Your project managers are stretched thin. Superintendents cannot be everywhere. Details are falling through the cracks, and too many questions still make their way back to you.
It may seem obvious that the company needs another person. But hiring is not always the solution. Sometimes it is the most expensive way to avoid fixing a broken process, unclear accountability, or an employee performance problem.
In this episode of The Construction Leading Edge Podcast, Todd Dawalt walks through five tests construction business owners should complete before hiring a project manager, superintendent, estimator, operations leader, selections coordinator, or another overhead position.
The goal is not to avoid hiring. It is to determine whether the business truly needs more capacity—or whether the pressure could be reduced through a better process, clearer ownership, stronger performance, or a more complete preconstruction handoff.
Listen / Watch
Prefer to watch? Watch the full episode below:
Who This Episode Is For
This episode is for construction business owners who are considering adding another person but want to make a strategic decision instead of reacting to temporary pressure.
It is especially relevant if you:
- Are considering hiring a project manager, superintendent, estimator, operations leader, or selections coordinator
- Feel like the current team is overloaded and constantly working in reactive mode
- Worry about adding overhead before you know whether the workload will continue
- Have team members who regularly bring decisions and questions back to you
- Are unsure whether the real problem is capacity, accountability, process, or performance
- Start projects before scopes, selections, trade partners, budgets, and schedules are fully prepared
- Want to calculate the workload before making a six-figure hiring decision
- Need to determine whether the company can financially support another overhead role
- Want new employees to enter a clear system instead of being hired into confusion
Problems This Episode Helps Solve
This episode helps answer questions such as:
- How do I know when it is time to hire another person?
- Is my construction company short-staffed or simply disorganized?
- Do we need another project manager or a better preconstruction process?
- How can I calculate whether my team has a real capacity problem?
- What should a new employee be accountable for?
- How do I know whether an employee is overloaded or underperforming?
- Can the business afford another overhead position?
- What is the full cost of hiring a project manager or superintendent?
- Should I hire someone to build our processes for us?
- How can I avoid hiring from panic or refusing to hire because of fear?
Episode Summary
When a construction company feels overloaded, hiring another person can appear to be the fastest solution. But before adding payroll and management complexity, the owner needs to identify the exact problem the hire is supposed to solve.
Todd explains that there are several possibilities. The team may have a legitimate capacity gap. The company may also have unclear accountability, an incomplete process, a weak office-to-field handoff, or an employee who is not fully owning the role they already have.
Adding a person without making that distinction can create more overhead without reducing the chaos. The new employee may become one more person asking the owner questions, waiting for direction, and trying to operate without a documented playbook.
The first test is accountability. Before writing a job description, determine who currently owns the result and whether someone on the existing team should already be accountable for it. Shared responsibility often means no one is truly accountable, so the work eventually falls back on the owner.
The second test is process. Project managers and superintendents may look overloaded because they are receiving incomplete projects from preconstruction. When scopes, selections, budgets, trade partners, schedules, and procurement details are not ready, field leaders must solve those problems during construction.
The third test is capacity. Owners should calculate the real hours required to manage the company’s workload instead of relying only on the feeling that everyone is slammed. Estimating the hours required by role and project can show whether there is a measurable gap.
The fourth test is performance. Hiring can become an expensive way to avoid a difficult conversation with someone who is not making decisions, following the process, or delivering the results their role requires.
The final test is financial readiness. A salary does not represent the full cost of a hire. Payroll taxes, benefits, vehicles, devices, software, recruiting, training, mistakes, and management time can turn a $90,000 salary into a substantially larger annual commitment.
By testing accountability, process, capacity, performance, and financial readiness, construction business owners can make the right hire at the right time for the right reason.
Key Takeaways With Timestamps
00:12 – Are you short-staffed or just disorganized?
Todd introduces the central question owners should answer before hiring a project manager, superintendent, estimator, operations person, or selections coordinator.
01:05 – Hiring can be an expensive way to avoid the real problem
Before hiring, determine whether the company needs more capacity, a stronger process, clearer accountability, or a performance conversation.
02:30 – Owner dependency can look like a staffing shortage
When every question and decision goes back to the owner, hiring another employee may create one more person who needs direction instead of reducing the bottleneck.
03:29 – Hiring too early and hiring too late both create risk
Waiting too long can burn out the team and affect customers. Hiring too early can add overhead, complexity, and more work for the owner.
04:56 – The fear of hiring someone and later laying them off
Owners often hesitate because they do not want to recruit someone away from a stable job and then eliminate the position if the workload changes.
07:16 – Do not hire a person to compensate for a broken process
A new employee may not solve chaos caused by unclear accountability, poor handoffs, underperformance, or an incomplete operating process.
07:54 – Ask what problem you are actually trying to solve
“Can we afford to hire?” is not the only question. First identify the specific result, constraint, or business problem the position should address.
10:54 – Test one: Clarify accountability before adding headcount
Determine who is accountable for the result today and what exact results a new employee would own.
11:45 – Avoid hiring someone simply because you need help
Hiring a person with a vague responsibility to “help out” creates confusion. The role needs defined outcomes, decisions, and measures of success.
13:47 – Shared responsibility often means no accountability
When multiple people are partially responsible, important work can fall through the cracks and eventually return to the owner.
