Pipeline Workshops™: Velocity Accelerators®: A Savvy, Motivated, Mutually-Accountable Homebuilding Team

Pipeline workshops™ do not stop at the “what” and the ‘how-to”;  they also address the “why” and the “want-to”.

There has always been an underlying context – an underlying business logic – to everything we expound in a Pipeline workshop™.  Understandably, the focus is on the principles and disciplines of homebuilding production themselves, but we also give that underlying context – the underlying business logic – the attention that it critically deserves.

So – one of the Velocity Accelerators® we do at a Pipeline workshop™ is a deeper-dive into that context and business logic, into two crucial, inseparable disciplines that must work together:  Open-Book Management and Team-Based Performance Compensation.

The efforts of a homebuilding company to improve operating performance and business outcomes will fail, if it does not succeed first in creating a homebuilding team that works toward commonly-held and commonly understood business goals.  This type of team – a team that is savvy, motivated, and mutuallyaccountable – stands in stark contrast to what is simply a collection of individuals working toward their own, separate goals.

With most teams, what you would likely first find missing is the business logic that forms the context necessary for understanding everything else.  Understanding the homebuilding business is necessary, but it is not sufficient.  In order to compete in the business world, everyone on the team also has to learn the business of homebuilding.  They have to understand their individual responsibilities as part of the overall team, and they have to understand what is at stake, individually and collectively.

Instilling savviness to the team is the role of Open-Book Management.

But – not just understand the business outcome that is at stake for the company;  each of them must also have a personal stake in that business outcome;  they must own the outcome, for the company, and for themselves.  They must have a stake . . . in what is at stake.

Instilling motivation and mutual accountability to the team is the role of Team-Based Performance Compensation.

Open Book Management flows from Jack Stack’s work in the 1980s as CEO at Springfield Remanufacturing Corporation to rescue the former International Harvester (Navistar) division from almost certain bankruptcy.  Following a 99% leveraged employee buyout, Stack instilled transparent responsibility, by opening the company’s books and making it everyone’s business to improve performance.

Stack recounted that effort in two books (The Great Game of Business and A Stake in the Outcome);  Inc. Magazine’s John Case expanded on open-book thinking in other industries and companies, in two subsequent books (Open Book Management and The Open Book Experience).

Then, Case described (in Open Book Management) how Steve Wilson developed the basics of OBM-inspired team-based performance compensation at Mid-States Technical Staffing Services (now part of Modis);  Wilson subsequently described this work in a publication, titled The Bucket Bonus Plan.

We take a very specific approach in our application of the principles of Open Book Management and Team-Based Performance Compensation.

We advise our clients to be transparent (open).  We urge them to demonstrate candor (the courage to tell and hear the truth) in the constant internal disclosure of operating and financial data, whether in meetings, or through dashboards and heads-up displays.

We advise our clients to impart business literacy (knowledge and understanding) to teammates, so that those teammates don’t just understand the homebuilding business, they also understand the business of homebuilding, through the teaching of business and production principles.

We advise our clients to adopt a teambased approach to performance compensation, by way of a progressively-weighted milestone plan, centered on achieving targeted performance above a baseline in a specific business outcome, impacted by the actions of every single teammate.

We urge an approach that is simple, easily understandable;  that is visible, transparent, compelling;  that rewards success rapidly and frequently;  an approach that is selffunding, that is paid from income the company would never have otherwise generated, from economic return they would have never otherwise achieved.

In terms of compensation – we urge our clients to make it significant, make it meaningful.  In terms of participation, we urge them to make it allinclusive.

We tell them that a Team-Based Performance Compensation Plan should only provide winners or losers, not winners at the expense of losers.  It should give the right to lead and to demand results;  it should give the desire to be lead, not managed.

Savvy.  Motivated.  Mutually-Accountable.  Team.


Come.  Participate.  Learn.

Open-Book Management and Team-Based Performance Compensation is one of three Velocity Accelerators® (along with Critical Chain Project Management and Business Process Improvement) that will be explored in depth at the next Pipeline workshop™, October 14-15, 2021, at the Ponte Vedra Inn and Club, in Ponte Vedra Beach, Florida.

The cost is $895.00 per person.  Attendance is limited to only 30 attendees.  For team pricing, inquire here (flgroves@saiconsulting.com).

Delivered by SAI Consulting.  Sponsored by Simpson Strong-Tie.

For more details:  www.buildervelocity.com