Volumes have been written on how companies can reduce the total cost of ownership (TCO) of an information technology investment, but most of the case studies are geared toward information technology departments and rarely deal with the specific concerns of the building industry.
Now, builder consultant Unify International, based in Tustin, Calif., has developed Web-based technology to help builders measure costs across the life-cycle of the home building process--from the field to the back office to the supply chain--and to set improvement goals by using a TCO system designed specifically for the building industry.
Steve McGee, president of Unify International, says the TCO system, known as "Job Ready, Job Complete" (JRJC), has been in the works for six years. McGee says roughly 10 builders and 250 contractors are using JRJC, which was deployed for the first time during the past year.
The idea in JRJC is for the subcontractor who follows another subcontractor to evaluate that subcontractor's performance. Under the system, a "Job Ready'' generates a "Job Complete." So when a painter arrives on the job, he evaluates the performance of the drywall person and identifies if the job is ready. If the job is ready, the drywall job gets moved into the "Job Complete" category on the master job chart on the Unify International Web site.
Each time the drywall person's performance is evaluated, the painter identifies the amount of time lost, if any, and any equipment costs the delay may have caused, statistics that are kept daily, weekly, and monthly based on the builder's needs. Subcontractors and builder personnel can view the schedules and performance data on the Unify Web site via password.
JRJC encompasses five steps: 1) set up a measurement system; 2) review the data; 3) set an improvement goal; 4) identify obstacles and solutions; and 5) identify the plan and the method of monitoring on the improvement goal. Engle Homes of Arizona uses the model to evaluate nearly 100 processes. And, Timberlake Cabinet Co. is using JRJC with Engle Homes and Maracay Homes and plans to develop an application that will let its field people enter the tracking information to the Unify Web site via a handheld.
Here's how Engle Homes is using JRJC:
1. Set up a measurement system. Engle's flooring contractor, SC Design, measured the clean rate of the painter, drywall person, and finish carpenters from October to December 2002.
2. Review the data. The clean rate was 50 percent from October to December 2002, with the painters being the biggest culprits.
3. Set an improvement goal. Engle and the flooring contractor set a clean rate goal of 100 percent by the end of February 2003.
4. Identify obstacles and solutions. During discussions with the tradespeople, it was discovered that the painters didn't clearly understand the cleanliness expectations of the flooring contractors. The flooring contractor walked several houses with the painters to evaluate the problem and define a standard for a clean job. They agreed that all tile/vinyl areas a minimum of 15 inches away from walls and doors must be sprayed with protection to avoid paint oversprays on floors.
5. Define the plan and method of monitoring the improvement goal. All parties met at specific homes to review results throughout January and February 2003. In February, Engle defined a new set of standards based on the agreed-upon solutions. Training sessions were also scheduled so Engle's supers could learn about the new standards, and follow-up review sessions were scheduled.
Result: In January 2003 the clean rate hit 96 percent, and it has stayed up over 96 percent.