You know there's a problem when you nickname a framing contractor “The Butcher of Belle Meade.” But that's just what job superintendents called one framer working on projects in the central Carolina division of D.R. Horton.
“He was dedicated and loyal, but he was killing us with failed inspections and call-backs,” says central Carolina division president John Nance.
Then there was the drywall crew that couldn't stay on schedule. They did quality work, but they never, ever hit a date.
Some builders might simply fire trade contractors that didn't meet performance standards. No one would blame them. D.R. Horton decided to try something different. With the help of the NAHB Research Center, they turned the situation around.
With the framing contractor, “we helped him define his business and turned him into a trade contractor we want,” Nance says. They cut two days from the cycle time, greatly reduced callbacks, and freed up their superintendents' time. With the drywall crew, they saw an immediate savings. The contractor cut one and a half days from the cycle time and started hitting dates.
“Because they're more efficient, they're saving money and said they could do our houses cheaper,” Nance says.
Establishing Standards NAHB's trade contractor certification is patterned after ISO 9000, an international set of standards for quality management and assurance in a number of industries. Heavy on documentation, it specifies procedures and processes for home building, with real-time inspections throughout construction.
“It was checklist after checklist, it was taking hours and hours of superintendent time and tons of paperwork,” Nance says, “and there was no accountability from the trades.”
What they wanted from a quality assurance program, he says, was to have trades supervising themselves; a reduction in callbacks, costs, cycle time, and superintendent work load; and the ability to run more units.
Nance was attending a mold seminar in 2002 when he heard about the NAHB Research Center's trade contractor certification program and decided it would work much better than his own. Getting his trade contractors to participate was a hard sell.
“Most were not very receptive,” Nance says. “Change is hard. It's even harder when you have to pay for it.”
The reluctance of trade contractors to go through the process is understandable, says Dean Potter, director of quality programs at the NAHB Research Center. It costs them money and time and requires them to change the way they do their jobs.
“One of the things I do say to the trades is this is one of the few initiatives builders come to them with that will make them more money,” Potter says. “I'm not saying this doesn't cost money, but it's an investment, not a cost. The companies we certify will tell you they're more profitable because of the program.”
Less Risk For Litigation Participants have seen as much as a 50 percent reduction in warranty work in a year, Potter says, which decreases their operating costs and reduces their exposure to litigation.
For Gypsum Construction, a national plastering contractor that helped pilot the program in Las Vegas, certification has saved the company thousands in insurance premiums. General manager Sean Cavanaugh says that three years after being certified, the company's liability insurance premiums have stabilized instead of increasing 300 percent to 400 percent a year, as they had been in the past.
“Three years ago, we had nothing when we went into a situation with defect litigation,” Cavanaugh says. “We didn't have who was on the job or what happened on the job. Now we can defend ourselves. You pull any house we've done out of 5,000 we did last year, we can show you everyone who worked on the house and all the inspection forms.” Leah Bryant, regional general manager of the Arizona and Nevada divisions of KB Home, helped bring the program to her regions for two reasons: construction defect litigation and because her market had become a prime target for union organizing based on lack of training.
“We needed a third party to legitimize all the efforts we'd put in place, all the progress we'd made, and to improve our training,” Bryant says.
In 2002, KB Home announced that any trade contractor that wanted to work on its houses had to have NAHB certification or be nearing audit completion for certification. To date, 96 percent of its trade contractors are certified and the rest are going through the process.
Like KB Home, the central Carolina division of D.R. Horton mandates certification for its trade contractors. They must complete their NAHB certification training and start writing a quality assurance manual within six months of starting work with the builder. Within six months of writing the manual, they must apply for trade contractor certification. The third-party audit required for certification is only good for a year, which puts an emphasis on continual improvement.
“We're trying to get all the trades to buy into taking care of themselves and everyone else around them,” Nance says.
On the jobsite, Bryant says that certification has improved communication between the trades and the job superintendents.
“They're all speaking the same quality language,” she says. “In the past, they'd have a problem, resolve it on that jobsite, and go on. We document the fix, make sure it's incorporated in the plans and specs, and educate everyone that this is how you fix this kind of problem.”
Big Results As a result of the training, in just one year, KB Home in Las Vegas went from ninth to third in J.D. Power's customer satisfaction rank. Warranty claims rarely exceed 14 days.
KB's had fewer failed first inspections and callbacks, and has shortened cycle times.
“We have a framer who has experienced a one-day savings on the same house they framed nine months ago,” Bryant says. “When you're building 3,000-plus homes a year, that's a lot of time.”
KB Home has taken the process a step further and is undergoing builder certification throughout the company. It sends a powerful quality message to its customers, puts them on the same page with their trades, and helps with litigation by documenting their quality processes, Bryant says.
“I'm very passionate about this program,” she says. “I think this is not just good for KB Home, it's good for the industry.”