14:28 – Define what winning looks like in the first 90 days
Before hiring, clarify what problems should stop reaching the owner and what measurable results the employee should produce.
15:47 – Test two: Check the process before blaming capacity
Determine whether a better process—especially a stronger preconstruction process—would reduce the workload on project managers and superintendents.
16:23 – A preconstruction deficiency creates field chaos
When projects begin without complete information, the field team must compensate for missing scopes, selections, budgets, trade partners, and schedules.
18:01 – Incomplete handoffs make every project harder to manage
A superintendent cannot permanently outwork a bad handoff, and a project manager cannot manage incomplete information forever.
20:06 – Test three: Calculate the management hours required
Move from emotion to math by estimating the number of hours each project requires from an estimator, project manager, superintendent, or coordinator.
21:04 – Calculate usable hours, not theoretical hours
Meetings, travel, interruptions, administrative work, and other obligations reduce the number of hours an employee can actually spend managing projects.
22:29 – Test four: Assess the current team’s performance
Determine whether the team is genuinely overloaded or whether someone is failing to make decisions, follow the process, or own the expected results.
23:04 – Hiring can help owners avoid a hard conversation
Adding another person may allow an existing performance problem to remain hidden instead of being addressed directly.
24:39 – Define the leading indicators of success for each role
Todd recommends identifying the five most important activities that indicate whether an employee is succeeding in the role.
26:02 – You may not be able to take every employee into the next stage
As the company grows, some people may struggle to transition from an informal environment to a results-based organization with clearer accountability.
27:04 – Test five: Forecast the true cost of overhead
Project managers, estimators, superintendents, and coordinators bring costs beyond salary, including benefits, vehicles, software, recruiting, training, and management time.
27:48 – A $90,000 salary may represent a much larger commitment
The full annual cost of a role may reach $120,000 to $150,000 after the additional employment and operating expenses are included.
28:18 – Determine how much revenue and gross profit the hire requires
A financial forecasting tool can show how much additional gross profit and revenue the business needs to support a new overhead position profitably.
29:05 – Evaluate the cost of not hiring
Burnout, turnover, unhappy clients, schedule delays, missed details, and the owner remaining involved in every decision also carry significant costs.
31:09 – Make the decision from a position of strength
Use workload, accountability, processes, performance, backlog, pipeline, and financial data to replace emotional arguments with a strategic decision.
33:33 – Pitfall one: Hiring from panic
Feeling overwhelmed may be valid, but panic is not a hiring strategy. Diagnose the pressure before adding payroll.
34:27 – Pitfall two: Refusing to hire because of fear
When the numbers prove a capacity gap, fear and scarcity thinking can prevent the company from making a necessary investment.
35:08 – Pitfall three: Expecting a new hire to create the system
A talented employee can improve a system, but should not be expected to invent the company’s processes while simultaneously performing the job.
37:15 – Complete all five tests before making the decision
Clarify accountability, examine the process, calculate capacity, assess performance, and forecast the full financial impact.
40:23 – Take a five-minute hiring action step
Write down the role you are considering and identify whether the problem is capacity, process, accountability, performance, or financial readiness.
Key Concepts From This Episode
Capacity Problem
A capacity problem exists when the amount of work genuinely exceeds the usable hours available from the people responsible for completing it.
Capacity should be evaluated with measurable workload data rather than assumptions, frustration, or a temporary surge in activity.
Accountability Problem
An accountability problem exists when no single person clearly owns a result, decision, or part of the business.
When responsibility is shared vaguely among several people, work may be missed and questions often return to the owner.
Process Problem
A process problem occurs when employees must repeatedly compensate for incomplete information, unclear steps, inconsistent handoffs, or missing standards.
Adding headcount may increase capacity temporarily, but it will not eliminate the unnecessary work created by a broken process.
Preconstruction Deficiency
A preconstruction deficiency occurs when projects enter production before the scope, selections, trade partners, budget, schedule, specifications, procurement, and other important details are ready.
That missing information creates extra work for project managers, superintendents, field personnel, and the owner.
Performance Problem
A performance problem exists when an employee has reasonable capacity and adequate systems but does not consistently make decisions, follow the process, or deliver the expected results.
That requires clear expectations, feedback, accountability, and follow-up—not automatically another hire.
Fully Loaded Cost of a Hire
The fully loaded cost includes salary plus payroll taxes, benefits, vehicles, devices, insurance, software, recruiting, training, onboarding mistakes, and the time required to manage the employee.
Owners should calculate this complete cost before deciding whether the company can support the role.
Resources Mentioned
Construction Leading Edge Resources
Tools, Software, and Platforms Mentioned
- JobTread
- Procore
- Buildertrend
Recommended Next Step
If your company feels short-staffed but you are not sure whether another employee will solve the real problem, apply for a Business Evaluation Call.
The evaluation will help identify weaknesses in your preconstruction process, office-to-field handoff, accountability structure, and operating systems. It can also reveal profit bleeds and owner dependency that may be creating unnecessary pressure on the current team.
Client Success Stories
Want to see how other construction business owners are applying these ideas?
Watch client success stories from builders, remodelers, and general contractors who have worked with Construction Leading Edge to reduce chaos, improve their systems, and build companies that run with less owner dependency.
Related Episodes
Episode 408: Before You Hire or Buy Software, Fix This First in Your Construction Business
Todd Dawalt explains why construction owners should systematize in the right sequence—process, tools, then people—before hiring more staff or buying software.
