Builders are mostly realists.
They work in a messy real world of dirt and the challenges that lie beneath its surface. They succeed or fail in a messy real world of zoning, permitting, planning, and environmental commission and town or city board meetings and the byzantine web of their motivations and interests. They deliver or don’t based on a messy real world of skilled work crews who show up or don’t.
They assemble structures and systems in a messy real world of thousands of pieces and parts that fit or don’t fit, that cost more today than they were priced at yesterday, in conditions that are often unfriendly influences on careful, high-quality, efficiently achieved outcomes.
And they do it again, and again. They front a lot of capital expense–on land, time spent, labor, and materials–with the belief they can get those costs back and then some, and they get good at living in this messy real world, good at tolerating high levels of risk to their plan, good at making things that don’t work at first work in the end.
And many of them, when they hear the word “innovation,” think, “that’s not my messy real world. That’s going on in the less messy, more cushioned world of retail, or entertainment, or media.”
Innovation is mostly something builders are well-aware of, but find to be largely impractical, if not counterproductive. It can show up in the finish and trim stage of the process as home technologies buyers demand, but the bones, and guts, and systems of homes need to be all tried and true.
This kind of realism, which insists that materials, and techniques, and processes follow messy real-world patterns that have proven themselves over time to result in homes that give their owners fewer headaches, less financial duress, more time-tested value is why we so respect what builders do.
It’s how they create more value where there was less before.
What may not be so apparent is that innovation has not stood still over the past few years. Its reaches and its effects extend now, beyond the Xbox and the iPhone and the special effects department of a movie studio, into, yes, the messy real world.
Some call this “next wave” innovation, and it’s where builders’ lives and livelihoods intersect with their own future well-being and success.
Next wave innovation is all about the messy real world. It’s about matching kidneys in human patients whose health will fail if the right donor isn’t located quickly. It’s about getting an ADHD-afflicted 9-year-old from being an unhappy D student to a mildly well-adjusted B student. It’s about how micro-grids can support power grid systems through battery storage and reversing energy flows during high-use periods.
And it’s about homes, not just their door bells, and garage door openers, and lighting systems, and appliances, but their very structure and systems. It’s how they’re assembled, how they live, and how they sustain value as they return, again and again to the market.
Innovation has grown up. It’s about accessing new strategic options by looking at basics of a business and operational model through a new lens, where technology and use of data play a part.
Now we know, for instance, offsite building has begun to capture the imagination and interests of builders, architects, engineers and their partners.
Fully-realized and technologically-optimized, factory-assembled homes could go far to addressing essential, messy real-world challenges like materials costs, and local code, and labor shortages, and the financial stresses around each of those issues.
A number of influential and smart people are talking now about the potential of offsite, but few have actually been doing it in the messy real world.
The team at factory-based modular home game-changer Blu Homes, and the team at Colorado-based Oakwood Homes, and the team at L.A.-based Living Homes, and the team at Berkshire Hathaway unit Clayton Homes have been doing it in the real world.
We’re honored to have Maura McCarthy, co-founder and vp of market development for Blu Homes, lead our Hive conversation about the nexus of capital investment, regulatory change, technology, and design and operational transformation around factory assembly of homes for people.
As “dean” of our Hive strategy focus, Maura, above all, applies her brilliance to matching capital resources with what people need and want. Well-designed, sustainable, healthy, simple homes engineered and built in a factory and delivered and craned into a site is, for her, one such felicitous match up.
She and Oakwood Homes president Pat Hamill–who will join Maura in our Hive “strategy” session–share an uncommonly articulated view that home building’s business model might best start with clarity around the person or people who need the home, and map design, engineering, capital, construction, and real estate to that central need.
As opposed to the reverse. Too, this unique and exclusive conversation will include Andrew Salzberg, head of transportation policy and research at Uber. To put consumers first, home builders–like their tech startup counterparts–need at times to learn how to ask for forgiveness rather than to ask for permission. What better way to understand opportunity areas in working with local jurisdictions on overcoming outdated and unhelpful laws than to ask the folks at Uber how they do it?
Builders are realists. They understand their work performs a job for people who live in their homes, for towns who get revenue from their projects, for laborers who seek career opportunity, and for our national economy, which derives two-thirds of its resources from what happens under those rooftops.
Now, though, builders have a new lens through which to look at and respond to the messy real world they work in and navigate. That lens is innovation, next wave innovation.
Next wave innovation will be the only way builders can bridge the widening gap separating their current customer universe–those with abundant means and brighter prospects–from their current non-customer universe, a growing population of people who are treading water, or worse, slipping under water as social and economic mobility vanish.
The good news is that builders have learned over time to be high-risk tolerant. They’re used to the messy real world. They can do this.
For the highest quality discussion on the issue of the imminent convergence of technology-fueled construction, design, and engineering solutions, as well as capital and regulation and home buyers’ needs, register for Hive today.
