claims, liquidated damages, and the time value of money isn’t expected.
  • Allocate transaction price: Transaction price is allocated to the performance obligations in a contract that requires separate accounting. Of interest will be the allocation of variable consideration (awards, incentive payments) associated with only one performance obligation, rather than the contract as a whole. An entity can allocate transaction price entirely to one (or more) performance obligation when certain conditions are met.
  • Recognize revenue when/as performance obligation(s) satisfied: Under existing guidance, revenue recognition is based on contractor activities; provided reasonable estimates are available, revenue can be recognized as the contractor performs. Under the new standard, revenue is recognized when a performance obligation is satisfied, which occurs when control of a good or service transfers to the customer. The standard is also expected to impact:
  • Warranties – Warranties are currently accounted for within contract accounting or outside contract accounting in accordance with existing loss contingency guidance. Change may occur for some businesses that use a cost-to-cost input method for measuring progress and don’t include warranty as a contract cost.
  • Contract costs – Direct costs of fulfilling a contract are capitalized under the new standard if not within the scope of other standards and if they relate directly to a contract/future performance, and are expected to be recovered under the contract.  Incremental direct costs of obtaining a contract are recognized as an asset if expected to be recovered. There could be a significant change for contractors currently using the gross profit method for calculating revenue/cost of revenue.
  • Contract assets and liabilities – Cost in excess of billings and billings in excess of cost initially recognized on the balance sheet under current GAAP should be similar to the contract asset and contract liability recognized under the new standard. However, the transfer from a contract asset to an account’s receivable balance (when the contractor has a right to payment) may not coincide with timing of the invoice as is required under existing guidance.

E&C companies should continue to evaluate the new standard’s impact on business activities, including contract negotiations, key metrics, taxes, budgeting, controls and processes, information technology requirements and accounting.

About the Authors: Kent Goetjen ( is PwC’s U.S. Engineering & Construction industry sector leader. He has more than 30 years of experience providing service to clients in the engineering and construction industry. Michael Sobolewski ( is a partner at PwC US and an engineering & construction industry specialist. He has extensive industry experience, including work with private companies that have operations locally, nationally and globally.

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By Jennifer Friedman 

In a heavily regulated industry like construction, there are a wide range of compliance issues business owners need to follow. In many instances, companies overlook the importance of remaining in “good standing” after initially incorporating or forming an LLC. Ensuring that the company is staying compliant within state guidelines is essential to continue operating the business effectively and being able to bid on contracts. The benefits of being in good standing coupled with the consequences of failing to comply are compelling reasons why you should know where your company stands.

Most Common Ways to Fall Out of Good Standing

There are many ways that a company can jeopardize its compliance. The easiest way a business can lose its good standing is by failing to file an annual report or make franchise tax payments. It is also important to update an entity’s status whenever the business completes actions such as mergers, acquisitions or expansions because these changes may require filling out a new annual report and tax forms. States also change compliance requirements periodically so business owners have to be aware of new deadlines, forms and fees. While they may seem inconvenient, routine checks to ensure all materials are submitted ahead of time save time and money in the long run.

Consequences of Failing to Remain in Good Standing

The most concerning effect of falling out of good standing is that a business can be suspended and lose permission to continue work. A business in poor standing also appears as an increased risk so lenders are less likely to provide funding. A non-compliant company may have to surrender the company name so competitors can scoop up valuable, established branding. Business owners can be personally liable for failure to comply and can be penalized by the state.

Good Standing Sets The Business Up for Growth

Remaining in good standing brings a wealth of benefits that makes other processes smoother. When a business properly completes the report and tax forms that must be filed in order to maintain compliance, it will receive a Certificate of Good Standing that entitles the company to do business legally. This lends credibility to the organization and secures the benefits of incorporation. When the time comes for the company to expand, the Certificate of Good Standing is a prerequisite to gaining permission to operate in additional states, also known as “foreign qualification.”

How to Prioritize Good Standing

Businesses need to take compliance seriously from the start and invest in relationships with compliance lawyers, accountants and registered agents. To stay up to date on regulation requirements, business owners should take advantage of online tools that make legal issues easier to understand. Getting into the habit of routinely reviewing compliance issues with professionals will help the business avoid unnecessary trouble while keeping it on track for future achievement. In summation, making good standing a priority from the outset and thoroughly understanding the ways in which to keep your business in good standing, is imperative for establishing credibility and maintaining sustainable long-term success.

