January 8, 2024 • 45 mins
Marshall Wilkinson, a second-generation construction leader, has orchestrated over $2.5 billion in construction sales and sealed multimillion-dollar deals for NYC Public Works projects. Raised in the heart of the construction world, he's turning heads with his groundbreaking ALP philosophy – Altitude. Logic. Pressure.
Listen in as Marshall shares his journey, insights, and explosive growth strategies that have revolutionized the construction industry.
Listen in as Marshall shares his journey, insights, and explosive growth strategies that have revolutionized the construction industry.
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Transcript
Episode Transcript
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(00:00):
Welcome back Lumberjacks, and i'll youconstruction folks to episode four. If you're
new. I'm Lou your host ofThe Builder Upper Show, a podcast where
we talk about everything in construction andtrades. Now let's get into it.
I would like to welcome our guest, Marshall Wilkinson, the New York construction
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boss the hardest market in the world. Marshall, welcome, Thanks Lou.
Great to be here, appreciate itabsolutely so. Tell me who is Marshall
Wilkinson. Marshall Wilkinson is a secondgeneration contractor and construction manager from New York.
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I grew up in Long Island,New York. Nice suburban life,
right, but a person who's dedicatedhis life to this business. Carried a
torch from my father and and fellin love with the business and is now
currently a consultant and a coach.And I helped contractors scale, but most
importantly in my core, I'm aconstruction man, been that way since the
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highchair. What was your specialty,Marshall, electrical and what got you into
it? Like in the beginning,Well, I really didn't have a choice.
I'm a second generation, so youknow, I kind of already had
a path set for me. AllI ever heard of the dinner table growing
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up was how to run projects andhow to do jobs. We specialize on
water and wastewater treatment plants, sounion shop class a heavy work and since
a kid, my dad's been runningthose projects. The New York City dep
has the largest capital project budget,at least they have had for a very
long time. So they made abusiness decision to move in that direction.
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And so I've been learning how torun water treatment plant since I'm one years
old. And we hear that alot. We hear, you know,
father son, dad gets him intoit. When did you decide to become
a construction owner. Well, Iwasn't allowed in the business until our business
until twenty five, twenty six yearsold. So I don't think my father
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didn't want to, you know,be called out on nepotism. He's worked
with guys for a very long time. He didn't want those guys to think
that the new young kid was goingto come in. And because I had
the same last name that I wasimmediately going to get a corner office and
I was going to you know,climb the corporate ladder. I had to
prove myself so I worked every jobin construction on my way up. I
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worked with various different contractors in differentpositions on different types of projects before my
dad thought that I had the chopsand I was strong enough to come into
the business. And then what Idid is I injected more of a corporateness
and a professionalism and more of asales orientation to the business where he was
really more of operations and a kindof guy who really understood the field and
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the tools where I came in.And although I had that background, I
also I brought some a little bitmore corporateness to the business and put systems
in place and scaled it from there. Awesome. Yeah, I like how
you you made that transition and youmade it successfully. What is something you
know today that you wish you knewwhen you started? Oh man, a
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lot, a lot really, youknow. I learned a lot of lessons,
and I learned them the hard waybecause the way I was brought up
was my dad. You know,I use this reference a lot. You
know, kind of the way TigerWoods father, Earlwood's dealt with Tiger is
definitely how my dad dealt with me. He was grooming me and So when
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you have all of that confidence andyou think that you know it all,
and your your father's telling you you'rethe man, You're the king, You're
going to be the best ever lived. You know. Really, it's really
as dramatic as that. I hada lot of confidence and I didn't have
all of the knowledge and the skillto back it up. Construction is a
very interesting business because you need tohave experience. It's very experience driven because
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every project is unique. Fires areon every project. You have to build
the construction muscle, so to speak. And so although I had the information,
I knew how to run a job. I knew how to run a
company. I knew how to runwork. I understood everything about project management
and scale and buying out subs andscheduling and estimating and all the machinations they're
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in. There's a difference between knowinghow to do it and been doing it
for a few years. Like Iwas right, you know, obviously growing
up as a teenager arm working andworking in the business and stuff. But
you know, from eighteen to twentyfive, I'm in other places, you
know, making my bones, soto speak. And you run into guys
who've been doing this for thirty fiveforty years. You do not know more
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than those guys. And that wassomething I had to learn the hard way,
because I would play smash mouth football. Well, guys that have been
the business for forty years. Ithink my way was better. And sometimes
old schools the only school is whatI learned, So I had to learn
that lesson a lot. I alsolearned very valuable lessons with employees and human
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resources in letting the line out onguys and giving people time to breathe and
grow and not be so harsh onpeople. And then you know, obviously
you're a for profit business, andwhen you're a young guy, you want
to make a lot of money.And I certainly did, and I certainly
did want to make a lot ofmoney and did make a lot of money,
but I was always counting other people'spockets and I had to learn that
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these people were resources for us,and they were tools for us to earn
more. And really what my jobwas, as I'm mature to do an
executive, was to make sure thatI gave them the tool and the leadership
and the systems to make them successful, rather than saying, oh, I'm
paying this guy this much money thisguy's making that much more than me,
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you know, as a young guyto like, I know this guy's making
XYZ, And that was just immaturity. But I learned all those lessons the
hard way and in a very embarrassingmanner. That's why I know them so
well now, and I impart allthose lessons on all my clients, because
it is a difficult thing, especiallyif you're a first generation contractor and you're
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coming from a family that were maybeemployees and weren't business owners. You're taking
a very specific employee type of mindsetbringing it into an entrepreneurial realm where our
biggest expense is the human resource anda lot of times I see a lot
of frustration around the owners and theiremployees, and although it's warranted, it
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has to be you have to lookat it through a very specific lens,
because we need these people to makeus money, We need them to deliver
projects for us, and so noteverybody's one hundred percent. And I learned
that, and then I'd learned tolook at everybody, all my employees as
a as a profit center. Thereare revenue silos for me. Each person
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they need to deliver a certain typeof revenue back to me if they're on
a revenue generation end of things likeproject management in the field, and then
if they're not, if they're justoverhead carry they are a part of me
delivering my product or my service.And I just matured as an executive to
understand what all of that meant.And I learned those lessons the hard way.
But there are there are quite afew lessons that I learned on the
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way up, that's for sure.Well put during those few struggles that you
had, or if there was anystruggles that stock out, what motivated you
to work through that? Well,I mean I was motivated to be the
best, you know, like youknow, just because you know, you
come up in a family business,and I like to refer to us as
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like a family dynasty. My dad'sRobert Wilkins, and he's done probably twelve
to fifteen billion in work. He'sa very big player. He's very well
known in the public works world,the class a world in New York City.
So I was motivated to be betterthan him. I never because of
the way he grew me. Ialso didn't want to be a person say,
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oh, you know, that's Wilkinson'skid. I wanted people to say,
that's Wilkinson's Kitty Sharper's attack. Watchthat he'll cut your head off,
right, And because I wanted thatto be my reputation, I just I
had a massive, burning desire tobe that person, and I figured out
the only way to be that guyis to actually be that guy, to
actually know your stuff, and soI just had a desire to learn all
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of it and master it. Soundslike you feel those shoes very well.
Well. We have a lot ofconstruction owners that tap into this podcast.
A lot of them are wondering,how did you scale your business? Is
there any tactics that you feel listenerscan benefit from. Absolutely, scaling isn't
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something that's done on accident. Scalingcomes from preparation and having a plan in
place and working that plan. Ninetypercent of contractors, I believe, go
out because they operate under the wrongsystem. They don't have the right strategies
and systems in place, and youdon't know what you don't know. I'm
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fortunate enough, fortunate enough to bearound so many big boys that I stole
strategies and I stole systems from them, so to speak. You know,
I adopted a lot of what Isaw work. And I also noticed that
in our business, there are alot of regional players in New York.
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So you have these family businesses thatbecame union shops, that dad started them
and the kids take them over,and I what I recognized was they still
were extremely dysfunctional an organized because becausethe the starter usually comes out of the
field all of the tools, andthen there's a there's a period of years
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that he's fighting to grow a businessand scale it and do his absolute very
best, but he's not necessarily aCEO and doesn't understand very particular business concepts,
traditional business concepts and strategies and systemsthat could work in a contracting company.
They just tweaked a little bit.And so what I did is I
modeled some of the bigger players.I befriended a lot of them. I
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got to know them intimately. Igot to know the inside of their business,
and you know, based on that, based on my own education,
and you know what I learned.You know, I went to b school
and I have an education, SoI brought that corporateness into the into the
business. And so laying out aplan for for scaling is required. So
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you have to have the right strategyin place. You also need to be
I've never met a contractor or sorea contracting company that scaled that was hands
off. Can I run a constructioncompany from a yacht? You know,
if my dad didn't have a stroke, he'd be in the office right now,
seventy something years old. The factthat you know where I come from.
