Some construction companies do succeed no matter what shows up on their way. The key here is finding a path for growth and resilience through scalability. Let's clarify these problems and dive into the possible solutions.
Maintaining your construction company profitable is a tough challenge in the 2020s - even more so when you want to keep a steady growth. Some might dare say that managing one is hard enough, let alone making sure if it’s profitable or not. However, some companies do succeed regardless of covid, the pandemic or whatever shows up on the way. The reason behind that is finding a path for growth and resilience through scalability.
First things first, let us dive into the main problems faced nowadays by most construction companies of different vertical business structures and sizes:
Lack of innovation in the core business
Lack of visibility over their finances
Ageing workers and market gap for new hires
Digital transformation failure part 1: too many digital solutions not integrated causing new problems and doubling work
Digital transformation failure part 2: the team not adapting to the company's digital transformation - time and money waste
Lack of innovation in the process: things are done in the same way for too many years
Multiple risks to manage along with an enormous number of variables of complex activities
If we put all of this information together we can see that the key point here is the fact that construction has been doing the same work in the same way over and over throughout the decades. As the second least digitised industry, losing only to agriculture for obvious reasons, the construction market does not attract enough new talents and misses closing this gap, which only leads towards deeper issues.
Looking at various paths for success throughout the years, one can observe that companies that grow slowly but steadily into the "infinity" usually do not bring up any radical changes and yet, they transform their business steadily and this is their key point. From the most different markets like Disney, Coca-Cola, Microsoft, Facebook and even Netflix, they all constantly transform what they do a little bit each day into what they will do in the future.
Do not stop yourself to think that Blockbuster turned down their chance to buy Netflix. Instead, open your eyes to the Netflix marketing positions from the distributor, through the streaming distributor, to the producer. They knew it was a matter of time when other main producers, like Disney, would launch their own platforms. A couple of years ago, the Oscars were highly criticised for nominating their own productions, meanwhile, according to predictions, this year’s ceremony will be full of Netflix original films. You can bet Netflix is about to bring something new to the table, as many other tech companies, such as Amazon Prime or Apple, are following their lead with their original productions.
These successful companies know how to avoid their own death by reinventing themselves with resilience. They are aware of their need to adapt in order to remain relevant in the current times, as time goes by. Just like a phoenix, they know how to let it go and rebirth not from the ashes, but from the new market needs. They invest in research and value this knowledge by treating it as strategic information that will guide them. They behave as long-term entrepreneurs. They have a clear view of innovation as a constant need in all of their business aspects. Innovation will not only drastically impact their business today, but it will certainly do so in the long run and this is why they do it consistently.
Accepting the need for growth and resilience - one can only see this being successful if innovation becomes part of the company’s DNA. This approach must become part of how the business is run and be, therefore, an integral strategy routine.
To understand this, you need to pause whatever you’re looking into now and start looking ahead into what can be your future. While doing research on sustainable growth, Mckinsey established the so-called three horizons model. “This approach illustrates how to manage current performance while maximising future opportunities for growth”.
How to invigorate the portfolio, Mckinsey
The three horizons model is the disruption cycle of what you do today to build the person you will be tomorrow. This means managing scaling innovation inside your company to be repeated many times in an infinite cycle. Moreover, this also means fostering and promoting the innovation success cases and establishing a positive environment for creativity.
You need to hear people out and give them space to go out of their comfort zone of 'we master what we do' into the unknown areas where many things can happen.
You need to be comfortable with failure as this means your team is doing something that has never been done before.
You need to welcome young, inexperienced, fresh minds questioning what you do, how you do it and why you do it - often, at the same time.
Back to the scalability point, it is important to reinforce the need for the three horizons model to become a cycle inside your company. If you are innovative only once, you will not succeed in the long run to keep growing and at some point, you might even lose your resilience. If you learn how to grow your innovation in a well-structured manner, like a geometric progression, you can establish a path for scaling your growth sustainably - jackpot!
Interested in learning more about innovation in construction? Check out our other articles to discover why the innovative approach is crucial for the future of your company:
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