During a question and answer session at a recent industry conference, a home builder asked Moody’s Analytics chief economist Mark Zandi for his thoughts about the labor
Checklist for a Full-Value Home Building Business
Here's a 23-point checklist of items to help home builders create full value for their company.
What's your end game? Do you plan to shutter your business and ride into the sunset? Sell to a willing buyer? Pass the company along to your children?
When its time to retire, what is the value of your company?
Custom building allows you to create projects that reflect your vision and personality. Successful builders develop reputations that are extensions of their vision and personality. That reputation is the foundation of their success.
When it is time to retire, though, that personality goes with you. What then is the value of your company?
Senior Editor Bill Lurz offers one solution to this problem in his feature on page 44. Custom builders can move to a more production orientation, which will increase the company's value. I want to offer a 23-point checklist of items to build a business that has full value. I developed this list in conjunction with business partners in a company whose purpose was to merge high-end general contractors. We broke the list into five management areas. How many of these items have you implemented?
- Pursue a written strategic plan with goals and objectives
- Document work flow
- Follow an organizational chart that supports the work flow
- Establish a method for information sharing within the company
- Create an advisory board with outside members
- Develop a succession plan for ownership and management
- Implement an executive development program supporting leadership and management growth
- Develop a written plan to implement a business strategy that includes a preliminary budget
- Operate from a diversified revenue source
- Use an integrated marketing program that supports the business strategy
- Create a value-added sales system
- Implement a computer-based estimating and pricing model
- Follow an established method for successful adoption of new technologies
- Establish an annual budgeting process
- Employ a GAAP that generates common management reports
- Produce key management performance criteria
- Implement a comprehensive risk management program
- Create formal job descriptions based on work-flow analysis
- Follow a proven recruitment program that attracts quality employees
- Implement a training program that supports company objectives
- Define career paths for all employees
- Develop and operate from a written quality-based, customer-service oriented production system
- Follow a written safety program CB
Paul Deffenbaugh, 630/288-8190, firstname.lastname@example.org