Do you have (over)-commitment issues?
By Phil Harwood, Esq.
Capacity planning presents an operational challenge for many contractors because of the number of variables involved. Because of this, there is a tendency in our industry to take on too much work, become overcommitted, and struggle to perform during larger snow events. This tendency to overcommit is often seen after a couple of light winters. Snow pros are lulled into a false sense of security about how much work they are able to perform because capacity naturally increases in light winters.
Overcommitment and service failures damage the reputation of these companies and of our industry as a whole. We can do better than this.
For snow contractors with robust subcontractor networks, capacity planning may be seen as irrelevant because, in their minds, they can always hire a subcontractor to perform additional work. While this may be true from the contractor’s perspective, capacity planning remains extremely relevant for their subcontractors.
Snow pros hiring subcontractors would be smart to work with their subs to ensure that the sub is not often overcommitted. Just because the contractor has a subcontractor under agreement doesn’t mean that the subcontractor is actually able to perform the work. Proactive contractors work with their subcontractors to help them with capacity planning, which benefits both the subcontractor and the contractor.
Determining capacity involves a fair amount of math, which may be intimidating. We will be explaining this math in detail on our upcoming webinar, September 23 at 10 AM Eastern time. This webinar is offered and no cost, courtesy of the Snowfighters Institute. Click here to register.
Some of the inputs into this math equation are the number of vehicles, equipment, and people available to do the work, along with reasonable production rates for each item.
Production rates are best determined by each individual company. Production rates should not be obtained from external sources because they vary greatly from company to company. There is nothing wrong with comparing your production rates against those of your peers, but you should always use your own production rate information. We will discuss more about production rates on the webinar.
Another important element of capacity planning is a concept referred to as cycle time. Cycle time is the amount of time required to complete one full service. In other words, if you hit the stopwatch the moment you decided to mobilize, your cycle time is the amount of time it takes you to finish plowing, shoveling, and deicing all of your accounts.
A final topic for this blog is related to expanding your capacity. There are a number of strategies that may be employed to create additional capacity without adding more subs, trucks, or people. In addition to creating more capacity, the strategies also provide for back up capacity and improved customer satisfaction. Snow contractors who fail to build into their operations excess capacity are setting themselves up to fail by design.
Determining capacity, production rates, and expanding capacity are all critical components of capacity planning. You are invited to join us for a deeper discussion on these topics at our upcoming free webinar. We hope you can join us.
Also, please consider attending our virtual workshop, being held September 30 from 9-4 ET. This workshop will cover some of the same material, preparing your operations team for another winter season. Click here to register.
Now go forth.
