Archive for November, 2021

Pipeline Workshop™ No. 17: Save the Date

Posted November 28, 2021 By Fletcher Groves

Pipeline Workshop™ No. 17 will be held March 23-24, 2022, at the Ponte Vedra Inn and Club in Ponte Vedra Beach, Florida.

Welcome to the most intense, demanding, interactive, and challenging production management learning experience on the homebuilding planet.

“This is my second attendance to the Pipeline Workshops™.  All I can simply say is WOW!  Fletcher and his team strive to improve the workshops and make [them] even more relevant.  I especially enjoyed playing the Pipeline Game™ again and learning about [the] Velocity Accelerators®.  I look forward to attending in the future!”  (Carlos Alvarez, President, Alvarez Homes, Baton Rouge, LA)

“The Pipeline workshop™ was really effective in showing how operational decisions affect business outcomes and how risky a ‘more for more’ approach to growing a home building company really is.  The Pipeline games™ were not only fun, but they were super-effective in showing how unbalancing the production system, managing the constraint resource, and managing the right amount of WIP, creates predictable operational results and maximizes financial outcomes.

“At the end of the day, running a successful business is about how much money you make on the amount of money you invest.  The Pipeline workshop™ helped me understand this better than any workshop or seminar I’ve ever attended.

“I highly recommend it.”  (Charles Roberts, VP – Operations, Providence Homes, Jacksonville, Florida)

“The Pipeline Workshop™ completely changed my approach to meeting my company’s productivity and profitability goals.  I came away with several actionable items that I was able to implement right away.  Any homebuilder with an open mind, who is willing to challenge the traditional ways of thinking that our industry has grown comfortable with, will benefit greatly by attending.”   (Ryan Band, Owner, Unbridled Homes, Louisville, KY)

“The [Pipeline Workshop™] takes a complex problem set and simplifies it through a hands-on experience.  Getting to see the decisions you make play-out in front of you is invaluable to opening your mind up to a new way of managing the pipeline.”  (Kevin Jewel, Jr., Chief Operations Officer, French Brothers Homes)

“If you want to truly understand the impact of cycle time and work-in-process on your company’s success and desire to gain competitive market advantage, the Pipeline Workshop™ is a mandatory training.”  (Allen Grinalds, Operations Director, Ivey Group)

 

Pipeline workshops™ are now in their ninth consecutive year, and we have worked relentlessly to enhance and improve it.  Over the years, we have:

(1) improved the best production simulator and business game in the industry (the Pipeline Game™), made it faster to play, easier to understand;

(2) introduced an operating statement format to the game that mirrors the particular characteristics of homebuilding operations;

(3) found ways to transfer the learning faster, to make the connection between operating decisions and business outcomes clearer, quicker, more direct;

(4) started to examine areas of disruptive innovation (for example, outsourced building models that become integrated building models);

(5) introduced an MBA-level business case (RB Builders: Lessons from the Pipeline©);

(6) emphasized important and emerging areas we call Velocity Accelerators®.

Pipeline workshops™ are unique;  they are utterly unlike any other homebuilding conference.  The learning split is 70% simulation/business case, 30% lecture;  the format is intense, interactive, and competitive;  the Pipeline game™ production simulations and the RB Builders: Lessons from the Pipeline© business case rigorously test attendees’ true understanding of production management principles and disciplines, and challenge their ability to solve production problems.

Pipeline workshops™ build an intuitive, instinctive understanding of production principles and disciplines;  they draw the subtle-yet-crucial distinction between being in the homebuilding business, and simply being in the business of building homes.

Our venue, the Ponte Vedra Inn and Club, is a renown AAA Five Diamond oceanfront golf and tennis resort established in 1928;  we provide a relaxing and enjoyable reception on the Historic Inn’s putting green at the end of the first day;  we offer recommendations on outstanding local dining;  there are abundant opportunities for networking.

