Luke Payne, President of Western Excavation, returns to the podcast today to join host Taylor White of Ontario's Ken White Construction for a candid exploration of the intricacies of entrepreneurship, resilience, and work-life harmony. Their discussion, filled with personal anecdotes and professional advice, touches on the importance of a supportive family foundation, the concept of a "zero-fail mentality" for business success, and the evolving landscape of leadership and success in the modern world. This is a truly enlightening episode which not only illuminates the paths to navigating the construction industry's challenges, but also probes the societal shifts influencing work ethics and personal fulfillment.
Luke and Taylor go on to address practical aspects of business management, such as tackling seasonal operational challenges and the benefits of digital project tracking. In addition to emphasizing the significance of venturing into new business territories and reevaluating traditional operational methods to enhance efficiency and productivity, this talented duo also ventures into motivational strategies for employees, suggesting innovative approaches to foster a motivated and engaged workforce. Through a blend of poignant stories and insightful discussions, they offer a multifaceted perspective on balancing the demands of a thriving business with the priceless moments of family life. As you will hear, this episode stands as a testament to the power of resilience, adaptability, and the relentless pursuit of success, encapsulated in the journey of navigating the complexities of the construction industry while cherishing the value of family time.
Topics:
- The significance of camaraderie and support among entrepreneurs
- Key attributes essential for success in the construction industry
- The concept of a "zero fail mentality"
- The importance of family involvement in achieving a balanced work-life integration
- The role of spousal support in navigating business and family life
- Insights into the challenges of managing a construction business
- Exploring digital solutions for enhanced job tracking and project management
- Employee incentives and creating a culture of transparency and shared goals
- Societal shifts in the perception of success
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Episode transcript:
Taylor White: There's so much to life. And how do you manage that with having young children and a wife at home that you still have to fill their cup as well?
Luke Payne: You’ve got to include them on those things that you do. You’ve got to make it part of, “Hey, Saturday, we're going to go into the shop and wash equipment.” I'm going to bring Lila and Riley with me. I'm going to give Riley the hose and I'm going to walk around with Lila. You create that life kind of based around what you're doing, if that makes sense. I love being around my little girl. I love being around Riley. So I want them to be involved in the things that I also love, which is working. My mental blocking of hard things is working harder.
Taylor White: Welcome back, everybody, to the CONEXPO-CON/AGG Podcast. I am your host, as always, Taylor White. With me today, I have another man, the myth, the legend, somebody who's been on the podcast before, but with a duo, now by himself. The inventor of Lucas Oil, the man who I owe US$1,500 to still, Luke Payne. Welcome to the show, buddy.
Luke Payne: Thanks for having me. I'll be honest, I totally, totally forgot about that. So thanks for reminding me.
Taylor White: Well, for the listeners listening, we actually just went on a trip to Montana, and we were there. Luke is a very super nice guy. He's like, “I'll take care of it, and then when everybody’s back, we’ll divvy it all up.” And transferring from Canada to US, actually, I think what's left is just Dylan's share. So if Dylan's listening to the podcast, I'm going to cover his share. I just haven't sent it to you yet.
Luke Payne: No worries, man. The Montana trip was fun. It was a good time.
Taylor White: What a blast, eh?
Luke Payne: Yeah, dude. It was. The planning was super easy, and the execution was great. Our ride home, though, got a little interesting, but we made it happen.
Taylor White: So for everybody listening, it was myself, Luke Payne, Dylan Mercier, and Will Schure. All just completely different stages, honestly, of life and business, but all share the same issues, struggles, and work-life balance and all this stuff. So Luke, actually, you were the one who kind of put us all together and was like, "Hey, I know you guys did something last year.” But this year was just like, “Okay, let's go out there and do this.” And I think a lot of the stuff I took back from it was super invaluable. But yeah, it got a little hairy on the way home there.
Luke Payne: Yeah, the conversations we had definitely made an impact on my end as well. It was just super fun to see people in different stages, the best way to explain it, I think. But then having the same problems just on different scales, I think that was really fun to invest some time into and really just have a good conversation. And obviously, spending a week together, we got to know each other pretty well, and it was a good time. But coming on the way back, for anybody who doesn't know, which probably people don’t know, Will decided to put it in the ditch. Dylan and Taylor had a flight to catch. I don't know.
Taylor White: Pretty fix though, starting the day before, I was sitting in the back seat saying, “I swear to God, if you make us miss this flight–” Because every time we go down, to everybody listening, Will would go super quick. And we were going down from 9500 elevation down to like 7500 down the side in Big Sky Montana. And he would always try to skid and slide off the side of the road. And I'm like, “Dude, tomorrow morning, you're taking it slow. You're taking it easy. I got a wife and two kids at home waiting for me.” And sure enough, we ended up in the ditch.
Luke Payne: We did, and I don't think it's entirely his fault because it was pretty icy. We might have taken that corner going a little too fast, but we made it, which was cool. We came together, and we somehow got ourselves out. There was no cell service, so we're like, "Alright, let's go, guys." And he gets a flight.
Taylor White: There's a lesson to be learned in that situation, you know? Okay. It's 3:00 AM in the morning. We're on the side of a mountain with no cell phone service. Nobody's going to be on this road for another two hours. What do we got? We got a ratchet strap and four dudes who can help push something. So let's try to get out of this situation. Yeah, that was exciting. To back up a little bit here. So, you were on the podcast before because you have your own podcast, the Dirtbags Podcast with Luke Eggebraaten. And this is the first time I was like, “You know what? After Montana, I just want to get and chat with Luke for a bit.” So maybe backup for people listening. Who is Luke Payne? What do you do, and why are you on this podcast?
