A notification came through calling attention to a discovery opportunity around, “The Supply Chain’s Critical Role in Product Launch.”
It’s being presented by the Harvard Business Review, and hosted by noted supply chain wizard and consultant Brad Householder.
That may sound like a commercial for an HBR web seminar, but it’s not.
The message jogged our focus a bit, and made us realize the role a chronically unsung group of subject matter experts and professionals plays in the best that is home building development, design, and construction in America. Especially now.
Directors of purchasing, strategic sourcing, strategic accounts, and supply chain.
(Aptly named) Householder’s premise is that to launch products today, a tactical approach to supply chain management is a no-go. Won’t work. He writes:
A supply chain manager has the power not just to optimize speed and control costs but also to determine customer satisfaction by anticipating demand and executing a strategy to fulfill that demand. This is crucial to every mid-market high-tech company. Failure to deliver when and where customers expect can mean losing a once-in-a-lifetime opportunity to succeed.
Fact is, every new subdivision, every new neighborhood, every new store, every new “flag” is home building’s “new product launch.”
The technical, engineering, design and aesthetic, functional and experiential performance of every single detail spec’ed into every nook and cranny of every home pivots around the effectiveness of a purchasing or supply chain manager. What’s more these professionals have to be negotiators, relationship managers, cross-pollinators and transmitters, whose solutions must deal with the need for interoperability, velocity, quality, efficiency, and, um, results. They’re the ones who have to walk the line between the architects, builders, the engineers, code officials, manufacturers, integrators, and, always waiting at the end of the hallway, finance.
As HBR’s webinar promo notes, home building’s purchasing elite corps has a new charge:
“Transforming those day-to-day transactions into extensions of their overall corporate strategy.”
And now, as lumber costs spike and other materials expense falls into the vortex of a rapidly and potentially profoundly changed global trade policy context, the decisions and knowledge out of this discipline is as important as ever.
We’ve had a chance, through our BUILDER Concept Home series of initiatives and through other channels, to work with some of the business community’s best and brightest when it comes to the transformation of purchasing from a tactic to a core strategic discipline.
At TRI Pointe Group and its Pardee Homes unit, we got to see first-hand the full-repertoire of skills and judgment from two pros, Kevin Wilson, VP purchasing & national accounts at TRI Pointe, and Bill Hughes, regional director of purchasing at Pardee, as they worked with architects Basennian Lagoni, designer Bobby Berk, and landscapers AndersonBaron on our Responsive Homes in Las Vegas’s Inspirada.
We teamed up with two other wizards in the field on the KB Home ProjeKt for Greenbuild last fall in Los Angeles, Dan Bridleman, Senior VP of sustainability, technology, and strategic sourcing, and Jacob Atalla, VP of sustainability initiatives at KB. This project stress-tested the ability to specify future-proof products, performance, modularity, and componentization, and Dan and Jacob put an entire tool-box of skills to work to bring a visionary deal into high volume builder reality.
NEXTadventurers: (from left) interior designer Lita Dirks, architect Deryl Patterson, and Taylor Morrison's Carol Thompson, national director of strategic sourcing, East Region.
For our recently completed Taylor Morrison NEXTadventure Home project, looking around the corner at the 55+ home of the near future, our purchasing maestro Carol Thompson, national director, strategic sourcing for the eastern U.S. put on a clinic. Thompson worked closely with the Orlando-division leadership and architect Housing by Design’s Deryl Patterson to bring ideas and delight to an attainable level in a launch of designs that will likely scale nationwide as Taylor Morrison builds out its 55+ Esplanade brand.
Now, we’re in the thick of an equally challenging and ambitious project, one that puts “renewability” inside the walls, into the very construction workflows and processes, and certainly carries it across to the livability of the home. It’s our Meritage Homes reNEWable Living Home, to come to light in January 2018 in Orlando. For this project, we’re locked in with another of the industry’s best purchasing and national accounts teams, led by Royal Erickson, national strategic sourcing director, and on-the-ground purchasing director Thad Lynch.
Here’s a look from salary and compensation guru Jim McGuire at Specialty Consultants Inc., indicating where purchasing director salaries come in in the spectrum of important positions among high production builders.
Let’s put it this way, the companies are getting their money’s worth. There may not be a National Purchasing Directors Day on the calendar, but especially as global trade looks as if it could perfectly well take several steps backward in the coming weeks and months, those purchasing, sourcing, and supply chain folks are going to have their work cut out for them.
Meanwhile, we salute them for jobs amazingly well done in the first several years of the recovery.
