Leveraging the Change Order

Leveraging the Change Order

Philip Kresge

Sr. Director, National Resources

What will we learn today?Nothing we don’t already know!

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We know what we should be doing!

Maybe we’re not doing it because . . . Overwhelmed Preconceived notions Complacent

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What we’ll talk about

Change order in the scheme of promotion vs. sales

Prospecting for opportunities

3 Ways to Facilitate the Change Order Success Stories

Getting the most out of your success Turning sales into promotion

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By definition, promotion is a long-term investment

Influencing a thought process

Sales is a more immediate process

We usually differentiate between the two

Change Order more akin to sales than promotion

An everyday occurrence in our promotion efforts

Promotion vs. Sales

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Promotion Dogma

“Getting in early is key to successful promotion”

“Once the job is in Dodge reports, it’s too late” It’s never too late!

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Change Order

Substituting a specified building material with concrete.

Asphalt Wood Steel

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Job specific Time sensitive

Change Order

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Change Order can be most successful if you . . .

Solve a problem for your customer At the time they are thinking about it Do it easily and quickly

Selling Solutions

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Prospecting

The Usual Suspects Dodge Reports Construction News Local Networking

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Only the most foolish of mice would hide in a cat’s ear

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Only the wisest of cats would think to look thereDon’t overlook the obvious

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Mid-job / Next-job recommendation Landscaper, in the midst of sodding a yard,

suggests a rock wall to reduce runoff Caterer, serving a summer party, reminds

client that Christmas is only five months away

Review Current Projects

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Review Upcoming Projects

Residential Already doing walls & floors What about driveway?

Commercial Someone will be asking for a price for footer/floor What about parking lot? Flowable fill possibilities?

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Know Your Customer

• Decision makers• Vote yes or no

• Influencers• Can convince decision makers • May be stakeholders• Should be on your promotion team

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The only way to

know is to listen!

What does your customer want?

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What are the Hot Buttons?

• Aesthetics

• Energy Efficiency

• Initial Cost

• Life-cycle Cost

• Unique Design

• Sustainable Development

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Listen to customers’ wants and decipher their needs

Teach customers to want what they need

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Teach customers to want what they need

Energy Efficiency ICF Construction

Low Maintenance Concrete Parking Lot

Aesthetics Decorative Concrete

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Look at all the possibilities

Tilt-up Walls ICF Parking Lots Flowable Fill Decorative Pervious SCC ??????

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Utilize ALL Your Tools

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Promoter may only have 10-15 minutes for introductory meeting

Alternative to using laptop/projector for presentations

Fact-finding mission

Low Tech Pitch Book

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Concrete Parking Lots Over 1,000 sold

Flowable Fill Initial orders (300) being

distributed now Pervious Concrete (TBA) Environmental Benefits

of Concrete (TBA)

Low Tech Pitch Book

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Change Order can be most successful if you . . .

Solve a problem for your customer At the time they are thinking about it Do it easily and quickly

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3 Ways to Facilitate the Change Order

Make Suggestions Exercise your expertise

Ask for the Order The fast food approach

Design/Build

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Make Suggestions

Use your professional expertise to provide insight Provide alternatives to existing designs Present new technology

Self consolidating Pervious ICF

Demonstrate benefit to owner Quality Economy Safety

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Salvation Army

Allentown, PA Owner looking to resurface

existing asphalt Contractor Power of Suggestion Stressed Safety as an issue

(hot button) Provided unsolicited

proposal for concrete 7,500 ft2 parking lot

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Muncy Homes

Owner looking to upgrade gravel lot Spec’d asphalt paving Team identified “hot buttons”

Low maintenance Life-cycle cost

Taught owner to want what he needs Owner chose to pay $500,000 over

asphalt bid Initial proposal

550,000 ft2 =12,000 yd3 Owner added 4 acres

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Ask for the Order

You are already bidding the job You are already supplying the job Mid-Job / Next Job Recommendation Decision maker may consider alternatives if

beneficial Mobilization costs reduced Construction schedule

“Would you like fries with that?”