Creating a visual image of homebuilding production.  Establishing the connection between operating decisions and business outcomes.  Building a new way of thinking – systemically – towards solving core problems and managing constraints.  Managing limited capacity and resources, doing more without more, ideally doing more with less.  Dealing with variation.  Managing homebuilding production as the type of workflow that it really is – multi-project management with surrounding, supporting, and embedded-processes.  Placing the emphasis on actions that increase velocity.

The fundamental proposition of a Pipeline workshop™ is this:  the key to creating sustainable competitive separation is being able to thrive on the velocity side of economic return – being able to thrive on the velocity side of Return on Assets.

Registration for Pipeline Workshop™ No. 17 opens December 13, 2021.  The attendance fee is $945.00.

Sponsored by Simpson Strong-Tie.

Come.  Participate.  Learn.

 

Here is the permanent link to the workshop website:  www.buildervelocity.com

The link provides information about the workshop, reviews from builders who have attended previous workshops, and a downloadable Adobe PDF file with detailed information about the venue, agenda, and schedule that can be shared.  When early registration opens, all of the information, including the agenda and schedule, will be updated, along with the event registration and hotel reservation links.

The full attendance fee is $945.00;  the early registration attendance fee (open December 13, 2021 through January 14, 2022) is $795.00;  for team pricing:  (flgroves@saiconsulting.com).

 

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Aspects of Gratitude

Posted November 21, 2021 By Fletcher Groves

(initially posted on Escape from Averageness® in November 2015, updated and reposted here)

Many of us will take time off this week, even if only on Thursday, to join friends and family to celebrate Thanksgiving.  Somewhere amid the fraternity, food, and football we will take the time to express our gratitude and thankfulness for the circumstances we enjoy.

More than ever, in 2021, in the current world in which we live, we need Thanksgiving to be more than just a generic, pre-scripted, perfunctory expression of gratitude;  it should be more than an afterthought;  it should be more than an obligatory gesture;  it should be more than a sense of personal pride and accomplishment.  It should be much more.

Now more than ever, it would be helpful instead to focus on the aspects of our gratitude, on the elements of the thankfulness we should have.

The Desolate Wilderness was written just over 400 years ago, as a journal recorded by Nathaniel Morton, keeper of the records of Plymouth Colony, based on the account of William Bradford, its first governor;  And the Fair Land was written in 1961, by Vermont C. Royster;  they have been published, together, in the Wall Street Journal, every year since 1961.

Faith, and a Sense of Eternity:  “they knew they were pilgrims and strangers here below, and looked not much on these things, but lifted their eyes to Heaven . . . and therein quieted their spirits.”

An Appreciation for Fellowship:  [the night before departing] “was spent with little sleep . . . but with friendly entertainment and Christian discourse and other real expressions of true Christian love.”

A willingness to Venture, with a sense of Courage, Resolve, Determination, and Perseverance:  In the face of “a sea of troubles before them . . . no friends to welcome them, no inns . . . no homes, or much less towns, to repair unto . . . [the onset of] winter . . . what could they see but a hideous and desolate wilderness, full of wild beasts and wild men . . . behind them . . . a mighty ocean . . . a bar or gulf to separate them from all civil parts of the world.”

A Reminder of Providence, and the Richness of this Land and its People:  “But we can all remind ourselves that the richness of this country was not born in the resources of the earth . . . but in the men that took its measure . . . remind ourselves that for all our social discord, we yet remain the longest enduring society of free men governing themselves . . . and we might remind ourselves also, that if those men setting out . . . had been daunted by the troubles they saw around them, then we could not this autumn be thankful for a fair land.”

 

(the second edition of The Pipeline: A Picture of Homebuilding Production© was published in January 2016)

The second edition of The Pipeline: A Picture of Homebuilding Production© remains both a management book and a business book.  Yes, it is a management book, because it is about the principles and disciplines of production management, as they relate to – and as they are applied toward – the specific conditions, requirements, and parameters found in the homebuilding industry.  But, it is also a business book, because there is a difference between being in the homebuilding business, and being in the business of building homes.

