Managing Construction 18

Question 1

The last phase of the construction cycle is:

Answer 1

the KEEP TRACK PROCESS, aka.: FINANCIAL MANAGEMENT.

Question 2

Financial management is:

Answer 2

the diagnosis and operation of your finances, and EXCELLENT ACCOUNTING IS THE FIRST STEP.

Question 3

A BASIC FINANCIAL PRINCIPLE of construction is:

Answer 3

to create JOB COST reporting that allows project managers to tie physical completion percentages to financial results.

Question 4

Owners trying to create personal wealth with employees who do not know:

Answer 4

MONEY MANAGEMENT FUNDAMENTALS IS MADNESS.

Question 5

Which people make the most money for a construction firm?

Answer 5

MIDDLE MANAGERS.
3% is average profit before tax, 10% is average overhead, 87% is DIRECT JOB COST.
MIDDLE MANAGERS RUN THE JOB.

Question 6

Middle managers influence or control _________% of the project.

Answer 6

87%

THEY ARE CRITICAL TO PROFITABLE CONSTRUCTION.

Question 7

The first rule of business is:

Answer 7

DON’T RUN OUT OF CASH. THE 2ND THROUGH 10TH RULES ARE: DON’T RUN OUT OF CASH.

Question 8

What are the FOUR typical issues construction firms have to solve?

Answer 8

1. How do you decrease the cash flow conversion cycle?
2. How do you improve the RETURN ON INVESTMENT (ROI) of a project?
3. What are the KEY FINANCIAL CONTROL MEASURES you should review at least monthly?
4. Which construction factor is the true profit opportunity for most firms?