What started out as a seminar to “stay ahead of the curve” for Shambaugh & Son Inc. (No. 8) has blossomed into a 20 percent increase in worker productivity. The now 10–year–old program — the Program to Increase Productivity and Efficiency (PIPE) — has become a cornerstone for the Fort Wayne, Ind. company.
PIPE, which was the runner-up for the Mechanical Contractors Association of America’s 1994 Management Innovation Award, takes aim at increasing worker education by offering a 32-week accredited continuing education course in conjunction with Indiana-Purdue University. The courses cover all aspects of project management and supervision responsibilities. PIPE “develops an ‘elite forces’ group of site managers.”
“The people who attend these classes are pretty excited and proud about completing them,” says Mark Shambaugh, chief operating officer. “We’ve had more than 70 people go through and complete the classes on their own time.”
PIPE’s sister Total Quality Management program — PRIDE (Productive, Responsive, Innovative, Dedicated, Enthusiastic) — has received plenty of national attention, too. PRIDE, which is in its fifth year, sports a stellar record. It, too, was runner up for MCAA’s Management Innovation Award in 1993.
Every job over $5,000 receives a report card for the client to fill out. Shambaugh & Son Inc. tracks the responses — which numbers almost 1,300 — by 10 different categories, including foreman, project manager, division and men on the job. “This helps foster the repeat business climate we have,” Shambaugh says. “We are finding out where owners think we need to improve.”
Shambaugh says his company finds more potential clients ask for his TQM programs right out of the gate. “Our programs are helping us maintain our old customers, but it’s helping us obtain new ones, too. It has paid off with a sharper focus on meeting or exceeding customer expectations on every project.”
The PRIDE program includes a “Customer of the Month” segment, where Shambaugh invites a customer in to meet with the company’s top personnel. Shambaugh says it provides a great forum for customer feedback.
“We’re getting mostly positive statements,” shares Shambaugh. “But sometimes I invite customers who I know are having a problem with us. I don’t just invite the good customers. I don’t shy away from the problems.”
Facing his problems straight on has helped ripen 1200 employees into a $157 million company (No. 8). “I don’t like a flavor of the month program,” Shambaugh explains. “What’s driving these programs is that most of our customers are asking us to benchmark and measure everything we do — from safety to quality to productivity. Asking contractors for benchmarking statistics, productivity, safety and mission statements is a growing part of the industry, which took off in the industrial segment. We want to measure ourselves for everyone.”
Shambaugh also gauges the company through his mission statement. Shambaugh & Son Inc. broke the mission statement into six different elements and held six weeks of department meetings to review, each week, one of the six elements, and brainstorm how each group could make each element a reality in their daily construction lives. MCAA recognized the program with its 1996 E. Robert Kent Management Award.
“We wanted to make the mission statement a day-to-day goal instead of a plaque on the wall,” explains Shambaugh. “This is the most current program. This benchmarking measures our overall goal toward reaching the mission statement.”
All the measuring and benchmarking shows on the bottom line. There was an average of 25.5 percent improvement in the four Mission Statement Report Card elements from 1994 to 1995. Directly linked were improvements in measurable productivity, quality, safety, marketing and sales participation.
“We want to stay ahead of the curve,” says Shambaugh. “If you don’t have something good enough you may not even get to the dance floor.”
