Consider the irony that contractors like to bring up when they talk about the current state of production home building: Builders, they say, are pressuring them to compress their stages of construction. But cycle times keep stretching out, partly because builders' scheduling is unrealistic, given today's labor and materials availability and the complexity of the homes being built. A domino effect ensues, as one crew after another falls behind. Haste makes waste, leading to time-consuming callbacks to fix mistakes. Closings get stalled. Buyers get frustrated. Guess who gets blamed?
In this scenario, contractors are obedient servants at the beck and call of builders whose construction schedules are slaves to their escalating sales quotas. “Builders have come into this market with brute force and act like you should be happy that you have work from them,” says the president of one large Arizona-based contracting company.
Contractors also question whether builders care a whit about cycle time delays when they hire lowest-cost installers. “There are certain contractors we just don't want to work behind due to problems we inherit from them,” says Timothy Davey, CEO of Irvine, Calif.–based DRI Services, the support company of DRI Residential, which has 650 roofing installers and generated $80 million in revenue in 2005. This might explain why more contractors and pro dealers are bundling related trades—such as drywall and painting—to gain control over consecutive stages of the construction process (see “Package Deal,” page 128).
Cycle time may be a function of buyer demand, but delays are exacerbated by many factors. Certain building products are perennially on allocation, inspectors take their sweet time getting to a jobsite, and home designs are increasingly more complex, to say nothing of environmental regulations.
Bob Ritchie, president of Riverside, Calif.–based RCR Cos., with 2,400 employees—one of the largest plumbing contractors on the West Coast—says his daughter recently purchased a house from KB Home and was presented with 85 pages of options. This plethora of preferences can extend the construction cycle, Ritchie says, if for no other reason than because the paperwork often flows more slowly into the field.
John Wiseman, president of Naples, Fla.–based Core Construction, a production management company, notes that weather-resistant building codes in his market call for high-impact windows that can weigh 500 pounds each and require two crewmen 2½ days to install, versus one man and one day for a normal window.
All of these problems could be minimized, say contractors, were it not for the gaping void in experienced management that exists at many jobsites. And any objective appraisal of cycle time delays would find fault with contractors that take on more work than their volatile workforces can handle, and then insist that quality control is solely the builder's responsibility.
Contractors begrudgingly acknowledge this contradiction, and some aren't scheduling work as far out as they once did. “If you look at our progress board, you'd see that there's nothing [scheduled] more than a week in advance,” says Dan Bollin, president of Toledo, Ohio–based Transtar Electric, whose 40 union installers work on around 150 homes per year, generating $3 million in revenue for the company.
Giuseppe DeGaetano, president of Hammonton, N.J.–based DeGaetano's Concrete, has seen his business expand by 25 percent to 33 percent annually for the past five years, to $4 million in 2005. He says the trick to keeping up with demand without imploding is to resist taking on a lot more work than the previous year. In 2005, DeGaetano's crews worked on 200 homes, and he's convinced they could handle another 50 or 60, “but not 100—we'd be running around like chickens with our heads cut off.”
MOTIVATING WORKERS There is broad consensus that the smooth handoff of construction stages between trades, as well as the monitoring of quality at each stage, depends largely on the ability and attention to detail of jobsite managers (see “Curbing Callbacks,” page 130). Pyramid Framing Contractors, a Fort Worth, Texas–based production management firm that builds 50 entry-level homes per year, works on five houses at a time and completes them all in 45 days. Pyramid's secret weapon, says owner Skeeter Wells, is its experienced jobsite superintendent, Roy Kljajic. “Staying on schedule is critical. We have no down time,” says Wells.