Tuesday, February 19, 2019

Cascading Leadership that Attracts Talent

When it comes to attracting talent, you likely don’t need to hire hundreds of seasoned painters. Instead, you should focus on attracting good people and turning them to good painters. In our recent conversation with Brian Nolan, he discussed two types of leadership, cascading leadership and hourglass leadership.

Hourglass leadership is often referred to as owning a job. The workflow can be compared to sand falling through the narrow portion of an hourglass. All ideas and tasks have to come through you and end up taking longer. Some of the downfalls of this leadership style include: focusing only on what has to get done immediately, tying one person down with all the tasks and challenges finding quality workers.

On the other hand, cascading leadership distributes leadership across all levels. This style passes down the ownership and frees up time for everyone. Some benefits of cascading leadership include:

  • Delegation of tasks
  • Time to focus on things you want to do
  • Teamwork is valued

In order to implement cascading leadership in your company, you should start with a clear vision, implement effective systems, determine your structure and plan for the future. Then, you should focus on finding good people to work at your company.

Don’t miss Brian’s presentation at the 2019 PDCA EXPO where he explains more about starting at the top and maintaining an effective leadership style in your business.

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Wednesday, February 13, 2019

Pathway to Success – Core Values

As you tackle your employee training and customer relations, it’s important to outline what you value to see the most success. We recently had a conversation with Nick Slavik, host of Ask-A-Painter Live, and he explained the five core values he uses in his company. These are the kind of values that are adaptable to any sort of business, especially a painting business.

Gain and Maintain Trust

In a business, you have to do certain things initially gain trust. Then, you must maintain without giving any sort of indication people cannot trust you. To keep track of this value, Nick asks his employees if their coworkers trust them and if they delivered what was promised to clients.

Continuous Improvement

You need to constantly be improving, and Nick Slavik makes it his goal to make the improvement curve happen faster. He makes sure employees master their skills and get better every day. He asks if employees became a better painter and a better leader to promote this value.

Quality Always Wins

Maintaining the highest level of quality in your work is always the way to see the most success. Nick asks his employees if they’ve maintained the quality standard of company and if they’re doing work that could win a national award.

Discipline=Freedom

One of the most important parts of Nick’s business, this value comes directly from a navy seal, stating that the more disciplined you are, the more freedom you will create for yourself.

Produce

In the painting industry, you need to hustle and put in quality hard work. If you’re not producing something great in your extra time, you need to be smarter about what you’re doing.

Ready to use these values in your own business? Download the Pathway to Success poster here.

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Monday, February 11, 2019

Pay Increase Based on Problem Solving

How do you decide how and when to give pay raises? We recently had a discussion with Jason Paris of Paris Painting who has found success promoting employees based on their problem-solving skills. He’s been able to create an efficient process, communicate how it works and regulate it objectively. Here are some of the highlights from our conversation with Jason:

  • Being less ingrained in the norm of business allows for the ideation of new processes.
  • Pay raises should be focused on how you work together.
  • Start with standardized positions, but branch off when you get to mid-tier management.
  • Your crew must be willing to help your business succeed to make this system work.
  • Make sure your crew knows about the paths to success and how to progress in different areas.
  • If you want to elevate your employees, treat your company as a partnership with them.

To learn more about this process, check out our podcast, Pay Increase Based on Problem Solving.

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Senate Introduces IMAGINE Act of 2019 for Rebuilding American Infrastructure

IMAGINE

On Feb. 7, Senators Sheldon Whitehouse (D-RI), Lamar Alexander (R-TN), and Susan Collins (R-ME) introduced legislation (IMAGINE Act) to encourage investing in new techniques and materials, including paints and coatings, that would help to extend the life of critical public works that draw increasingly poor ratings for condition and performance. Senators Mike Rounds (R-SD), Cory Booker (D-NJ), and Tina Smith (D-MN) have joined as cosponsors of the bill.

Companion legislation is expected to be introduced by Rep. David Cicilline (D-RI) in the U.S. House of Representatives this week.