Episode 429: Grow Your Profit Without Growing Your Team
Todd Dawalt explains how construction business owners can increase profit without adding headcount by eliminating low-value work, load shedding non-revenue-producing tasks, and creating more specialized roles.
Episode 428: Scale Without Sacrificing Profit, Control, or Freedom: The 3-Legged Stool Every Builder Needs
Todd Dawalt explains how builders can scale sustainably by avoiding common growth traps and building the systems, pre-construction process, accountability chart, playbook, and role clarity needed before adding people or work.
FAQ
How do I know when it is time to hire another construction employee?
A hire may be justified when the workload math shows a sustained capacity gap, the role has clear accountability, the supporting processes are documented, the existing team is performing appropriately, and the business can support the fully loaded cost.
Should I hire another project manager or fix our process first?
Examine the process first. If project managers are overloaded because scopes, selections, budgets, schedules, or trade partners are incomplete at handoff, strengthening preconstruction may reduce the workload without adding headcount.
How do I calculate whether my construction team is overloaded?
Estimate the weekly hours required for each active project, including site visits, client communication, trade coordination, scheduling, ordering, quality checks, meetings, and closeout. Compare that total with the team’s realistic usable hours.
What should I define before posting a construction job opening?
Define the exact results the role will own, the decisions the employee can make, who manages the position, what work will move off another person’s plate, and what success should look like during the first 90 days.
How can I tell whether we have a capacity problem or a performance problem?
A capacity problem means a capable employee has more legitimate work than their available hours allow. A performance problem means the person has sufficient capacity but is not consistently completing the expected activities or producing the required results.
What is the real cost of hiring a project manager or superintendent?
The true cost includes more than salary. It may also include payroll taxes, benefits, insurance, a vehicle or allowance, phone, computer, software, recruiting expenses, training time, onboarding mistakes, and management time.
Should I hire an experienced employee to create our systems?
An experienced employee can improve existing systems and contribute valuable ideas. However, hiring someone into an unclear organization and expecting them to build the system while performing the role creates unnecessary risk.
Todd Dawalt
Founder of Construction Leading Edge and host of The Construction Leading Edge Podcast
Todd Dawalt is the founder of Construction Leading Edge and host of The Construction Leading Edge Podcast. Since 2014, Todd and the Construction Leading Edge team have helped construction business owners systematize their companies, reduce chaos, improve profitability, and build businesses that run with less owner dependency.
Full Transcript
Todd Dawalt (00:12.974)
Have you ever wondered, how do I know when it’s the right time to hire someone for my construction business? Or maybe the question is more specific. How do I know when it’s the right time to hire a superintendent, a project manager, an estimator, or an operations person or a selections coordinator? Have you ever looked at your team and thought, are we actually short-staffed or are we just disorganized? Maybe your PMs are stretched thin, your superintendents can’t be everywhere.
And details are falling through the cracks, and every other question still bubbles its way up to you. Maybe part of you thinks we need more help, but another part of you thinks, what if I hire someone, add a bunch of overhead, and the work dries up? So here’s the thing: hiring is not always the solution. Sometimes it’s the most expensive way to avoid solving the real problem. That’s what we’re going to talk about today.
Before you hire someone, it could be your first hire, it could be your tenth hire, but before you hire someone, you need to prove whether you need more capacity, a better process, clearer accountability, or a performance conversation. You’re listening to the Construction Leading Edge podcast from constructionleadingedge.com.
Where it’s all about systematizing your construction business to maximize freedom, impact, and wealth. My name is Todd DeWalt, and my team and I have helped nearly 500 construction companies eliminate chaos, grow their profits, and grow their team. So let me know if any of this sounds familiar. Maybe you’re looking at the workload and thinking, we need another superintendent or we need another PM or
feels like we need another estimator or we need an operations person who can take this stuff off my plate. And maybe you’re right. Maybe your current team is managing more projects than they can reasonably handle. Maybe there are not enough hours in the week for all the site visits, client meetings, subcoordination material ordering, schedule updates, quality checks and and everything that your projects require. But maybe that’s not the whole story.
Todd Dawalt (02:30.54)
Because in a lot of construction businesses, the owner is still the answer person. A PM has a question and it goes to the owner. Superintendent’s not sure what to do, goes to the owner. The estimator needs a decision and it goes to the owner. A client asks something that should have been clarified weeks ago and it goes to the owner. And the owner becomes the pressure relief valve for the entire business. And eventually it feels like the only answer is to hire another person, but
Underneath that hiring conversation, there’s usually a deeper question. Are we truly short-staffed, or is the business just too dependent on me? And that’s a very different question. Because if the business is too dependent on you, hiring another person may not solve that. Another way to say this is: if your business is a machine, is your machine designed to fail without you?
If you were to be removed from the process willingly or unwillingly for a week or two, is your business going to fail? If so, your business is designed to fail without you. So now if you hire somebody in that situation, you may just have another person asking questions, another person who needs direction, another person who needs to be onboarded, another person who’s not going to be trained very well because you’re already so busy doing other things. And that’s
That’s why this decision really matters because if you hire too late, your team gets burned out, right? Your customers feel the chaos, and good people may leave. But if you hire too early or you hire for the wrong reason, you add overhead, you add complexity, you add this management burden. You may add more work for yourself without actually fixing the problem. So there are a few common fears and concerns that I hear.
