You know that phenomenon where you hear a reasonable sounding, logical guy armed with facts that presents an convincing analysis of a problem and his solution and you think, “You know, he’s right” … and then you hear another logical guy armed with facts that presents a totally contrary analysis of the identical problem and a completely different solution and you think, “Whoa, wait a minute … HE is right … I think … maybe.” So now you don’t know who to believe and then it occurs to you that had you heard just ONE of these two guys, you’d be in his camp, probably quoting him to your friends,
Wisdom is timeless, which is why two Harvard Business Review articles published in 2001 and 2008 are still as valid and thought provoking today as when they were published. (The references to the papers are listed at the end of this blog.) In an economic crisis and industry downturn Rigby considers that there are three phases and critical dos and don’ts to be aware of in each stage. Reflect on how you reacted in phases 1 & 2 and how you plan to react as phase 3 emerges. 1. Storm clouds gather. Don’t act as if the storm will blow over.
From 1979 to 2001 I worked in high level positions within corporate America. I was always surprised over the number of consultants that called offering their advice, solutions and their roadmap to success. So in 2001, when I decided to broaden my scope nationally and offer my consulting services. I was always very conscience of my approach. Initially, I actually had CEO’s tell me that they felt I was more interested in the sale than I could ever be about their success. This was a certain wake up call.
For over 30 years I have worked with executives that indicate they are interested in improving their skills, leadership ability or their overall company performance. About two thirds of that time was as a corporate officer and the balance as a consultant. In the old days, exploring the strengths, areas of development and desires of the executive wasn’t called coaching. In fact, many executives at that time would have taken offense to the term.
As a consultant, I literally spend 30 hours a week on the phone with builder owners, CEO’s and senior level staff of Home builder’s, Real Estate Brokers and Land Developers. My approach on every call is to build a relationship and determine the pain points that keeps these executives up at night.
The latest numbers from the Census Bureau confirms what we've all been seeing: more people are doubling-up. Whether it's getting a roommate or recent grads staying with their parents, more people are living together than in the past. Some 30 percent of households are doubling up, up from 27.7 percent in 2007.
Lean savings that go direct to the trades don’t reduce the builder’s costs, right? If this is your belief, there is no greater obstacle to becoming truly Lean. I once heard a purchasing manager say in regard to the many extra trips the lumber company was making on the builder’s behalf, “So what? Those are his costs and they don’t count for us.” If you are hoping to crack the code on Lean, you have to acknowledge that a dollar is a dollar is a dollar, and no matter where it falls, it is important and it counts.
We all have our eye opening moments in life. When I was 17 my dad would often remind me to keep checking the oil in my 72 Bonneville. I did check the oil frequently (in my mind anyway) for a while. It was only after the old workhorse left me stranded on the expressway with a thrown rod that it dawned on me that running out of gas (an activity I participated in much too often) was quite a bit different than running out of oil. During the struggle to get to school, work and figure out how to pay for another car was when the lesson really sank in.
What are the risks for your business. Where are your weak points? Obviously safety is a key issue, but what about warranty, defects and other issues? Specific risk sources in construction projects include:
Probably the simultaneously most understandable yet least valid excuse for not launching a Lean implementation is that your staff is overloaded and has no time. I hear it constantly so let's just say it, "No one has enough time or people today!" That's the nature of a housing recession. It’s a given.
It seems hard to believe now, but when the iPad was introduced last year, there was a lot of question about whether or not Apple had finally made a mistake — would people pay $500 or more for a tablet when all others had failed to catch on in a major way?Well, we all know the answer to that question. The iPad has been a raging success, with some 25 million sold as of this summer. The even bigger surprise has been the use of the iPad as a business tool, even in the usually tech-averse remodeling industry.
From the year 1999 to 2001 I led the enterprise wide SAP conversion for a top ten builder. Up until that time, very little was ever seen of a fully integrated software system for the builder. Software companies claimed to be fully integrated, but when you tested the product, it fell short of expectations. SAP was to be the shining knight on the white horse for Home building, offering a system that would revolutionize the industry. Well simply stated, it was developed by software developer’s not home builders and failed miserably.
BIM is technology which can be of enormous help. It can of course be a great tool to help us integrate for example design and estimating. It should also become a critical tool for communication with the client, engineering consultants and trade partners and in this way help to create an integrated project. BUT let us not forget the construction team! If the construction team is not involved then the critical opportunity to better connect Design – Construction or rather Design-Build is lost.
Check yourself before you wreck yourself. This delightful saying comes from a rap song by Ice Cube. Mr. Cube’s message urges us all to make use of a verification system (the balance of his message is not quite suitable for this blog). A simple method of ensuring your design specifications are consistent from home to home is to use a checklist.
So often I hear builders say that quality may work in manufacturing plants, but not out here building homes. Well of course it does work, but hearing that from a successful builder is ideal. Here is a link to a short video featuring Gary Zajicek, VP of Construction and Customer Relations at Veridian Homes in Madison WI. Gary talks about the impact of using Quality Management Systems, in this case the NAHB Research Centers, National Housing Quality Certification program for Builders and Trades which is based on ISO9001.
One of the many harsh realities we’ve grown accustomed to during this economic downturn is the turbulent nature of stock market indices, especially the Dow Jones Industrial Average. Since the beginning of 2008, the DJIA has experienced historic or near-historic daily drops on 14 occasions — each time sending both Wall Street and Main Street into panic mode.
In speaking to many builders and re-modelers weekly, it has been interesting to take note that the classic performance appraisal has fallen by the wayside since the economic downturn. Many tell me that this process became a non- value added activity when all the layoffs began in 2006 and since that time no-one in their organization has really seem to care.
For several years I led 600 real estate agents across multiple markets. About 20% of my business involved the Homebuilder. Here’s what I learned that can be very helpful to the homebuilder when the real estate agent is marketing your new construction.
While dining at a restaurant recently I was asked by the waiter how my meal was and if there was anything that could be improved. The meal and service were wonderful and I had only one minor suggestion. But I did end by thanking them for asking! When was the last time you were asked by a business how they could improve?
As a dedicated practitioner of Lean process and methods, one of the more aggravating things I sometimes hear is a builder bragging about how they are obviously “Lean” because they have gone through three, five, or seven rounds of rebids. Everyone had to do rebids during the past five years of the housing recession. After all, customers have in effect rebid the builders continually. Because foreclosures and short-sales still make up a significant part of the market, that means that the rebidding from the consumer end continues.