ACA supports this bipartisan legislation and is encouraging Congress to support the Innovative Materials for America’s Growth and Infrastructure Newly Expanded (IMAGINE) Act, to encourage research and deployment of innovative construction materials in transportation and water infrastructure projects nationwide.

ACA believes that by protecting the surfaces to which they are applied, paints and coatings will be a significant contributor to any effort to improve U.S. infrastructure. Many of the nation’s roads, rails and bridges are falling into disrepair, while important aspects of the aviation system are outdated and in need of expansion or renovation, and the waterway system is hampered by aging locks and decades-old infrastructure.

The IMAGINE Act would encourage the development of materials such as high-performance asphalt mixtures and concrete formulations, geo-synthetic materials, advanced alloys and metals, reinforced polymer composites, aggregate materials and advanced polymers.

The Senate bill, S. 403, would promote the use of advanced infrastructure materials, as outlined here.

Creation of an Interagency Innovative Materials Task Force

A Task Force would be created to assess existing standards and test methods for the use of innovative materials in infrastructure, identify key barriers in the standards area that inhibit broader market adoption, and develop new methods and protocols, as necessary, to better evaluate innovative materials.  The Task Force would be chaired by the National Institute of Standards and Technology and bring together the Federal Highway Administration, the Army Corps of Engineers, the Environmental Protection Agency, and other relevant agencies organizations.

Research

The bill authorizes $8 million for the Turner-Fairbank Highway Research Center to collaborate with relevant State and Tribal agencies and other stakeholders to research and develop innovative materials, prioritizing work targeting large span bridges, highway reconstruction and rehabilitation, rural roads, and coastal resiliency.

Innovative Bridge Program

The bill authorizes $65 million for the FHWA (FY 2020 to 2024) for a new grant program available for the design and installation of innovative materials in bridge projects.  Special consideration would be given for “at-risk” coastal bridge projects, projects in rural areas prone to inland flooding, and bridge retrofits.  Domestic sourcing and nontraditional production techniques would also be given preference.

Water Infrastructure Innovation Program

In addition, the bill authorizes $65 million for EPA (FY 2020 to 2024) for a new grant program available for the use of innovative materials in the design and installation of wastewater transport and treatment systems and drinking water treatment and distribution systems in small to medium-sized communities.  Special consideration would be given to areas prone to saltwater intrusion or flooding.

Innovative Materials Hub

The Secretary of Transportation, in coordination with leaders of other agencies, would designate through a competitive selection process the development of innovative material hubs located throughout the United States to further drive research and development of different innovative materials for use in infrastructure projects.

This last provision was inspired by the success of communities of materials manufacturers that have leveraged their innovations and expertise to grow their industry.

Contact ACA’s Heidi McAuliffe for more information.

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SCAQMD Considers Amendments to Rule 1106 for Marine and Pleasure Craft Coating Operations

California’s South Coast Air Quality Management District (SCAQMD) recently issued Proposed Amended Rule 1106 – Marine and Pleasure Craft Coating Operations and hosted a working group meeting for interested stakeholders.

The district is accepting stakeholder comments on its proposal through Feb. 26, 2019. The SCAQMD Governing Board will consider the proposed amendment and rescission at a Public Hearing on May 3, 2019.

The proposed amendments will affect two rules, Proposed Amended Rule 1106 and Rule 1106.1.  Staff proposes to subsume the requirements of Rule 1106.1 into Proposed Amended Rule 1106 – Marine and Pleasure Craft Coating Operations and rescind Rule 1106.1 – Pleasure Craft Coating Operations.  Additionally, to align VOC limits with other California air districts and the U.S. EPA Control Techniques Guidelines, the proposal will revise the VOC content limits for pretreatment wash primers, and antenna, repair and maintenance thermoplastic, inorganic zinc, and specialty marking coatings. New coating categories for marine aluminum antifoulant, mist, nonskid and organic zinc coatings and marine deck primer sealant will also be added. The proposed amendment will include provisions for pollution prevention measures, enhanced enforceability, and for the promotion of clarity and consistency.