This is a very common issue that comes up in our live events and in our CEO alliance. When is the right time to hire someone? And there are concerns like what if I hire someone away from a good job? They trust me to come to work for my company. And then six months or 12 months down the road, I have to lay them off because the workload didn’t hold. Right? They’ve got a family, and you hire this person away, and then you have to lay them off.
Todd Dawalt (04:56.994)
That’s a big concern. And it’s a it’s a really legitimate concern because most people we work with don’t want to gamble with somebody else’s livelihood or their own company’s financial stability. Another fear is what if I what if my team is already operating at redlined? They’re stressed or overloaded. What if I don’t hire somebody? If if your PMs or superintendents or estimators are already stretched really thin.
Then jobs suffer. Customers get frustrated. Customers start questioning things. They lose trust. And they usually don’t come out and say, hey, my trust has eroded with you. It’s usually they start questioning things. They start asking about, hey, what’s the plan for this? What’s going on here? Hey, I caught this mistake. And then they start scrutinizing your invoices. And then things slow down. They get out the microscope, right?
when things are when the team is stretched thin, good people can burn out. And eventually the people you’re trying to protect may start wondering if this business is ever gonna get better and should they pull the ripcord and get out now? So what if what if you wait too long to hire? Then there’s another concern. What if I hire someone and they just create more work for me?
You bring somebody on board, and now you’re training them, you’re answering questions, you’re fixing their mistakes, you’re telling them what to do, you’re explaining your way of doing things. And they’re not actually producing results. They’re just putting more work on you. And you see them sitting in their truck or sitting in their office and they’re not busy, and you’re like, I’ve just taken on all of this additional overhead for this person, and they’ve just created more expense and more work for me. And you may wonder.
Wouldn’t it be better just for me to suck it up and do my do it myself? I it I don’t do I really need somebody, or can I just work a few more hours and just avoid this headache? And that’s the trap. Right? If you don’t hire when you really need capacity, then the business keeps leaning harder on the same people and it keeps leaning on you. But if you hire when the real issue
Todd Dawalt (07:16.874)
Is not a lack of capacity, but the real issue is unclear accountability or a weak process or a poor handoff or underperformance. You may add six figures of overhead and end up with the same chaos, maybe worse. So my advice is don’t hire a person to compensate for a broken process. You don’t want to do that. I’m going to talk about some pitfalls in a few minutes, and I’m going to give you a five step framework.
That you can go through to know it when is the right time to hire. So
The better question is not, here’s a better question. A better question is well it’s not can we afford to hire someone? The better question is what problem are we actually trying to solve? Right. The level of results you get are dependent on the questions you ask. So if you’re asking, can we afford to hire someone, the answer may be yes. But a better question is what problem are we actually trying to solve? And that’s what we want to talk about in this episode.
So a quick break for something that might hit close to home. If you own a construction business and you’re you’re a custom home builder or remodeler or a commercial general contractor, and your business basically lives in your head and it’s dependent on your nervous system. If your business is a machine and it’s built around you, then this is for you. I was on a business evaluation call recently with a builder doing multi-million dollar custom homes and big renovations.
And on paper, things looked great. In reality, he was working, when we dug into it, we figured out he was working 60 to 70 hours a week. And he he admitted that he was spending 50 to 75% of his time on low rent activities, as he called them, or low value activities, and putting out fires. When we looked at his handoff of projects from the office to the field, he graded it at a C or a D because they were starting jobs before scope.
Todd Dawalt (09:22.21)
was nailed down before subs were clearly lined up, selections were half baked, and there was a lot of, hey, we’ll figure that out later. Classic just enough to start trap stuff. And that led to a lot of profit bleeds, costly mistakes like delays, rework. There were a couple of near disasters on high profile projects that he could not afford to screw up. And when we went through the evaluation of his business, we found
Frankly, hundreds of thousands of dollars a year in hidden profit between rework, giveaways, lost productivity, and opportunity cost. And the common thread was a week pre-construction and handoff process. And that call is what I want to invite you into. It’s a free, about a 45-minute long business evaluation call with my team. We’ll walk through a simple diagnostic to grade your
Handoff of projects from the office to the field, we’ll see how much hidden profits may be in your business. And we’ll map out what a real operating system for your business would look like so it can run without everything going through you. If it looks like we can help, we’ll schedule a second call to talk through the implementation program that fits your situation. And if it looks like we can’t help, then you’ll still walk away with clarity and a concrete plan.
Either way, we’ll leave you better than we found you. But the deal is we only have capacity to take on a handful of builders that we work with each month. So if you want your business to look different 12 months from now, now’s the time to act. And the first step would be to click the link in the show notes to schedule your business evaluation call or go to constructionleadingedge dot com forward slash apply APP L Y and book your business evaluation call.
Okay, now let’s get into that five-step framework. Five things to do before you hire. Step one is to clarify accountability before adding headcount. So the first question would be: who is accountable for this today? If there’s a part of the business where there’s chaos, things are falling through the cracks, the first question is: who is accountable for this today? Before you post a job ed?
Todd Dawalt (11:45.08)
You need to look at your strategic blueprint, part of which is your accountability chart. This is where a lot of construction companies get into trouble. They want to hire somebody because we need help. they use what Dave Ramsey called the the mirror test. And the mirror test was pretty simple. When somebody came in to interview for a job, they would hold a little mirror up in front of their face and then look at it. And if it fogged up, they would say, You’re hired.
