Scenario: Peter Anderson was a seat-of-the-pants type of builder. He knew construction well, and tried to catch mistakes early by visiting his jobsites daily, and spending long hours coordinating with clients, subcontractors, and suppliers. No system in the world, he felt, could equal a pair of vigilant eyes on the ground. While his philosophy had served him well while he was a small builder, as he grew in size, he found he was overcome with the details and complexity of managing multiple projects.
Subcontractors were unable to turn their schedules around at a moment’s notice. Supply orders sometimes dropped through the cracks. Comments from clients were written down on scraps of paper and pieces of 2×4, and promptly misplaced and forgotten. Even when Peter hired a new superintendent and office manager, the lack of a coherent system threatened to inundate the building company.
At the behest of his office manager, Peter started exploring construction management software. The office manager kept the company’s accounts on QuickBooks, but estimating and scheduling were done by hand or assisted with spreadsheets. Worst of all, the calculation of these functions seemed to be locked inside Peter’s head. He couldn’t have someone else do the estimating or scheduling because no one else knew exactly how Peter thought.
What should Peter do? Continue as he has, and keep his business small enough to handle it out of his back pocket, or invest thousands of dollars (and hours and hours of time) in an integrated construction management system to tie all the functions together into a (hopefully) smooth-running operation?
Solution: Building a custom home is an exercise in controlled chaos. With thousands of steps involving hundreds of people, and with the uncontrollable factors of client whims, weather, site conditions, and human error, things will inevitably go wrong. The trick, of course, is controlling as many variables as possible and preventing mistakes from devolving into total disaster.
Even if he keeps his business small, Peter will invariably suffer from the lack of organization. If he should die or develop a serious medical condition, the business would simply disintegrate. The other extreme, however—a rigid, formalized overall management system—seems totally unsuited for Peter’s personality.
As long as the accounting system is working well, the firm should continue to utilize it. Companies can only deal with a limited amount of change at any given time, and fixing something that isn’t broken could break the company.
The first step for Peter is to think through his construction process, and break it down into each step of the building process. He should then develop a manual scheduling program, something simple that sets tasks, time constraints, and durations. Even a simple scheduling program like Microsoft Project may be beyond Peter’s capacity to update and manage.
He then should tie that scheduling program to the actions that must be taken at each stage. This becomes the basis for his management system. The system could be as rudimentary as a collection of checklists, each tied to a scheduled task. These are then copied and put together in a three-ring binder.
After Peter has developed a manual system, he can then turn over the process for other people to follow. It will provide the information he needs to manage the business, without having to personally take care of every little detail.
Once the system is working smoothly he can then begin to computerize it. Some of the forms can be transferred to Excel to simplify the math and do more complicated analysis. Someone other than Peter should oversee the computerization process so Peter can continue to oversee the big picture of the company.
There is no one system that provides a correct solution to this problem. The important thing is that there is a system, and that it is compatible with the way the builder does business.
Al Trellis, a co-founder of Home Builders Network, has more than 25 years of experience as a custom builder, speaker, and consultant. He can be reached at altrellis@hbnnet.com.