Jennifer Friedman oversees marketing activities for the small business segment of CT, a Wolters Kluwer Company, providing legal compliance solutions to the small-business community. As the CMO of CT small business, Jennifer directs all activities related to digital marketing and advertising to help build the brand through innovation, partnerships and enhancing the customer experience. Visit for more information.

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By Riggs Kubiak

Ten years ago, contractors or construction executives relied solely on referrals to expand their business. However in today’s world of Angie’s List, LinkedIn and Yelp, word-of-mouth isn’t the only way to secure new business leads. With technology on the rise in commercial real estate, new business prospects are just a click away. As with everything else in today’s world, if you’re not using the latest technology to move your business forward, then you run the risk of falling behind on the opportunities that your competitors are capitalizing on. Here are three reasons why technology is here to stay:

  • Easy Sharing – It is crucial that new mobile apps help building professionals easily store and share their projects on their tablets, as opposed to having to always carry piles of glossy and outdated brochures.
  • Seamless Updates – One of the best things about today’s connected world is that everything that you have is constantly being updated to provide up-to-the-second information. This is true for the real estate industry as well, as for too long professionals have spent a great deal of money on printing out glossy brochures that become outdated within a month of printing. This constant wasting of money is prevented by apps that allow real estate professionals to store their portfolio and constantly update it.
  • Analytics – Technology allows people to access a great deal of information that they were never able to access. For a long time, architects, engineers, contractors and construction executives wouldn’t know who was looking at their portfolios and what projects got more traction when displayed. That is all changing now, as technology allows for an incredible analytical analysis of who is looking at your portfolio, what projects look the best, how long people are looking through your portfolio, etc. The bottom line is this: mobile and web-based platform are turnkey solutions for construction executives who are looking to expand their networks and win new business. If you’re not latching on to this trend, then you are truly missing out on incredible opportunities.

Riggs Kubiak is the CEO and founder of Honest Buildings (HB), the world’s leading connection engine for real estate projects. From architects to engineers, contractors to technology experts, HB helps professionals find and meet the perfect people for their real estate projects, fast. With an innovative suite of products and more than $300 million in deal flow to date, HB is changing the way real estate connections are forged.

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By Kunal Hinduja

Construction managers have a lot to consider when they embark on a massive new project, and the pressure to come in on time and under budget can be enormous. Plus, the venue – whether it be an office building, sports stadium or a shopping mall – has to look great. A stunning lobby will surely enhance the value of a building, attracting many visitors and tenants, but what’s invisible often produces the most value. When it comes to revenue generation and tenant retention, indoor telecommunications need to be a top priority for today’s construction industry.

These issues might seem trivial when planning a $100 million construction project, but these are the amenities that can make or break a visitor’s opinion of the venue. Today’s buildings require a distributed antenna system (DAS), an indoor cellular network allowing all cellular mobile devices including smartphones, tablets and any other mobile device to connect to wireless carriers such as AT&T, Verizon, T-Mobile and Sprint. As mobile devices become more and more advanced, our indoor DAS networks need to perform at a higher and higher capacity. Plus, more data sessions are generated from indoor venues today than outdoor locations, adding greater the strain on the network.

In recent years, high-capacity mobile telecommunications networks have been an after-thought when building commercial real estate. For construction managers and building operators, a solid DAS increases tenant retention and serves as a valuable source of revenue. Public safety is also an important issue to consider when planning for mobile telecommunications in new buildings. More than 70 percent of all emergency calls are made within structures from mobile phones, and a reliable connection of calls is absolutely crucial.

From the beginning of the planning stages, construction managers should be thinking of safeguards to guarantee calls placed to 911, or first-responders such as police and fire departments or emergency medical services. Distributed antenna systems provide this critical function and they could possibly make the difference between life and death. Just as construction managers ensure that sprinkler systems are set up properly and that the structure won’t topple over in the event of a hurricane or earthquake, the same emphasis should be given to a proper DAS to ensure public safety. It’s not just for the outgoing 911 call. Maintaining an open radio frequency communication between first-responders regardless of discipline or jurisdiction is mission critical to ensure the safety of the public as well as emergency personnel involved.

Kunal Hinduja is President of ARQ, a mobile telecommunications services company, which has installed DAS for a variety of projects ranging from professional sports stadiums to Las Vegas resorts. For more information, contact him at or visit

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By Riggs Kubiak

New York City has no shortage of celebrated landmark properties, protected for their historic value. Today, however, these buildings are often in need of structural updates (including electrical, audio-visual, and HVAC) to preserve their character and ensure their continued future use. Such projects are multi-faceted – and often have a unique set of challenges.