They would hire anybody with a pulse. But the problem with that, just hiring help, things are stacking up, so you just hire help. That’s a problem because if you do that, people who do that haven’t clearly identified identified who is accountable for what results. So you need to ask who is accountable for various parts of the business? At a high level, who’s accountable for sales and business development?
Who is accountable for pre-construction activities? Who is accountable for the the handoff from the office to the field? Who’s accountable for making sure projects are set up properly? We call it nailing the handoff. Who is accountable for operations? Things like completing projects on schedule, completing projects on budget, quality control. Who’s accountable for client communication during construction? Who’s accountable for managing trade partners?
Who’s accountable for ordering long lead materials? Questions like that. Sometimes the problem is not that you need another person. Sometimes the problem is that three people are partially responsible, which means no one is actually accountable. If two or three people are accountable for something, then nobody is accountable for it. It’s an old saying that I I I’ve gotten tired of saying, but the best way to starve a horse.
Is to have two people feed it.
Todd Dawalt (13:47.102)
If two people are responsible for something, nobody is responsible for it. And when nobody is accountable or nobody’s responsible, guess where it goes? Back to the owner. It slips through the cracks and lands in your lap. Everything that’s shared, if everything is shared, everything eventually falls back on the owner. So before you hire, ask: if we hire this person tomorrow, what exact results would they be accountable for?
Not vague responsibilities, not help manage jobs, not a 47-point job description, not help out, not keep things moving. What exact results would they own? What decisions would they make? And actually, a better question before you start putting together a job description is is there somebody on the team who should be accountable for this already? We’ll talk some more about that in a minute.
But if you do need to hire somebody, what results would they own? What would they be accountable for? What problems would no longer make their way back to you? What would winning look like in the first 90 days? If you cannot answer those questions, you are not ready to hire. You need to clarify accountability first. What we do with our clients as part of our strategic blueprint that we help them create is to develop an accountability chart, an organizational design.
For the future, for two years in the future, what does the business need to look like? That is when somebody talks to me about hiring and they have a question about hiring, I always say, let’s go to your accountability chart. Start there. Step two: check your process before blaming capacity. So a good question to ask would instead of who should we hire, are we ready to hire?
Would a better process reduce the pressure?
Todd Dawalt (15:47.104)
Is this a people problem? Is it a capacity problem? Is it an accountability problem? Or is it a process problem? What I found is in a lot of cases, people want to hire people hire superintendents and project managers.
To deal with the chaos, but that doesn’t actually solve the problem because the real problem is not a capacity issue, it’s a pre-construction problem. There’s a pre construction deficiency, sort of like hundreds of years ago, sailors suffered from this this debilitating disease and they would die. And then polar explorers trying to get to the South Pole struggled and dealt with the same type of symptoms. And they thought it was the presence of something.
But it was actually scurvy. It was the absence of something. It was the a vitamin C deficiency. And what I found is a lot of companies, a lot of construction companies, are dealing with a pre-construction deficiency. This chaos and profit bleeds. It’s a deficiency in their pre-construction process. So this is where a documented pre-construction playbook becomes critical because a weak handoff.
Can make every project require more supervision than it should. Okay. If jobs are starting before the scope is nailed down, your PMs and supers will pay for it. It’s like pushing a snowball down the hill. If you’re saying we’ll figure that out later, well, who’s going to figure it out? Is your PMs and superintendents and lead foremen, your lead carpenters, they’re going to figure that stuff out on the fly during the job. If selections are incomplete, the field
We’ll pay for that. If subs are not lined up, the schedule will pay for that. If budgets and specs are not clear, your field leaders are going to pay for that. If the project is not bought out, the field is going to pay for that. So if the handoff from pre-construction to production is sloppy, everybody downstream has to compensate for it. So a lot of times the owner looks at that and says, the situation looks at this chaos. We need more help. But the real issue is.
Todd Dawalt (18:01.1)
Maybe we need a cleaner pre-construction process. So ask, are jobs starting before scope is complete? Are selections complete before production starts? Before production starts. Are subs lined up? Are budgets, schedules, and specs ready before the field takes over? Are recur recurring questions answered in a checklist, in an SOP, or in a playbook?
Do PMs do your PMs and superintendents know where to look before they ask the owner?
So here’s what I found. A superintendent cannot outwork a bad handoff forever. A PM cannot project manage their way out of incomplete information forever. So don’t hire a person to compensate for a broken process. Fix the pre-construction playbook, or at least fix the most painful part of the handoff before assuming another person is the answer. What I’ve seen over and over is.
Is when there are people who think they’re field leaders, superintendents, project managers. I had one example, a custom builder building beautiful coastal homes in Florida, doing $35, $40 million worth of work, came to me and said, I don’t I’m not sure if my field team, my superintendents and project managers need better time management or if we need to hire people because our we’re not hitting our project schedules or projects are over budget, it’s just chaotic.
And as we dug into it, we realized it wasn’t a time management issue, it wasn’t a capacity issue, it was a lack of pre-construction. Projects were getting handed off, incomplete, and then it was the classic just enough to start trap, which creates chaos during construction. And another way to say that is there was a pre-construction deficiency. So fix your pre-construction process.
