Take the Voodoo Out of Homebuilding Process Improvement

I frequently run into my neighbor John in the yard. Last evening, while watching the dogs play, we talked about the protective actions taken in the Great Lakes to limit the diversion of fresh water to far-off places, something everyone in my area is against. That led to a discussion about the environmental groups who are leading the fight, such as the World Wildlife Federation.

John said, "Well, you know some of those green groups just go too far; they are obsessive." I agreed with John but said I thought that was because they had to be. The combined power of the all the industries and governments that had conspired to make such a mess of the Great Lakes requires a bunch of very loud, obnoxious people overdoing it on a regular basis to get anyone's attention.

Eighteen hours later I ended a 90-minute interview with the co-author of a new book on how to achieve the utmost in customer loyalty and reap exceptional results. We were doing fine until he asked me about some of the "high-powered techniques" many builders use to analyze, classify, understand and communicate with prospects and customers.

Now, I like some of that stuff, and our facilitators even use some of it in training. But a lot of it is pure voodoo. It has more to do with manipulating people rather than communicating with them.

I explained to the author that 90 percent of what builders do to get customer satisfaction is front-end or back-end.

A good estimate is 20 percent up front, trying to know the customer and set expectations; 70 percent at the back-end, managing the final walk, closing and warranty period; and only 10 percent during the building process. Why? The middle requires improving and managing the construction process itself, and that's a lot harder.

Here's the rub. With business as bad as it is, builders have cut back on both the front and back ends and especially on service. They can no longer afford reparations.

The data in J.D. Power and Associates scores lags as much as two years, but I'd guess the 2006 national builder average of 112 will drop this year, if only a point or two. In 2008, however, I predict a precipitous drop — unless something big changes. That something big will be builders finally getting serious about genuine, deep, paradigm-changing process improvement.

With a few notable exceptions, builders have not figured out that if you create a disciplined, bulletproof building process you will have very few customer issues. And for those you do, they have time to deal with them. Our people spend all of their time fixing things and relationships that are broken, leaving no time to prevent problems and improve product and process.

Meanwhile, I will keep cajoling, agitating and writing to provoke builders into becoming truly process-focused. When I finally came up for air at the end of the author's interview, which had morphed into a Scott process tirade, he said, "Wow, you're really obsessive about this process stuff, aren't you?"

I replied simply, "Damn right. I have to be."