We've got best-of-2015 listicals coming out the eye-balls, 2016 trends predictions up the wazoo, and data--little, big, and medium-sized--pouring everywhere, all the time, into every nook and cranny of the business. Feeling smart?
All that content, and hopefully, the odd diamond in the rough that sparked an idea or shed light on a mystery, or simply, perhaps, allowed you to move on to doing what it's worth your time to do.
What most of us will learn from, after all, in the first few weeks of 2016, is our budget. They tend to be amazing at quickly revealing where the hasty plugs and cut-and-pastes expose us to reality. When one or more of those 2016 predictions don't transpire exactly when or how we may have counted on them to, a budget becomes a wet blanket cast over those year-end reviews and outlooks.
There are two questions for January 5, 2016 that really matter people whose mission is to make a business of this livelihood of home building and residential development.
One is what do I, and my team, need to learn today that will help us operate smarter and better tomorrow?
The other is what do I, and my team, need to decide today that will lead to our success story 36 months from now?
After all the trends and all the recaps and all the predictions, home builders' biggest enigmas remain:
how to buy and develop lots for less than they can be sold for with a house on them how to buy labor and capacity at a predictable value-based profitable rate how to [buy] capital for less than it pays to invest it in building a new neighborhood how to design and price new homes to inspire existing homeowners to buy new, and non-homeowners to buy...new
Think for a moment about Vilfredo Pareto, who, whether we realize it or not, plays a huge role in most of our everyday thinking.
Pareto is the Italian economist who in 1906 proposed a mathematical principal to describe the distribution of wealth in Italy--20% of the people owned 80% of the wealth.
This 80-20 "rule," as we know it today, applies in some form or fashion to so many things.
Now, think about this. What if 20% of your company's talent today produces 80% of your organization's value?
Go back to the earlier first question and ask yourself, what do I and my team need to learn today that will help us operate smarter and better tomorrow?
One may be looking at the 80-20 talent question, and saying: Would it make operations smarter and better to try to have that same 20% of the talent produce more than 80% of the value? Maybe, if they work harder, or longer hours, or faster, that same 20% of the company's talent could generate 81% or 82% or maybe 85% of the value.
Or, maybe it's the other way around. Maybe the discovery one should make today regarding how to operate smarter and better tomorrow involves trying to migrate one of the 80% of your talent who is currently producing only 20% of the value up to the level of the 20% of talent who are producing 80% of the value.
The question here is, how are you going to discern what you need to ask and try to discover so that you can make your company--large or small--develop workflows, decision chains, value creation, marketing messaging, and stakeholder return processes work better so that it's a business that's constantly learning what business it's in.
The trend stories won't tell you that. Your budget should, if you work with it and learn to treat those variances to budget not as quantities to sweep across the calendar, but as opportunities to learn where you can invest effort to improve your company's operation tomorrow. And as opportunities to decide what your company needs to make itself so that 36 months from now it's a huge success.