Todd Dawalt (20:06.636)
Make sure that that process is nailed down before you hire someone. Step three is to calculate the the management hours required. If you’re thinking about hiring an estimator or a project manager or a superintendent, a good question to ask is: do the does the math prove we need to add another person? This is where you move from emotion and gut feel to numbers, to logic. Because
We’re slammed, may be true, but it’s not specific enough to make a six-figure hiring decision. So I’ve done this a few times with clients. We were designing their strategic blueprint for the future. And in one specific case, we were trying to figure out how many estimators do they need? Do they need to hire more estimators? And so we we did some simple math. We broke down what their duties look like.
How many hours would it take per project that they were working on? If a typical project required 100 hours of estimator time and they were gonna do 10 projects a year, then that’s a thousand hours. That’s half of an estimator. So you can do some math.
for a project manager or a superintendent, you could estimate the weekly management load by project. For each active project, do the math. How many hours or week are required for site visits, trade coordination, client communication, schedule updates, ordering materials, quality checks, meetings, closeout, punch work, and then ask how many active projects do we have? What phase is each project in? How many weekly management hours that does each one take?
And then how many usable hours do our PMs and supers actually have? Not theoretical hours, but usable hours. Not not everybody has 40 clean hours a week for managing projects. There are meetings, windshield time, interruptions, admin, et cetera. So you can do the math. This works for estimators, selections coordinators, project managers, superintendents, just about any role, you can do the math.
Todd Dawalt (22:29.766)
And if the math shows a capacity gap, then hiring may be the right move. If the math does not show a capacity gap, the pressure may be coming from process, accountability, or performance, which we’ll talk about next. Either way, the math gives you a better conversation. So do the math. Calculate the management hours required. Step four is to assess your current team’s.
Performance. And you can ask this question, are we short staffed, or is someone not owning their role? Is someone not following the process? Is someone not doing what they’re accountable for? And this one requires some some brutal honesty because hiring can can become a very expensive way to avoid a hard conversation.
Let me say that again. Hiring can be a very expensive way to avoid a hard conversation. So you can ask questions like has the current team handled this level of workload before? If yes, what’s changed? Is the volume truly higher or is performance lower? Is someone consistently dropping the ball? Is someone on the team avoiding decisions that they should be making?
Is someone bringing questions to the owner that they should be able to answer? Is someone not delivering the results that they are accountable for? In other words, is someone underperforming, but everyone is just working around?
So think about this. Are you considering a hire because someone is overloaded or because someone is not performing? Those are very different problems. If someone is overloaded, you may need capacity. If someone is not performing, you may need accountability. I’ll say that again. If someone’s overloaded, you may need capacity, but if someone is not performing, you may need accountability. And if you hire another person,
Todd Dawalt (24:39.34)
Without addressing the performance issue, you may just give that problem more room to hide. So before hiring around under performance, schedule the one-on-one, clarify the role, define what we would call their top, their big five, the big five activities that are leading indicators of success. This is what we teach our clients to do in our program: is to establish the big five for each role.
Ask questions like, hey, well, tell them this is what needs you need to start doing, this is what you need to stop doing, this is what you need to continue doing, set clear expectations and set a follow-up date. Give that person a chance to own the role, make sure they’re clear on what winning looks like. And then if they cannot or will not own it, if they don’t have the capacity, deal with that directly. But do not assume that adding another person will solve a performance problem.
As companies grow, I’ve seen this over and over. As companies grow, you can’t take everyone with you. As your company grows, you need to understand you can’t take everyone with you. There are people who will not make the transition from a a chaotic three musketeers type environment where it’s all for one and one for all. There are people who won’t make the transition to an accountability.
results-based organization at $10 million a year. You you can’t take everyone with you. And that’s okay. And you have to make the the fundamental decision. Am I going to wrap my business model around people or am I going to design my business based on the results that I want to achieve in the future and then find the people to achieve those results? So you can’t take everybody with you. You need to understand that. Step five.
Let’s talk about numbers. You need to forecast the true cost of overhead. It’s different when you’re hiring, let’s say, field labor operators, carpenters, et cetera. You can you can put they’re producing they’re putting work in place, they’re producing revenue. But when you’re thinking about hiring estimators, superintendents, project managers, selections coordinators, these are overhead costs. So
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You need to ask a question like Can the business support this hire?
Another question to ask is what would it take financially to make this work? And remember, don’t just look at the salary, because salary is only part of the cost. You also need to consider payroll taxes, benefits, vehicles, vehicle allowances, phone, computer, software, insurance, recruiting cost, training time, additional software. We already mentioned software, mistakes made during onboarding, and the the time that it’s going to take somebody to actually train this person. So a $90,000 hire.
Maybe a $120,000 to $150,000 per year decision when you look at the full picture. This is why our clients use a tool that I developed years ago called the Revenue Maximizer. It is a financial forecasting and modeling tool, and it helps them look at overhead, revenue, gross profits, and model the financial impact of decisions like that so they’re not just guessing. So it allows
Let’s say you’re thinking about hiring someone in six months, and you’re wondering how much what would it take to make this work? Well, with using the revenue maximizer, you would plug in that additional overhead cost six months out, and it would tell you how much more gross profit you need to create each month, therefore how much more revenue you need to generate each month to make it work profitably. So ask questions like
What’s the true annual cost of this role? What gross profit is required to support that cost? And then look at your backlog. Is the backlog strong enough? Is the pipeline strong enough? Is this really a long-term need, or is it just a temporary spike? And you can look at the actual logic. You can look at your pipeline. You can look at your backlog instead of this scarcity brain induced fear.