Luke Payne: Yeah, man. Again, thanks for having me. I'm Luke Payne. I own a company out of North Dakota called Western Excavation. Formerly was Black Iron Dirt, we ended up merging those two companies together this year. I've got a partner on the Western side. Our business kind of goes where we're needed. We're an excavation, mass earthwork, underground utility contractor, and we’ll go North Dakota, South Dakota, Minnesota, and into Montana if we have to, to service our clients that we work well with and just kind of expand our horizons. Why am I on the podcast? I don’t know, man. I feel honored to be here. So I appreciate you asking me. But from the conversations that we’ve had from the text of, “Hey. What do we want to talk about?” I'm interested to kind of really dive into different aspects that you and I might have of ownership, how to run your business, all of that type of stuff.
Taylor White: Yeah, and I think that's what I was most excited about to chat with you today because I think we've covered some other stuff in the podcast we did previously. I'll make sure that that’s linked, obviously, to go and listen to. But just being on a trip with you and talking about a lot of different dynamics, I know that for myself, a lot of the takeaways that I got from the trip were just like, I would say, reassurance. I would say for me, it was like sometimes I think maybe I'll surround myself with people who weren’t like, "You shouldn't say that'' or "You shouldn't do that." And honestly, it was nice being around just so relatable people. Just other young, hungry men who are getting after it in the construction business, and doing things with their life. They’re not standing from the sidelines. All four of us are guys who are doing something, trying to make a difference, trying to make an impact.
And it was interesting, times where I think, "I'd be tougher," and then I hear Will or you in a conversation, and I'm like, "Yeah, they're getting after it. They're doing what they want." I would second-guess that, and I'd be like, "You guys ever think about the pushback from this and the pushback from that?" And you're like, "Yeah, of course. Obviously, at times. It's business. Right?" But I think just hearing the conversations and to summarize it, just a lot of reassurance on my end and be like, "Okay, I'm not the only one who thinks this way or pushes back this way." And when we were talking about coming on the show, for me, I think some of the stuff I wanted to talk about right off the bat was, what does it take to be a business owner in your eyes? Not in anybody else’s eyes, but in Luke Payne's eyes, what does it take to run and own a construction company in 2024?
Luke Payne: The construction world is tough, especially for young guys that are coming into. I started out in 2018, and I really didn't get into the space I am today until, I’d say, was around ‘21 into ‘22. So there's still a lot that I got to learn. But through the eyes of ownership and through the eyes of the owner, I tell you what, you got to have grit, you got to have mental toughness, you got to be really competitive. But at the same time, you got to be friends with these guys that you do compete with because you can help each other in different ways, and I don’t think you want to create any enemies. Patient, adaptive, and tireless, all of those words kind of define ownership in my eyes. What it takes? I think it takes stupidity, too, because there are things that come up to where you’re just like, “I’m going to put my best foot forward, see where it goes, and learn.” I don’t think there's a right answer on how to run a business, but I do think there’s different lessons that you can learn in every aspect of experiences that can make you a better owner.
Taylor White: I couldn't agree more. And one thing I really liked that you kind of mentioned, Montana, you’re talking here is kind of the zero-fail mentality. What, in your eyes, does that mean? Zero-fail mentality. Because for me, it's when shit hits the fan, you keep pushing through and keep hammering. If the issue comes up there, a client or an employee, you push through it, you figure out a resolution, you keep hammering. What does zero-fail mentality mean to you?
Luke Payne: Well, zero-fail. You have to put yourself in a position where you’re not going to fail. Say you are running low on cash and people aren't paying their bills, What do you do? As the business owner, that is your duty to figure out whether you’re putting money in yourself or you start banging on doors and be like, “Hey, I need to get paid for this.” Or say you do have a situation with a general contractor and it’s a fast decline. What are you going to do to get in front of it to really resolve that and step forward and be like, “Hey, what do we need to do to keep moving forward?” So the zero-fail mentality, it can go into every aspect of business. It's just knowing like, “I’m not going to fail. I’m going to do whatever it takes to make sure we’re on the right path or to get something achieved.” And just knowing in the back of your head that you can do it instead of maybe sitting back and thinking about it too much to where it kind of destructs you in a way or it deconstructs your thinking to where, “This isn’t going to work out. I don’t know where to do it.” And then you kind of go into an emotional spiral and you bring all of these factors that haven't even happened yet into the equation, to where if you just think, “I’m going to figure this out. What are my steps A, B, C, and D?” And go from there.
Taylor White: So a lot of my conversations that I’ve been having lately with anybody that I can kind of connect with, and I know that we’ve spoken about this before, too, and it ties well in, too because I, generally, really liked the zero-fail mentality aspect and kind of having that in your brain whenever anything happens. Failure is going to happen. It’s normal. It’s how you learn. The best way to learn. But for me, it's how you kind of overcome that, over the hump of zero-fail mentality. What’s on the other side of that mountain of zero-fail mentality? For me, I think we talk a lot now about today’s society, and I mention it to people or the fathers whenever I’m talking about my kids - they’re talking about how you’re going to raise your kids. For me, I think I want my kids, my daughter and son and whatever future kids that I have, grow up and understand that in today’s day and age, if you can put yourself out there, you can be vulnerable, transparent, be a good human being, be honest and trustworthy, but also be able to tell people what you want and how you want it done. You will conquer anything that you want.
So essentially, what I am trying to get to is what’s your take on the next generation? Because there are so many winners in the next generation. I do not want to sit here and try to think of people saying, “Oh, new generation, new society.” Dude, I have so many winners on my team. I know so many winners below us. Even Will who was on the trip. He’s like 16 years old and he’s winning hard. But there are so many winners in each generation. So what’s your take, I guess, on society? Maybe we’re kind of in this softer society. How do you combat that? How do you fight that?
