Tag Archives: Efficient Homebuilding

Declare Independence from Tradition!

Embracing 21st Century Technology in our 20th Century Industry
(Or, why we do things differently at Contrado)

Thomas Jefferson once said that he liked “the dreams of the future better than the history of the past.” He knew what they needed: independence from traditional political, economic, and religious oppression. By writing the Declaration of Independence and the US Constitution, he was expressing the convictions that were in the hearts of the American people – the need for change.

1.  Understand that People Are Afraid of Change. When was the last time you changed the course that you were on? “Change” is a broad word that we can apply to many different things… a birth, a loss, a move, a new opinion, a new job. But ultimately it is a departure from tradition – which leads to a new way of doing things. For example, the change our nation went through during the 1700’s, despite being fought by many, led to a whole new world of possibilities and fresh starts. Regardless, change usually freaks us out. Whether it’s Good Change or Bad Change, we as humans are naturally afraid of the unknown. We fear failure. We feel doubtful about the possible outcomes. But we have to remember we always have options, and we can always CHANGE the outcomes. You don’t have to settle. “Open your arms to change, but don’t let go of your values.” – Dalai Lama

2.  Understand the Technology. If we think of change as a software upgrade, what software are you in need of, right now? Do you need better online engagement with prospects, for example? Do you need to build more homes with limited resources? Do you need better software to help you meet your customer’s exact needs? If you don’t know, evaluate what isn’t working. Then inform yourself!  You can start by asking the question, what are the best tools out there for what I need right now? If you go beyond word-of-mouth and previous methods into the world of uncovering the new, you will find services, systems, software, companies, and tools that you have never even heard of (like Contrado’s new HTML5 Interactive Floor Plan system!). What are today’s game-changers? Incorporating iPad technology into their homes? Making it easier for you to do your job? Building homes in half the time? You will be surprised at how much newness is flooding the industry.

3.  Understand that nothing will change unless you Try Something New. Times they are a-changin’! We are living in an exciting time where technology seems to be accelerating at the speed of light, and we will be left in the dark if we don’t try to keep up. In other words: have you ever heard someone say that the definition of insanity is ‘doing the same thing over and over again, and expecting different results’? Trying new things can be scary folks, but how can you improve without even a little bit of change? Traditional tactics in the Revolutionary War ultimately failed the British; the revolutionaries were outnumbered, so they developed guerilla warfare to outmaneuver their red-coated opponents. They were forced to innovate the way they battled – thinking differently, operating more efficiently, using what they had and just going with it – which led them to victory.

You have the right to life, liberty, and the pursuit of happiness.  So if after all of this you don’t do it for you, do it for our Founding Fathers!

The Independence Equilibrium

How to Find the Right Balance in the Home-Building Industry

With our most celebrated national holiday upon us, we at The Contrado Group have been thinking about Independence quite a bit lately. Yes, we’ve also been looking forward to breaking out the BBQ, floating around on that unused raft, and maybe even playing with some fireworks. We will be celebrating our country’s Day of Independence – the day our Founding Fathers came together and drafted a revolutionary document declaring our freedom and our independence from our British ancestors. So we asked: what does that have to do with us in the home-building industry? How can we apply such a monumental moment in history to us? And most importantly, how do we find the right balance that will enhance efficiency for all?

First, we must acknowledge that Independence Inevitably Leads to Innovation. In embracing your individuality as a company (or as a person, for that matter), you will be surprised at how many new ideas you have and how much new material you can actually create. Take our Founding Fathers for example. Not only did they fight in an actual decade-long war for their freedoms, but after their triumphant victory they created the “Declaration of Independence,” they established the US Constitution (“We the People”), and in general had a pretty successful American Revolution. They were pioneers. In declaring Independence like they did, you are virtually breaking through the old dysfunctional way of doing things, and embracing change and newness as your Modus Operandi. And the final objective? Self-sufficiency… on your terms. This is the bread and butter of the American Dream and of what being successful means in our society today, applicable to both to the individual and the organization.

