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A 2015 Wish for Home Builders
As you strive for operational excellence, you better recognize risk for what it is
by John McManus, Builder Magazine
DECEMBER 29, 2014
Home builders are like other people in a lot of ways. But in some characteristics and habits, you’re just different. And that’s mostly
a very good thing.
Home builders are generous-souled, incredibly driven, and hard-working people who want their efforts to result in filling a deep human need that often has an almost permanent (decades- long) set of implications for use of part of the planet. Good work means work that lasts, stressed by the elements of nature, economic ups and downs,
and incessant use.
There’s something in the DNA of a home builder—whether it’s an entrepreneur working at a kitchen table, via Starbucks WiFi hookup, out of a truck, or in an office full of
white-collared MBAs—that appears to be comfortable with what is cognitively tough. Risk, for instance.
Home builders take on risk both in
what they buy—land, labor, materials, processes, and products—and what they sell—improved residential properties. There’s reward for excellence on both sides of that equation, and there’s punishment for either miscalculation or misfortune on both sides as well.
Value varies, after all. Sometimes it all but disappears in time, only to come roaring back.
Observers would say home builders may be good at a lot of things, but they’re
not skilled at mapping risk into their
businesses. This probably traces to a now well-known phenomenon that people, by nature, are more optimistic than reality warrants that they ought
to be.
Home builders need to get better at putting risk where it needs to be in a business plan. Now. That is an area of operational excellence that may have been an option in bygone cycles, but that’s no longer the case.
“Why we care” underlies all of the details, all of the behavior and attitude, and all of the intentions with respect to
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