by Bob Renner, cofounder of Liaison Technologies
I’m a tech CEO who recently completed a large home remodeling job, and I learned something unexpected along the way: Managing a construction project is a lot like running a business. Outside the construction industry, the skillsets for entrepreneurs and general contractors may not match up on many points.
But there are lessons in a construction project that definitely apply to business. Here’s what I learned:
1. Nothing is more important than planning.
It all starts with the blueprint, in home building or in business. When I launched my project for a major addition to my house, I quickly learned that every detail would become an integral part of the finished project, and getting from point A to point B requires inspiration, creativity and vision. The same is true when launching a company: You must think through every aspect of product or service development and delivery, starting with a detailed plan. Your success will be directly proportional to the planning you put into the project on the front end.
2. Choose your battles wisely.
Very few of us can claim to be experts at every task. Once I enlisted the help of a friend to pour a concrete countertop. It took us four tries to get it right, which was an expensive way to learn that sometimes it’s best to call in the experts right away. The same is true in many business situations. My company has acquired nearly a dozen other businesses, leveraging their technologies and experts rather than reinventing wheel. By focusing on our core competencies and securing the expertise we needed from outside the company, we chose our battles wisely.
3. Be flexible.
If there’s ever been a construction project that rolled out exactly according to plan, I don’t know about it. The unexpected always makes an appearance, sometimes in the form of hidden flaws that a wall demolition reveals, gas lines lying under a proposed water pipe placement path, etc. The same is true in business. My company originally rolled out a master data management SaaS product more than a decade ago, but the market wasn’t ready, so we retooled our offering to concentrate on IT integration. Now that businesses are recognizing the importance of big data and information sources are multiplying, we’ve redeployed concepts from our earlier rollout. Flexibility is the key.
4. Don’t let the perfect be the enemy of the good.
Whether in building or in business, it’s important to balance functionality with visions of perfection. I learned that lesson when laying out slate tile for a patio in an intricate pattern. After it had been perfectly laid out, a few tiles cracked upon settling. The first couple of times that happened, I replaced them. When the third tile developed a crack, my wife pointed out that it’s a beautiful patio anyway, and we should just enjoy it. She was right. The same lesson holds true in business: Even a less-than-perfect solution can still make customers’ lives easier. Focus on improving your product, but don’t let the perfect be the enemy of the good.
5. Avoid the “sunk cost” fallacy.
When you’ve poured your heart and soul into a project, it’s hard to walk away, even when it doesn’t turn out the way you envisioned. Sometimes the future value of an endeavor makes investing more time and money worthwhile. But occasionally, it’s better to just move on to the next thing. Some of the things I’ve tried to build ended up being more useful as firewood than furniture. And sometimes in business, I’ve found that walking away was the right thing to do. Our acquisition strategy has succeeded largely for that reason: We’re not afraid to walk away.
Knowing how to sweat a copper pipe doesn’t mean you have what it takes to run a business. Coming up with elegant solutions for intractable customer pain points doesn’t mean you’ll be able to successfully renovate your kitchen. Building and business require different skillsets. But a construction project can teach you a lot about handling business situations — and vice versa.
Bob Renner is one of the founders of Liaison Technologies and the company’s first employee. As President and CEO, and a member of the Board of Directors, he guides corporate operations, strategy, and acquisitions worldwide. Bob earned his Master of Business Administration degree from Emory University and his Bachelor of Science degree in Electrical Engineering from California State University (Fullerton).