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Osram - Sylvania

Bethlehem, PA Tilt-up Concrete

Building Producer &

Contractor made pitch for 296,000 ft2 parking lot

5,600 yd3 concrete

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Harvest States Flour Mill

• Slip-formed building and silos

•R/M Producer suggested concrete parking lot in lieu of spec’d asphalt

• Priced competitively due to lack of mobilization costs

• 5,000 yd3 of concrete in parking lot

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Smith TransportRoaring Spring, PA

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• Originally steel building with asphalt pavement

• Footings, floors, etc. 3,500 yd3

• Converted to Tilt-up + 5,000 yd3

• Asphalt to Concrete + 4,000 yd3

• Total Concrete 12,500 yd3

• 250% increase after project was put out to bid• “Would you like to Biggie Size your order?”

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Design Build

Possibly the easiest way to facilitate the change order

D/B is a strong influencer Producer / Contractor part of the D/B team Present concrete options

New technologies

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Shelter Systems Ltd.

Producer/Contractor part of D/B team

Owner wants to maximize development of site

7+ Acres of pervious concrete substituted for conventional asphalt

Eliminated 1 ½ acre pond “My lumber isn’t sitting in

water.”

There will be obstacles along the way

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Not an easy task

Much of the world has its defenses up to keep out new ideas

Customer’s preconceived notions Concrete is too expensive Concrete is too difficult to place Concrete cracks

We can fall prey to our customer’s objections

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Are we too focused?

Sales call to get P/O for concrete footings, floors Pays no attention to customer’s comments about

Material price instability Manpower issues Construction delays

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Are we too focused?

Sales call to get P/O for concrete footings, floors Misses at least three opportunities

Tilt-up concrete ICF construction Flowable fill

What about the parking lot?

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Make sure you are solving the right problem!

Count Basie

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Choose Your Battles Wisely R/M Producer, Pervious Concrete Contractor, Admixture Supplier

aggressively promoted pervious concrete

“The perc rate [on site] was .07 inches/hour. One of the ones on the perimeter was .27 inches/hour.  There were a few where the rock was so shallow they couldn't perform a perc test.” 

“The Commonwealth requires a rate of .52 inches/hour for pervious pavements and requires bedrock to be excavated to three feet below the bottom of the stone reservoir.”

“The strategy that we have arrived at allows us to collect the water from the bus lot and infiltrate it into another portion of the site that percs more effectively, at a rate between .65 and .93.”

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Choose Your Battles Wisely

“We couldn’t agree more with your points regarding economic and environmental responsibility.  Based upon those criteria, we determined that impervious concrete, combined with underground percolation storage, would be the most practical method of holding and treating stormwater from the planned . . . site.”

impervious concrete

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A Word of Caution

Keep your promotion message positive Focus on benefits of concrete Sell Solutions Handle your competitor’s weaknesses with care Mediocrity Always Attacks Perfection!

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Leveraging Your Success:Turning Sales into Promotion

How can we switch sales back into promotion?

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Publicize Your Success

Issue press releases Create one-page flyers Distribute to

Members Promotion partners Existing customers Potential customers

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Osram-Sylvania Project highlighted in Concrete Producer magazine September 1997

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Bed, Bath & Beyond project highlighted in flyer prepared by ICFA

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Tell the whole story

• Identify the customer/project

• Identify the wants/needs

• Quantify the results• construction time saved

• money saved

• customer satisfaction

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Follow-up

Is customer/owner still satisfied?

Did specifier include concrete on subsequent projects?

Are there any other projects from other specifiers/owners as a result of this project?

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Measurement

Yd3 placed as a result of change order

Every yd3 specified from that point

Collect data and update regularly

Report findings to members justifies their investment

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Think outside the box

Have you missed opportunities?

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Change Order can be most successful if you . . .

Solve a problem for your customer At the time they are thinking about it Do it easily and quickly

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Remember . . .

Opportunities are everywhere

It’s never too late

Teach your customers to want what they need

Turn your sales into promotion!

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Persistence Pays

Thank You!

Philip Kresge

pkresge@nrmca.org