It's a cool, breezy day in the heart of a Las Vegas winter, and Ken Paulson, a site superintendent for Astoria Homes in Las Vegas, leads a short tour of this, the Veranda community, where a half-dozen homes have reached various stages of completion. Paulson oversees as many as 75 homes under construction at one time. Sure, he has help from two other supers who report to him, but he still faces a daunting challenge. How do you make sure that tons of lumber, windows, frame systems, and roof tiles arrive at the site in the right amounts, colors, and condition, so they don't slow the rapid pace of production? This is the final phase of the purchasing chain, where decisions that affect quality and maintenance must be made carefully.
“We handle each material differently,” Paulson explains. “Windows, for example, we try to install them the day they arrive. That means less chance of them being damaged, and they're less likely to walk off the job-site. The windows are actually dropped in the garage of each house.”
From Paulson's point of view, the most critical point in the purchasing loop is the moment when materials arrive on the jobsite, because that's the point when his credibility and responsibility are on the line. By now, if the supplier has done his job, most quality problems have been eliminated. But flawed shipments accepted now may become a liability.
“We have the right to accept or not accept at that point,” Paulson explains. “Anything we reject goes back for refund or replacement. We have a certain number of turnaround days built into the schedule. Now, if we break a window after they leave, that's a different process. Then it's our fault, so we write a variance purchase order and the manufacturer comes in and fixes it—but we pay.”
Once materials have been accepted at the jobsite, the various trades take dominion over them. They too have systems for dealing with inferior materials from the stacks, and minimizing returns. For example, Mark Brown, Astoria's framing foreman on the Veranda project, says his crews cull framing lumber as they go.
He points to a stack of warped and otherwise defective 2x4-inch studs nearby. “Most of those, we'll cut up into blocks,” he says. “I have a company that makes floor trusses and other components, so we can use a lot of the stuff, or use it for blocking.
“When lumber arrives,” he continues, “we try to get it all up off the ground right away. Lumber is not as good as it used to be. You have to do everything you can to keep it straight on the job.”
Of course, most serious issues with product quality and consistency should be addressed before the material reaches the jobsite. That's where the feedback loop with central purchasing becomes critical. To understand how it works, I spent some time at Astoria's central office in Vegas.
Command Decisions Doug Ross, Astoria's vice president of purchasing, wields tremendous purchasing clout. He and a handful of top managers at the company make most of the key decisions and select every product used. They also decide when to try something new.
To get a sense of how the mind of a purchasing vice president works, take a look at Ross's office. Symmetrical stacks of paperwork, no sign of any clutter, neatly labeled blueprints—everything in its place.
“I guess I'm pretty conservative when it comes to making changes,” says Ross, referring to his decision whether to use one product line or another. “But we always listen carefully to what we hear from anyone in the company.”
Ross also deals directly with manufacturers. “Somebody like Viking may call us and say ‘How do I get on the bidder's list?' Of course in a lot of cases, we're concentrating on entry-level, so that would narrow the bidders.”
Ross says he selects some commodity products, such as insulation, primarily on the merits of the available installers—a valuable insight for manufacturers. “We're looking at the ability of somebody to do a good job on time,” he says. “We don't always take the lowest bid, but we are looking for value.”
How Change Happens Major shifts in purchasing do happen occasionally, driven by an alignment with current events and market forces. Common brand-changers: volatile lumber prices, changes in building codes, recurrent defects, and design trends.
For example, Astoria has recently changed many of its building practices to address concerns about water infiltration and mold. It has also ditched ceramic tile in favor of one-piece shower surrounds.
Have consumers noticed?
“It's all in what they expect,” says Ross. “In a lot of entry-level homes, you don't see much tile anyhow.”
At the jobsite level, workers are not shy when they have a product preference. For example, framing foreman Mark Brown prefers floor trusses over engineered Ijoists and gets his wish.
“You've got to use what works,” says Brown. “This just makes it a lot easier for all the other trades to come in and do their jobs and feed things through those trusses.”
THE BOTTOM LINE Company: Astoria Homes, Las Vegas
Goal: On-site monitoring and feedback on purchasing decisions.
One major manufacturer has a grand plan for solving the problem of mismatched roofing shingles on the jobsite—and preventing purchasing backlash in the form of returned materials or unhappy clients.
Every so often, says Chuck Stein, vice president and general manager of Owens Corning's HOMExperts program, a purchase order goes awry. A roofer looks up at his half finished work, only to discover he has nailed down two different shades of green shingles. Of course, the pallets are labeled, and the batch number is coded, but a mistake could happen at the distribution point, or even in the unloading of the truck at two different jobsites.
“What we're looking at is a bar-code system for every pallet,” says Stein. “That way you can track that batch all the way back to the manufacturer, as well as the distributor, so everybody knows it's going to the right place.” Stein adds that the builder shouldn't have to worry about getting the right materials. He (or his superintendent) should be able to just sign off when the order arrives. But the key people, from the distributor to the truck driver, would have a reliable way to make sure the builder gets the right stuff at the right time and place.
Evenflow By handling materials in a predictable, methodical way and recognizing the inevitability of delays, you can prevent a purchasing logjam when materials arrive on the building site. Here are a few tips to keep your jobsite humming.