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Time is money

By:
  • Douglas Freer, CSP
- Posted: September 26, 2018
As purchasers of snow services continue to implement new technology to better manage their physical assets, certain technologies are becoming more mainstream - particularly those designed to collect and manage more data so the client can make more informed, real-time decisions. If you want to work in this arena, you must be willing to accept, adopt and welcome your clients’ requirements. 

Technology that breeds efficiency is great, but when it’s not your choice to implement but rather a requirement, you have a choice to make. Is the client worth the investment you’ll need to make to comply? 

It will take time and effort to figure out how their requirements will impact your business, and what new processes you’ll need to establish to make their implementation work from your end. 

Is the client worth it?
You must determine the lifetime value of the client. Examine your sales and margins over the life of the relationship, and evaluate where you expect them to be in the next one to three years. Look at the estimated ROI. If you have a long-term agreement, can you recoup the money you must invest within the time frame? What if you operate on a season-by-season basis? The risk vs. the return may be quite different. 

If your gut instinct and back-of-envelope math tell you it may not be worth the investment, dig deeper to see what other options you have to retain this client. If the money or the time required for a viable ROI simply isn’t there, don’t be afraid to walk away. Be honest with your client and move on. But if you think it might be doable, develop a plan to move forward. Besides retaining your client’s business, you may actually improve your business as you develop processes and policies that apply more broadly to other areas. 

Your client is making an investment to improve operations and needs vendors to be a partner in making it successful. A good client is worth the investment. 

Compliance comes at a price
Out-of-pocket expenses for hardware, software and labor are all true costs to your business and should be evaluated before making the commitment. 

Management labor. Consider the time necessary to learn the new requirements, adjust/change and implement the new processes required in your business, plus the time to manage the new processes. Does your management team (which may be just you) have the time to adequately tackle this challenge, or will you need to hire administrative support?

Training labor. Your field and administrative staff need to know and understand the technology and submission process. Once trained, audit and follow-up will be necessary to make sure the process is being followed. 

Receivables. If their system does not work as intended, you may not be able to report work for payment or they may not be able to process it effectively, resulting in a potential delay in payment. Can your cash flow afford that bump in the road?

Hardware. Reporting from the field may require the purchase of equipment or devices if your crews don’t currently have them. 

Software. Applications may not be free, and the computer software you may need could cost you per license. Fortunately, many reporting methods are web-based and provided by the client, but these systems are for their work only. If you want to replicate the process for your other clients, you may have to invest in existing software and applications or develop your own. 

Whose burden is it?
The requirement to collect and report information to verify service takes time and is, therefore, a direct expense to the contractor. How much time and cost are involved depends on what information is being requested and how it is collected. When the client or property manager dictates a change in reporting protocol that may require new methods, processes or technology, consider the time and other expenses and who’s paying for it. Change can be positive, saving time and money, but it can also create an undue burden.

Positive change. Required signatures from store managers may be replaced by smart-device applications, allowing the driver to report completed work on-site. A GPS-enabled device can validate that the driver was on-site when the work was reported, providing the client real-time information while saving the vendor time since the driver doesn’t have to wait for a manager to sign paperwork. The investment in smart devices and training is offset by less time spent on-site. 

Burden. Before-and-after photos of completed service are part of the scope of work and need to be uploaded or emailed at time of service. Assuming you have a process to manage the information flow, consider the time it takes for field personnel to take four or five photos, complete the service, take completed photos from the same four or five positions, and then transmit the photos. The additional 10 minutes it takes to perform this function multiplied by the number of sites you service and then multiplied by the quantity of service visits in a given season results in a significant time investment. 

Training
In all likelihood the new technology your client has chosen to simplify things on its end will result in some changes on yours. The amount of data you’ll collect and have to manage will likely be different and may increase. Plan to train your team on what will be required.

Basic improvements in productivity may be achieved by providing additional training to existing staff that work with specific software, or by training those using it for the first time. More detailed on-the-job training will be required for specific applications, web portals or other interfaces your staff will be required to use. Additionally, your processes that have been modified or created will need to be explained, tested and managed. 

Training is an overhead cost and likely not one you can charge to the client. It will be easier to determine direct out-of-pocket costs for training, but soft costs related to productivity loss or otherwise will be more difficult to quantify. 

Capacity
Administratively, you must have the capacity to handle reporting requirements. Technology generally allows for more points of information to be collected. If there are exceptions to the process, the data points still need to be collected and reported, but perhaps manually or through alternative methods. These exceptions can become time consuming and require a well-designed process on your end, plus administrative labor to ensure all data has been captured and communicated to the client. You will need to audit your new processes to make sure your team is functioning properly within the new system. 

Going through a rollout may have some downsides and unwelcome cost implications. Consider how you can use this investment to improve your operations and leverage the investment to other clients, thus improving your ROI. For example, if you’re required to submit a certain report during or at the end of the storm, can the same template or process be used to send information to other key clients? 

Vendor scoring
Your client has many snow services vendors, and it uses some method to determine how effective its vendors are, both in providing service and in managing the relationship requirements. Your score will determine if they’ll continue to work with you. 

You can negatively impact your score if you’re slow to respond to questions, don’t provide timely or complete reports and make mistakes on invoicing. Your ability to deliver on expectations will impact your long-term relationship. 

Being forced into a change is not always easy or welcome, however, there can be benefits, particularly if you’re focused on making it a win for both parties. When the request is more of an undue burden, it’s time to negotiate. One thing is certain. As technology improves and the industry evolves, more clients will mandate that vendors comply with their proprietary systems, requiring the vendor to choose between adopting the new technology or walking away from their business. 
Trickle down impact of tech implementation
Your client’s decisions will impact your business as you adjust your processes and train to ensure compliance with their new technology. Try to anticipate that impact and carry out processes on your end for a successful implementation. Understand who will be impacted, what their role will be, and how you will audit the new processes. 
  • Front office/administration: Manage user names/passwords for various systems, collate service information, generate reports, ensure all data has been entered, manage invoicing and receivables, and contract compliance.
  • Dispatch: Shared responsibilities for managing service information, special requests and reporting procedures; handling exceptions during storm events; and ensuring all real-time information is being submitted.
  • Field crews: Collect and report service information accurately and properly via the various methods that may be required.
  • Fleet & equipment: What modifications to your vehicles and equipment may be required for reporting? GPS systems may be vehicle-mounted, while cameras and smart devices are mobile. Determine what equipment you will need to purchase.
  • Management: Decisions related to level of investment, process development and implementation, hardware/software purchases and ensuring consistency. 
Doug Freer, CSP, owns Blue Moose Snow Co. in Cleveland. Contact him at doug@bluemoosesnow.com or 216-539-3688.
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