(this post appeared on EFA® in April 2010; reposted here, with the same title, as a three-part series. It is about creating competitive separation; written well-before the book was published or the workshop was created, this is what The Pipeline: A Picture of Homebuilding Production© Second Edition is all about, what Pipeline workshops™ are all about)
“I guess it comes down to a simple choice. Get busy living. Or, get busy dying.” (The Shawshank Redemption, Castle Rock Entertainment, 1994)
If his only object was to exist or survive, I imagine that Andy Dufresne would have become like everyone else in Shawshank, and settled for whatever business-as-usual constitutes in that setting. It took him twenty years to dig out of prison for a crime he did not commit, but Andy Dufresne did not choose to merely exist.
Get busy living, or get busy dying.
 is the fourth year of this housing recession, one that has surprised even us veterans with its depth, duration, and complexity born of excessive intervention into markets and monetary/fiscal policy. Maybe it will be the last year.
Either way, as distracting and difficult a time as right now is, it is time for builders to consider how they will choose to make the world of homebuilding when this is finally over.
If you think this recession has been a test of survival, wait until you see the recovery.
Ten years ago , I wrote an article for Professional Builder, titled “The Road That Lies Ahead”. It was one of a series of articles on the findings of Reference Point™, our periodic survey of senior executives regarding management practices in the homebuilding industry.
In part, I said this:
“LIFE ON THE SERENGHETI: It seems obvious to us that the demand for housing in the next five to seven years cannot support the aggregate level of anticipated growth if three-fourths of these builders aim to significantly increase the size of their current operations, even if we factor in a continuation of the current level of acquisition and merger activity and reason that our group of builders might be a particularly aggressive strain.
“On the other hand, we do not see any reason to doubt their intent. A couple of scenarios come to mind. One possibility is that some of the demand is transferred by acquisition or merger, but, beyond that, everyone settles for less growth than they would like – too many lions, not enough zebras, everyone still hungry, but no one starving.
“The other possibility is that some of these builders might actually develop (or acquire) the capabilities that will allow them to redefine operating and financial performance as we know it. In that case, the current level of industry consolidation begins to pale – and we will be looking at a group of bigger, stronger, faster lions, capable of eating zebras to their hearts’ content . . . “
“. . . There is a clear and simple message in all of this: The road ahead is difficult and uncertain, but there is opportunity along with the danger. Do not be complacent. Do not follow the crowd. Do not waste your time and effort on things that do not create value.”
I remember, my dad once remarked, “Son, you see life the way you wish it was”. I replied, “No, you taught me to see life the way I choose to make it”. Fast-forward, from 2000 to 2010. How will you choose to make your world? How will you create a sustainable way forward in this industry?
Builders have choices about how they move forward from this debacle, but not all of the choices available to them meet the criteria of being sustainable. From the standpoint of what constitutes sustainable competitiveness, I do not think business-as-usual is going to cut it any longer. I do not think settling for being different-but-no-better-no-better-but-no-worse than the competition is going to cut it any longer. I do not think that attempting to insulate yourself and achieve a competitive advantage within a secondary market, by settling for the adoption of “industry best practices”, is going to cut it any longer, either.
I do not think there is much comfort in not being among the slowest zebras on the Serengeti.
There is such a thing as the tyranny of averageness. At the end of the day, average is still just that. Average. No matter how you cut it, even if it is occurring on a higher plain. The question is this: Does the world really need any more average homebuilding companies?
Get busy living, or get busy dying.