Throughout the late 1990s, Masco Corp. busily bought contracting businesses, diversifying beyond its manufacturing and supply roots into the role of installer for production builders.
Starting in 1995, with a $900-million acquisition, the Masco Contractor Services division has grown to the point where it brings in more than a quarter of Masco's revenue—$3.5 billion of the company's $12-billion total, says Michael Ulinski, the company's vice president of sales and marketing.
For the past few years, Masco has been working to sort through all those diverse acquisitions and assemble them into a cohesive, synergistic whole.
The purpose of the program is to bundle home building services that are scheduled to occur sequentially in construction. For instance, Masco might offer to install cabinets, countertops, and hardware for the doors and drawers, taking the burden of scheduling several contractors, and the inherent downtime in the process off the backs of builders.
“Once we are doing multiple products in a house, if you can get them to become sequential, with one thing right after another, then there are savings,” Ulinski says. “There is no hand-off downtime [from one contractor to another] or errors.”
Masco tested its BuildLogix system out in two markets, teaming up with five builders. “We said, ‘We think this has value and we want to confirm it,'” says Ulinski. “It's a difficult thing to get a builder to say you are saving them money.”
Nevertheless, they did, and Masco was happy enough with the results to roll out the program nationally. In markets where it had two branches doing the same thing, the overlaps were eliminated. Managers were asked to diversify into new types of installations and, in some cases, told they had to add a specific installation service to fill in gaps.
For instance, if Masco had an installer of cabinets it might also require the branch to start doing countertops as well. And that same branch might be asked to stop installing exterior siding since that happens at a different phase in home construction.
“It was an immediate evolutionary shift in how we do business,” says Ulinski. “For us, it's like the secret sauce that McDonald's puts on [its] Big Mac. You get Build-Logix with our services.”