Profitability then People

Like what you see? Consider subscribing to get the latest articles here.

One of the things that drives me nuts about the New School generation of construction is their belief that they should automatically be rewarded, whether or not they have put in the hard work. (And by the way, when I talk about the New School, I’m specifically referencing Millennials and Gen Z.)  

As a Millennial myself, it bothers me that so many people in my generation think that companies have to give bonuses, or have to give yearly salary increases, or have to provide unique training experiences, or generally that they have to make them feel good and amazing all the time—without ever calling them out for what they need to be doing better. 

All of these things are benefits that employees receive in return for their hard work, adding value to the business, and helping to either a) drive sales, b) deliver projects profitably, or c) support the people who are out there doing a and b. 

However, I think the average employee simply doesn’t realize that for companies to offer these benefits, they must be profitable. 

Thus, let’s talk about profitability for a second: 

Profitability must come first—before all the other benefits—otherwise, there won’t be a business to continue giving bonuses, salary increases, or jobs in general. Without profit, there’s no money, which means businesses go under, or in some cases, owners continue struggling and fighting to keep the lights on for years and years without ever taking anything home for themselves. This may seem harsh to the employees reading this book, but this is not the way business is supposed to work. The owners in your companies are supposed to make more money than everyone else because they are taking all the risk (it’s not your house that will be taken if a bond claim gets pulled on a project!). 

Meanwhile, owners who are people-first but have a business that is not profitable are inadvertently enabling some undesirable behaviors from their employees. Mentally, they tell themselves they do it because they want to protect their people from worrying about the “money side” of the business—and ultimately, they have very good intentions because they just want their people to feel good and be happy! But, without any understanding that the company isn’t profitable, employees are subconsciously influenced to do the bare minimum in their roles. They never go above and beyond or think innovatively because they have absolutely zero incentive to do so; they are getting paid (and bonused) either way.

When you have a staff that is only doing the bare minimum, I promise you that you will never reach the status of a top Contractor. Your competition will kick your butt because they have a bunch of people who get it and are putting in the effort it takes to make a buck in this challenging industry.

So, while I want every business to treat their people amazingly, both the owners and employees reading this need to understand that a considerable part of your role—no matter your title—is to help drive profitability so that everyone can reap the rewards. Remember: profitability comes first, then people. 

Spark Notes:

• Too many Millennials and Gen Zers expect rewards without first proving they’ve earned them through real, measurable contribution.

• Bonuses, raises, and perks aren’t entitlements—they’re outcomes of driving profit through sales, project delivery, or support.

• A business that isn’t profitable can’t sustain people-first values, no matter how well-intentioned the owners may be.

• If you want the rewards, help make the business profitable—because without profit, there’s nothing to reward.