THE NEW YEAR HAS BEGUN. IT'S SUPER BOWL SEASON. Everyone's focused on setting new goals. Many of us will watch the two best teams in football fight it out for the national championship. What better time to have an energizing talk with your home building team about nailing some key objectives in the coming year?
Rest assured, winning the “game” won't be as easy this year. You probably won't be able to pass through price increases like you have in the last two years. The biggest builders, with their incredible balance sheets and land positions, stand like 350-pound defensive tackles in your way. But you are fast and can turn on a dime. It's time to buckle down to business and turn your company into a lean, mean building machine!
Maybe you have what it takes to try even-flow production, starting and closing the same number of homes each year. Maybe you have the guts and determination to implement a system-wide computer system. But not every move needs to be a hard one. Here are six achievable plays that should be in everyone's book.
Buy Scheduling Software. Here's a great holiday present for your trade partners—put your schedule out on the Internet so they know where they are supposed to be and when. With inspections taking as long as video replays, and games (read: building homes) taking longer, what better way to give your company a fighting chance than having everyone play from the same book?
Conduct Joint Service Calls. The good news is that the industry's customer service marks are improving. The bad news is that the typical home buyer still has 10 or more problems. One of the things that you can do to improve their satisfaction is cut down on your service calls by trying to fix a bunch of things at one time. No one wants to stay home from work to wait for repair people. Rally your special teams—your trade partners and service folks—to make joint calls.
Keep Construction Lists. Zero defects at closing is one goal that few companies ever accomplish. What's more important is making continuous improvement. And the key to that is developing a comprehensive checklist for supers to use with managers and then keeping track of progress.
Sharpen Pricing. Research indicates that many builders fumble the ball during the option and upgrade process. Customers feel like they've been tackled from their blind side when they see the charge for granite countertops, hardwood flooring, and fireplace surrounds. Keep track of what other sources, especially distributors and retailers, charge. You don't have to sacrifice profits by bringing prices down to more realistic levels—odds are you will sell more upgrades.
Speaking of profits, one of our America's Best Builders this month, Keystone Homes, registered a huge increase in options sales after it put the process online.
Cut Plan Variety. Several builders have announced recently that they are taking the heretical move of cutting the number of plans that they offer buyers. Why? Because every plan requires a different take-off list, a different options list, and possibly, a different team of specialty suppliers. The back office has to keep all that information up to date, and the whole system frustrates efforts to consolidate vendors and secure better purchasing terms.
Engineer Plans for Value. Sit down with subs and suppliers to find more cost-efficient ways to build your homes. Builders who routinely engage in this process say there's nothing like it. Your trade partners are your best source for ways to take money out of your plans without sacrificing design.
Another of our America's Best Builders, Shea Homes, took weeks out of its production schedule in Phoenix by bringing in subs to map the home building process from start to finish.
These are just suggestions. What's more important is that coaches develop their own objectives. And then motivate their teams to achieve them.
Boyce Thompson, Editorial Director