Monday September 17, 2018
Seasonality in Resort Custom Homebuilding - How We Manage It
It’s a fact of life in coastal Sussex County Delaware - construction activity near the coast slows in the summer months. Most municipalities have restrictions on pile-driving during the summer months and some communities and HOA’s forbid any construction activity at all.
Even if they are permitted to build during the summer, many clients prefer to wait until September, particularly if they are demolishing an old family cottage. It is understandable that folks want to use their old home for one last summer before tearing it down and starting anew.
These factors result in a lot of homes starts every September. Almost invariably, our clients are hoping to have their new home completed in time for the next summer.
Our job would be easier if we could just start (and deliver) one to three new custom homes each month. But that is not going to happen, and we must adapt to the reality of working in resort communities. Here is how we deal with it:
First, we limit the number of new homes we can start in any given month. It would not be fair to our clients, our team or our trade partners to overstress the system by trying to start too many homes at the same time. One tool we use to manage our starts is a Construction Start Slot Reservation Contract. This short contract is not a binding commitment to use Turnstone, but it is a tangible sign of seriousness on the part of the homeowner. The contract requires a small deposit that is fully refundable if the homeowner changes their mind far enough in advance for us to react. Not unexpectedly, we are already close to filling our September 2019 starting slots. The only way to create more slots is to hire and fully train additional Project Managers, which is a decision we are continually assessing.
Next, we use sophisticated software to manage the schedules for all our projects. Shortly before we break ground, we establish a “baseline” schedule, which is our educated guess as to how the project will proceed. A system of predecessors ensures that the construction steps detailed in the schedule happen in the correct order. The predecessors also create the critical path for the project. By linking clients’ decision deadlines to key milestones on the critical path, we ensure that we get the decisions we need to keep the project moving according to the schedule.
Our Project Managers update the schedule each day, adjusting the actual completion dates of 100+ steps along the critical path. They can tell exactly where they stand relative to the baseline schedule for each task. Throughout the process, our clients have real-time visibility to the top-level schedule milestones and the projected completion date. Also, select trade partners can access this system to coordinate their schedules with ours.
In the custom home building business, “stuff” happens. Over the course of a project, it is almost inevitable that something will occur that moves the project schedule beyond the projected completion date in the baseline schedule. When this happens, we task our Project Managers to create a detailed plan to get the job back on schedule. If necessary, we will use an “all hands on deck” surge to get a tardy project back to the original timeline, but only if doing so does not sacrifice quality.
Does this mean we always meet our original projection? Of course not. Even if we were perfect (we’re not), there are too many variables beyond our control to be able to make that commitment so many months in advance. Any builder who tells you to the contrary is not building a truly custom home. What it does mean is that our project managers are aware, every day, where they stand relative to the baseline schedule. And our clients are too.
We would be happy to let prospective clients test drive the system. Just give us a call to set up a no-obligation demonstration.