Also, I do know for afact there's a seventy plus year old
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man right now in the office workingat his desk in Long Island. I
know exactly you know, I'm notgoing to say the name, but I
know exactly who he is. Iknow he's there right now. The kids
are running the business. You haveto be hands on, so you could
automate processes and now because of technology, we could be distant and I could
be at home and I still couldbe tracking job cost data, which is
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one of the biggest holes that Ifind in all contractors. And that's my
number one pet peeve is to knowwhere I am at any given time,
any day on any project. Andthe fact that there are millions of dollars
at risk every day visa VI materialin labor, especially if you're a union
shop you're working on these big jobsand you're like net sixty out, but
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you got to wait a month toget it approved. Rex, you're really
ninety days out. You're paying unionlabry, have massive carry, and you
don't know where you stand on thejob. To me is madness. No
other business in the world would dothat. The Wall Street guys, when
they deploy capital to get a return, the number one thing on their mind
is risk management. So I adoptedthat philosophy and I take that with me
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and that's how I create my job. Cost tracking spreadsheets and systems that I
have in place. But the systemsare their number one thing. The secondary
thing. I guess they're both equallyimportant, but I'm gonna kind of bifurcate
the system a little bit. Youhave an operation system and strategies that need
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to be in place. Then youhave to have a perpetual, ongoing,
constant system in place. For leadgeneration. Contractors are stagnant. They get
leads and then they get so muchworth and they stop marketing. Then they
stopped out there and driving revenue andmeeting clients or the world that I come
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from as a rip them and readthe world low bid. But you have
to supplement that with private work aswell, and so being a salesman getting
out there and closing deals is equallyas important to know that you have the
ability to close deals and negotiate contractsand take that and stick it into a
system that outputs on the other endof delivered project. If you have the
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confidence in your system and the abilityto deliver projects because you have the right
system in place, the right peoplein place, then your confidence going out
and getting work is going to beeven that much greater. And you're gonna
have this massive desire to just keepfeeding the machine. And that's what we
used to call it, feeding themachine, because we created a machine,
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and so our jobs were how dowe feed the machine? Today? What
else can we do? You know, if we didn't have fifteen to twenty
jobs going at once, I'm gettingnervous, you know, to say that
the most contractors that blows their mind. How do you have fifteen jobs going
on once? Well, you wehave fifteen different project managers. Each project
manager could handle anywhere between five andfifteen jobs depending on the size. Right.
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So, and then when you whenyou think of it that way,
then I look at every single PMas a profit center. He said,
if this PM cost me x yz a year, but I know he's
going to deliver me thirty points onevery job, and he can handle ten
jobs at once, Well, thenI know how much money I'm gonna be
able to get out of a PM. So then I'm scaling on a on
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a per person basis. I knowI need to hit a certain number.
I need more men. I needmore project managers because being being a part
of the union, it diminishes mymy need for figuring out how I get
labor. I pay the union becauseif I need men, I get men,
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even if they have to pull guysoff the bench or get a traveler.
If I need seventy five electricians ona site tomorrow, I'm gonna get
it. So then I'm not limitedby the amount of manpower. Now I'm
limited by the amount of work Ican get. But then typically if I
have a bad system in place,I'll be limited by the amount of work
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I can get and by the amountof work my people can handle. So
then I end up in a constant, what I call a constant gardening effort
of recruiting and trying to cultivate projectmanagers because each one of them. I
look at as a profit silo.So I kind of look at the contracting
business a little bit different than traditionalizedI see you through a different lens,
and because of that, I believethat was the reason why we're able to
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scale so quickly and do what we'vedone. That is something that you do
today for business owners, for constructionowners in particularly. I do that for
contractors every day. I embed withthem, you know, on a consulting
basis, and I take the businessapart. I get the sock draw and
we recreate all the systems that arerequired. Lucky them that they don't have
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to reinvent the wheel. They canjust runch to you when you were.
They have to face the fear lot. It's it's tough to look at the
mirror. Yeah, So that's thebiggest thing I find is to get people
in a position where they don't takeoffense that you know, I'm not insulting
their baby, but I have totake this thing apart. We got to
look in the mirror here and behonest with ourselves. Don't kill the messenger.
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And then the next thing is isif I put systems in place,
but you don't run this you don'thave a corporate culture here. That's a
real business what the systems are meaninglessif we don't have SOPs and checklists and
our culture is one of excellence andthe leadership promotes a corporatism, meaning we
have a system, we have ameans and methods, a methodology on how
we how we operate every function inthis business from the back of the house
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to the front of the house.That's how we that's how we always talked
about it in our business. Fromthe back of the back of the house
is estimating, front of the houseis project management, and all the C
suite activities from the back of thehouse to the front of the house.
If there isn't a very strong leaderthat says, hey, do not deviate
from the SOPs. It's paint bynumber, okay, then you'll have then
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you can scale. But if youif everybody's doing something different and they're deviating,
that you've got a bunch of oresin the in the ocean and they're
going in a different direction and you'renot going anywhere. So everybody has to
be, uh, you know,in line. And what I noticed was
just to the side, the moreorganized and compartmentalized you can get in a
contracting company, the longer your peoplewill stay with you. What I've noticed
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is that the more entrepreneurial, themore unorganized the businesses, the less my
employees would stay, the more regimented, and the more the more defined I
could get in their duties and responsibilities, the better they performed. And I
think that's just an interesting take onhuman nature and the difference between an employee
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and an entrepreneur. As an entrepreneur, we like an organization and chaos.
We can operate in that world andknow what we end up doing is we
end up using that and creating aframework that drives revenue. Employees do not.
They get a job because they're lookingfor security, and if they don't
have a framework, a very specificduties, task and responsibility framework, then
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they don't feel like they're secure andthey don't feel like they're working for a
real business. And what they dois they would leave me and go to
work for the city where there's noupward mobility and potential. But there's massive
framework in compartmentalization. And I alwaysalways struck me because I'm like, listen,
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if you stay with me and youmake me money, I'm going to
write you bonuses at the end ofthe year at my discretion. But I'm
gonna write your bonuses. You're gonnafeel like you're working on Wall Street.
If we make a lot of money. I am a pig, and that
money carrot was meaningless because I'm anentrepreneurial minded. And then I and they
would go to other larger companies,and all of those companies were way corporate.
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They're publicly traded, you know,like you know, you know one
of these companies where I don't dothat, that's this guy's department. Take
that and talk to him. Whereasan entrepreneur, that's repulsive to us.
We want to you want your peopleto be able to get up and work
over here and also work over there. And that's a fairy tale. Employees
do not operate that way. That'sone guy in your business who can do
all those things. Employees show up, they get a paycheck, they want
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to get that coffee, eat thebagel at the desk, grind their farts
in a chair, and operate ona very specific sop and say this is
my job. I did it.Nobody could say I didn't do my job
today. Get up at four o'clockand go home. The more of that
type of environment I created, themore money we made, which is totally
contra to every impulse in my body. And that was part of one of
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those learning lessons that I was tryingto elucidate earlier that I had to learn
that I had to learn that employeesare very specific reason sources to use them
as tools specifically. Once you do, you will prosper as an entrepreneur.
That's great advice. And did youdo anything fun with the employees? Was
there any you know, down timeor events that you would throw for the
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employees to make them feel special.No, we have how we had Christmas
parties? Yeah, uh you know, and uh you know in the early
days, in the earlier days,Christmas parties would be you know, open
bar, and then later I stoppedthat. Too much trouble. Yeah,
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you know, guys get out ofhand. You know, we're in construction,
you know, so you know,guys get out of hand and stuff
like that. And I don't wantthat liability. See, I'm a risk
manager, bro. Yeah, soyou know, once you have something to
lose, Yeah, once you havesomething to lose, I don't want people
getting because then I have to.Now I got to get you know,
thirty black cars and I got tohave them drive people home because they're getting
whacked and saying insulting their co workersbecause they're drunk at a Christmas party.
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I don't need that headache. Butyou know the main guys, you know
the top guys. So so letme explain another concept, if I may,
ye, there's more to rewarding peoplebesides money. And when you're a
strong leader, if people respect you. So this you have to earn the
respect to your people, not justsign the check. You you have to
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be You can't ask people to dothings that you couldn't do. So in
my in in the contracting business,I could do everything at the highest level.
And that was what part of droveme. I wanted to be great
at everything. If I had todo the shop the submittle log and do
the shop drawings, I would bethe best shop drawing and submiddle guy.
If I got to do takeoffs,I'm the best takeoff guy, the best
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estimator. I'm the best project manager. If I have to do a CPM
schedule, I'm on it like ahornet. Aside from the c suite stuff
and the contracts and the delay claimsand all that all that stuff, so
well, I really believe in competencyand your people knowing that you were competent.
You're the one of the smartest guyswalking around here. Okay, that
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is very important to me. That'scalled altitude. That's a part of my
philosophy. ALP is my company Altitude, logic, and pressure. I believe
that those that's what that stands for, and those concepts need to be at
play and known at all times,especially to get a deal done. But
I think altitude is huge. Soonce you've earned their respect as a leader
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and you have altitude, another wayto reward people is with your attention.
So if you're doing the right thingand you're following procedures and we're making money,
and you're being professional and you're takingthis serious. Our shop is very
serious minded, bro. We're therenot for our health, We're there to
make money. And like I toldyou, I viewed the business like a
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hedge fund. I'm deploying capital geta return. Now, I'm not a
bastard about it, you know,you know, But at the same time,
they understand that there's a leader thereand that he's got his eyes on
everything when it cats away to miselplay that is or sure. So they
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need to know that there's a strongperson there who you can't get one over.
Once you earn that reputation, thenthe guys that do good things want
to get in your inner circle.And if they see that you give praise
and you take guys to lunch,you are doing the right thing. It
creates a competitive environment in the workplace. So I don't have to take them
the wherever, give them tickets toa show or go to a Yankee game.
