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Is Rework Just the Cost of Doing Business?

Updated: Oct 10, 2022

Ask any owner or COO or CFO of any utility construction company what the biggest impediment to profit is, and 9 times out of ten, they will tell you it’s rework. Some studies have shown rework can be as much as 8 times the cost of the initial installation. That doesn’t take into consideration the exposure to employees to additional hazards and risk and the impact to contractual obligations. There are some instances where rework can’t be avoided. Design problems and plans that have to be adjusted or projects that are so huge that the scale exceeds the ability to effectively control everything can make some rework inevitable.

Rework can be controlled. Measuring and tracking rework is a good start. Holding everyone accountable for their workmanship is a real deterrent. No one likes to be called out for poor workmanship. Poor project management, poor supervision, unskilled labor, miscommunication, lack of training, no quality cont

rol standards are all causes. Some of the items listed are inevitable. The labor market may be stressed to the point that the only employees in the labor pool are those with little skill or experience. Project time limits may impact the time needed to adequately train employees on how to do the job effectively. It can also be due to hiring urgency and lack of priority in standards. “If the body is warm, you are hired.”, doesn’t work very well and you end up with a revolving door of new hires and labor issues.

Leadership at all levels is a key to eliminating rework. Performance standards that reflect professionalism and effective oversite are key essentials to controlling rework. Accountability is very important. Making every employee responsible for their workmanship and rewarding according to performance, enhances the opportunity for a successful project. Many companies think they cannot afford a quality control department. However, if those companies track the actual and the hidden costs associated with rework, the addition of a quality control team makes sense.

A word of caution. The quality control program effectiveness is dependent on being autonomous. It cannot answer to anything other than the most senior leadership. Everyone knows about time constraints and contract deadlines and profitability, and if a project is going sideways and there’s a need to stop work, it’s not a popular decision. No one would admit that happens but in reality, production pressures often drive the project. Nothing could be more harmful than ignoring a problem. There’s a quote by Jarod Kintz that goes like this. “Ignoring a problem is the same as being ignorant of it.” Our effectiveness as an industry is dependent on providing a quality product for our customers. Our profit margins are not so great that we can afford to do things twice. “If you don’t have the time to do it right, what makes you think you’ll have the time to do it over?” Seth Godin

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