- Highly Variable costs which can be impacted the most by focusing on the 6 Pillars of Productivity and ABC Daily Planning.
- Mostly Fixed costs such a major material and subcontractors can be impacted the most through disciplined and integrated supply chain management.
- Indirect costs including jobsite supervision and logistics are driven by schedule which is a function of how much gets spent each day in categories 1 & 2.
Focus on “Billable” as a great indicator of your value-add for the day considering that 100% completed tasks are easily billable to the customer. If you want great cash flow on your project then your Schedule-of-Values (SOV) must be loaded in aligned with your task plan.
Optimizing productivity is about keeping the ratio of actual costs vs. billable equal to or lower than the ratio of your budget vs. contract. Watch this as a daily, weekly, monthly and a running Job-to-Date (JTD) metric.