Developing a construction general manager who can effectively lead, direct, and motivate an organization is one of the most important investments a contracting firm can make. The role of general manager is designed to be active and engaging, as the GM is paid to make things happen across the entire operation. For firms looking to strengthen their leadership bench, understanding the structured path to GM development is essential. Before examining the specific steps for growing a general manager, it helps to have a solid grasp of the Essential Insights On 40 Construction Tools List With images that support field operations, since a GM must understand the tools and equipment their teams rely on daily.
The Active Role of the Construction General Manager
The construction general manager must be engaged and active in leading, directing and motivating all the right people and processes to produce a profitable result. As the great basketball coach John Wooden once said about leadership, “Failure to act is often the biggest failure of all.” A general manager cannot afford to be passive or reactive. The role demands proactive engagement across every facet of the construction business, from field operations to financial oversight.
Understanding the broader context of construction operations is critical for any GM. Familiarity with the Key Facts About Construction Project Life Cycle Phases helps the general manager see how each project fits into the larger business picture, from conception through closeout.
Seven Steps for Developing Your Construction General Manager
The following seven-step framework provides a structured approach to onboarding and developing a general manager over the first six to twelve months. Each step builds on the previous one, creating a comprehensive growth path that benefits both the individual and the organization.
Step 1: Place the New GM on a Scheduled Growth Plan
Assuming you have incorporated the necessary leadership skills when hiring, it is critical to place the new GM on a scheduled growth plan that you can monitor. The first six to twelve months should be used to work closely with your new general manager, depending on their background and experience level.
It is wise to have the new GM submit to an assessment of how strong they are at each key skill area. Then, assuming there are one or more areas to improve, work to develop a schedule of learning, debriefing and monitoring. Such an effort produces greater alertness and intent on the new GM’s part and keeps you informed about how your general manager is progressing.
Step 2: Gradually Expose the GM to an Expanding Circle of Contacts
Depending on the recent experience of your new general manager, you will want to gradually add to their contact bank those individuals they will need to have access to and interact with. Consider the expanding circle of contacts:
- Inner Ring: Direct reports, peers and senior leaders within the company. The GM must get to know and understand each company leader and their role to fully resource their efforts.
- Second Ring: Suppliers and vendors. Meeting these partners is critical so the GM can assess what the company is using, how much is being paid and whether better purchasing decisions can be made.
- Third Ring: Customers. Before the GM initiates customer contact, they need a solid understanding of “what we are about” and “how we do things.”
- Outer Ring: Social networks, community organizations and local associations. Introducing the GM into business development and community goodwill outlets rounds out their education.
Step 3: Direct the GM to Assess Construction Systems and Processes
A key benefit of engaging a general manager is improving the organization they will be leading. It is paramount that you receive a clear, unbiased and accurate assessment of how things are really performing. This step can be challenging for some GMs, especially if they have come from outside the company. When someone starts examining how things have been done in the past, they are bound to stir up some emotional resistance from workers who would rather leave things as they are.
You will want to help pave the way for your GM to start their assessment by educating workers and other leaders about the purpose of the GM’s efforts and its importance to the company. Understanding how Key Facts About How Commercial Construction Differs From residential work can also help the GM tailor their assessment approach to the specific markets the company serves.
Step 4: Move the GM to Produce Performance Results
Produced performance results should reflect not only the financial picture but also process success. The table below illustrates key performance areas a general manager should track from the start:
| Category | Financial Metrics | Non-Financial Metrics |
|---|---|---|
| Operations | Project profit margins, overhead costs | Customer satisfaction scores, safety incidents |
| Workforce | Labor cost ratios, overtime percentages | Employee attendance, absenteeism rates, late arrivals |
| Planning | Budget variance, change order impact | Number of pre-project meetings conducted |
| Scheduling | Equipment utilization rates, rental costs | Number of weekly and bi-weekly planning schedules produced |
| Quality | Rework costs, warranty claim expenses | Defect rates, punch list completion times |
The performance results of these items can be quite telling about what is really going on in the company and which “squeaky wheel” needs grease first.
Step 5: Schedule Regular GM, Owner and HR Meetings
There is perhaps nothing as frustrating as dealing with today’s employment issues. Whether it is harassment, benefit issues or just getting some employees to work on time, such things take a lot of time and energy for the general manager. If you have a Human Resource Manager on staff, be sure to schedule regular update meetings for employee-related issues. This also provides a debrief opportunity for the GM to ask private questions, confirm recent employee treatment or solicit advice on anything they need to adjust in their own leadership.
Having a strong knowledge of Construction Materials Selection Properties and Applications of Building materials also helps the GM participate meaningfully in procurement and quality discussions during these leadership meetings.
Step 6: Require the GM to Set Strategic Objectives and Performance Goals
After the first four to six months, your general manager should be getting fairly comfortable with what they know and who they know. They should have a much clearer picture of the company’s work processes, employee needs and performance potential. At this point, engage them to develop three to five strategic objectives for either their division or the company, depending on what they are leading.
For each strategic objective, have the GM also develop two or three specific goals. These goals should be:
- Short-term in duration, typically 30 to 90 days
- Specific with respect to performance targets and deliverables
- Measurable in terms of cost savings, revenue generation or efficiency gains
- Aligned with the company’s overall business strategy
- Reviewed and adjusted on a regular cadence
Step 7: Require the GM to Provide the Hi-Lo Report
This report should be required of the GM starting with the first week on the job. The Hi-Lo Report is designed to be a weekly update of the highlights and lowlights experienced by the GM and their division or company. The secret is to keep the Hi-Lo Report to only one page of bulleted points. It is not intended to be pages and pages of information.
The Hi-Lo format is straightforward:
- Three to five highlights that reflect positive decisions, results, efforts or achievements from the most recent week
- Three to five lowlights that reflect difficult situations, challenges, failures or near-misses from the most recent week
- Brief bullet points that convey the division’s description of what was experienced, without excessive detail
This format keeps the general manager from wasting hours on another report. It should be sent to the contractor, owner or other senior leaders as needed. If the owner and leaders read a bulleted point that they want more clarification on, they can request more detail from the general manager.
Expanding the General Manager Role Beyond Traditional Boundaries
In the past, a construction company might have hired a general manager to run the shop, the equipment yard or perhaps even a new start-up office. While such hires are certainly within the scope of what has been presented, the role of the GM can actually be expanded to include other situations such as:
- Leading a new geographic expansion or regional office
- Overseeing a newly acquired subsidiary or division
- Managing a large, complex project portfolio
- Driving organizational change and cultural transformation
- Developing and mentoring the next generation of company leaders
Building Your GM Profile for Long-Term Success
If you are considering bringing the general manager role to your construction company, seek as many leadership skills as possible for your new hire. Work up a GM profile of the skills you feel would benefit the general manager role that your company needs. This profile should include:
- Leadership and team-building capabilities
- Financial acumen and business management experience
- Operational knowledge of construction processes and systems
- Communication and relationship-building skills
- Strategic thinking and problem-solving ability
- Adaptability and willingness to learn
Once hired, work the seven steps outlined here and watch the progress your GM will make. The investment in a structured development plan pays dividends in the form of stronger leadership, better operational performance and a more profitable construction business. A general manager who is properly onboarded, mentored and held accountable becomes a genuine asset who can elevate the entire organization.