Luke Payne: Well, that question is based on who you ask. If you ask our parents or grandparents what they thought about our generation, they probably would say, "Oh, they're soft. They don't want to work. They expect too much or they watch too much TV.” Whatever the case may be. But looking back at where they came from, I think our generation and the generation upcoming behind us is really good at adapting. The, I’ll call it, the sex appeal of working 80-hour weeks, working your fingers to the bone - hard, hard-ass times, those aren't as prominent in our times right now. People are a lot more savvy. I know guys who use chat GPT to form their email replies. In a simple case like that, I think we're just - and I don't want to say we are, but I think there are a lot of people who just understand how to do things easier, and maybe that comes off as they’re a softer generation or they don't work as hard. Well, if you can do something more effectively and save time, I still think that's working pretty hard.
I do think it's a balanced scale, because I do think there is a shift in the social norms where the generation before us and even after us, the sign of wealth, I think, was a very big thing people wanted to achieve. And what was wealth to them? It was materialistic items. It was fancy cars, big houses; it was this huge persona of "I am wealthy. I am wealth. I have all of these belongings to my name." To where in our generation and the generation after us, I feel like they’re a lot more comfortable with less. And, obviously, people still like nice things, but I don't think the drive to go buy a $10 million house or this $200,000 car is so present anymore. There are obviously still people who want those things, but I don't think that is something that is so in society anymore. I'm struggling for words on how to kind of form them, but I think people like time over possessions I feel like now.
Taylor White: I could not agree more. And I think kind of what - it's almost like people are valuing that healthy work-life balance and figuring out how to have that comfort with less, and maybe trying to work more or work less but have a little bit more. And maybe that means free time. And a good example of the generational stuff is we were just at a lunch meeting, and I was telling my dad how we were looking at going to PEI Island in Canada for a week this summer with my family. I've never taken a summer vacation in my life because of the industry, because of business. But I'm like, you know what, dude? I grew up with my dad not going on any summer vacations with me because it was like, "No, you got to stay. You got to work." But now I'm like, "Dude, you know what? We have people in place. We have an awesome team. And if I can't go away for one week out of the whole summer and no other vacations, just one week, then I'm doing something wrong." And that to me is that healthy work-life balance and maybe that new shift of like, "Well, maybe this is what success looks like to me," right?
Luke Payne: A question for you - based on that, kind of changing roles here a little bit - you kind of answered it in a way, but what does success mean to you? From our conversations in Montana, I feel like we're both very similar with we want nice things, we'll pay for better experiences, things like that.
Taylor White: Yeah. I mean, I think I'd be such a liar if I sat here and was like, "I'm not the guy who wants the fancy stuff." Like, you got to be honest and true to yourself. And I feel like people call it bullshit really easily these days. And I love that I drive a nice truck, a nice diesel truck, and I'd love a boat - a nice big Donzi or something like that. So there is a side that I do appreciate that you can afford the more materialistic stuff. And I think that it's hard, because people can be fine, all set, a yahoo, and still appear to be "making it." So I think the ultimate thing for me though is, “Is that guy on the fancy new cigarette boat with the brand new dually pulling it, is he talking about how he has got to be at work at 4:30 A.M. on Monday and if he's not, his boss is going to be mad?” Or is he kind of like, "Well, we might take it day by day. Maybe Monday, it's supposed to be nice so I'll hang out with the fam." And to me, I think that success, when I talk to somebody, it's time, right? Nice stuff is nice stuff, and I'm just admitting that I do like nice stuff. But time, to me, is the ultimate. Can you just go and do that? Could you just go and block off an afternoon if it's super nice and your wife wants you home? Can you just go and do that? Sometimes with business, you can't - trust me, I'm not saying that's every day - but that's success to me. How would you kind of perceive that?
Luke Payne: I think you hit it really well. I think everybody has a different definition of what success is, and it all depends on their motivation and what they want to achieve in life. Me, I love nice things. I will always pay for quality. I will always try to achieve more. In a way, achieving more isn't always materialistic things, but that could be in business as well. I think my attitude towards success is me knowing where I'm at, what I need to do to help other people achieve. And if I can help other people achieve their goals, I'm going to be achieving my goals at the same time. But it kind of goes back to our previous conversation about what does that leadership look like to you? In my head, mental health, I've never really considered something that I'm cognitively aware of. If I'm in a sad place, I'm going to go work harder. If I’ve got hard times, the zero fail mentality - like, how do I get out of these hard times? So that is kind of my definition of success, what can I overcome and what can I achieve? I'm a person who is not happy once I achieve something; I'm looking towards the next thing and the next thing. So my success is constantly pushing myself, I think.
Taylor White: I like that answer. It makes me think my answer was shit because I totally agree with that. And, like, I'm the same. It's once you reach something, for instance, I remember, talking about social media. I remember when I first started YouTube and there was a guy, Carson Schifsky, shout out to Carson Schifsky. And I remember he had a YouTube channel and he had 5000 subscribers and I had 50. And I was like, "Holy crap, can you imagine what it's like to have 5000 subscribers, dude? Like, this guy's probably got a brand deal where a company sends him stuff." It was just like, "Holy shit, that must be so cool." Then you hit 5000, and you're like, "Well, 10,000 is going to be even cooler."
Luke Payne: What's the next number? 100,000? That would be cool. I’ll get a plaque for that.
