Contractors: Reduce the Cost of Loss While Helping to Save Lives

Promoting a Culture of Continuous Improvement Can Beef Up the Bottom Line

Bestselling business strategist and author Thomas J. Peters once said, “Excellent firms don’t believe in excellence – only in constant improvement and constant change.”

For contractors, remaining competitive in the current marketplace is a constant struggle. For many businesses in our industry and throughout the global marketplace, it is becoming increasingly difficult to find growth opportunities that generate profits. When economic conditions limit the resources contactors can spend to continually improve business externally, they must look within their organization to find ways to improve. Therefore savings and improvements to the bottom line must come from changes within the organization.

True to Peters’ point, smart contractors who want to stand out are constantly evaluating how they can improve processes and streamline their business. To remain competitive, contractors cannot continue practicing business as usual. Reducing the total cost of loss due to accident and injury can help improve contractors’ bottom line. Saving lives can lead to saving costs. This is a simple fact, but the truth is, many construction firms fail to take the time or make the effort to identify where their losses occur and what steps they can take to mitigate those losses.

Three Steps to Improve Results

I would like to suggest three steps to contractors who are looking to improve their business, regardless of the economic climate.

The first step is to acknowledge that you can take a more proactive approach to loss mitigation. By devoting the necessary time, you can implement a new safety procedure, for example, or streamline an existing process. With the appropriate focus toward making these types of changes, you can quickly begin to mitigate your loss exposure.

The second step is benchmarking. At Zurich, we recognize that the goal of most contractors is to be the best in comparison with others in the industry. Therefore, we find benchmarking, or comparing your firm’s loss trends to those of your competition, to be a valuable way to identify savings and prioritize loss mitigation solutions.

For Zurich’s customers, we take a three-pronged approach using our Construction Value Proposition – Benchmarking for Risk Improvement:

1. Evaluate a contractor’s loss experience against those with similar industry classifications, payrolls and exposure states.
2. Compare a contractor’s loss ratio to that of similar contractors.
3. Identify the exposures that most dramatically impact losses through an analysis of the contractor’s loss history by coverage.

The third step to improving your business is to take a good, close look at your losses and their impact on your bottom line. Identify two to three losses and how the mitigation of those losses could directly improve your bottom line.

Constant Review

Continuously reviewing, revisiting and (as necessary) revising your existing processes keeps your business relevant, competitive and attractive to potential customers.

Contactors are famously competitive. Put that competitive spirit to good use, just as some of the world’s top executives do. Bill Gates once said, “I have always loved the competitive forces in business. You know, I certainly have meetings where I spur people on by saying, ‘Hey, we can do better than this. How come we are not out ahead on that?’ That’s what keeps my job one of the most interesting in the world.”

Creating a safe environment for workers is one of the most important efforts a contractor can undertake. These efforts help control expenses, maintain a healthy bottom line and make the business more competitive. Most importantly, they can protect employees from injury and death, which is what every contractor wants to see at the end of the day.

Topics Profit Loss Contractors