I am told that the Introductions written for business books typically answer this question:  Why should you purchase this book?

In the case of The Pipeline©, I would say it is because improving performance on the velocity side of the Return on Assets is the best path – perhaps the only path – for a homebuilder intent on achieving sustainable competitive separation.

Because that path is an escape from averageness.

The issue is not whether the velocity side of economic return is more important than the margin side of economic return;  they are co-equal components of Return on Assets.  Gross Income derived from making more on each house built (higher margin) has the same contributory value, dollar-for-dollar, as Gross Income derived from building more houses with a planned, finite, and controlled amount of inventory and production capacity (higher velocity).

Nor is it necessarily a choice.  Although the circumstances sometime favor one or the other, we don’t have to choose between efforts to increase Return on Sales and efforts to increase Asset Turnover;  margin and velocity are driven by different aspects of the business, so they generally don’t react to, or adversely affect, each other.

It is simply that, while just as desirable, beneficial, and important as higher velocity, higher margin is not a strategy for creating lasting competitive advantage;  between higher margin and higher velocity, higher margin is the easier, more common strategy.  And, the strategy of achieving higher margin typically has to be augmented with an insistence on having more capacity.  Adding production capacity (and the required inventory) is a “more-for-more” proposition.  It’s the easy, more-traveled road.

You can add production capacity, but don’t expect it to separate you from your competition.

As a business strategy, higher margin augmented with additional capacity can be readily co-opted;  true competitive separation that is also sustainable comes more from doing what your competition will not do – and likely cannot do.  Like finding ways to become more productive, to “do more without more”.

Consider the situation that confronted RB Builders, the homebuilding company portrayed in The Pipeline©  (and chronicled earlier in The Saga of RB Builders©), facing the world at the close of 2007, at the end of the halcyon period known as The Age of Homebuilder Entitlement®:

“In many ways, RB Builders was a product of that age, just another homebuilding company satisfied with occasionally adopting other builders’ ‘best practices’, content to be good, no-better-but-no-worse than the other builders with whom it competed, a building company with a middle-of-the-road approach to delivering the value its homebuyers demanded.   

“The previous 10 years had been good for RB Builders.  But, it was becoming a dangerous approach to business, because – as the saying goes – ‘the only thing in the middle of the road are yellow lines and dead armadillos’.   

“It was becoming a homebuilding no-man’s land. 

“Locked into an operating model – into an organizational structure, management system, processes, culture, and employees – that could not deliver extraordinary levels of distinctive value, the company found itself dumped into a teeming mass of homebuilders that all looked the same, sounded the same, and priced the same.  Indistinguishable from other builders, and unable to create any type of competitive advantage, RB Builders was trapped and sinking – like a modern-day dinosaur – into the tar pits of average-ness.” 

The world doesn’t need any more average homebuilding companies.  It already has enough of them.

 

The Pipeline: A Picture of Homebuilding Production©, Second Edition is available POD through the publisher’s bookstore, and from any of the main booksellers (amazon.com, barnesandnoble.com, or booksamillion.com).

virtualbookworm.com/collections/the-pipeline-a-picture-of-homebuilding-production

It is typically carried in-stock on amazon.com:  amazon.com/Pipeline/1621378047

Connect with us:  saiconsulting.com/contact-SAI

 

(the second edition of The Pipeline: A Picture of Homebuilding Production© was published in January 2016)

“We’ve never met, but we use your pipeline book [The Pipeline: A Picture of Homebuilding Production© Second Edition] in our operations.  We are sending our VP Operations and three Construction Managers to your workshop [Pipeline Workshop™] this week.”  (Tommy French CEO, French Brothers Homes, Alamogordo, NM)

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“I would recommend The Pipeline: A Picture of Homebuilding Production© Second Edition to anyone already in, or looking to get into, the production homebuilding business.  The case study used is easy to follow and you learn through real life examples.  As a company, we learned a lot through the book that we were able to put into action.  For example, after reading the book we immediately started to even flow our jobs starts.  I always understood the concept of a pipeline, but the book helped me to see how it all worked together…and how what we were doing was hurting more than helping the problem.”  (Doug French, CEO, Stylecraft Builders, College Station, TX)

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“When I found out a second edition of The Pipeline: A Picture of Homebuilding Production© came out with additional content, I was excited to get my hands on it.  I was not disappointed.