Taylor White: And dude, I have the plaque sitting in my office. I had two hours of me and my wife. I opened a bottle of wine and I was like, "Well, this is cool." And then I was just like, "Over it, if something else happened with work." It was just like, again, that constant push of just like, "Okay, now my mind's on whatever else is going on." I got the plaque in the middle of winter when work was super slow and there were just so many other stresses, like cash flow and business. But, yeah, you just kind of push and you just move on and there's always the next thing. But I think that's what separates winners from losers. And I think relating it back to our previous conversation about society and stuff like that, there's winners and there's losers. And a lot of the time, right now in kids' sports in Canada, I'll refer to that, I don't know about the US. But for instance, I have some neighbors in the neighborhood, their kids are 6 or 7. They play hockey and they don't have team captains. They don't actually turn on the scoreboard, which is wild in my opinion.
Luke Payne: I agree with that, yeah.
Taylor White: Tell me about it. Craziness. You're not turning on the scoreboard for your kids, so they're not understanding the value of, "Hey, we didn't work hard enough." I get that they're just 6 or 7, by all means. But putting your kids in sports is not just about them running up and down the field, getting exercise. It's about teaching them about leadership, about working as a team. It's teaching them that if we don't work hard enough, we're not going to win this game. They outworked us, so therefore they won. And we're taking that away from our kids. Isn't that sad?
Luke Payne: It's instilling or it's taking away the confidence builders when you do win, and it's also taking away the opportunity to build competitiveness. So that is not something, and I'm sure we agree on this, that we probably won't be raising our children in that type of society.
Taylor White: Definitely not. And I mean, I think it comes down to the new, young society. I mean, our school board, the Otto Carleton District School Board, they just put out everything saying, "We feel like grade 12 students, seniors, who are supposed to graduate but actually have failed, we're actually going to start letting them just come to graduation and still walk across the podium because they feel left out." And this is a real thing. It's like, "I feel like I'm this crazy guy sitting back going, 'Okay, am I the freaking weirdo in the room thinking that this is wrong, or is everyone else the weirdo? Who's the weirdo in this situation?'"
Luke Payne: You're definitely not.
Taylor White: You didn't work hard enough there and you didn't stop talking to your kids. You didn't work hard enough. So therefore, you're not passing. So therefore, you don't get to go to graduation.
Luke Payne: And this brings up a couple of different topics. So I'll start with the first one. This one's kind of treading a little bit lighter, but it's life begins at the end of your comfort zone.
Taylor White: I was getting into it.
Luke Payne: Yeah, no, that was awesome. I mean, great rant topic. I'm excited to add to that. But again, life begins at the end of your comfort zone. How do you achieve that? How do you know what your comfort zone is if you aren't pushed? So that's where my head goes right away. But then also, and I don't want to bring religion into things, but also I was born and raised Catholic. I went to a Catholic school, and through the Bible and through teachings, we'd have religion every Wednesday. And one thing that the Catholic faith is huge on is that we're called to suffer. And what does that mean? Well, I think we're called to suffer in business. I think we're called to suffer in life because it helps us reach that future potential that we might have and it all kind of ties together. Obviously, I don't want to get super deep into the religious talk, but that has always kind of stuck with me. You were put on this earth to overcome things. You were not put on this earth to get a participation trophy and not worry about who didn't win the soccer game. If I'm playing that game and I'm six years old, turn that fucking scoreboard on. I want to know who won. But I think it was just how we're raised and the difference of that social norm into society as well. Because I do know that requirements for certain testing are being dumbed down. The requirements for kids K through 12, they're a lot less, like homework isn't a thing anymore. I do think we do need to bring some suffering back and I can't even classify that as a hard time, but harder times to where we can prepare those people for real life. Because that's not real life, in my opinion.
Taylor White: It's a false sense of reality. And it is very frustrating because, again, then if you make your child go to school and it's like, "Well, my dad and mom think it's stupid." And then it's like, "Okay, then you're those parents," right? And I mean, luckily, we're from a smaller town, so a lot of people obviously kind of maybe have their heads on straight. And I know, luckily, we're in the construction industry, and 99% of people listening to this podcast will definitely be agreeing with us. And I want to go off and say, too, that by all means, if you think that it's okay to turn off the scoreboard and you want to raise your child like that, it's up to you how you raise your children. Trust me. But everything that I'm saying and we're talking about is how I want to raise my children and how I think that I was raised and what made me successful and what's made us success.
But I think I like your point about religion because it almost gives - and we had this conversation in Montana - I’m not a super religious person and we talked about that, but I do like the fact that it’s a sense of faith and a sense of belief that there’s more to it than just what’s in front of us. And I can’t get into the religion talk because I don’t know enough about it, but I think that’s what it sums up to and I think maybe it gives people a sense of belief and faith like that old saying, "Hard times make strong men," whatever, all that is, I always mess that up. But you know what I'm saying? I think that it kind of ties in really well with each other.
Luke Payne: I agree. Yeah. I don't know the specific quote offhand, but I know which one you're talking about. But, yeah, they do tie together. And not to get into the religion side as well, because everybody has their own beliefs.
Taylor White: For sure.
Luke Payne: I'm not one to push my beliefs onto somebody, but I do believe we are called to suffer as a society, and I do believe that we need to have some fortitude, some grit to overcome things. I don't think we were put on this earth to be comfortable. You think about the early days. You even take the early 1900s to the 1960s. It was a very hard time for people worldwide. And I look at that now, and it just shows we have a fantastic opportunity ahead of us because we are in a very comfortable society. How can I put myself out of my comfort zone? How can I get more uncomfortable to learn more? How can I put myself in these situations to where I really have to dig deep and find an answer?
Taylor White: Yeah, I also think we weren't just put on this earth to work and die, you know?
Luke Payne: I agree.