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They'd much rather go to a lunchwith me. And so I would
reward people with my time. Ifyou do the right thing, you get
next to me, you become inthe inner circle. If you don't,
then you don't get the time.And that's how I managed, and I
believe that that's very effective. Yousound like the Michael Jordan of construction bosses.
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He almost had that same essence tohim. He had his mind on
straight, he knew exactly what heneeded to do, and if he gave
you his attention, you know youwere listening. Yeah. Yeah, And
people want it. They yearn forit. People want to go to work.
I genuinely believe people want to goto work and they want to be
praised and they want to do agood job. Obviously you find people who
don't care, but I mean forthe for the majority of people that have
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kids and have a house and theiradults, you know, they want to
go to work and they want toknow that they're doing a good job,
and they want to do a goodjob. They want to go home and
not even say I work today.I did a good job. I did
what I was supposed to do,right, So, you know, I
wanted to cultivate that environment where ifyou come here and you do a good
job, not only is the endof the year good, but then you
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also get access to the C suite, you get access to my time,
you get perks. There are perksto that, right without me having to,
like I said, you know,take him out and do things.
And I just want to I justwant to say something else on that on
that line. Also, we startvery early in this business. My men
are on the tools at seven o'clockin the morning, right, so I'm
in the office at six thirty.So you know, come four or five
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o'clock, these guys are home.They're shot these people, My people are
exhausted to then say hey, Wednesday, let's go out for Happy hour a
drinks. That's not in the cultureof this industry, you know, because,
like I said, we're a hardcorecontracting outfit. Now, if I
was like selling machines, if Iwas selling slide gates and stuff like that,
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yeah, I'd want to go outwith engineers and take them to drinks
and that type of thing. Butlike the people that working for us,
these are construction people. You know, they're asleep at eight thirty at nine,
they were up at four o'clock inthe morning. Yep, you know.
So it's also a little bit ofa different dynamic. You know,
did you have that same respect foryour dad when you guys would be driving
around. Did he ever point out, hey dad built that or anything like
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that where you thought that was amazing? Constantly It's the only thing that ever
we ever talked about. Our familyidentity was construction. You know, like
you grow up and you got somesome kids in the neighborhood and you know
them, they have some sort ofidentity for a reason. Oh this is
John. Oh that guy, hisdad's a cop. That's the cops house.
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That's this guy's house. Right.Our family identity was we were we
were contractors. We were construction guys. So it was just, you know,
it's just the norm. That's allwe talked about. And my mother
is a saint because my mother dealtwith all that. She was highly supportive
of it. She you know,you know, old school, she raised
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the kids, she was at home. She supported my dad and everything that
he did, and they worked asa team. So dinner talk was construction
talk quite a bit. Always it'salways dad unwinding, right, it would
always would evolve into that, right, But you know, we had normal
dinners and my mom would talk aboutthe day and what's going on with school.
Like, you know, I hadtutors growing up, so you know,
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right after dinner, the tunor wouldthe tutor would come. So we
talk about school and what I've donein my homework and if I'm prepared.
My dad was big on that whenI got in high school. And so,
yeah, it's funny I lived.I lived two different lives when I
was younger. We didn't have muchmoney. Okay, I guess that's the
life of everybody, to starting something, to getting their life together right.
And then as I got a littlebit older, our socioeconomics changed, and
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I think that was when my dadreally started to understand business and try to
become more of a CEO. Andhe was, you know, big on
that. So I had tutors tocome after dinner, so we had normal
dinners, but it would always devolveinto the machinations of the day and screw
this guy and his subs, screwedme and his engineer sucks. And you
know all that every day when youhave to attract newer, younger contractors,
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let's say, straight out of highschool. Is it getting harder these days?
Well, contractors you mean workers?Workers? Yeah, okay, so
extremely difficult. Listen, quite honestly, Lou. Part of the reason why
you know me and why I dowhat I do is because I'm trying to
bring a different light to this businessand I'm doing my best to bring more
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talent into it. In my opinion, it's the greatest business on the face
of the earth. I'm obviously biased, but you can make all your financial
dreams of reality in his business.You don't have to go to Wall Street
and push paper around. You canbuild things for humanity and civilization. Concurrent
with that, you can employ alot of people at wages that are very
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competitive, you know, in contractingespecially, you know when you do the
big jobs, prevailing wage and unionrates. These guys make good, very
good money for what they do,and that allows them to live a certain
lifestyle, send their kids to privateschools, or live in certain neighborhoods,
and you know, save up andget a corvette for the weekends and live
a certain lifestyle. And construction affordsevery It affords a three to sixty win
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for everyone. The contractors can makemoney, the workers themselves could do very
well, and then what we're delivering, the product that we're delivering for the
owner is exactly what they want.I think it's I think it's the best
business. But it's not promoted.It's looked down upon. And my whole
life, when I've when I've toldpeople I'm in I'm in construction, they
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look at me like, you're inconstruction because you know, people I know,
I'm educated, I went to school, and they would go, you
were in construction, and because theywere equating construction with doing somebody's bathroom,
Like, yeah, how do youthink that bridge was built, dude that
you drove over? Today. That'sconstruction man, that's the stuff I do.
When you fluss the toilet, whereyou think the water goes? I
(29:41):
own? Do you think that's governed? Frown man? So we because it
is so essential and because honestly,we work in silence. These the men
go to work every day and theyperform their tasks and they go home okay,
And they're not They don't make TVshows about us, and we're not
in movies and stuff like that.So people take what we do for granted,
(30:03):
even though it's what it's the anchorof civilization. And I want the
young people who are talented, whowould go down to Wall Street because they
want to make a lot of money, I want them to reconsider. And
I would also argue that I canget you the two hundred thousand dollars faster
in contract, and then you canget the two hundred thousand dollars in Wall
Street if you didn't go to anivy. And so I'm trying to make
(30:30):
that more appetizing to the youth.And that's why you've seen my presence on
social and because nobody in my inour industry is doing it. All the
guys that know me, my wholelife. They laugh at me. I
see them looking on LinkedIn because noneof them will get in front of a
camera, and none of them willtell you how they did it right.
(30:51):
It goes back to the little conversationwe had earlier about the coaches that are
out there. Yeah, there maybe coaches that are better than me out
there that have scaled into four orfive hundred million. I only did one
hundred million. I've done two anda half billion in construction, right,
but they've taken their companies to fourfive, six hundred million and beyond then
never going to get in front ofa camera, and they're certainly never going
(31:11):
to come into somebody's office and tellthem how to do it. Except I'm
trying. I'm not listen. I'mnot a saint either. I'm getting paid
for my time, of course,but it's the only thing I don't have
to do. I can go to. I couldn't go do anything else if
I wanted to everything. Look atbuildings. I'm looking at everything. What
(31:33):
can be done? What can Ibuild you? That's just you know,
It's all I know. So I'mdoing my part to bring this industry that's
given me so much and afforded alifestyle that I currently live and allowed me
to have the afford me the lifethat I've had visa VI our business.
I'm trying to make that more knownso we can get better talent in our
industry. I mean, there's anROI for your service, so it's not
(31:56):
like they're just paying and not gettinganything out of ITROI. The thing is
that they got to get there here. The biggest issue I find is that,
you know, if I take aguy like I just took a guy
and I scaled him this year.The past eleven months, he was on
the tools. He's been on atool since he's fifty four years old.
He was on the tools until he'sfifty three. Oh wow, I took
(32:19):
him off the tools. In elevenmonths. He went from six hundred and
fifty thousand revenue to twelve million.In fact, that's where I am now.
I'm in Florida, and when I'mdone with this, I'm gonna go
in his office and see here.His name is Court Construction, Saint Petersburg,
Florida. Guy's name is Brian Bettencourt. I've done an interview with him.
He can find him on my YouTubeand everything. The biggest that he
has is he's fifty four. He'snever been a CEO. Okay, so
(32:45):
the thing the issue is is there'sa point where yes, we're building stuff.
Yes, means and methods are important. That's why his business is so
dynamic. Yes, you need toknow how to put pucks in a net.
Yes you need to be able tolook at drows and take it off.
You need to know how to dothis whole thing. But then there's
a whole other world outside of itthat you also need to know how to
(33:06):
do as an executive and as aCEO, putting systems and strategies in place,
and then put taking the tool beltoff, putting on a white shirt,
going out there and closing deals likea professional, and articulating yourself and
advocating for your business. So youhave to be everything in this business.
It is so dynamic. That's whysome of the greatest entrepreneurs come from construction
(33:27):
and real estate development, because thereare so many moving pieces. You have
to be a really dynamic brain.Imagine if all I had to do was
just do stocks all day, orI just had to do this one thing
all day. I mean, Iwish I can do one hundred and fifty.
I gotta be a doctor, alawyer, an accountant, an engineer,
an architect, a carpenter. Igotta be everything, you know.