“Fletcher manages to turn a potentially dry topic into a very entertaining and insightful read and learning experience.  The examples used are easy to follow, and are the best way to explain the principles of production homebuilding that I’ve come across.  The book opened my eyes to the seemingly obvious mistakes homebuilders often make in terms of managing their portfolio of work in progress, both on the physical side as well as the financial side.

“The new content regarding vertical integration with labor providers was a fresh perspective and a new way of thinking about the benefits of this business option.”  (Dennis Shriver, Vice President/Owner, Hearthside Homes of Kansas City, Kansas City, MO)

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“I again salute my colleague and good friend of so many years, Fletcher Groves III, on a noteworthy achievement with the second edition of The Pipeline: A Picture of Homebuilding Production©.  A useful industry textbook has now become an indispensable guide to organizing the universe of important operational and financial considerations that bear on the business of homebuilding.

“Fletcher has added an important section to this landmark opus, to extend an invaluable guide for naming, assembling and measuring economically the constituent parts to the system of homebuilding.

“The innovative first edition of the book used the Pipeline game™ to simulate the complex environment of the business of homebuilding.  The game prompts interactions and insights among the actors in a homebuilding team, and serves to illuminate how to optimize a business set within defined constraints while teaching a vocabulary of relevant quality principles and measurements that should govern all homebuilding manufacturing.

“The second edition further refines components of the game, resources, operation expenses and the income statement, to reflect more closely the real world of homebuilding operations.

“My reading of the first edition of The Pipeline: A Picture of Homebuilding Production© resulted in the conclusion that the book should be used as a textbook, if not a workbook, for all principals in the homebuilding business.  Looking again, and in particular at the addition of the ‘extended’ game, I have now come to think that any homebuilding company owner or CEO who does not adopt and internalize what The Pipeline: A Picture of Homebuilding Production© has to offer is putting at risk ROI, if not his company.

“For an internal homebuilding team, I believe that it should use the book in the same manner as a flight simulator is used in aviation, with annual trips to the ‘box’ as a team, and as the cornerstone of a continuous improvement effort that will generate quality and revenue.”  (Kent Steen, Vice President – Marketing/Sales, Bitrage NOVIS Corporation)

**********

The Pipeline: A Picture of Homebuilding Production tells the story of how RB Builders learned the principles of homebuilding production in the turbulent years following the end of the period known as the “Age of Homebuilder Entitlement”.  It is a story told in the exchanges of dialog between team members, senior management, and RB Builders’ trusted, results-based advisor/partner.

The result is a deep understanding of a production system with an enduring visual image, the elements of which are crafted to the specific conditions, requirements, and parameters of the homebuilding industry, and a realization that improving performance on the velocity side of the ROA equation is the best path a homebuilder has to achieving sustainable competitive separation.

The Pipeline is about the specific application of underlying principles and disciplines of production that are universal – physics rooted in the laws that govern all production systems.  The book is about using the tools that work for homebuilding production, without regard to the consulting religion from which they come.

The Pipeline makes the connection between operating performance and business outcomes.

Next:  The Pipeline: A Picture of Homebuilding Production©, Second Edition:  The Escape from Averageness

 

The Pipeline: A Picture of Homebuilding Production©, Second Edition is available POD through the publisher’s bookstore, and from any of the main booksellers (amazon.com, barnesandnoble.com, or booksamillion.com).

virtualbookworm.com/collections/the-pipeline-a-picture-of-homebuilding-production

It is typically carried in-stock on amazon.com:  amazon.com/Pipeline/1621378047

Connect with us:  saiconsulting.com/contact-SAI  

(the second edition of The Pipeline: A Picture of Homebuilding Production© was published in January 2016)

“In his second edition of The Pipeline: A Picture of Homebuilding Production© , Fletcher L. Groves III provides another invaluable tool to those who manage a home building production business.  Combining his in-depth experience in the construction industry with a passion for its business aspects, Fletcher describes practical guidelines for improving the velocity side of the ROA.  Fletcher recognizes that this is the best way a homebuilder can achieve what he calls ‘competitive separation’.