Taylor White: And I think that this work-life balance and pushing yourself because, don't get me wrong, I'm a workaholic and I'll work just as hard as the next guy. But you do have to compromise and relationships come into effect with that sort of stuff. And that's kind of what I wanted to talk about next is how you kind of work with owning a business, doing a podcast, everything else that you have going on. I'm sure there's other stuff that you're part of, whether it be boards or community stuff or whatever. There's so much to life. And how do you manage that with having young children and a wife at home that you still have to fill their cup as well?
Luke Payne: You got to include them in those things that you do. You got to make it part of hey, Saturdays, we're going to go into the shop and wash equipment. I'm going to bring Lila and Riley with me. I'm going to give Riley the hose and I'm going to walk around with Lila. You create that life kind of based around what you're doing, if that makes sense. I love being around my little girl. I love being around Riley. So I want them to be involved in the things that I also love, which is working. My mental blocking of hard things is working harder. So I love bringing them into that as well. But then having those experiences and don't get me wrong, it is tough because we are gone a lot. There are times that there are things that we miss in childhood, there are things that we miss in day-to-day aspects. And that's something you have to live with as a parent, to know that's going to happen. But there also has to be kind of a picture painted with that relationship. What are we working towards? What is the point of these efforts that we're putting into this thing called work, this thing called life?
Taylor White: Yeah, I actually, I just did a podcast with Dave Turin, Gold Rush: Dave Turin, it should be out right now for people who are listening. He literally had an example of this work-life balance and he was talking to me and I'll share it. And I was like, that happened to me last weekend. He's like, "You know, Taylor? You got to make time for your family because there will come a day when your daughter has a dance recital and she's looking over at an empty seat and just sees her mom and you're not there." And I just got goosebumps again. I literally, in the podcast, was like, "Dave, you just almost made me cry.” I mean, my eyes got glossy because last weekend, that literally happened. My daughter had a dance recital. I went to here, I came here to the shop and caught up on emails and invoicing. And my wife afterwards was like, "Cara kept looking over to see if you were there." So then that's whenever I think it comes down to having a good wife at home for the business side, but also whenever I'm looking at now doing maybe a vacation, I think that–
The gist of our conversation with Dave Turin was like there are some times where business comes first and people are always like family over business. Dude, 100%. I'm doing all this because of family. Do not get me wrong. But there are times when you own a business that you have to make a decision to choose business over family. Whether that's checking an email when your daughter's calling your name and wants to show you her doing something or little things like that, or missing a whole event. There are times when that happens. And that's why I like asking people like yourself about, you have a kid and a wife and what your answer is. And to me, it talks down to having the support at home, coming down to your wife. My wife is a fucking rock star. And I'm not trying just to get her to listen to this and get brownie points, but I'm dead serious, dude. Like, I don't probably even say this to her, but it's like, dude, I'd be so messed up without her.
Luke Payne: Yeah, they're the backbone of the family. They're the ones that keep everything going. Because you have a tough day, you need somebody to rely on, too, and that's usually your wife. Your kids have a tough day, they need somebody to rely on. And it's going to be mom, it's not going to be dad. But, yeah, it definitely tugs at you a little bit when you are missing those moments and you're like, “I hope I can get another one.” But I also think that teaches them something, too. Because, say, the next one that you're able to go to, you make it so fun. “That was awesome. That was great.” But then, if you miss another one, it makes them look forward to, “Okay. Well, I can't wait for dad to be here.” But then also I think it kind of instills a little bit in them like, “Dad's working, dad's providing.” Dad has to be at these places because that is giving me the opportunity to do these things. And obviously, as three and four year olds, they won't understand it, but as they grow up, that's just going to become part of the norm and maybe they'll adapt that type of mentality, too. Like, "I'm going to be there for everything I can, but there are going to be times where I'm not able to make everything. And that's okay."
Taylor White: Yeah, I think that they'll realize as they get older that we can go on a nice family vacation and do these things because dad is gone or maybe dad works hard, and they instill that kind of hard work with them. To kind of change, shift a bit. I am curious because a lot of our conversations, because I'll be honest with you, when we were in Montana, I mean, that was right around that time, about a month ago now, right?
Luke Payne: Yep. And it was that last week of February, I think.
Taylor White: Yeah, last week of February. I mean, that was such a difficult time internally for us. Just receivables are high, no one wants to pay, cash flow's bad, wintertime, it's just killer here. I wanted to talk to you about that and I wanted to see and understand your business because you had some guys in the shop putting some beacons on stuff. And what was also interesting is that you guys move locations a lot. Not move locations where you're based out of, but you'll travel for work. And that was another big takeaway that I had from the trip that really clicked in my head. Two things. The guys come to the shop in the morning and how that's a massive waste of overhead. And then you guys couldn't believe that we did that still. And then the second thing, you're like, “Dude, you only go 60 km away from your home base. That's insane.” So I wanted to ask you about your business dynamic. What's it like in the wintertime for you? And maybe is that why you go a little bit further, so that you do have more opportunity to not have to shut down in the wintertime, or is it not as hard, or is it hard sometimes?
Luke Payne: Oh, dude, it's still hard. When you were talking about– When we were having the conversation about cash flow. Every business owner at some point throughout, we'll call it a year span, you're going to probably have to come up with some cash yourself to maybe inject into the business. I've had to do it probably twice this year, but that's because it's what the winter brings. We're not in a normal winter right now. Normally, we get quite a bit of snow, and guys are very active with the snow removal, but this year, I think we've gotten a total of 10 inches.
Taylor White: Dude, it's insane.
