IF YOU HAD TO PICK, WHICH IS A bigger risk for your business today: land scarcity or talent scarcity? In fact, in light of new homes economics, they're practically the only two areas that really pit one of your companies against another in today's marketplace. According to data BUILDER compiles for its BUILDER 100 list, about 130,000 people work for the nation's top 100 home building companies. Translation: These companies closed on the sale of about three-and-a-half new homes per employee in 2004. Will you be able to count on each employee accounting for four homes finished and sold in 2006? Five?

As the room-for-everybody-to-prosper era winds down, big home builders will compete head-to-head on many fronts, especially for home buyers. Already, we're beginning to see a climate that insists construction supervisors know as much about customer focus as they know about building code … demands that purchasing managers get “selling-in” and information systems as much as negotiating deals with manufacturers … and expects that land acquisition executives function equally deftly at deciphering a landowner's psyche and charming a planning board as understanding soil stability and water runoff. Job descriptions place unprecedented emphasis on a balance of technical skills, team instincts, and powers of persuasion. Don't worry, that's just the marketplace—and its customers—telling us what business we're in.

“The Talent Squeeze: How to tie compensation to your arc of business growth” is an analysis of one of home building's challenges, getting the right person in the right job. The special report tells the story of the critical strategic issues, the financial ramifications, and the tactical practices and programs of hiring and retaining.

“Talent Test” by Bridget Mintz Testa (page 8) explores leadership's willingness and ability to “pay the price” of expanding and enriching its management-level talent pool. CEOs comment on the expense and return on investment they expect to get from casting “their most valuable assets”—people—in the right place job … and on the risk of not doing so.

“How to Play Base” (page 18) by Jamie Pirrello, who recently joined Michael P. Kahn and Associates as a managing director, evaluates the cost, the risk, and the return on investment of finding the right person. It also investigates how financial decision-makers attract the best talent to keep operations at optimum capacity, and at the same time, manage people costs to ensure that the company hits gross margin goals. Jamie also analyzes trends in structuring comp packages that put the most money into deferred compensation, pending performance, team, divisional, and corporate achievements.

“Playing for Keeps” by Abby Garcia Telleria (page 32) reports on initiatives and investments in retaining talent as the industry consolidates and competitors' appetite for people/proficiencies intensifies. What are the compensation trends, intangible career development and work-life balance programs, and morale-boosting events that effectively sustain talented people's loyalties, even as other big builders court those talents to fulfill their own needs? In “Class Struggle” (page 25), Lisa Marquis Jackson reports about builders who've gained an edge in reaching in the college ranks for multi-talented doers, managers, and strategists. Builders need to better define the richest raw materials they can identify among emerging job candidates, and court them as aggressively as other industry segments do to bring in the best.

In “Performance Art” (page 40), the Sharrow Group's Lou Csabay introduces a chapter that drills into key disciplines in a home builder's enterprise—marketing/sales, architecture, construction, finance, human resources, information technology, land acquisition, legal, purchasing—and sorts out the salaries, intensity of demand, key qualifications required, amount of turnover vs. the cost trends of retention, geographical dynamics, and, finally, a forecast on what will happen to salaries and compensation over the next 12 months.

What's your pick on which is tougher to get right, land or people?

e-mail: jmcmanus@hanleywood.com