ACA is drafting industry comments for the comment deadline. ACA’s comments will focus on supporting SCAQMD’s efforts to improve air quality while ensuring that top quality marine coatings products are available for customers in the South Coast basin.

Inclusion of a One-year Compliance Date

Once Amended Rule 1106 is finalized, all its requirements will go into effect immediately. ACA would like the air district to include a one-year effective date from the date of amendment adoption in its proposed rule so that industry has enough time to comply with new provisions. For example, there are new labeling requirements in paragraph (g)(1) that apply to all marine coating manufacturers. In the current Rule 1106.1, there are no labeling requirements for pleasure craft coating manufacturers, which means that those entities will need to adjust their supply chain processes to ensure appropriate labels are prepared and placed on their products. As a result, those affected manufacturers will need time to properly implement the new labeling requirements before the compliance date goes into effect.

Similarly, there are new provisions in section (e) regarding prohibitions on possession, specification, and sale of products that are not in compliance with certain requirements in the rule. Marine coatings manufacturers will need a reasonable amount of lead time to ensure that any non-compliant products are not in their possession nor being sold within the District’s jurisdiction.

Addition of a Three-year Sell-through provision

Because there are new requirements that will alter the way marine coatings manufacturers assemble and supply their products, ACA will urge SCAQMD to add a three-year sell-through provision to Amended Rule 1106. A sell-through provision would allow companies to continue selling regulated, unlabeled products that were manufactured prior to the amended rule’s effective date for a set period after the amended rule’s effective date. This would give industry time to sell through their existing inventory while reducing the amount of waste that would occur if no sell-through provision was included in the amended rule. The addition of a sell through provision would also be consistent with SCAQMD’s longstanding practice of including a sell-through provision in its rules.

Modification of the Most Restrictive VOC Limit Provision

The amended rule proposal paragraph (d)(4) states that, if a coatings product “meets the definition of or is recommended for use for more than one of the marine coating categories listed in paragraph (d)(1) or the pleasure craft coating categories listed in paragraph (d)(2), or the low-solids coating category listed in paragraph (d)(3), then the lowest VOC content limit shall apply.” ACA plans to underscore to SCAQMD that the problem with combining the marine coatings and pleasure craft coatings rules together as the district is proposing, is that companies may sell products that can be used on both pleasure craft and marine vessels. According to paragraph (d)(1), these products would be subject to the lowest limit of both tables.

For example, under the current regulations, companies that sell high gloss products intended for pleasure craft (i.e. wood, fiberglass, or metal substrates) must meet the 420 g/L limit pursuant to Rule 1106.1. Inversely, companies that sell high gloss products intended for marine vessels must meet the 340 g/L limit pursuant to Rule 1106. Under Proposed Amended Rule 1106, companies would either have to market two separate products (one for marine and one for pleasure craft) or apply the 340 g/L limit according to the most restrictive VOC limit provision in paragraph (d)(4). The same issue arises for antifoulant, pretreatment wash primer, and “any other coating type” categories. As written, this new provision would be extremely burdensome on both industry and SCAQMD because it would cause a great deal of regulatory confusion and uncertainty.

In the alternative, ACA will suggest that SCAQMD modify this provision in Amended Rule 1106 so that the most restrictive VOC limit would apply separately to Marine Coatings Categories in Table of Standards I and Pleasure Craft Coatings Categories in Table of Standards II instead of across both tables. This would eliminate the expected confusion that would undoubtedly arise.

ACA will remain engaged with the air district throughout its rule amendment process.

Contact ACA’s Rhett Cash or Raleigh Davis for more information.

 

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Chicago Fed Indices Provide Insight into Economic Conditions

construction

The Chicago Federal Reserve Bank publishes two indices – the National Financial Conditions Index (NFCI) and the adjusted National Financial Conditions Index – that provide reliable measures of financial conditions to policymakers and market participants who are looking for guidance on the state of the economy. Because U.S. economic and financial conditions tend to be highly correlated, these two indices move with the business cycle and the level of inflation.