Luke Payne: It’s crazy, but it follows different patterns and it is what it is, but it's also given us the ability to catch up on our backlog. We had a lot coming into the spring to where, thankfully, now we got caught up on that, so we can take on more new projects, but it's not such a big billing thing. So it's like, okay, how do I navigate this? And this is really our first year, I'll say it's struggling, but I don't think we're struggling. It's just, yeah, cash flow's tight. You guys want their hours. You try to come up with ways to get their hours. You try to get creative on different things that you can offer. This year, we're doing a lot of demos, that's giving guys their hours. But as far as the travel piece, we travel because we're in a very big area, but with a lot of competition. I'm not going to bid against guys that are doing a net 2% on projects. That doesn't make sense to us. I'm not going to hold that–
Taylor White: Yeah, it's not fun.
Luke Payne: It's not fun. Everything's got to go perfect. And then on top of that, you've got 10% of your money held up in retaining, so you're actually fronting 8% of that project. To me, that doesn't make sense. I'm going to go to the places that people don't want to go, or it is a harder area, and there's risk of people breaking into your equipment, stealing your equipment, but I'm also going to charge for that. That helps me pay the guys better. That helps create a better atmosphere with what we can offer. And so we've seen that to where a lot of people around us say, like, “We're not going to travel, we're not going to go anywhere.” So there's an opportunity for us to pick these projects and relate to the guys. Like, “Hey, let's bust our ass from April to November, and then you get all the winters if you want to take time off. If not, we'll find snow removal opportunities or demolition opportunities.” You know, let's base this company around the company's needs. It’s kind of our thought process behind it because again, everyone's got goals. Everyone wants to make money, everyone wants to provide for their family. How can we be the most effective at that?
Taylor White: I think what really makes sense when you said it was, and I mean, we're even doing it right now, is finding the jobs and adjusting because the guys do want hours. Because we have a young crew, a young crew that wants to buy houses, that want to get married, that want to have kids and do all this stuff. So they want the hours and they want to work. And do I blame them? God, no, not at all. Work as much as you can. The difficult thing is in the wintertime when there's not that work, we've got stuff for them to do. Like, I got a crew over at the pit today. I got four guys there, three guys there, and that's all just unbillable work. So you got to suck it up on your end because I won't see the reward from having them there screening topsoil or screening sand until late summer when, okay, I may not have as many receivables because we made our own sand and we screened our own sand, but I'm carrying that cost for giving them hours from now all the way until then.
And it's hard because some of the guys are like, “Well, just send me to the pit tomorrow. Send me here.” And it's like, it's a difficult decision and it's a fine line because are you going to bankrupt yourself? Well, no, but you want to give the guys hours. So then the winter time is the struggle of, like you said, you got to be comfortable with, okay, you got to put some money in, put your money where your mouth is, and then. Do that. So that's kind of the struggle, I think, with keeping the guys busy. And, I mean, we've managed to do that now. Thankfully, work is picking up here in Ottawa, but yeah, it is good, but it's kind of just crazy. And the thing with traveling is it really made sense to me because we've limited ourselves for so long, and just staying in a 60-kilometer radius, that's so insane. We're like, “Hey, if it's longer than a 40-minute drive, we don't want it.” They got to change that mindset, man.
If you want to grow and we're complaining about not having much work or too competitive, that's why I loved hearing your guys' input on that. You guys, you and Will both were in the front seat of the truck, and you guys couldn't believe it. It's like, “Man, really? So you're telling me a 45-minute drive is too far?” And I'm like, “We kind of think that is a long drive.” And it's like, what a privilege we've had, getting all the work that we have had within 30 minutes, 40 minutes of where we are. Insane, man. It made me think so much about all that aspect that I was like, yeah, those kinds of lessons. Just talking to other people is so invaluable, you know?
Luke Payne: Yeah, you get different people's opinions, and hopefully you can learn something that they made a mistake on that they probably know a better answer to. But as far as traveling, I know I'm kind of intrigued on my end. It's obviously great that you guys can stay in such a closer area, but was there pushback on traveling? And I don’t consider an hour to an hour and a half traveling. I consider that a day job. Hey, you’re going to go out there in the morning and you’re going to come back at night. You might get back at 7:00 or 8:00. But also I think that’s kind of a stigma around construction. When it’s work time it’s work time. My mom always used to say, "When it's making hay season, you make that hay." She wasn't a farmer, but I don’t know why she always uses farm analogies. But for us and for the guys even, too, when they are traveling, they're getting paid to travel, so what does it matter to them? Hey, I’m getting two hours of just riding around in a pickup or an hour and a half, or whatever the case may be, to go to this job to where maybe it’ll help make the company a little bit more money.
Taylor White: When do you not pay? So you say, “Go ahead, we’re going to pay for travel.” Where’s the cut off of, “I don’t pay my guy to drive to work,” because you’re not paying them to wake up and drive to work. You pay them when they show up on the job site, correct?
Luke Payne: Yeah. If they travel, though, it’s different. We provide company–
Taylor White: It's a travel job.
Luke Payne: Yes. If it’s a travel job, everyone will go to the shop, grab their pick up, they’ll get with their crews, and then they’ll head out. Depending on how they have to go, we have hourlies for guys driving. We have per diem pay, all of that, and then we usually cover their expenses when they drive. But it's just kind of a well-known thing like, hey, if I’m traveling, that's time that it’s coming out of me that yeah, I got to pay that because that’s the guy’s time as well. To where if they are to stay in a town, true, they could show up at 6:00 and go do their thing and screw around for the shop for a little bit, where these guys are getting up 3:00, 4:00 AM and head out and their trying to get there by 7:00 AM to start a project. So I think you got to respect their time as well. And it’s hard to– I shouldn’t say it’s hard, it’s kind of hard to really kind of bring this conversation into an employee level, to show the vulnerability of it, but then also you can't show the bad side of it where it's like, "Hey. I'm spending this much.” They’ll see it as, “Well, you're not paying me for this." Or, “This isn’t working out.” Or, “It doesn’t matter. I’m hourly.” It's good to kind of paint that picture for your employees, too. Like, “Hey. This is our big picture. But I need your help to achieve that. What can I do better on the business end to help achieve that with you and me?”
