labor utilization to help you compete

LABOR UTILIZATION

to help you compete

Presented by

Kip BagleyVice President of Service, EMCOR Services/Mesa Energy Systems

Jim LeslieVice President, Tucker Mechanical, an EMCOR Company

BONUS PROGRAM WEBINAR SERIES MODULE 5September 10, 2014

Don NealCEO & Founder

Moderator

Tips for this Webinar

Be an active participant

• Ask questions anytime on the side chat bar

• Engage by answering the polling questions

Don’t feel obligated to take notes

• Slides and webinar will be available after the

presentation at www.msca.org

Share this experience with your colleagues • Schedule for the webinar series will be

displayed at the end

Kip BagleyVice President of Service, EMCOR Services/Mesa Energy Systems

Jim LeslieVice President, Tucker Mechanical, an

EMCOR Company

OBJECTIVES

Understand how to use labor mix properly and how it can increase margins along with the longevity of your business.

National Agreement? What you didn't know! Learn to use your best salespeople – the

technicians! Understand the pitfalls and peaks of field

incentive programs.

Polling Question #1

Do you track your service crew/labor mix?

A. YesB. NoC. Not Sure

Labor Mix – Blended Work Force (crew rates)

ACTUAL TOTALS

Jim and Kip's Air

FOREMAN & JOURNEYMA

NAPP 5 YR

APP 4YR

APP 3YR

APP 2YR

APP 1YR

TRADESMAN

or < 50% of

J Rate

Total Techs

J MEN / A&T%

TOTALS 125 11 2 8 8 7 12 173 2.6

Office 1 15     3       18 5.0

Office 2 14   1 1 1 1   18 3.5

Office 3 49 3 1 2 2   6 63 3.5

Office 4 17       2 2 2 23 2.8

Office 5 13 3   1   1 1 19 2.2

Office 6 3       1   1 5 1.5

Office 7 8       2 3 2 15 1.1

Office 8 6 5   1       12 1.0

Labor Mix – Blended Work Force (crew rates)

IDEAL TOTALS

Jim and Kip's Air

FOREMAN & JOURNEYMA

NAPP 5 YR

APP 4YR

APP 3YR

APP 2YR

APP 1YR

TRADESMAN

or < 50% of

J Rate

Total Techs

J MEN / A&T%

TOTALS 112 9 9 9 9 9 16 173 1.8

Office 1 12 1 1 1 1 1 1 18 2.0

Office 2 12 1 1 1 1 1 1 18 2.0

Office 3 42 3 3 3 2 3 7 63 2.0

Office 4 16 1 1 1 1 1 2 23 2.3

Office 5 13 1 1 1 1 1 1 19 2.2

Office 6 3 1 1 5 1.5

Office 7 8 1 1 1 1 1 2 15 1.1

Office 8 6 1 1 1 1 1 1 12 1.0

National Service Agreement Discussion

Service, Maintenance & Operations Work

ARTICLE VII – Scope of Service, Maintenance and Operations Work

ARTICLE IX – Classification of Employees14. Service Journeymen15. Servicemen (MES)16. Service Apprentices17. Tradesmen (MEST)

ARTICLE X – Hiring and Use of Employees

ARTICLE XII – Wages, Benefits and Hours of Work

Polling Question #2

If you’ve ever moved a technician from the field into sales, how was the transition period?

A. GoodB. BadC. UglyD. N/AE. I don’t know.

Technicians Selling

Identify techs who are a good fit for sales

How to transition techs from field to sales

Provide guidelines for incentivizing techs

Who Do They Trust?

Who do your customers really trust to give them technical

information about their systems?

Who Do They Trust: The Salesperson?

Who Do They Trust: The CFO?

Who Do They Trust: The Dispatcher?

Who Do They Trust: The Technician!

Technician Loyalty

In order of priority:

1. Customers2. Contractors3. Unions

The Good, The Bad and The Ugly . . .

Transition from Field to Sales Positives Negatives What technicians fear the

most

Transition: The Good

Technical knowledge and background Understand systems and equipment Natural at sales Comfortable in front of customers No fear to speak from their experience

and knowledge

Transition: The Bad

Technical knowledge – too much is sometimes a bad thing!

Tendency to oversell Lack of pure sales training Horrible at “cold calling”

Transition: The Ugly

Technicians don’t consider themselves “salespeople” – they view themselves as customer “supporters.” Techs provide solutions they truly believe will help the customer.

Deathly afraid to jump from hourly to salary/commission.

Fear of leaving the uniform for a polo shirt.

Not used to delayed or long-term results.

Eyeing Future Salespeople

What to look for when targeting future salespeople from the field: Outstanding rapport with existing customers Willingness to go “above and beyond” Great at paperwork/computer skills Works well with others Dispatcher and office staff perception Talk to technician’s existing customers Is the technician ready to go from union to

non-union financially? Do you have a replacement?

Polling Question #3

Do you currently have or have you ever had a Field Referral Program for sales?

A. YesB. NoC. I don’t know.

Field Referral Program

Helping technicians sell from the field:

Beware of compensating “normal” activities

Watch payout amounts Decide between revenue or

gross profit payouts Use COMMON SENSE!

Profitable Maintenance Agreements

Looking at the entire account vs. contract only

Gross margin of maintenance agreement Gross margin of pull-through work Average margin of maintenance

agreement and pull-through work = actual profitability of account

Key Takeaways

Implement a blended work force to maximize your labor resources.

Use the National Service & Maintenance Agreement as a tool to strategize and manage your labor force.

Capitalize on the customer’s inherent trust of their technician, and transition your techs into sales – but choose wisely and train thoroughly.

Evaluate the actual profitability of an account by averaging the gross margins of pull-through work and maintenance agreement.

It’s Your Turn…

Q1: Was this webinar informative and useful?A. Yes, I found this informative and useful.B. Yes, but it wasn’t as informative and useful as I expected.C. No, this was not informative or useful.

Q2: Did the speaker present the material in a clear and concise manner?D. YesE. No

Q3: Will you download this webinar, and share it with others in your company?F. YesG. No

Join us for the next webinar on October 22!To register, go to https://msca.webex.com

October 22: EfficiencyPresented by Mike Star and Devon Hubbard

December 3: New Business OpportunitiesPresented by Jaimi Lomas and Adam Wallenstein

Reminder

The PowerPoint and handout will be available on the homepage of the MSCA website immediately after the webinar at www.msca.org.

The archived webinar will be accessible from the MSCA website within 24-48 hours.

For Additional Information or Questions, Contact:

Barbara DolimExecutive DirectorMSCA(301) 990-2210 (direct)bdolim@mcaa.org

Kip BagleyVice President of ServiceEMCOR Services/Mesa Energy Systems(949) 460-0460kip_bagley@emcorgroup.com

Jim LeslieVice PresidentTucker Mechanical, an EMCOR Company(203) 630-2506jim_leslie@emcorgroup.com