(33:50):
So the biggest thing that I findis that their inability to really start believing
that they're a CEO and that theycan be one. And that's the big
hump. So I have to Ihave to get them to believe that they
can make money. Once they startmaking money and seeing margins, they go,
oh wow, this is really working. While this could work, then
I got to take it to thenext level. And that's the hardest part
because you need people in this businessto grow. Can't have a three man
(34:15):
shop and go to one hundred million, No, absolutely not. So that's
when the CEO and the leadership comesinto play. Yeah. Yeah, when
you're implementing those systems. How importantis technology? Uh? Well, the
systems are tracked visa v technology.I mean, I'll tell you I'm a
mix of that. I'm a mixit too. I use technology and I
(34:36):
leverage it as I feel as appropriate. There Listen, there are times where
you can get two bogged down inthe tech. Remember, there is gonna
be a difference between the people thatsit in the office all day, and
the tech that they're running and they'reworking out of and their workstations, and
then the data that they need fromthe field. Those guys aren't always loving
(34:58):
tech, right, So our businessis gonna be a mixture of some of
the tack pile in the tech.For instance, like when I run change
orders, I have change order folders, they're red, and I run it
by a folder system and on thefront of that folder, I have the
SLP and the checklist for change orders. Okay. Then when that change order
gets handed off to the appropriate party, then it gets put into the tech.
(35:22):
But my pms aren't doing that.They're gonna grab a red folder.
Boom, that's a change order.All those red folders already have pre stapled
on them the SLP for a changeorder and the checklist that's required. I
make it paid by number for theseguys, okay, And once they're done,
they check it all off and theygotta sign the front of it.
Once that's signed, attesting to themfollowing the rules and going through the checklist,
(35:44):
then it comes back to the officeto get processed, and then that's
all tech. So it's a mixtureof the two Okay. If I left
it up to them in the field, lou would never happen. No,
they'd be prosecuting change orders without thembeing approved. I would know about it.
It wouldn't be cost coded. Iwouldn't have it. I couldn't track
it. I wouldn't know what thehell is going on. And then in
(36:06):
the PM meetings that I have withthem, they'll sit there and they'll lie
right to my face. Right,that's what pms do. They will lie
to you one hundred out of onehundred. They don't want to get reamed
out. And if especially if theproject has a long duration loan there they
know what they're missing. And sothey're saying, well, I got time.
I don't got to tell Wilkinson yet. I'm gonna rob Peter to pay
Paul. I could horse trade withthis guy, and I don't play that.
(36:29):
I need to know what's up rightnow, not because I want to
reprimand you, because I don't wantto be blindsided. So let me know
so I could come in and Ican guide you, because I want to
know what's going on with the money. Right. So there's like I said,
I don't know how anybody could everbe a coach or a consultant in
construction without knowing this business in andout. There's so many unique peculiarities in
(36:51):
this business to do it right thatyou know, if you're not a contractor,
I don't know how you could evercall yourself a consultant or a coach.
This is really important and for everybodythat's listening right now, I want
you to definitely pay attention to this. Knowing that Marshall is in construction and
can help you with your business.Where can they find you, Marshall,
(37:15):
Where can they get a hold ofyou and reach out to you for help?
Well, you can find me atMarshall Wilkinson dot com, Altitude Logic
pressure dot com. That's my mainsite, okay, and that's the consulting
site. And you could find meat Real Marshall Wilkinson on Instagram. That's
probably where I'm the most active,and you could pop me in Google.
(37:39):
You can find me there too.You are very well known and have a
lot of followers. One of thelast questions I have for you before we
want to wrap up is do youhave any advice for new construction owners that
you would like to share with ourlisteners. Yes, absolutely, man,
I'm full of it. I'm fullof the advice. But for specifically for
the new guys that are coming in, I would say, it's a great
(38:01):
opportunity for you now to start gettingorganized. So one of the biggest things
and the biggest issues, Lou thatyou're going to see you, I'm sure
you've come across it, and thatI see constantly is in the beginning phases
of the business, what you're whatyou are focused on, Solis is getting
work. You need money, soyou're trying to get customers. And then
(38:25):
to the detriment of the back office. But that's the perfect kind to set
up the back office because you don'thave so much work. You know,
when I when I have to goin and I have to you know,
reassemble these companies and they and they'vebeen around for so long. It is
a nightmare. All the entanglements andand and the people that are stuck in
(38:47):
their ways and you try to puta new system on them, and it's
total chaos. Right now, doit right at the beginning, So start
getting organized. Everything starts with organists. Start getting organized. And I would
say, most importantly, make surethat you put in place a very robust
and you know, easy to use, but robust job cost tracking system.
(39:14):
You need to know what your committedcosts are? Can I just explain that
really quick before we go. Idon't want to leave them with Yeah,
I don't want them to leave themwith something and then they feel unfulfilled and
they can't do it. Most importantly, you need to know what your committed
costs are. This is for thejob cost tracking. This is required your
committed costs or your build price.So quickly, open up an Excel spreadsheet.
(39:38):
Create a job number. Every oldjob should be by job number,
by the way, not by thecustomer name. Should be job number.
So this is twenty twenty three.Let's say this is your first job in
twenty twenty three. The job numbershould be twenty three oh one. The
next one should be twenty three ohtwo. Right, create a job number
system. The first thing I wantyou to do is put the contract value
(40:00):
the column. The next thing Iwant you to do is put the committed
cost in the column. Committed costis what your actual build price is.
The reason why it's called committed costis because that's what you're committing to have
to pay. Right. Because thedelta between contract value and committed costs is
what we make, right, Itshouldn't be thirty points er die. So
(40:22):
your contract value in one column.The other columns you committed costs. The
next one is current committed costs.Because your committed costs could change. Okay,
you know why you committed costs couldchange a little. I don't wanna
put you on the spot. Tellme it could change because of change orders.
Yes, right, So my committedcosts changed because my contract value in
(40:42):
created increase because of change orders.Here's the thing. What if your current
committed costs increase and your contract valuedoesn't increase, that means that your missing
scope, that maybe you had togive a subcontractor a change order that you
can't go to the owner too.You're losing money. You need to know
that. Then the next column isgoing to be my actual committed It's what
I have actually committed to date.Does that make sense? What I've actually
(41:06):
spent to date. So my originalcommitted costs are my bill price, my
current committed costs, and my actualcommitted costs. And then you have to
have your change order column in casethere's any change orders and change order values.
If you could do something very simplelike that, very simple. In
the next column, I want youto put a column I call it the
gross clear So the delta between mycurrent committed costs and my current contract value
(41:30):
is what I'm clearing, Okay,and put it in a formula in the
next column of a percentage and watchthat thing and make sure it don't go
below thirty. The next portion ofthis, though, is very important.
All of these systems and a verysimple tracker like that, which is like
ABC one two three. But you'dbe surprised some of you guys don't have
it. Is that bad data in, bad data out. If you don't
(41:54):
do a constant gardening effort, thesetools are worthless to you. So here's
how you make them perfect. You'vegot to commit to yourself and make a
promise that you're gonna go by.This is what my dad used to go
by, Sam walton sundown method.You know Sam Walton, the founder of
Walmart. You know Sam's Club.Yep. What he would do was before
(42:15):
he left for the day, justas this, just as his cashier would
reconcile the register for the day.If you worked at a retail store,
before you go home, you canjust leave all y cash and a register.
You have to reconcile and close outthe books for the day. Yep.
You gotta do the same thing asa contractor. So take thirty minutes
(42:37):
and reconcile the day and all youneed to do is input if you got
a payment today, input if you'vegot to change order today, or input
if you bought out a new subtoday. That's it, just three things
to those affects. You're committed costs. If you didn't, then you don't
have to put anything in that tracker. If you did, take ten seconds
and put it in, create theformula and it'll automatically calculate. And this
(43:00):
way, every morning, when youhave your cup of coffee, you pull
that tracker up and you know whereyou are in any at any given time
of the day on that job.And that's the most dogge you can get
in organized in the beginning phases.And then we can get more complex after
that. But that's that's you knowwhat I would recommend that the new guys
(43:20):
start to do. Okay, Andfor those templates that you're talking about,
is that something that they could potentiallyget from you. I don't sell them,
okay, I create them. Ibuild out systems for my customers.
Okay, so that would be somethingthat I would I could either embed with
them, which is what I prefer, going to their office, meeting them,
(43:44):
meeting me face to face, meetingtheir people, because then I can
give them a much better analysis oftheir people and how I really think it
should be tailored to them specifically.That's one option. The other option is
I also could just build out thesesystems replicated like mine. I could do
that remotely. But I get thisquestion a lot low. And so what
I really think I'm going to doover the break here, this Christmas break
(44:06):
that we have coming up, I'mshutting things down for about a week,
okay, uh, And so Ireally think it's probably a good thing for
me to create a bunch of thesetemplates and shoot a course and put it
in my university for the guys thatcan't afford to have me come out,
so at least they could start doingit on their own. And then what
(44:29):
I think is probably more cost effectivethat they start to do it, then
they get some of my time remotely, and then I looked at it on
the zoom and I could direct themwhat's right and what's wrong. And what
should be tweaked, and then theyactually have a pride in work that they
did it themselves. So I thinkI'm going to start offering that, but
as of today, I do notoffer that. Marshall, thank you so
(44:50):
much for being a guest. There'sa lot of value that the listeners can
take away from today. Well,thank you, Lou, I appreciate it's
my pleasure. And everyone else pleaselike, subscribe comments, share the builder
up our show with anyone in construction. We will see you next time.
(45:16):
If you're a construction contractor and wouldlike to appear as a guest on our
podcast, write us an email.It's Lou at lumberfi dot com.
Welcome back Lumberjacks, and i'll youconstruction folks to episode four. If you're
new. I'm Lou your host ofThe Builder Upper Show, a podcast where
we talk about everything in construction andtrades. Now let's get into it.