Second, we must recognize that Independence Isolation. Think of our industry as an ecosystem. Each member contributes to the overall operational efficiency of the system, which as it turns out, is paramount for saving time and money and for producing the best results. Who does your architectural planning, drawings, & renderings? Who does your marketing, and your selling?  You may need to re-evaluate your game plan. Being over-independent often results in the dreaded Silo-Effect (dun dun dunnnnnnn!): operating in isolation. This leads to little/no communication and an almost guaranteed increased inefficiency. In most of these all-too-similar cases, being over-independent indirectly cuts you off from valuable resources and other members of our “ecosystem,” who are there to give feedback, bounce new ideas off of, and in essence help you grow.

So, how do we find the Independence Equilibrium?

  1. INNOVATE: We must create space for the innovation that independence breeds. Within your company’s means, ask yourself what you can do differently to maximize operational efficiency.
  2. COLLABORATE: We must find the Pioneers, the Innovators, and the Front-Runners and we must collaborate with them. Outsourcing key parts of our processes, people, and technologies to these guys will yield better results than trying to figure it out on our own – one-stop-shops and multi-taskers welcome!
  3. NETWORK: We must keep in constant contact with the members of our ecosystem, the other home-building industry professionals. There is a big chance they might have the solution you are looking for.
  4. EMBRACE CHANGE: We must declare our Independence from the old dysfunction! The plus side for home-building professionals? We don’t need to fight a 10-year war and risk death for our revolution.

Is It Really Time to Buy A New Home Again?

So what is real right now? Is the waiting over?

What is real is that market conditions truly are beginning to point to a return to new home demand. Here is what we know:

  • Cost to rent is up significantly
  • Home prices are way down
  • Foreclosures are slowing
  • New jobs are being created
  • New build numbers are at levels not seen in a decade

All of these indicators point to an oncoming demand for renters to move across the street to a new home of their own. The time is coming for families and couples to get back into the game. New homes being built will be a large part of that story.

In non distressed markets, jobs creation is showing some good growth. Rents and home prices are rising at about the same pace as apartments are in short supply. As resale home inventory is becomes thinned out, people will realize how few new home builds are available currently, only 78,000 in 41 cities studies by Metrostudy. That is down from 343,00 units at the peak! And is down from a decade ago as well. Construction is ripe to take off!

Even in distressed foreclosure markets like Phoenix, the outlook is indeed looking better. Investors have been an important part of buying through distressed properties. Families that have been displaced are moving into homes as renters, further reducing the number of homes on the resale market. Most importanly, foreclosures are slowing. We will hit some bumps, but the overarching story is that the health of the resale market is beginning to return. New construction will follow suit!

For several years the fundamental of cost to own vs. cost to rent along with new build levels has given a number that indicates an unhealthy market but for the first time in a long time, it would appear that that number is going in the opposite direction. One where confidence returns, home valuations rise, the American Dream becomes attainable once again.

To read a full article explaining why new home demand is on the near horizon, please read this informative article.

Market Watch - Sales of new homes up

Additional news from Builder Pulse,  Market Watch and Arizona Republic.

The Power of Collaboration / BIM Consulting

The Contrado Group has put together a task force to review the entire process of residential construction. From concept of a residential community to the final energy certification process that needs to occur in order to receive the given rating for a home for Energy Star and/or LEED’s programs.

The overall solution appears to involve collaboration between all disciplines in the construction process. Too many times, our builders are getting lulled into low-price scenarios at the expense of the total-cost of the project. The aim of our task force will be to have better communication, documentation, and execution of trades for a given project. In doing so, we believe that there will the following benefits:

  • Higher Customer Satisfaction
  • Quicker Time-To-Market Cycle Times
  • Improved Cash-Flows
  • Lower Construction Costs
  • Less Material Waste
  • Higher Profit Margins

Our task force is very focused on sharing of key informational components that not only directly affect those trades that are involved, but the overall construction process. In doing so, we believe construction savings from just field errors will mirror those in the following chart that was taken from a study by J.C. Cannistraro a mechanical contracting firm from Boston.

 

Through collaborative efforts, we believe that our builders will be able to save “10 to 20 percent of a project’s finances and possibly reinvest into a project” For more on this study, click on this picture:

 

Please give us your thoughts regarding areas you believe we can make more efficient in the home building industry.

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