Todd Dawalt (29:05.376)
Where it’s just it’s all in your head and it feels emotional. You can look at the the pipeline and what your forecasted revenue is gonna be. And you can then you can also look at what happens if we don’t hire. You may see that your revenue would spike six months down the road, and your team would be exp would have to do fifty percent more revenue than they can handle, and you can make a
A logical decision, and you can make that decision looking forward into the future.
And that last question is really important too. What happens if we don’t hire? Because some people are you may be afraid that you can’t afford to hire someone, but it’s possible if you have a huge backlog, you may not be able to afford not to hire. Because sometimes the cost of not hiring is also real. There’s a cost to costs like burned out team members. Burned out team members are very expensive. Turnover is very expensive.
Unhappy customers, very expensive. Liquidated damages because of schedule delays, very expensive. Details getting missed, very expensive. You being stuck in every decision, you having to work 70 hours a week, very expensive. So the goal is not to avoid hiring, the goal is to hire at the right time for the right reason, in the right role, with the right financial support. Now, picture this. Imagine
Making hiring decisions without the drama, right? If you think about a Fortune 500 company, think about how they’re making hiring decisions, right? They’re looking into the future. there’s a leadership team that’s not arguing about gut feelings. this is how this is how big boy and big girl businesses make hiring decisions. So imagine your leadership team is not arguing about gut feelings or
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Flip-flopping from one day to the next. One person’s not saying, we’re drowning, we have to hire, while another person is saying, Yeah, but what if what if the work dries up? We can’t have we can’t add overhead. Instead, what if you could say we looked at the workload, we looked at the handoff, we looked at who’s accountable for what, we looked at the current team performance, we looked at the financial the financial impact. Now we know what problem we’re solving. Imagine having real clarity.
On the actual problem you’re solving. That creates confidence. You can operate from what one of our clients, Andy Culp, recently talked about on a podcast, operating from a position of strength, from a position of confidence. If the answer is to hire, you can hire with clarity. You know what results that this new role owns. You know what work moves off whose plate.
You know what winning looks like in the first 90 days. You know what the person should not own. You know who manages whom. You know what systems and checklists they will use. And you know that the business can support the cost. If you go through this process and the answer is is to fix the process, you avoid adding overhead and you solve the actual bottleneck without taking on more overhead.
If the answer is to clarify accountability, then you stop letting everything fall through the cracks because everybody owns it. You eliminate that starving horse syndrome. If the answer is to address performance, then you lead effectively. You stop hiring around someone who’s not doing the job that they already have and they’re getting paid for. If the answer is to wait and reassess, then you track the workload for 30 days instead of making a permanent hire.
Based on a temporary feeling or temporary spike. And that’s the goal. The goal is not to avoid hiring. The goal is not to just hire for no reason. The goal is to make the right hire at the right time for the right reason to operate strategically with your business. That’s how big companies do it. That’s how big companies become big. Is
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They take it out of the emotional part of the brain and they make logical strategic decisions. So there are three pitfalls that I want you to watch out for. I’ve talked with nearly a thousand construction business owners over the past 10 years. And there are three pitfalls here. Pitfall number one is hiring from panic. This sounds like we’re drowning. Just find someone, find somebody with a pulse, get them in here.
And and maybe you are drowning. Maybe you do need some help, but panic is not a hiring strategy. Okay. Slow down long enough to diagnose the pressure. What is the real problem here? Make sure you’re actually solving the real problem. Do not add payroll, do not add add overhead until you know what is actually the problem that you’re solving. Pitfall number two is.
Refusing to hire out of fear. The opp opposite mistake is also pretty dangerous. You may have a real capacity gap. The math may show it. Your team may be overloaded. Your team may be begging you for help. Your customers may be feeling it, but you avoid the hire because you’re afraid. Fear is not a strategy. Scarcity brain is not a strategy. What if what if we have another pandemic?
What if I lose everything? What if, what if, what if, what if? This is what keeps you stuck. Okay. Fear keeps you stuck. So operate strategically, operate logically. Use the numbers, use the backlog, use the pipeline, look at your tool like the revenue maximizer, look at the math, make a business decision. Pitfall number three that I see is people is saying, I’m gonna hire someone and they’re going to create the process for me.
Okay, pitfall number three is I’m gonna hire a unicorn, they’re gonna come in here, clean all of this shit show up, and they’re gonna put a process in place for me. They’re gonna bring their process, how they use JobTread or Procore or BuilderTrend, they’re gonna come over here, they’re gonna, they’re gonna fix it all for me. And this is one of the biggest traps. The thinking is let’s hire somebody who’s really good, high level, we’ll pay them extra. Maybe they’re a unicorn and they’ll figure it out.
Todd Dawalt (35:59.628)
Maybe, maybe they will help. Maybe they’ll bring some ideas. But what I found is those people who were really good at another company, they were really good because they were operating within a system. They were operating within a strategic blueprint with clearly defined roles and responsibilities. They were operating with a clear process to follow, a documented playbook that they could follow. So even if you find a superstar.