I would like to welcome our guest, Marshall Wilkinson, the New York construction
(00:24):
boss the hardest market in the world. Marshall, welcome, Thanks Lou.
Great to be here, appreciate itabsolutely so. Tell me who is Marshall
Wilkinson. Marshall Wilkinson is a secondgeneration contractor and construction manager from New York.
(00:48):
I grew up in Long Island,New York. Nice suburban life,
right, but a person who's dedicatedhis life to this business. Carried a
torch from my father and and fellin love with the business and is now
currently a consultant and a coach.And I helped contractors scale, but most
importantly in my core, I'm aconstruction man, been that way since the
(01:12):
highchair. What was your specialty,Marshall, electrical and what got you into
it? Like in the beginning,Well, I really didn't have a choice.
I'm a second generation, so youknow, I kind of already had
a path set for me. AllI ever heard of the dinner table growing
(01:33):
up was how to run projects andhow to do jobs. We specialize on
water and wastewater treatment plants, sounion shop class a heavy work and since
a kid, my dad's been runningthose projects. The New York City dep
has the largest capital project budget,at least they have had for a very
long time. So they made abusiness decision to move in that direction.
(01:56):
And so I've been learning how torun water treatment plant since I'm one years
old. And we hear that alot. We hear, you know,
father son, dad gets him intoit. When did you decide to become
a construction owner. Well, Iwasn't allowed in the business until our business
until twenty five, twenty six yearsold. So I don't think my father
(02:20):
didn't want to, you know,be called out on nepotism. He's worked
with guys for a very long time. He didn't want those guys to think
that the new young kid was goingto come in. And because I had
the same last name that I wasimmediately going to get a corner office and
I was going to you know,climb the corporate ladder. I had to
prove myself so I worked every jobin construction on my way up. I
(02:42):
worked with various different contractors in differentpositions on different types of projects before my
dad thought that I had the chopsand I was strong enough to come into
the business. And then what Idid is I injected more of a corporateness
and a professionalism and more of asales orientation to the business where he was
really more of operations and a kindof guy who really understood the field and
(03:06):
the tools where I came in.And although I had that background, I
also I brought some a little bitmore corporateness to the business and put systems
in place and scaled it from there. Awesome. Yeah, I like how
you you made that transition and youmade it successfully. What is something you
know today that you wish you knewwhen you started? Oh man, a
(03:30):
lot, a lot really, youknow. I learned a lot of lessons,
and I learned them the hard waybecause the way I was brought up
was my dad. You know,I use this reference a lot. You
know, kind of the way TigerWoods father, Earlwood's dealt with Tiger is
definitely how my dad dealt with me. He was grooming me and So when
(03:52):
you have all of that confidence andyou think that you know it all,
and your your father's telling you you'rethe man, You're the king, You're
going to be the best ever lived. You know. Really, it's really
as dramatic as that. I hada lot of confidence and I didn't have
all of the knowledge and the skillto back it up. Construction is a
very interesting business because you need tohave experience. It's very experience driven because
(04:15):
every project is unique. Fires areon every project. You have to build
the construction muscle, so to speak. And so although I had the information,
I knew how to run a job. I knew how to run a
company. I knew how to runwork. I understood everything about project management
and scale and buying out subs andscheduling and estimating and all the machinations they're
(04:40):
in. There's a difference between knowinghow to do it and been doing it
for a few years. Like Iwas right, you know, obviously growing
up as a teenager arm working andworking in the business and stuff. But
you know, from eighteen to twentyfive, I'm in other places, you
know, making my bones, soto speak. And you run into guys
who've been doing this for thirty fiveforty years. You do not know more
(05:00):
than those guys. And that wassomething I had to learn the hard way,
because I would play smash mouth football. Well, guys that have been
the business for forty years. Ithink my way was better. And sometimes
old schools the only school is whatI learned, So I had to learn
that lesson a lot. I alsolearned very valuable lessons with employees and human
(05:25):
resources in letting the line out onguys and giving people time to breathe and
grow and not be so harsh onpeople. And then you know, obviously
you're a for profit business, andwhen you're a young guy, you want
to make a lot of money.And I certainly did, and I certainly
did want to make a lot ofmoney and did make a lot of money,
but I was always counting other people'spockets and I had to learn that
(05:48):
these people were resources for us,and they were tools for us to earn
more. And really what my jobwas, as I'm mature to do an
executive, was to make sure thatI gave them the tool and the leadership
and the systems to make them successful, rather than saying, oh, I'm
paying this guy this much money thisguy's making that much more than me,
(06:08):
you know, as a young guyto like, I know this guy's making
XYZ, And that was just immaturity. But I learned all those lessons the
hard way and in a very embarrassingmanner. That's why I know them so
well now, and I impart allthose lessons on all my clients, because
it is a difficult thing, especiallyif you're a first generation contractor and you're
(06:30):
coming from a family that were maybeemployees and weren't business owners. You're taking
a very specific employee type of mindsetbringing it into an entrepreneurial realm where our
biggest expense is the human resource anda lot of times I see a lot
of frustration around the owners and theiremployees, and although it's warranted, it
(06:53):
has to be you have to lookat it through a very specific lens,
because we need these people to makeus money, We need them to deliver
projects for us, and so noteverybody's one hundred percent. And I learned
that, and then I'd learned tolook at everybody, all my employees as
a as a profit center. Thereare revenue silos for me. Each person
(07:14):
they need to deliver a certain typeof revenue back to me if they're on
a revenue generation end of things likeproject management in the field, and then
if they're not, if they're justoverhead carry they are a part of me
delivering my product or my service.And I just matured as an executive to
understand what all of that meant.And I learned those lessons the hard way.
But there are there are quite afew lessons that I learned on the
(07:34):
way up, that's for sure.Well put during those few struggles that you
had, or if there was anystruggles that stock out, what motivated you
to work through that? Well,I mean I was motivated to be the
best, you know, like youknow, just because you know, you
come up in a family business,and I like to refer to us as
(07:57):
like a family dynasty. My dad'sRobert Wilkins, and he's done probably twelve
to fifteen billion in work. He'sa very big player. He's very well
known in the public works world,the class a world in New York City.
So I was motivated to be betterthan him. I never because of
the way he grew me. Ialso didn't want to be a person say,
(08:18):
oh, you know, that's Wilkinson'skid. I wanted people to say,
that's Wilkinson's Kitty Sharper's attack. Watchthat he'll cut your head off,
right, And because I wanted thatto be my reputation, I just I
had a massive, burning desire tobe that person, and I figured out
the only way to be that guyis to actually be that guy, to
actually know your stuff, and soI just had a desire to learn all
(08:41):
of it and master it. Soundslike you feel those shoes very well.
Well. We have a lot ofconstruction owners that tap into this podcast.
A lot of them are wondering,how did you scale your business? Is
there any tactics that you feel listenerscan benefit from. Absolutely, scaling isn't
(09:05):
something that's done on accident. Scalingcomes from preparation and having a plan in
place and working that plan. Ninetypercent of contractors, I believe, go
out because they operate under the wrongsystem. They don't have the right strategies
and systems in place, and youdon't know what you don't know. I'm
(09:26):
fortunate enough, fortunate enough to bearound so many big boys that I stole
strategies and I stole systems from them, so to speak. You know,
I adopted a lot of what Isaw work. And I also noticed that
in our business, there are alot of regional players in New York.
(09:48):
So you have these family businesses thatbecame union shops, that dad started them
and the kids take them over,and I what I recognized was they still
were extremely dysfunctional an organized because becausethe the starter usually comes out of the
field all of the tools, andthen there's a there's a period of years
(10:09):
that he's fighting to grow a businessand scale it and do his absolute very
best, but he's not necessarily aCEO and doesn't understand very particular business concepts,
traditional business concepts and strategies and systemsthat could work in a contracting company.
They just tweaked a little bit.And so what I did is I
modeled some of the bigger players.I befriended a lot of them. I
(10:33):
got to know them intimately. Igot to know the inside of their business,
and you know, based on that, based on my own education,
and you know what I learned.You know, I went to b school
and I have an education, SoI brought that corporateness into the into the
business. And so laying out aplan for for scaling is required. So
(10:56):
you have to have the right strategyin place. You also need to be
I've never met a contractor or sorea contracting company that scaled that was hands
off. Can I run a constructioncompany from a yacht? You know,
if my dad didn't have a stroke, he'd be in the office right now,
seventy something years old. The factthat you know where I come from.
