Calling on all electrical contractors that have made it past the start-up stage and have tweaked their processes to transition into a much larger—and more sophisticated—company.
What were your growing pains and how did you solve for them?
Amy Lewis, an assistant professor at Oklahoma State University, is asking contractors who have “lived through these changes” for real-world perspectives as part of her research on how contractors successfully transition to more scalable organizations.
The study aims to detail the transition point that almost every successful electrical contracting firm reaches eventually, Lewis said.
“A company gets off the ground because the founder is everywhere,” she said. “They are pricing the work, walking the jobs, holding the customer relationships, signing the checks and making a lot of the big decisions. That works beautifully up to a certain size, and then it starts to stop working.”
Lewis seeks to understand what that inflection point actually looks like in the electrical contracting industry. When does it tend to happen? What signals it? What do firms do, successfully or unsuccessfully, to move past it?
“The end goal is to give contractors a more concrete roadmap so they are not figuring it all out alone or only by trial and error,” Lewis said.
Many of the common pain points that growing contracting firms face can be traced back to the same root cause: the company has grown, but the way decisions get made has not.
“You will see leaders working longer hours than they did when the firm was half the size,” she said. “Things start moving slower instead of faster. Project managers wait on approvals that used to take one phone call. Communication gets harder once you cannot gather everyone in one trailer or around one table.”
Lewis is also really interested in “the human side” of it. Founders may struggle to let go of work they used to do themselves. Key people may feel like they have outgrown their role, but do not see a clear path forward. Culture can start to drift when a firm is hiring quickly.
And then there are the industry-specific pressures around bonding capacity, licensing, workforce development, cash flow, safety and field-versus-office tension. “Those things compound everything else,” Lewis said.
A major piece of Lewis’ study is technology adoption, and when in a firm’s growth those investments actually get made. Most contractors start with spreadsheets, paper, QuickBooks “and whatever is in the founder’s head, and that holds up longer than you would think,” she said.
Lewis seeks to understand the timing of technology adoption. When does a project management platform start to pay off? When does formal estimating software become essential? When does a company move from QuickBooks into a real construction ERP? When does fleet management or field time-tracking software become worth the investment?
“Those decisions are often delayed too long because the old way feels like it is still working, even when it is not,” Lewis explained.
Alongside the technology piece, she is examining the parallel shifts in leadership and structure. That may mean bringing in dedicated operations, HR, business development, safety, project controls, estimating or finance roles. It may mean developing the next layer of field and project leadership instead of relying on one or two superintendents or project managers to carry too much of the load.
“I am also interested in governance and succession changes, such as formal leadership teams, outside advisors, ESOPs and family business succession structures, and how those reshape the way decisions get made over time,” Lewis said.
Getting actual electrical contractors to share their stories is far more effective than an outsider just making assumptions, “because the textbook version of scaling a business does not account for what makes electrical contracting electrical contracting,” she said.
The licensing requirements, the bonding relationships, the labor market realities, the cash flow pressure, the safety demands, the field and office coordination, and the way work flows in cycles “all matter,” Lewis said. A contractor who has lived through doubling headcount, adding a service division, hiring the first operations manager or realizing the founder cannot be the bottleneck anymore knows things that general management literature will not fully capture.
“And honestly, the audience for this research is other contractors,” she wrote. “They are going to find the findings credible and useful only if the work is rooted in the experience of people who have actually done it.”
About The Author
KUEHNER-HEBERT is a freelance writer based in Running Springs, Calif. She has more than three decades of journalism experience. Reach her at [email protected].