Measure progress, reward employees

January 28, 2011

The Nashville Business Journal - Friday, January 28, 2011

Revenue is expecting to dip at J&S Construction as its fiscal 2010 wraps up; yet CEO John Stites is happily spending more than $150,000 on a purely optional expense: incentive payments for the company's 115 employees.

"If I stopped the incentive program right now, I'd be cutting my throat," Stites said, later noting his disbelief that "well-meaning companies don't incent people who are their life and breath: the people out in the field."

The J&S incentive program has been in place for years, and Stites said it serves multiple purposes. 

For one, Stites has long been a believer in measuring performance at each project. "You can only improve what you measure," he said.

At J&S, incentives are divided into four categories: project safety, client satisfaction, meeting the project's timeline and meeting the project's budget. Encouraging employees to meet definite goals also allows J&S to progress its quality in those categories,

Stites said. That, in turn, creates loyal customers, Stites notes that the construction. Industry is perceived by many as rife with contractors who habitually miss deadlines and budgets. The incentives encourage employees to prove to clients that J&S is not such a company.

"All we're selling to people is trust,” Stites said. 

Stites estimates that the company has some 70 customers that go to J&S without soliciting bids when they need work done.
 
The incentives may reduce the company's profits, but Stites said that loyalty means J&S isn't pitted against "low-cost providers. We're able to get a reasonable margin for our work." The company expects to generate $29 million in revenue when its fiscal 2010 ends.

Stites said the Cookeville-based company plans to become more active in the Nashville area. After' last year's flood, the company helped Stansell Electric Co. rebuild its facility, and J&S also erected: a number of hangars at Nashville International Airport. Plans for other Nashville projects are also in the works.

~Eric Snyder




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