Also, I do know for afact there's a seventy plus year old
(11:20):
man right now in the office workingat his desk in Long Island. I
know exactly you know, I'm notgoing to say the name, but I
know exactly who he is. Iknow he's there right now. The kids
are running the business. You haveto be hands on, so you could
automate processes and now because of technology, we could be distant and I could
be at home and I still couldbe tracking job cost data, which is
(11:43):
one of the biggest holes that Ifind in all contractors. And that's my
number one pet peeve is to knowwhere I am at any given time,
any day on any project. Andthe fact that there are millions of dollars
at risk every day visa VI materialin labor, especially if you're a union
shop you're working on these big jobsand you're like net sixty out, but
(12:03):
you got to wait a month toget it approved. Rex, you're really
ninety days out. You're paying unionlabry, have massive carry, and you
don't know where you stand on thejob. To me is madness. No
other business in the world would dothat. The Wall Street guys, when
they deploy capital to get a return, the number one thing on their mind
is risk management. So I adoptedthat philosophy and I take that with me
(12:24):
and that's how I create my job. Cost tracking spreadsheets and systems that I
have in place. But the systemsare their number one thing. The secondary
thing. I guess they're both equallyimportant, but I'm gonna kind of bifurcate
the system a little bit. Youhave an operation system and strategies that need
(12:45):
to be in place. Then youhave to have a perpetual, ongoing,
constant system in place. For leadgeneration. Contractors are stagnant. They get
leads and then they get so muchworth and they stop marketing. Then they
stopped out there and driving revenue andmeeting clients or the world that I come
(13:05):
from as a rip them and readthe world low bid. But you have
to supplement that with private work aswell, and so being a salesman getting
out there and closing deals is equallyas important to know that you have the
ability to close deals and negotiate contractsand take that and stick it into a
system that outputs on the other endof delivered project. If you have the
(13:28):
confidence in your system and the abilityto deliver projects because you have the right
system in place, the right peoplein place, then your confidence going out
and getting work is going to beeven that much greater. And you're gonna
have this massive desire to just keepfeeding the machine. And that's what we
used to call it, feeding themachine, because we created a machine,
(13:50):
and so our jobs were how dowe feed the machine? Today? What
else can we do? You know, if we didn't have fifteen to twenty
jobs going at once, I'm gettingnervous, you know, to say that
the most contractors that blows their mind. How do you have fifteen jobs going
on once? Well, you wehave fifteen different project managers. Each project
manager could handle anywhere between five andfifteen jobs depending on the size. Right.
(14:11):
So, and then when you whenyou think of it that way,
then I look at every single PMas a profit center. He said,
if this PM cost me x yz a year, but I know he's
going to deliver me thirty points onevery job, and he can handle ten
jobs at once, Well, thenI know how much money I'm gonna be
able to get out of a PM. So then I'm scaling on a on
(14:31):
a per person basis. I knowI need to hit a certain number.
I need more men. I needmore project managers because being being a part
of the union, it diminishes mymy need for figuring out how I get
labor. I pay the union becauseif I need men, I get men,
(14:52):
even if they have to pull guysoff the bench or get a traveler.
If I need seventy five electricians ona site tomorrow, I'm gonna get
it. So then I'm not limitedby the amount of manpower. Now I'm
limited by the amount of work Ican get. But then typically if I
have a bad system in place,I'll be limited by the amount of work
(15:13):
I can get and by the amountof work my people can handle. So
then I end up in a constant, what I call a constant gardening effort
of recruiting and trying to cultivate projectmanagers because each one of them. I
look at as a profit silo.So I kind of look at the contracting
business a little bit different than traditionalizedI see you through a different lens,
and because of that, I believethat was the reason why we're able to
(15:37):
scale so quickly and do what we'vedone. That is something that you do
today for business owners, for constructionowners in particularly. I do that for
contractors every day. I embed withthem, you know, on a consulting
basis, and I take the businessapart. I get the sock draw and
we recreate all the systems that arerequired. Lucky them that they don't have
(15:58):
to reinvent the wheel. They canjust runch to you when you were.
They have to face the fear lot. It's it's tough to look at the
mirror. Yeah, So that's thebiggest thing I find is to get people
in a position where they don't takeoffense that you know, I'm not insulting
their baby, but I have totake this thing apart. We got to
look in the mirror here and behonest with ourselves. Don't kill the messenger.
(16:21):
And then the next thing is isif I put systems in place,
but you don't run this you don'thave a corporate culture here. That's a
real business what the systems are meaninglessif we don't have SOPs and checklists and
our culture is one of excellence andthe leadership promotes a corporatism, meaning we
have a system, we have ameans and methods, a methodology on how
we how we operate every function inthis business from the back of the house
(16:45):
to the front of the house.That's how we that's how we always talked
about it in our business. Fromthe back of the back of the house
is estimating, front of the houseis project management, and all the C
suite activities from the back of thehouse to the front of the house.
If there isn't a very strong leaderthat says, hey, do not deviate
from the SOPs. It's paint bynumber, okay, then you'll have then
(17:06):
you can scale. But if youif everybody's doing something different and they're deviating,
that you've got a bunch of oresin the in the ocean and they're
going in a different direction and you'renot going anywhere. So everybody has to
be, uh, you know,in line. And what I noticed was
just to the side, the moreorganized and compartmentalized you can get in a
contracting company, the longer your peoplewill stay with you. What I've noticed
(17:32):
is that the more entrepreneurial, themore unorganized the businesses, the less my
employees would stay, the more regimented, and the more the more defined I
could get in their duties and responsibilities, the better they performed. And I
think that's just an interesting take onhuman nature and the difference between an employee
(17:55):
and an entrepreneur. As an entrepreneur, we like an organization and chaos.
We can operate in that world andknow what we end up doing is we
end up using that and creating aframework that drives revenue. Employees do not.
They get a job because they're lookingfor security, and if they don't
have a framework, a very specificduties, task and responsibility framework, then
(18:19):
they don't feel like they're secure andthey don't feel like they're working for a
real business. And what they dois they would leave me and go to
work for the city where there's noupward mobility and potential. But there's massive
framework in compartmentalization. And I alwaysalways struck me because I'm like, listen,
(18:40):
if you stay with me and youmake me money, I'm going to
write you bonuses at the end ofthe year at my discretion. But I'm
gonna write your bonuses. You're gonnafeel like you're working on Wall Street.
If we make a lot of money. I am a pig, and that
money carrot was meaningless because I'm anentrepreneurial minded. And then I and they
would go to other larger companies,and all of those companies were way corporate.
(19:02):
They're publicly traded, you know,like you know, you know one
of these companies where I don't dothat, that's this guy's department. Take
that and talk to him. Whereasan entrepreneur, that's repulsive to us.
We want to you want your peopleto be able to get up and work
over here and also work over there. And that's a fairy tale. Employees
do not operate that way. That'sone guy in your business who can do
all those things. Employees show up, they get a paycheck, they want
(19:26):
to get that coffee, eat thebagel at the desk, grind their farts
in a chair, and operate ona very specific sop and say this is
my job. I did it.Nobody could say I didn't do my job
today. Get up at four o'clockand go home. The more of that
type of environment I created, themore money we made, which is totally
contra to every impulse in my body. And that was part of one of
(19:51):
those learning lessons that I was tryingto elucidate earlier that I had to learn
that I had to learn that employeesare very specific reason sources to use them
as tools specifically. Once you do, you will prosper as an entrepreneur.
That's great advice. And did youdo anything fun with the employees? Was
there any you know, down timeor events that you would throw for the
(20:15):
employees to make them feel special.No, we have how we had Christmas
parties? Yeah, uh you know, and uh you know in the early
days, in the earlier days,Christmas parties would be you know, open
bar, and then later I stoppedthat. Too much trouble. Yeah,
(20:36):
you know, guys get out ofhand. You know, we're in construction,
you know, so you know,guys get out of hand and stuff
like that. And I don't wantthat liability. See, I'm a risk
manager, bro. Yeah, soyou know, once you have something to
lose, Yeah, once you havesomething to lose, I don't want people
getting because then I have to.Now I got to get you know,
thirty black cars and I got tohave them drive people home because they're getting
whacked and saying insulting their co workersbecause they're drunk at a Christmas party.
(21:02):
I don't need that headache. Butyou know the main guys, you know
the top guys. So so letme explain another concept, if I may,
ye, there's more to rewarding peoplebesides money. And when you're a
strong leader, if people respect you. So this you have to earn the
respect to your people, not justsign the check. You you have to
(21:26):
be You can't ask people to dothings that you couldn't do. So in
my in in the contracting business,I could do everything at the highest level.
And that was what part of droveme. I wanted to be great
at everything. If I had todo the shop the submittle log and do
the shop drawings, I would bethe best shop drawing and submiddle guy.
If I got to do takeoffs,I'm the best takeoff guy, the best
(21:47):
estimator. I'm the best project manager. If I have to do a CPM
schedule, I'm on it like ahornet. Aside from the c suite stuff
and the contracts and the delay claimsand all that all that stuff, so
well, I really believe in competencyand your people knowing that you were competent.
You're the one of the smartest guyswalking around here. Okay, that
(22:07):
is very important to me. That'scalled altitude. That's a part of my
philosophy. ALP is my company Altitude, logic, and pressure. I believe
that those that's what that stands for, and those concepts need to be at
play and known at all times,especially to get a deal done. But
I think altitude is huge. Soonce you've earned their respect as a leader
(22:29):
and you have altitude, another wayto reward people is with your attention.
So if you're doing the right thingand you're following procedures and we're making money,
and you're being professional and you're takingthis serious. Our shop is very
serious minded, bro. We're therenot for our health, We're there to
make money. And like I toldyou, I viewed the business like a
(22:49):
hedge fund. I'm deploying capital geta return. Now, I'm not a
bastard about it, you know,you know, But at the same time,
they understand that there's a leader thereand that he's got his eyes on
everything when it cats away to miselplay that is or sure. So they
(23:10):
need to know that there's a strongperson there who you can't get one over.
Once you earn that reputation, thenthe guys that do good things want
to get in your inner circle.And if they see that you give praise
and you take guys to lunch,you are doing the right thing. It
creates a competitive environment in the workplace. So I don't have to take them
the wherever, give them tickets toa show or go to a Yankee game.
