Recently, I was asked to define Quality, but I couldn't. The reason is because Quality is in the eye of the beholder. Quality is different for every person. So instead of asking each other, "What is Quality?" We must ask the person who really matters, our customer, "What is your meaning of Quality?" This definition of Quality is the one we must satisfy.

So the solution appears to be simple. Just ask the customer, "What do you want?" Unfortunately, too often buyers of construction services don't know what they need or even worse they send mixed messages. We all know buyers who demand a $100 job at a $90 cost with a $110 worth of Quality. What are we to do?

Conformance to requirements:

Quality expert, Philip Crosby, says, "The definition of Quality is conformance to requirements." That means the customer's requirements! In my seminars I often spend hours on the importance of defining the project. Unless the project is properly defined it's virtually impossible to satisfy the buyer's requirements and deliver a Quality project.

When I ask contractors to define a project, they usually respond: "Plans and Specs." While not wrong, it's only a portion of the answer. The customer usually envisions a whole list of items not included in the specifications, which frustrates contractors. They ask, "Why don't they put them in the specifications?" Ah ha! Catch 22! Buyers often don't know what they want or need or can't articulate it. Complicating things is that most problems aren't in the technical specs, but the customer-contractor relationship areas; such as attitude, communications, and cooperation.

The good news:

The customer-contractor relationship is where the total Quality contractor finds a great opportunity for distinction, and not just during the project. The customer remembers the relationship long after the project is completed. Competitive contractors have already developed efficient operations with regard to the physical construction activities, leaving little room for further improvement. In contrast, most contractors have tremendous opportunities to improve their relationships with customers and substantially improve the customer's perception of their Quality. Today competition is more about business concepts than construction methods.

It's in the contractor's best interest to sit down with the customer and explore how both parties can work together for their mutual benefit, in other words establish a mutual agreed upon set of requirements, including the relationship. There is no quick fix. However, unless contractors start recognizing this opportunity and make the necessary adjustments in the way they operate, they may not survive.

Cutthroat Pricing Prevails:

Low bids might appear to be a great benefit to buyers, but it's usually a false savings! When construction services are purchased solely on price in an overly competitive marketplace the price is driven too low. Yes, too low! The result is the customer-contractor relationship suffers, therefore reducing Quality and increasing costs.

Since the 1950's, Edwards Deming has been saying when you sub-optimize costs - try to minimize the cost of each item - you actually increase costs. Therefore, a contractor's critical role is to educate its customers. Competitive bidding doesn't need to be eliminated, but it must include a performance aspect in the evaluation. This means the contractor's Quality, which translates into customer satisfaction, should be considered in selecting the contractor. Fortunately, some buyers are beginning to recognize the need for a performance based selection process. Contractors must position themselves for this change and learn how to differentiate themselves beyond price.

Effective communication:

One place to differentiate your company is by improving communications with your customers, the critical first step to improving the relationship. In a study done by Engineering News Record, buyers of construction services indicated good project communication is critical for project success. My question is, "How many contractors even talk to the customer beyond a superficial level?" Poor communications magnifies every problem, while effective communications minimizes problems and facilitates solutions.

Contractors must use their experience and knowledge to help the customer understand their own requirements. This understanding is necessary for the contractor to conform to those requirements - the very definition of Quality! The industry must focus on creating win-win situations instead of the competitive win-lose environment, which often turns into a lose-lose situation. This approach offers a contractor an opportunity to differentiate, because most of its competitors will ignore this opportunity.

Immediate steps you can take to improve Quality:

1. First, create an atmosphere where win-win solutions are required. Words won't accomplish this - it takes positive action by all senior company executives. Without this continuous leadership at the top this program is doomed. After the process is started, the leaders must continue to spend time encouraging and helping their employees to conform to the customer's requirements - true Quality.
2. Give your people the tools to do their job. This includes training in effective communication and negotiation skills to create win-win solutions. If you aren't sure how to do it, invest in outside training - it's that important.
3. Normally the third step would be to explain the customer's requirements to your employees. But in the dynamic world of construction, the customer's requirements are constantly changing. The solution is training your employees to communicate with the customer to understand those changing requirements. Then give your employees enough flexibility to adapt to the situation. I'm not suggesting you throw in an extra floor. But you can work with them to minimize the cost and impact. You need to act like a partner, instead being self-serving. The only rule that applies is common sense. Once you make a commitment, live with it! You should constantly review everyone's efforts in this area to insure the best solution was adopted. If an employee satisfied the customer, he or she is never wrong, but continuous learning through review is a positive activity.

Summary:

Bid jobs have little room to include costs for extra services. However, there are many things that cost virtually nothing - such as attitude. When contractors become adversarial to protect their interests, they start a terrible downward spiral. Instead, if you put in the necessary effort to build a sound relationship with the customer you will be rewarded.

In the short term you will find the project running smoother with less problems. This translates into real cost savings for both parties. The long-term benefits are even better. Everyone agrees that physical Quality is important, but the best opportunities to improve Quality are in the area of customer relations. When your customers realize your Quality translates in to cost savings for them, you will start building customer loyalty. When this occurs, you will be able to earn a fair fee for your services, instead of being forced to be the cheapest. At the same time, the buyer will reduce their costs - thus creating a true win-win situation.

Every buyer of construction services won't accept this concept, but that's okay. Send those buyers to your competitors; they won't make any money off them either. Now you will have time to concentrate on buyers who appreciate the value you bring to their project. Don't give up on a buyer too quickly. It may take time for them to realize you are different and that there is a "real" savings in working with you despite your higher fees.

You build customer loyalty by "wowing" the customer, which is accomplished by exceeding the customer's expectations. And the only way to consistently exceed the customer's expectations is to continuously communicate with the customer in order to understand their changing requirements and seek win-win solution in satisfying those requirements - the ultimate in Quality.

Ted Garrison, president of Garrison Associates, is a catalyst for change. As a consultant, author and speaker he works with businesses in the construction industry to grow their business by improving profit margins and increasing productivity. He focuses on critical issues in leadership, project management, innovation, strategic alliances and marketing. He can be reached at 800-861-0874 or by email at Growing@TedGarrison.com. For further information see his web page at www.TedGarrison.com.