With a strategy based on continual price growth no longer viable, it’s those house builders who control their costs and reduce their time to build that will be the winners over the next 5 years.
Having spent decades working with house builders, construction firms and building material providers to help them dramatically reduce their costs – in one case identifying over £100m of savings for one house builder – we know where you should be looking and what you can do to quickly and effectively improve your operations to reduce cost and speed up your build. Ultimately improving your bottom line.
In this 4-part series, we break down the four key improvement areas that you should be focusing on to help you improve the performance of your sites, reducing costs and improving your time to build.
In our first blog we looked at Rework, your hidden factory. In today’s blog we look at the second of our four key improvement areas, Site Protection, the small changes that could save you £1,000s per plot.
To achieve the economies of scale necessary on your sites you’re no doubt following a structured waterfall approach to your build.
You’ll do all the groundworks, then build the shells and then move to fit out for 10, 20, 30 units at a time.
As we highlighted in last week’s blog these mistakes, accidents or damage to your units will cost you money. To combat these issues the industry has developed a vast array of protective measures – dust sheets for stairs, film for windows, caps for window features, plastic covers for sanitary wear, etc.
You no doubt have processes in your business to ensure that these are used and as you read this you may be thinking – “This isn’t a problem for us, we have protection processes in place across all of our sites”.
The problem for many house builders though is that while they will have detailed protection requirements written down, they are inconsistently applied. In a recent study for one major UK house builder we found that 69% of the plots sampled did not fully comply with the prescribed protection requirements, increasing the unnecessary risk of damage, rework and increased cost.
It is likely that if you reviewed your own sites you’d find a similar picture.
When you trace this issue back to its root cause it is often the result of a lack of clear processes, a lack of training and ineffective site performance measures.
While we have seen clear standards shown to us at head office, it can often be the case that these aren’t filtered down or are applied differently in each business unit or even site. If they are provided to the trades, they are often just handed over on a piece of paper, without much training or instruction about what they expect.
This, coupled with the way that sites are often measured – with a focus on the number of units completed instead of process adherence, number of issues or rework created – means that trades are often incentivised to complete their tasks as quickly as possible without as much focus on the way they leave the units after they’re finished.
As Management guru Peter Drucker said, “What gets measured gets managed” and this is a great example of that.
This model is tried and tested and we’ve used it across the construction industry to help our clients minimise accidental damage caused to their sites. So what is it and how can you use it to help minimise the unnecessary damage to your sites?
Below is the overview of the PMI mistake-proofing methodology:
Let’s look at each of these steps in detail.
Following these steps will help you dramatically improve the protection of your sites, reducing damage and improving your bottom line.
To minimise unnecessary damage caused during the build stages, most house builders will have processes in place which set out what protection needs to be used and when.
Unfortunately, due to a lack of understanding of these processes and the ineffective measures used to monitor performance these processes are often not followed. This leads to an increased risk of damage and higher costs on your sites.
By following our 4-step mistake-proofing methodology you can dramatically reduce the need for protection on your site and where it is necessary, increase its use to prevent damage from occurring.
In the next part of our series, we’ll be looking at Plot Utilisation and how you can make some simple changes to your processes to dramatically reduce the idle time across your sites.
If you don’t want to wait until next week you can download our detailed ‘Weathering The Storm’ eBook where we explain the tried and tested approaches that we’ve used to help firms across the industry dramatically improve the efficiency of their build programmes and increase their bottom line.
Download our Weathering the Storm eBook today!
If having read this blog, you want to take action but don’t have the knowledge or capacity to do so then that’s where PMI can help.
We have a strong heritage of working with house builders to help them understand where the issues are hiding on their sites and put in place effective improvements to turn their business goals into results.
If you want to find out more please get in touch with our Managing Partner, Rich Seddon: Rich.Seddon@pmi.co.uk
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