The Pipeline: A Picture of Homebuilding Production© Second Edition is a ‘must-read’ for all of those home builders that are determined not just to survive, but to thrive.”  (Carlos Alvarez, President, Alvarez Construction, Baton Rouge, Louisiana)

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“Be prepared to dog-ear and highlight.  Fantastic book chocked full of practical, useful strategies for a production home builder.  It’s like a mini-MBA for the home building professional.  I returned today to purchase another copy for a friend who is the most veracious student of the industry I know… I’m sure he’ll love it.”

“EDIT: make sure you buy the updated and expanded second edition.”  (David Keller, Keller CDD, LLC Construction Design Documents for Architecture and Engineering, Orlando, FL)

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The Pipeline: A Picture of Homebuilding Production©, Second Edition, is the latest in Fletcher Groves’ collection of work that uses real examples and lessons learned to educate the reader on the application of principles and disciplines needed to successfully manage a homebuilding production system.  The story contains a revised Pipeline game™ that simulates the risks and rewards based on the decisions a company can make when navigating through the ever changing environment in which decisions are made.  The updated game is more representative of a homebuilding operation in today’s marketplace and it’s worth the purchase.  This book is a must-read and it will have a significant impact throughout your entire organization.  This book is worth the purchase and it will have a positive influence on how your company moves forward.”  (Jeff Kornblau, Vice President, Land Acquisition, Eagle Construction of VA, LLC, Glen Allen, Virginia)

**********

The Pipeline: A Picture of Homebuilding Production©, 2nd Edition, published earlier this month contains revisions to the Pipeline game™ that (a) introduces a shorter game with an operating statement that is a better reflection of a homebuilding operation, and (b) compares an integrated building model to an outsourced building model.

“The clarification of terms to those that are more familiar to the traditional homebuilder makes the game both more interesting and easier for participating in the process.  As with most simulations, being able to compare the game to the day-to-day reality of the operations within a traditional homebuilder provides ‘experiential’ understanding of the process and the results.

“Definitely a worthwhile read and exercise for increasing understanding, if you are intending to continue to improve your homebuilding operation.”  (Hoyt G. Lowder, HGB & Associates, LLC, Tampa, Florida;  former Director and Principal, FMI Corporation)

**********

The Pipeline: A Picture of Homebuilding Production© tells the story of how RB Builders learned the principles of homebuilding production in the turbulent years following the end of the period known as the “Age of Homebuilder Entitlement”.  It is a story told in the exchanges of dialog between team members, senior management, and RB Builders’ trusted, results-based advisor/partner.

The result is a deep understanding of a production system with an enduring visual image, the elements of which are crafted to the specific conditions, requirements, and parameters of the homebuilding industry, and a realization that improving performance on the velocity side of the ROA equation is the best path a homebuilder has to achieving sustainable competitive separation.

The Pipeline© is about the specific application of underlying principles and disciplines of production that are universal – physics rooted in the laws that govern all production systems.  The book is about using the tools that work for homebuilding production, without regard to the consulting religion from which they come.

The Pipeline makes the connection between operating performance and business outcomes.

Next:  The Pipeline: A Picture of Homebuilding Production, Second Edition©:  More of What Others Have Said

 

The Pipeline: A Picture of Homebuilding Production©, Second Edition is available POD through the publisher’s bookstore, and from any of the main booksellers (amazon.com, barnesandnoble.com, or booksamillion.com).

virtualbookworm.com/collections/the-pipeline-a-picture-of-homebuilding-production

It is typically carried in-stock on amazon.com:  amazon.com/Pipeline/1621378047