Taylor White: I think what’s interesting is you mentioned how this conversation is on the employee level. That’s interesting because I’m currently trying to curate how to explain it to my guys. So how this conversation came up in Montana, not the traveling aspect, but I told these guys like, “Hey. When we have 23 or 24 guys in the summertime, everybody comes to the shop in the morning and then, clocks in, gets in the company truck, and then drives.” It could be right by their house or past their house, or the job site could be on their way, but they still came here, and you guys were like, "Whoa." And I've known that this was just a nasty nasty habit that happened.
I thought about this the other day, how did this happen? We had three people four years ago, and then you add a fifth and a sixth. We would all go to the shop in the morning, have a smoke and a coffee, and then we head out. Then it’s compounded to 20 people. So now I have 20 people in the summertime coming here, clocking in, getting in a vehicle, driving to a job site. That is unbillable hours. Because when my estimator estimates a job, he's not accounting for half an hour of travel for everybody on that job from the shop to the site. And then at the end of the day, another half hour of travel from the job site in the morning from the shop to it. And then at the end of the day, another half hour travel from the job back to the shop. My guys are good and I trust them, but let’s say there's another 10 or 15 minutes of shooting the shit with the guys, having another smoke, goofing around, talking about the day, then clocking out and getting into the car and heading home. So like an hour and 15 minutes times 20 people a day that I'm paying for, that’s coming out of pure overhead. That's what Will said, "That's pure overhead that you're just burning."
And I was like, “This is such a dirty habit that we have to stop.” So when you said employee level conversation, this all ties together. And it's been such a conversation in my own head that I have been having in the past two weeks. We're having a pit day next Friday to talk about the year ahead, have a safety meeting, have a talk about the business, changes that we've had, and that's one of the things. So how would you present that? You're my ChatGPT. How would you formulate this conversation and try to explain your place without telling them there’s more profits in the business? And then it’s like, “Fuck you. You want more profits? I know my employees listen to this podcast, this is a real conversation. How do you formulate that? How do you make it make sense so you don’t sound like a fucking monopoly man?
Luke Payne: 100%. It's a tough conversation to have because you have employees who are there for the business, and you do have those employees that are, “Hey. I’m just here for a paycheck.” It’s usually those, I’ll call it the 18 to 22-year-olds. This isn't my full-time career, and I don't want to be a laborer, whatever, but it's those people internally that were like, “Hey, I can have that conversation on a different level of understanding.” But bringing them all together, in my opinion, I love talking about numbers with people. I can formulate numbers pretty easily. As you were kind of going on there. So you said, you got what? 25 guys? Say they spend an additional hour at the shop every morning doing whatever they do. So 25 times 25. So your average hourly is $25 on those guys, some more or some less. That's $625 a day in just wasted time in the morning. And what's our working days? We're lucky if we get 140. So that's times 140, there's $87,000. Well, $87,500. And by showing those numbers, I can present this and be like, "How can we change this? This is money that's coming out of everybody's pockets because there's $87,000 that we could be doing to upgrade equipment, we could put towards bonuses, we could do a company vacation for this money."
I think, taking their insight and figuring out, "Hey, what are some of your wants, too?" If we try this, let's work out a way to where everybody kind of gets a benefit from it and not the, “Here’s a handout. Here’s a handout.” But I think say, "If we can save that time, I'm going to give $20,000 and give it to you guys.” Do you think that would be enough motivation for them to maybe change things? Or whatever the case that puts an additional $60,000 back in the business's pocket.
Taylor White: Yeah, everybody wants an extra $1000.
Luke Payne: Yeah, having those conversations and really bringing it down, because sometimes I feel like people think business owners just have an unlimited amount of money. "Hey, I've got this gold pot. I'm going to hand it out to you." I don’t, do you? And if you do, tell me how to get it.
Taylor White: I got a tree.
Luke Payne: A money tree? You'll have to send me some seeds. But I think for them and the people that are there for the company, will really invest themselves in it because obviously they want to grow. And if there's an opportunity to make more money, why would you not try it? That's my opinion on it.
Taylor White: Yeah, I totally agree. It's a difficult kind of situation. It's something that– And I think my main thing that I want to communicate to them is that they know that this is something I've created. I'm not blaming you guys. This is not your fault. This is something that I let happen and me alone. You could chalk it up to, "Hey, we told this PM that we wanted guys just going to the site," but who's steering the ship? Okay, great. Well, all fingers point back to me. So I think that I have to take ownership for it and explain to them that, "Hey, yeah, there are different stuff that we can do incentive-wise to make sure that this money that you're thinking that all of a sudden the business is just whatever, it's going back into machinery and nice stuff and this and that."
Another conversation that we talked about that I found very interesting was the incentives and how to incentivize your employees. And I'm not sure, I think it was more of a conversation. I know that we were all kind of just chatting about this and we're all trying to figure out ways of, okay, is it phantom stock in the company? Is it that a heavy equipment operator gets half a percent and the foreman gets 2% of this phantom stock company employee bank account? That if they do good on a job, money gets added in. If they do poorly, they have to understand that they did poorly. So they have to be okay with money also coming back out of that bank account. Have you ever run into this kind of conversation of like, "Okay, we want to run more profitably, I want to expect more from my guys, so maybe we can run lean and do more because that's every business owner ever.” Have you ever had that thought or conversation? Have you thought about it more like what could be if we made this happen, this incentive, employee incentives or stuff like that?