Take, for example, the Grace Episcopal church, built in 1847, which was in the planning stages of restoration late last year. ICS Builders was tapped to complete the art conservation and reconstruction of the roof in keeping with its original historic design while completing updates to the church’s infrastructure. ICS ensured that the new upgrades elevated the church to modern capabilities while keeping with the feel of the Brooklyn Heights Historic District.

While restoring the church, ICS Builders discovered a hidden mural on the ceiling, dating back to 1866. Staff preservationist Lisa Renz was called in to ensure the delicate unveiling process was a success. The ICS team overcame many of its roadblocks by implementing proper safety measures and gaining the trust of residents in their capability to perform their duties with the community’s best interests in mind. The project was successful because the church hired a firm equipped to handle such a specialized job. While this project is still in progress (the roof is in the process of being replaced), we can learn a great deal from this including:

  • The importance of ensuring that the updates fit with the aesthetic of the neighborhood,
  • Implementing safety measures to allow community members access to the building even during the construction, and
  • Finding the right projects for your expertise that will allow you to put your best foot forward.

The construction industry holds great opportunity, but it is imperative that firms find the right projects and professionals for their team. Riggs Kubiak is the CEO and founder of Honest Buildings, the world’s leading connection engine for real estate projects. 

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By Martin Flusberg 

Although energy management systems (EMS) are the norm in industrial buildings and large commercial facilities, they’re far from it for most commercial facilities. That’s because according to the Department of Energy, 90 percent of commercial facilities are smaller than 25,000 square feet, and most of these facilities don’t have an EMS. The reasons for the difference in EMS penetration are fairly straightforward. The potential savings of an EMS in smaller venues does not justify the cost of a system intended for the complexities of larger facilities.

Moreover, those systems were typically designed for use by on-site facility managers and, as a result, tend to be overly complex for smaller facilities without dedicated facility professionals on-site. In fact, our experience suggests that typical 100 store retail chains often have only one facility manager supporting the entire portfolio. Fortunately, a variety of recent technological developments have changed the EMS equation. Ubiquitous internet connectivity and cloud computing, low cost sensors and wireless communications, and the application of analytics to “big data” have changed the very nature of an EMS, resulting in cost-effective, user-friendly systems more accessible to smaller facilities.

EMS for Smaller Commercial Facilities

An EMS often starts with control of heating and cooling, the largest energy expense in a majority of commercial facilities. Heating and cooling systems in smaller facilities generally have more in common with systems in homes than with systems in larger facilities. As a result, relatively low-cost internet-controlled thermostats can take the place of more costly HVAC control systems. This has brought the savings and convenience of HVAC control to smaller facilities without the complexities associated with traditional EMS.

And fortunately, many small commercial EMSs offer intuitive interfaces that include features particularly important to small buildings Lighting cost is also particularly important as it is typically among the highest energy expenditures in smaller buildings. The good news is that fewer lighting circuits in small facilities means lower costs for lighting controls, and a new generation of products leverages centralized installation and wireless communications to make them even more affordable.

There are also relatively inexpensive new technologies that monitor facility operations at a granular level. Such systems may monitor energy use of individual pieces of equipment and present that information centrally, along with temperature and other variables. This granularity can deliver several major benefits, including:

  • Identifying opportunities for significant savings;
  • Informing management about the prevalence and costs of equipment powered on when it shouldn’t be, helping enforce corporate operating procedures; and
  • Proactively identifying equipment problems, potentially lowering maintenance costs and avoiding major disruptions.

For companies with multiple facilities, benchmarking capabilities deliver additional value by highlighting efficient and inefficient facilities. With granular monitoring, it is possible to pinpoint the reasons for performance differences across locations. And, users are able to identify equipment models that perform best, informing purchasing decisions with hard data. Finally, such an EMS represents a cost-effective way to perform “continuous” or “monitoring-based” commissioning.

Since equipment conditions can, and do, change constantly – often resulting in “drift” or performance degradation – ongoing monitoring ensures that operations can be fine-tuned at any time. Smaller facilities are now well-positioned to take advantage of new, cost-effective and user-friendly EMSs that deliver significant business value.

Martin Flusberg is CEO of Powerhouse Dynamics. He has spent most of his career developing innovative technologies that address climate change; the first half in transportation and the second half in energy. Most recently, he was co-founder and President of Nexus Energy Software, a pioneer in delivering on-line energy and carbon analysis to consumers and businesses. 

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