Brutally Honest Attack on Homebuilders?

Tuesday, September 8, 2009 at 10:48PM

Preface by Grant: This blog was written byMr.Dorris, MIGP(read his bio in the "Our Bloggers" section). I found it a tough call on whether topost this blog or not. I recognize that the general public is generally not aware of this information, and maybe it should be toned down or reworked so as not to offend. However, "Consilience: The Blog is intended to educate, inform and elicit opinions,and there are other places readers can go if theyexclusively want a 'feel good' blog."I continued,by asking: "Does it have educational value and does it advance sustainability?" My answer to the lastquestions was"yes" . . . so here itis.Is this a brutally honest attack on most homebuiders or does Mr. Dorrishave an axe to grind? Send along your thoughts. ----------- As I have previously posted, the 20% of homebuilders who build 80% of all homes are not in the business of building homes, they are in the business of making money (increasing shareholder value) and, therefore, do not necessarily know how to build. To truly understand this business model, we need to know the management structure of homebuilders as this knowledge will begin to shed light on why you should not let these companies get away with the things they get away with. I will first address upper management. These are the bean counters with a business idea, access to funding and absolutely no clue as to how to build a house. These are the people who will attend awards banquets, look for future property, put on a good show for investors or shareholders and occasionally come to town to tell everyone how they are not making them enough money. Upper management employs Estimators to establish their budgets. Like upper management, these people seldom know how to actually build a house. They work on a flat desk in a heated/air conditioned office where the sun is always shining and it is always a ‘Perfect World’. Since they never visit any site in the field, many site related budgets are off, and rather than learn how to do their job and establish correct budgets, they make up for it other places – such as practicing various techniques, that while within minimum standards (Codes), are just not sound building practices.

Middle management is local and acts as the liaison between upper management and the field superintendents. We’ll get back to them in just a minute as these are the guys who mess up most houses. At the bottom of the totem pole are field superintendents. These are the guys who are on site every day supposedly overseeing the daily construction of your home. These guys are in the trenches and, you would think, have reasonable construction experience and are looking out for your best interest. They do not and are not. Field superintendents are simply schedulers – nothing more, nothing less. They receive instructions from middle management that direct them to have certain jobs performed and then they schedule subcontractors to perform those jobs. Most field superintendents that I have encountered have little, if any, working construction knowledge. Ask them a construction question and all you will see is a deer caught in headlights. In reality, what you (the subcontractor) will get is the question “What do you think we should do?” This way, any field superintendent can then shift blame if they need to by saying the subcontractor told them to do it that way. It is my personal belief that field superintendents should have sufficient construction knowledge to reasonably fill in on any subcontractor crew and not hinder their progress. I have openly advocated having new hires work for some time period with each subcontractor trade to gain a base knowledge of construction. This falls on deaf ears as all of them are stuck in the field to be trained by previously hired ‘schedulers’. OK, now back to middle management. Middle management oversees that the ‘schedulers’ schedule work in a timely fashion while trying to follow the budget the ‘bean counters’ established. At the top of middle management is the Head of Construction. Middle managers are the guys that get substantial bonuses for making upper management the money they wanted – and they will do whatever it takes to get these bonuses. Many middle managers will make bad decisions to get houses closed in the time frame that will get them their bonus. This includes doing things to make a closing that they know will cost 10 times as much to fix later instead of doing it right the first time. Their hope is that these decisions will not have any physical manifestations until the warranty period is over. Most production builders have a business model that revolves around the closing date. Come hell or high water, this date is set in stone. In order to make sure the house is closed on this date, they tie their employee’s bonuses to this date. This only provides further incentive to make a questionable quality home a low quality home by rewarding bad decision making. Surprisingly, in this whole management structure, there are few, if any, who actually know how to build a house. Even more surprising is that there is no one who will accept any responsibility for the finished product their [company] name is on. Shifting blame for building failures to material suppliers or subcontractors is an art that homebuilders have perfected to hide the fact that they are “marketing companies that happen to build houses”. Sustainable building is ultimately about building safe, comfortable living environments that balance with their surrounding natural environments. It is about integrating planning and design with climate and site analysis to maximize the energy efficiency, durability, indoor environmental quality and water conservation of our structures, while simultaneously minimizing waste and our impact on natural resources. It is only though understanding this balance that building professionals can meet the challenge of putting this understanding into an actionable plan.
IMPORTANT: In our very next postwe will address a new homebuyer checklist to help the consumer know the basics of what to demand in a Greener home AND basic outline to teach builders the same concepts. These documents connect both ends of the process (builder and owner) for a better understanding of what we should be building.