The NFCI provides a comprehensive weekly update on U.S. financial conditions based on 105 measures of financial activity. These break down into three sub-indices, Risk, Credit, and Leverage. The NFCI accounts for conditions in money markets, debt and equity markets, and the traditional and “shadow” banking systems, using weekly, monthly, and quarterly data. In constructing the index, the Chicago Fed weights them by their relative importance in explaining the index’s historical fluctuations.

The adjusted NFCI, or ANCFI, is constructed to account for prevailing macroeconomic conditions as measured by the Chicago Fed National Activity Index (CFNAI) and the Personal Consumption Expenditures (PCE) Price Index. As such, it isolates a financial-only element of conditions, adjusts for the state of the business cycle and the level of inflation. As the Chicago Fed notes, “if …economic growth were weaker than average, as during a recession, financial conditions would be expected to be tighter than average as a result…Thus, positive values of the ANFCI have been historically associated with financial conditions that are tighter than what would be typically suggested by growth in economic activity and inflation, while negative values have been historically associated with the opposite.”

Looking at these indices, they appear to reflect the business cycle well. As shown below, both the NFCI and the ANFCI having strong negative inflection points in mid-2007. This was several months prior to the start of the 2007-09 recession, which officially started in December 2007, suggesting that these figures comprise a leading economic indicator.

NFCI

The current figure for the NFCI is negative, suggesting looser-than-average financial conditions, with the ANFCI also suggesting that financial conditions are looser than average historically, but slightly less so than the NFCI after accounting for prevailing macroeconomic conditions, including current levels of economic growth and inflation.

More information on these indices in available at https://www.chicagofed.org/research/data/nfci/background.

Contact ACA’s Allen Irish for more information.

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Update: CARB Suggested Control Measure Development

CARB

The California Air Resources Board (CARB) continues it process to develop a new Suggested Control Measure (SCM) for Architectural and Industrial Maintenance (AIM) coatings. The SCM is important since the various California Air Districts will use the new SCM to develop their future AIM rule revisions. In addition, the Northeast Ozone Transport Commission (OTC) states will likely also utilize the SCM in the development of lower AIM VOC limits in the Northeast states in the future (OTC Phase III).

This rulemaking could also impact many green building standards, since green building standards tend to reference the CARB AIM SCM.

In October 2018, CARB released a deliberative draft proposed SCM that was based on the California South Coast Air Quality Management District (SCAQMD) AIM Rule 1113, which is the country’s strictest regulation covering VOC in AIM products and includes over 20 limits that are lower than current CARB SCM. Notably, CARB did not include the restrictive SCAQMD Rule 1113 small container exemption provisions.

In December 2018, ACA submitted extensive comments to CARB on the draft proposed SCM, raising concern over the technical feasibility of the problematic lower limits for several categories, including: Industrial Maintenance; Rust Preventatives; Zinc Rich Primers; Metallic Pigmented; Graphic Arts; Aluminum Roof; Stains; Concrete Cure; Floor Coatings; and Form Release Compounds.

In preparation for the CARB’s SCM workshop on Feb. 19 workshop, late last month, CARB released revised SCM language and fortunately CARB decided not to lower the limits for Industrial Maintenance; Rust Preventatives; Zinc Rich Primers; Metallic Pigmented; Graphic Arts; and Concrete Curing Compounds.

CARB is tentatively scheduled to adopt the revised SCM in the summer of 2019.

The February 19 workshop notice can be found at https://www.arb.ca.gov/coatings/arch/e_signed_archcoatSCMworkshopnotice.pdf.

The February 19 public workshop handout and table of limits can be found at https://www.arb.ca.gov/coatings/arch/e_signed_Handout_for_2-19_SCM_Workshop.pdf.

ACA will attend the Feb. 19 public workshop and remain engaged in the CARB development process, collecting comments, concerns and developing industry positions.

Contact ACA’s David Darling for more information.

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