Luke Payne: Absolutely. I think everybody has thought about it and it's what systems need to be put in place for this because obviously you're not going to give someone who's been at the company for maybe four years a percent of the ownership. That just doesn't make sense. So how we're trying to do it is who is here. Who has given everything that they have? Let's talk to them and say, "What are your goals? What do you want to achieve? What do you want to do in your career?" "Oh, I'm a PM right now, but one day I'd really love to get into sales or something." Okay. Do we have a business development role that can maybe get morphed into this? If we kind of build a basis and build like a succession plan for the people who want to be here, then I think it becomes a lot easier and it becomes a better conversation because then they can be vested, then they can understand, "Here's what I have, if I achieve these goals. Here's what I could have if I make these steps, if I do these things in my career and I'm going to stay at this company." I feel like business owners have this conversation a lot, but what systems do they have in place to show that? I don't think there's a very good ladder that anyone can bring out at any time and be like, "This is how we did that."
Taylor White: Sorry, what you just said makes so much sense. It's awesome. Because what you're saying is, "Don't just talk about, 'Hey, we want to promote within and we want to show people that there's potential for growth.'" It's actually giving people the tools to succeed.
Luke Payne: Yep. It’s crazy. We took on Randy Blunt as a mentor this year, and I love Randy. Shout out to Randy. But it's really cool how they came to our office one day and our whole conversation for that day was system implementation. What systems do you need to implement and how hard is it once you get to a larger scale to get everybody on board with those systems? So it's figuring out what accounting software, what daily tracking you're going to use, stuff like that. But then also systems that need to be in place is that succession plan. It was really cool. He said, "When I was building this company, Luke, I wanted to make millionaires." And I was like, "I have never heard a company owner say that he wanted to make millionaires within his company." And for him to have that vision and to understand, "This is what I have to do," and he told us there were like eight of them. Eight people in the company that became millionaires or something. So I'm like, "How do you achieve that? It's crazy." But it shows that, "Hey, that can happen. But what are the steps that are needed to be taken?" And he didn't give us that ladder. But my next email to him is going to be like, "How do I create millionaires out of our company?" And he'll probably be like , "You've got a long way to go."
Taylor White: You mentioned daily tracking. I just want to ask you about that. So currently, foreman’s have iPads, we have Google Sheets where our estimators would actually put in the software for this demo example. So this is talking about foreman job tracking sheets. We estimated there's 200 tons of debris. We put 35 hours on the demo, this and that. And the foremans go in and they update their Google sheet and they say, "Okay, great. We were actually at 179 tons." And then there's a percentage saying, "Great. You used 79% of your allowance." And then that box stays green. If they got closer to 200, it would turn yellow and say, "Hey. Not much." And if it was over 200, then it would go red and they would know that it was no good. What do you guys have so that you know what’s going on in the job sites and then how your estimators can see how did we price it and how are we doing on the job actually?
Luke Payne: Yep. So this year, we're going to try busybusy. We've been doing a couple of different demos with the busybusy app.
Taylor White: busybusy, dude, that sales guy. Me and Dylan have a history with these guys.
Luke Payne: Well, this was a lady that’s really been kind of engaging us in conversations.
Taylor White: They’re great. I’m not laughing at busybusy, It’s just this one sales guy, the stuff he says - he’s hilarious.
Luke Payne: Yeah. You'll have to inform me on those after. Deal. But I mean, it's very cool because you can cost track, you can time track . Everybody has their hours based on that. If we're on a prevailing wage job, we can select what that person is as far as equipment and what they are doing. We're able to really see in real time where we are at on certain projects. How we were doing it in the past we were doing paper and pencil. We were trying to track receipts and organize them in folders per job. It just got too tough. So we're trying to automate it with this BusyBusy and I'm anxious to see how it goes. Again that was a Randy recommendation to say, “Try this one out. See what you guys think of that.” To just make things easier for everyone as a whole. Because how we do it, we got our estimating team that estimates, but then our project managers, they’re the ones who are following the budget and they are supposed to relay that to the foreman. The foremen are supposed to relay that to their crew.
Taylor White: That's how the process has to happen. And I guess what we're kind of doing is not utilizing the busybusy end of it, but so much curating these formula Google sheets that update in real time when they are out there with their iPads, and they’re putting in, I can look as it go updated and at the end of day today. There are 76 tons, “Okay, good. Oh, shoot. They’re kind of getting over their hours for supervision.” I guess, from how we’re looking at the job tracking, I wanted to ask you about that just because that’s something that’s a conversation right now. How do we digitize and get information from what’s happening in the field to the office? Because your estimator needs to know that stuff. Your estimator needs to know how am I pricing these jobs. And it's up to everybody along the way to get that information relayed back to the estimator so he knows like, “Shit. I’m pricing these jobs and I’m not even close to what we're using.” Or, “Hey. I need to be doing more.”
Luke Payne: Yeah, let's keep in that historical data for bids down the line. Chase, one of our operators, he’s really cool on how he says that. He goes, "The process is always the same.” Of how he operates as a foreman basically. And a lot of these projects have a lot of the same components. So you can look at that historical data and say where did we win, where did we lose, what do we need to change going forward.
Taylor White: I totally agree, dude. Sounds like you have a lot going on this year? I love sitting down and having a conversation with you. I always think it's super genuine and super real. I feel like we share a lot of the same thought processes. I really appreciate you coming on today and talking about these things.
Luke Payne: No, man. Thanks for the invite again. Hopefully, there was some value with the conversation. Like you said, it's just fun to sit down and talk and genuinely have a conversation and really listen to each other and engage in what they’ve got to say.
Taylor White: Everybody, thank you for listening to this episode of the CONEXPO-CON/AGG brought to you by our good friends over at Komatsu. I appreciate you. Catch you guys on the next one. Take care.
