Mower Maintenance: Keeping the Vision, The Morrell Group

Most landscape companies’ success is directly dependent on their success with mowing maintenance services. Lawn mowing is by far the most commonly offered service among contractors, and the ease of offering mowing services is what draws many people into this industry.

But how many people can watch their profit margins in maintenance services slide in the face of intensifying competition and still use these services as the vehicle for growing the company?

The Morrell Group, Atlanta, Ga., has been able to do just that. Maintenance services represent 40.8 percent of the company’s overall revenues each year, but those dollars aren’t necessarily the most important contribution that the maintenance group makes to the company each year.

Because the competition has forced maintenance margins down so low and the company’s landscape installation work typically comes from low-margin bid work, the key to profitability at The Morrell Group is the company’s myriad add-on services, such as seasonal color, irrigation and arbor care.

"Our maintenance group is not a good profit center for us right now," recognized George Morrell, chief executive officer. "We use this group to take care of our customers’ needs in such a fashion that we’re then able to get our other groups on to the property."

A REGIONAL APPROACH. The company has about 250 maintenance customers, and the management of these accounts is divided up geographically among four regional maintenance managers.

"Customer service is our primary responsibility," noted Kirk Talgo, one of the regional managers. "We are the point of contact for our customers, and every one of our other groups’ work travels through us. We either generate a work order for a job or we fill out a customer request that the other groups use. We’re then responsible for coordinating the completion of the job among our crews, the group that is performing the work and the customer."

"When we do our regular quality inspections, we look for opportunities to generate revenue for other spokes in the wheel," explained Brad Catanach, one of the regional managers. "We look at everything on the property – do the flower beds have good preparation as far as elevation? Should we change the bed design? Are there potential irrigation or arbor care upgrades?"

Even though the regional managers aren’t part of the tech services group or any of the other add-on service groups the company offers, the regional managers’ overall responsibility for the property and retaining the customer mean they approve any work done on one of their properties by the other groups. This check-and-balance system not only requires a cooperative work environment, but also demands that employees from all of the different groups constantly put the company’s interests ahead of their own group’s.

The organizational structure within the maintenance group includes nine operations managers who are typically responsible for the daily activity of three or four crews and an average of 45 to 75 properties generating $1.75 million to $3 million.

Just as Morrell and Don Smith, president, give the regional managers a great deal of independence to manage their own areas, the regional managers empower their operations managers with labor budgets and the responsibility to meet them.

"Crew productivity is so important, so everything we do is based on job set up," noted Catanach. "This market is so tight that we have to find ways to trim labor use, so we make sure that we go out to each of our new properties and work with the operations manager and the crew to figure out how we’ll approach each job.

"For example, doing a lot of office parks means we’re challenged by cars in parking lots," Catanach continued. "So we want to set up the route to have the crew at these properties by 6:00 a.m. and have them edge the concrete curbs on the parking lots and make the first mowing pass around the edges right away. Then we can blow off the concrete before any cars arrive."

The Morrell Group’s aggressive approach to job productivity even extends to crew and equipment set up for jobs.

"We used to think we had maintenance crews down to a science, and our standard was three men in a truck, two walk-behind mowers, two blowers, a stick edger and a trimmer," explained Catanach. "But then we decided we needed to think more out of the box. Now, we think we can put more people in a crew-cab truck and do bigger jobs and really maximize productivity."

Part of having the job approach down to a science also used to mean assigning strict responsibilities to various employees so their tasks were the same for every job.

"Every crew used to be set up with a supervisor, lead man and crew man in the three-man truck," Catanach noted. "Now that we’re fortunate to have some people who have been with us for awhile, having everyone be more widely trained makes much more sense. If the weakest link on the team can do everything the strongest link can do, then you’ve really got a well-oiled machine.

Terrance O’Rourke, another regional maintenance manager, said he relies heavily on job tracking forms that the operations managers fill out to track budgeted labor hours vs. actual labor hours.

"These forms let us see the performance for any week, month or year-to-date for any of the crews," O’Rourke said. "Then we can look for problems where the actual hours are significantly over or under budget. If we’re over budget on a job, then I need to meet with the operations manager handling that job and examine the job set up to find out what is wrong. Or, if a job is below budget, then I need to walk that property and make sure the quality is where we want it to be."

The information for these forms is gathered daily as each supervisor fills out a worksheet that tracks employee and crew hours for that day and turns that form into his operations manager, according to Talgo. The operations manager logs the information and turns the form in to his regional maintenance manager the next day. From there, the worksheet is used by accounting for payroll purposes and to generate tracking reports.

Surprisingly, tracking this information is a relatively new practice for managers at The Morrell Group.

"Two years ago, we wanted to know how much time we were paying our employees for while we weren’t being paid by our customers," recalled Talgo, citing Atlanta’s notorious highway traffic as one reason for this concern. "By doing this, we can see where our routes may be less efficient than we want them to be. Maybe we need to set up some satellite offices to cut down on this indirect time and cost of having five or six guys sitting in a truck in traffic. Now we have the information that tells us that."

The direct time, or actual billable hours for the crews, generally runs between 85 percent and 87 percent, but can be as low as 80 percent for some crews and as high as 95 or 97 percent for other crews.

"We’ve opened a satellite office on the grounds of one of our larger accounts, so one-third of my team has no indirect time except for 30 minutes of daily equipment maintenance and getting started each morning," pointed out Catanach. "But that location also puts my other crews 15 to 20 minutes closer to their accounts, so now my worst crews are still at 90 percent direct time."

The company tries to assign job responsibility to a regional manager based on the property’s location, but the managers noted that being sensitive to the value of relationships is also important.

"We try to keep the regions pretty tight and assign new jobs to the right manager, but most of our growth has occurred in two of the four regions," noted Talgo.

"And sometimes a property manager that one of the regional managers has a good relationship with picks up a new property in another regional manager’s territory," added O’Rourke. "In that case, we want to take advantage of the good relationship and keep that property manager working with the same regional manager. The property manager may even request that."

"We have one intersection where three of us are responsible for a different property on a different corner of the intersection," agreed Catanach. "Obviously, that’s not ideal from a productivity standpoint, but taking care of the customer has to come first."