(23:33):
They'd much rather go to a lunchwith me. And so I would
reward people with my time. Ifyou do the right thing, you get
next to me, you become inthe inner circle. If you don't,
then you don't get the time.And that's how I managed, and I
believe that that's very effective. Yousound like the Michael Jordan of construction bosses.
(23:56):
He almost had that same essence tohim. He had his mind on
straight, he knew exactly what heneeded to do, and if he gave
you his attention, you know youwere listening. Yeah. Yeah, And
people want it. They yearn forit. People want to go to work.
I genuinely believe people want to goto work and they want to be
praised and they want to do agood job. Obviously you find people who
don't care, but I mean forthe for the majority of people that have
(24:19):
kids and have a house and theiradults, you know, they want to
go to work and they want toknow that they're doing a good job,
and they want to do a goodjob. They want to go home and
not even say I work today.I did a good job. I did
what I was supposed to do,right, So, you know, I
wanted to cultivate that environment where ifyou come here and you do a good
job, not only is the endof the year good, but then you
(24:41):
also get access to the C suite, you get access to my time,
you get perks. There are perksto that, right without me having to,
like I said, you know,take him out and do things.
And I just want to I justwant to say something else on that on
that line. Also, we startvery early in this business. My men
are on the tools at seven o'clockin the morning, right, so I'm
in the office at six thirty.So you know, come four or five
(25:03):
o'clock, these guys are home.They're shot these people, My people are
exhausted to then say hey, Wednesday, let's go out for Happy hour a
drinks. That's not in the cultureof this industry, you know, because,
like I said, we're a hardcorecontracting outfit. Now, if I
was like selling machines, if Iwas selling slide gates and stuff like that,
(25:26):
yeah, I'd want to go outwith engineers and take them to drinks
and that type of thing. Butlike the people that working for us,
these are construction people. You know, they're asleep at eight thirty at nine,
they were up at four o'clock inthe morning. Yep, you know.
So it's also a little bit ofa different dynamic. You know,
did you have that same respect foryour dad when you guys would be driving
around. Did he ever point out, hey dad built that or anything like
(25:48):
that where you thought that was amazing? Constantly It's the only thing that ever
we ever talked about. Our familyidentity was construction. You know, like
you grow up and you got somesome kids in the neighborhood and you know
them, they have some sort ofidentity for a reason. Oh this is
John. Oh that guy, hisdad's a cop. That's the cops house.
(26:11):
That's this guy's house. Right.Our family identity was we were we
were contractors. We were construction guys. So it was just, you know,
it's just the norm. That's allwe talked about. And my mother
is a saint because my mother dealtwith all that. She was highly supportive
of it. She you know,you know, old school, she raised
(26:33):
the kids, she was at home. She supported my dad and everything that
he did, and they worked asa team. So dinner talk was construction
talk quite a bit. Always it'salways dad unwinding, right, it would
always would evolve into that, right, But you know, we had normal
dinners and my mom would talk aboutthe day and what's going on with school.
Like, you know, I hadtutors growing up, so you know,
(26:56):
right after dinner, the tunor wouldthe tutor would come. So we
talk about school and what I've donein my homework and if I'm prepared.
My dad was big on that whenI got in high school. And so,
yeah, it's funny I lived.I lived two different lives when I
was younger. We didn't have muchmoney. Okay, I guess that's the
life of everybody, to starting something, to getting their life together right.
And then as I got a littlebit older, our socioeconomics changed, and
(27:21):
I think that was when my dadreally started to understand business and try to
become more of a CEO. Andhe was, you know, big on
that. So I had tutors tocome after dinner, so we had normal
dinners, but it would always devolveinto the machinations of the day and screw
this guy and his subs, screwedme and his engineer sucks. And you
know all that every day when youhave to attract newer, younger contractors,
(27:47):
let's say, straight out of highschool. Is it getting harder these days?
Well, contractors you mean workers?Workers? Yeah, okay, so
extremely difficult. Listen, quite honestly, Lou. Part of the reason why
you know me and why I dowhat I do is because I'm trying to
bring a different light to this businessand I'm doing my best to bring more
(28:11):
talent into it. In my opinion, it's the greatest business on the face
of the earth. I'm obviously biased, but you can make all your financial
dreams of reality in his business.You don't have to go to Wall Street
and push paper around. You canbuild things for humanity and civilization. Concurrent
with that, you can employ alot of people at wages that are very
(28:33):
competitive, you know, in contractingespecially, you know when you do the
big jobs, prevailing wage and unionrates. These guys make good, very
good money for what they do,and that allows them to live a certain
lifestyle, send their kids to privateschools, or live in certain neighborhoods,
and you know, save up andget a corvette for the weekends and live
a certain lifestyle. And construction affordsevery It affords a three to sixty win
(28:57):
for everyone. The contractors can makemoney, the workers themselves could do very
well, and then what we're delivering, the product that we're delivering for the
owner is exactly what they want.I think it's I think it's the best
business. But it's not promoted.It's looked down upon. And my whole
life, when I've when I've toldpeople I'm in I'm in construction, they
(29:18):
look at me like, you're inconstruction because you know, people I know,
I'm educated, I went to school, and they would go, you
were in construction, and because theywere equating construction with doing somebody's bathroom,
Like, yeah, how do youthink that bridge was built, dude that
you drove over? Today. That'sconstruction man, that's the stuff I do.
When you fluss the toilet, whereyou think the water goes? I
(29:41):
own? Do you think that's governed? Frown man? So we because it
is so essential and because honestly,we work in silence. These the men
go to work every day and theyperform their tasks and they go home okay,
And they're not They don't make TVshows about us, and we're not
in movies and stuff like that.So people take what we do for granted,
(30:03):
even though it's what it's the anchorof civilization. And I want the
young people who are talented, whowould go down to Wall Street because they
want to make a lot of money, I want them to reconsider. And
I would also argue that I canget you the two hundred thousand dollars faster
in contract, and then you canget the two hundred thousand dollars in Wall
Street if you didn't go to anivy. And so I'm trying to make
(30:30):
that more appetizing to the youth.And that's why you've seen my presence on
social and because nobody in my inour industry is doing it. All the
guys that know me, my wholelife. They laugh at me. I
see them looking on LinkedIn because noneof them will get in front of a
camera, and none of them willtell you how they did it right.
(30:51):
It goes back to the little conversationwe had earlier about the coaches that are
out there. Yeah, there maybe coaches that are better than me out
there that have scaled into four orfive hundred million. I only did one
hundred million. I've done two anda half billion in construction, right,
but they've taken their companies to fourfive, six hundred million and beyond then
never going to get in front ofa camera, and they're certainly never going
(31:11):
to come into somebody's office and tellthem how to do it. Except I'm
trying. I'm not listen. I'mnot a saint either. I'm getting paid
for my time, of course,but it's the only thing I don't have
to do. I can go to. I couldn't go do anything else if
I wanted to everything. Look atbuildings. I'm looking at everything. What
(31:33):
can be done? What can Ibuild you? That's just you know,
It's all I know. So I'mdoing my part to bring this industry that's
given me so much and afforded alifestyle that I currently live and allowed me
to have the afford me the lifethat I've had visa VI our business.
I'm trying to make that more knownso we can get better talent in our
industry. I mean, there's anROI for your service, so it's not
(31:56):
like they're just paying and not gettinganything out of ITROI. The thing is
that they got to get there here. The biggest issue I find is that,
you know, if I take aguy like I just took a guy
and I scaled him this year.The past eleven months, he was on
the tools. He's been on atool since he's fifty four years old.
He was on the tools until he'sfifty three. Oh wow, I took
(32:19):
him off the tools. In elevenmonths. He went from six hundred and
fifty thousand revenue to twelve million.In fact, that's where I am now.
I'm in Florida, and when I'mdone with this, I'm gonna go
in his office and see here.His name is Court Construction, Saint Petersburg,
Florida. Guy's name is Brian Bettencourt. I've done an interview with him.
He can find him on my YouTubeand everything. The biggest that he
has is he's fifty four. He'snever been a CEO. Okay, so
(32:45):
the thing the issue is is there'sa point where yes, we're building stuff.
Yes, means and methods are important. That's why his business is so
dynamic. Yes, you need toknow how to put pucks in a net.
Yes you need to be able tolook at drows and take it off.
You need to know how to dothis whole thing. But then there's
a whole other world outside of itthat you also need to know how to
(33:06):
do as an executive and as aCEO, putting systems and strategies in place,
and then put taking the tool beltoff, putting on a white shirt,
going out there and closing deals likea professional, and articulating yourself and
advocating for your business. So youhave to be everything in this business.
It is so dynamic. That's whysome of the greatest entrepreneurs come from construction
(33:27):
and real estate development, because thereare so many moving pieces. You have
to be a really dynamic brain.Imagine if all I had to do was
just do stocks all day, orI just had to do this one thing
all day. I mean, Iwish I can do one hundred and fifty.
I gotta be a doctor, alawyer, an accountant, an engineer,
an architect, a carpenter. Igotta be everything, you know.