Employee, they still need clear accountability. They still need to be part of a playbook, part of the team. They need to have a clean handoff. There need to be clear expectations. There needs to be a clear definition of what winning looks like. So don’t hire someone into confusion and then act surprised when they struggle. Because you could just waste six months of overhead and all of the time and they just leave, unfortunately.
So a good hire can improve a system, but a good hire should not be expected to magically invent the system while doing the job.
That bears repeating. A good hire can improve a system, but a good hire should not be expected to magically invent the system while also doing the job. So here’s the one thing again. Here’s the take-home. Before you hire someone, prove whether you need more capacity, a better process, clearer accountability, or maybe you need a performance conversation.
If you clarify accountability, check the pre-construction process, calculate the management hours, assess team performance, forecast the true cost, you will make a better hiring decision. Maybe the decision is to hire. Maybe the the answer is to fix the handoff, to fix, to cure your pre-construction deficiency. Maybe the answer is to clarify who’s accountable for what and have a
Todd Dawalt (38:06.456)
Clearly defined accountability chart. Maybe the answer is to have that hard conversation about performance with somebody. Maybe the answer is to track your workload for 30 days. But at least you will not be guessing. You’ll be making strategic business decisions. You’ll be operating like a big boy or a big girl business owner, operating strategically, operating logically, and you won’t be guessing. And if your business is growing,
But everything still runs through you. I would encourage you to schedule a business evaluation call with our team. We’ll help you look at your handoff, your hidden profits that could be hiding in your business, the system’s deficiencies, and what you need to change so the business can run with less chaos, with fewer decisions falling back on you, giving you more profits and more freedom. So if that sounds good.
Click the link in the show notes to schedule your business evaluation call or go to constructionleadingedge.com forward slash apply A-P-P-L-Y. And then one more thing. This is the question that comes up. So I’m thinking about creating a tool, an AI-powered tool that would walk you through this exact decision.
Should you hire? Should you fix the process? Should you clarify accountability? Should you address performance? Should you wait and reassess? If an AI-powered tool to help you think through this question of should I hire, if that would be helpful for you and useful, do me a favor, leave a comment and tell me what role you’re thinking about hiring next. And if you’re listening to this and you’re like, that would be incredible, do me a favor, send me an email.
Todd T-O-D at constructionleadingedge dot com and put the subject line AI hiring tool. And then talk to me about what would be valuable for that. And if enough people say they’re interested, that’s something we may create for you. So we’re all about taking action here. So this is your five-minute action step. If you listen to this podcast and you don’t take any action, you’ve just wasted the last
Todd Dawalt (40:23.512)
40 or 45 minutes. So information alone don’t change nothing. It’s all about implementation, and implementation requires action. So here is your five-minute action step. Write down the role that you’re thinking about hiring. And then answer this question: what exact problem am I hoping this person will solve? Be really detailed. What problem are you hoping this person will solve? And then label that problem.
As one of these, is it a capacity problem? Is it a process problem? Is it an accountability problem? Is it really a performance problem? Is there a financial readiness problem? What is the problem you’re hoping this person will solve? And then go through these five steps that I just mentioned. I’ll recap those briefly. Step one: clarify accountability before you add headcount. Step two, check your process specifically.
Your pre-construction handoff process and see if you’re suffering from a pre-construction deficiency. Step three is do the math. Calculate the number of hours required. Step four, assess your team performance. Maybe you need to have a difficult conversation with somebody. And then step five, forecast the true cost. We have a tool called the revenue maximizer. Use something like that and do the math. What would it answer the question?
Two questions. Can the business support this hire? Another question is, what would it take to make this work financially? So that is my challenge for you to take action on that. And if you want to leave a comment on that, what is the person or the role you’re thinking about hiring? And then what problem are you hoping to solve? Love to see that. If you’re watching this on YouTube, leave a comment. If you’re on Spotify, you can leave a comment as well.
So before you hit stop, let me ask you something. If you’re building custom homes or big renovations, or you’re a commercial general contractor and you’re starting jobs before scopes, subs, and selections are truly dialed in, how long can you keep scaling like that before something cracks? Right? And if you’re concerned about that, if you’re concerned about growing, then I would encourage you to go schedule a free business evaluation call.
Todd Dawalt (42:45.96)
And we’ll we’ll walk through that. My team and I will we’ll help you grade your handoff, look put real numbers to your hidden profit bleeds, and then sketch out what what that operating system would look like in your business. And then if it’s a fit, if it looks like we can help, we’ll schedule a follow-up call to talk about the the right implementation program for you. And if not, we’ll we’ll s you’ll still leave with some valuable.
Clarity and concrete next step. So you can go click the link in the show notes to schedule your business evaluation call or go to my website, constructionleadingedge.com forward slash apply. And if you want to hear what it looks like to work with us, go to our website, constructionleadingedge.com, and hit the results tab, or you can go to constructionleadingedge.com forward slash results, and here’s some customer case studies. So
That’s it for today. If you got value out of this, do me a favor, leave a rating and a review in YouTube, Spotify, Apple Podcasts, wherever you’re listening, that helps spread the word. And if there’s somebody that you know who’s thinking about hiring and they need to listen to this, share this episode with them. Could be incredibly valuable for them. My name is Todd DeWalt from constructionleadingedge.com. I’ll see you next time.