(33:50):
So the biggest thing that I findis that their inability to really start believing
that they're a CEO and that theycan be one. And that's the big
hump. So I have to Ihave to get them to believe that they
can make money. Once they startmaking money and seeing margins, they go,
oh wow, this is really working. While this could work, then
I got to take it to thenext level. And that's the hardest part
because you need people in this businessto grow. Can't have a three man
(34:15):
shop and go to one hundred million, No, absolutely not. So that's
when the CEO and the leadership comesinto play. Yeah. Yeah, when
you're implementing those systems. How importantis technology? Uh? Well, the
systems are tracked visa v technology.I mean, I'll tell you I'm a
mix of that. I'm a mixit too. I use technology and I
(34:36):
leverage it as I feel as appropriate. There Listen, there are times where
you can get two bogged down inthe tech. Remember, there is gonna
be a difference between the people thatsit in the office all day, and
the tech that they're running and they'reworking out of and their workstations, and
then the data that they need fromthe field. Those guys aren't always loving
(34:58):
tech, right, So our businessis gonna be a mixture of some of
the tack pile in the tech.For instance, like when I run change
orders, I have change order folders, they're red, and I run it
by a folder system and on thefront of that folder, I have the
SLP and the checklist for change orders. Okay. Then when that change order
gets handed off to the appropriate party, then it gets put into the tech.
(35:22):
But my pms aren't doing that.They're gonna grab a red folder.
Boom, that's a change order.All those red folders already have pre stapled
on them the SLP for a changeorder and the checklist that's required. I
make it paid by number for theseguys, okay, And once they're done,
they check it all off and theygotta sign the front of it.
Once that's signed, attesting to themfollowing the rules and going through the checklist,
(35:44):
then it comes back to the officeto get processed, and then that's
all tech. So it's a mixtureof the two Okay. If I left
it up to them in the field, lou would never happen. No,
they'd be prosecuting change orders without thembeing approved. I would know about it.
It wouldn't be cost coded. Iwouldn't have it. I couldn't track
it. I wouldn't know what thehell is going on. And then in
(36:06):
the PM meetings that I have withthem, they'll sit there and they'll lie
right to my face. Right,that's what pms do. They will lie
to you one hundred out of onehundred. They don't want to get reamed
out. And if especially if theproject has a long duration loan there they
know what they're missing. And sothey're saying, well, I got time.
I don't got to tell Wilkinson yet. I'm gonna rob Peter to pay
Paul. I could horse trade withthis guy, and I don't play that.
(36:29):
I need to know what's up rightnow, not because I want to
reprimand you, because I don't wantto be blindsided. So let me know
so I could come in and Ican guide you, because I want to
know what's going on with the money. Right. So there's like I said,
I don't know how anybody could everbe a coach or a consultant in
construction without knowing this business in andout. There's so many unique peculiarities in
(36:51):
this business to do it right thatyou know, if you're not a contractor,
I don't know how you could evercall yourself a consultant or a coach.
This is really important and for everybodythat's listening right now, I want
you to definitely pay attention to this. Knowing that Marshall is in construction and
can help you with your business.Where can they find you, Marshall,
(37:15):
Where can they get a hold ofyou and reach out to you for help?
Well, you can find me atMarshall Wilkinson dot com, Altitude Logic
pressure dot com. That's my mainsite, okay, and that's the consulting
site. And you could find meat Real Marshall Wilkinson on Instagram. That's
probably where I'm the most active,and you could pop me in Google.
(37:39):
You can find me there too.You are very well known and have a
lot of followers. One of thelast questions I have for you before we
want to wrap up is do youhave any advice for new construction owners that
you would like to share with ourlisteners. Yes, absolutely, man,
I'm full of it. I'm fullof the advice. But for specifically for
the new guys that are coming in, I would say, it's a great
(38:01):
opportunity for you now to start gettingorganized. So one of the biggest things
and the biggest issues, Lou thatyou're going to see you, I'm sure
you've come across it, and thatI see constantly is in the beginning phases
of the business, what you're whatyou are focused on, Solis is getting
work. You need money, soyou're trying to get customers. And then
(38:25):
to the detriment of the back office. But that's the perfect kind to set
up the back office because you don'thave so much work. You know,
when I when I have to goin and I have to you know,
reassemble these companies and they and they'vebeen around for so long. It is
a nightmare. All the entanglements andand and the people that are stuck in
(38:47):
their ways and you try to puta new system on them, and it's
total chaos. Right now, doit right at the beginning, So start
getting organized. Everything starts with organists. Start getting organized. And I would
say, most importantly, make surethat you put in place a very robust
and you know, easy to use, but robust job cost tracking system.
(39:14):
You need to know what your committedcosts are? Can I just explain that
really quick before we go. Idon't want to leave them with Yeah,
I don't want them to leave themwith something and then they feel unfulfilled and
they can't do it. Most importantly, you need to know what your committed
costs are. This is for thejob cost tracking. This is required your
committed costs or your build price.So quickly, open up an Excel spreadsheet.
(39:38):
Create a job number. Every oldjob should be by job number,
by the way, not by thecustomer name. Should be job number.
So this is twenty twenty three.Let's say this is your first job in
twenty twenty three. The job numbershould be twenty three oh one. The
next one should be twenty three ohtwo. Right, create a job number
system. The first thing I wantyou to do is put the contract value
(40:00):
the column. The next thing Iwant you to do is put the committed
cost in the column. Committed costis what your actual build price is.
The reason why it's called committed costis because that's what you're committing to have
to pay. Right. Because thedelta between contract value and committed costs is
what we make, right, Itshouldn't be thirty points er die. So
(40:22):
your contract value in one column.The other columns you committed costs. The
next one is current committed costs.Because your committed costs could change. Okay,
you know why you committed costs couldchange a little. I don't wanna
put you on the spot. Tellme it could change because of change orders.
Yes, right, So my committedcosts changed because my contract value in
(40:42):
created increase because of change orders.Here's the thing. What if your current
committed costs increase and your contract valuedoesn't increase, that means that your missing
scope, that maybe you had togive a subcontractor a change order that you
can't go to the owner too.You're losing money. You need to know
that. Then the next column isgoing to be my actual committed It's what
I have actually committed to date.Does that make sense? What I've actually
(41:06):
spent to date. So my originalcommitted costs are my bill price, my
current committed costs, and my actualcommitted costs. And then you have to
have your change order column in casethere's any change orders and change order values.
If you could do something very simplelike that, very simple. In
the next column, I want youto put a column I call it the
gross clear So the delta between mycurrent committed costs and my current contract value
(41:30):
is what I'm clearing, Okay,and put it in a formula in the
next column of a percentage and watchthat thing and make sure it don't go
below thirty. The next portion ofthis, though, is very important.
All of these systems and a verysimple tracker like that, which is like
ABC one two three. But you'dbe surprised some of you guys don't have
it. Is that bad data in, bad data out. If you don't
(41:54):
do a constant gardening effort, thesetools are worthless to you. So here's
how you make them perfect. You'vegot to commit to yourself and make a
promise that you're gonna go by.This is what my dad used to go
by, Sam walton sundown method.You know Sam Walton, the founder of
Walmart. You know Sam's Club.Yep. What he would do was before
(42:15):
he left for the day, justas this, just as his cashier would
reconcile the register for the day.If you worked at a retail store,
before you go home, you canjust leave all y cash and a register.
You have to reconcile and close outthe books for the day. Yep.
You gotta do the same thing asa contractor. So take thirty minutes
(42:37):
and reconcile the day and all youneed to do is input if you got
a payment today, input if you'vegot to change order today, or input
if you bought out a new subtoday. That's it, just three things
to those affects. You're committed costs. If you didn't, then you don't
have to put anything in that tracker. If you did, take ten seconds
and put it in, create theformula and it'll automatically calculate. And this
(43:00):
way, every morning, when youhave your cup of coffee, you pull
that tracker up and you know whereyou are in any at any given time
of the day on that job.And that's the most dogge you can get
in organized in the beginning phases.And then we can get more complex after
that. But that's that's you knowwhat I would recommend that the new guys
(43:20):
start to do. Okay, Andfor those templates that you're talking about,
is that something that they could potentiallyget from you. I don't sell them,
okay, I create them. Ibuild out systems for my customers.
Okay, so that would be somethingthat I would I could either embed with
them, which is what I prefer, going to their office, meeting them,
(43:44):
meeting me face to face, meetingtheir people, because then I can
give them a much better analysis oftheir people and how I really think it
should be tailored to them specifically.That's one option. The other option is
I also could just build out thesesystems replicated like mine. I could do
that remotely. But I get thisquestion a lot low. And so what
I really think I'm going to doover the break here, this Christmas break
(44:06):
that we have coming up, I'mshutting things down for about a week,
okay, uh, And so Ireally think it's probably a good thing for
me to create a bunch of thesetemplates and shoot a course and put it
in my university for the guys thatcan't afford to have me come out,
so at least they could start doingit on their own. And then what
(44:29):
I think is probably more cost effectivethat they start to do it, then
they get some of my time remotely, and then I looked at it on
the zoom and I could direct themwhat's right and what's wrong. And what
should be tweaked, and then theyactually have a pride in work that they
did it themselves. So I thinkI'm going to start offering that, but
as of today, I do notoffer that. Marshall, thank you so
(44:50):
much for being a guest. There'sa lot of value that the listeners can
take away from today. Well,thank you, Lou, I appreciate it's
my pleasure. And everyone else pleaselike, subscribe comments, share the builder
up our show with anyone in construction. We will see you next time.
(45:16):
If you're a construction contractor and wouldlike to appear as a guest on our
podcast, write us an email.It's Lou at lumberfi dot com.
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