Category Archives: Best Practices

Enterprise Resource Planning from Constellation HomeBuilder Systems

 

You’re a homebuilder…

Homebuilder with too much Software

You’re great at building homes, communities, and condominiums. But the peripheral requirements of homebuilding can become a complex mess of estimates, options, upgrades, schedules, contractors, contracts, financing, cost allocations, warranties, and much more. Not to mention your trades need access to their schedule and your customers need a copy of their dishwasher warranty.

You understand this problem because you live it every day – managing the internal and external teams that are required to build a home. Our solution is Enterprise Resource Planning (ERP). Manage your resources – people, materials, time, and money – throughout the homebuilding process with one software system.

Let’s walk through the process of building a home with powerful software:

It all begins with your customer, relaxing on the couch, browsing your available communities and models pulled right from your ERP and displayed on your website. Your prospective customer completes a form to request more information: it looks like we have an interested buyer!

Prospective Buyers at HomeA personalized, automated message invites your prospective customer to visit your sales center. Your sales team finalizes options and upgrades with the customer, and the contract is signed immediately – or at electronically from anywhere in the world.

Takeoff immediately as purchase orders are pushed directly to your approved vendors and trades. Trades access schedules, documents, and purchase orders in the field – and receive automatic notifications of any changes or updates.

Meanwhile, land developers can acquire and develop land with tight controls over schedules, changes, and costs – tracked and costed through to the completed sale.

Construction hits a milestone: framing is complete. Once checked by your superintendent, electronic payment is released, or the trade is notified of exceptions. Notify your customer to keep them excited – they will want to tell their friends!

“Welcome to your new home!”

Home is Complete!A welcome message invites the customer to one of the happiest moments of their life. Walk them through their brand new home, complete the inspection and signoff immediately.

Track your revenue with specialized accounting features for homebuilders – and dashboards to monitor the entire process.

One partner. One solution. Powerful software.

Watch the video below for the full story – then request a live demo of our software solutions. Our team of homebuilding software experts can provide a consultation of your business needs and recommend powerful software to maximize your resources.

 

 

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Neal Communities is the 2015 Builder of the Year

Professional Builder, North America’s leading business publication dedicated to the home building industry, has named Neal Communities its 2015 Builder of the Year. The Sarasota-Fla.-based firm is the 49th builder to be honored as Builder of the Year by Professional Builder.

“With closings approaching 1,000 homes in 2015, Neal Communities did better coming out of the downturn than many companies did during the boom,” says Professional Builder Editorial Director Denise Dersin. “Neal’s focus on acquiring the best land and creating sustainable communities, along with its ability to hire—and keep—one of the best teams in the business has made it one of Florida’s fastest-growing home builders.”

We salute Neal Communities’ ability to weather the housing downturn by recognizing the trend early, finding a sold strategy, and putting a plan into action with strict controls to ensure success. The competition has noticed. Neal Communities was able to not only survive, but thrive through the downturn, and now sits on thousands and thousands of acres of prime land in Florida, without the typical bank loans to go with it. They are positioned for growth as the market rebounds toward a new normal. And they did it all while remaining loyal to their team – the Neal “family”.

“At Neal Communities, our entire team is deeply committed to improving the lives of the people we serve with superior customer service, products and value,” says Patrick Neal, owner and chairman of Neal Communities. “I could not be more proud of our dedicated team of exceptional home building professionals who inspire me to work harder every single day. To be recognized for excellence with this prestigious award is a special honor that we are humbled and pleased to accept.”

Congratulations to Neal Communities!

Continue reading via Professional Builder magazine.

To learn more about Neal Communities, visit their website.

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Process Makes Perfect

Did we mention process?

John McManus write for BUILDER Magazine:

What comes to mind for many leaders in home building, as they try both to make their 2015 numbers and project forward to model business for 2016, is a need for and a breakdown in processes. This makes sense. Many–if not all–companies let go of many people during the bad years, from 2007 to 2011 or so. They tried to hold on to the ones they could not do without, the best and the most productive, and the most expert in their fields.

As the market rebounded, these same industry leaders begin to rebuild, adding new talent to the existing experts to build operations in preparation for the big bang – the long-awaited surge in starts.

But what about process? The operations of a 2006 home builder should not be the operations of a 2016 home builder. Right?

Times have changed, people have changed, and maybe most importantly, technology has changed. It is so easy to rebuild what was – that is a basic human instinct. If something was taken from you, get it back, even if you have to build it from scratch. To ruthlessly pick apart that process is much harder – and it requires a real commitment to change (or at least the possibility of change).

But what about process? McManus notes LGI Homes as an example of process born in a time of very tight margins. Combined with a culture that permeates the entire organization, LGI has been successful adhering to their strict process. And it works – LGI makes dreams come true with their “why buying makes cents” approach to first-time buyers. This cannot happen without process, every step of the way.

Do companies, large and small, need to map new processes that avail of access to richer streams of real-time data, whether its discovery into “the who” of a potential customer base, the “when” of subcontractor crew schedules, the “what” of fire code compliant sub-flooring, the “how” of getting manufacturers to collaborate to develop new home systems ranging from kitchens to exterior finishes, to room comfort systems.

The bottom line is that yes, process is important and yes, process needs to adapt to a changing world of technology. Process does not and cannot exist in a vacuum. Take a moment to look at your company’s process through fresh “2016″ eyes, and tell us what you see.

Our business process review can help. Our home building software experts will look at your business with our knowledge of home building technology and processes that comes from working with hundreds of builders across North America. If you are interested in a business process review of your company, send us an email.

Continue reading “The Process Dilemma” at builderonline.com

See below an illustration of LGI Homes’ culture and process from the perspective of a first-time home buyer.


The Big Picture: Why Buying Beats Renting – An infographic by the team at LGI Homes

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Home Builder Software: ERP vs. BOB

Integration is the key!

A lot has been written on this subject over the years, but most of the verbiage has dealt with generalities. Builders have asked me to explain some of the differences and I have tried to relate these differences to their business.

The Best of Breed (BOB) solution is usually interfaced together by one of the vendors involved in the solution. Indeed there are solutions available that require a vendor of accounting software, sales software, project management software and customer service software. The system interfacer will claim that they have married together the best of all solutions on the market, by bringing together four databases. Let us consider this claim when it comes to a comparison the truly integrated Enterprise Resource Planning (ERP) software.

Consider for instance an integrated ERP customer service module:

  1. Does it integrate to the purchase order module, in such a way that warranty staff are able to easily determine who did the original work on the lot?
  2. Does it integrate to the sales module so that all customer information and option selections are automatically transferred over?
  3. Does it integrate to accounting module to the extent that all work on the lot that cannot be charged back, is automatically posted to the warranty cost code in the costing module?
  4. Does it integrate to the accounting module to the extent that all backcharges approved by customer service, automatically reduce the payment to the errant subcontractor on the next pay run?
  5. Does it integrate to the purchase order software to allow warranty to issue customer service purchase orders that can be tracked through the normal process of the builder?

These are integration questions from just one module! Most or all of these will not be handled by BOB software.

Consider other more general questions that I have found important to the builder:

  1. Is the production software integrated to the extent that the closing entry to the general ledger with all the associated Work in process and Cost of sales entries (etc.) automated on a lot by lot basis?
  2. Can sales see the current status of all lots in a community by virtue of having the schedule integrated to the sales module?
  3. Can the approvers of an agreement run a margin report on a new prospective deal by virtue of having the budgeting and costing software integrated to the sales module?
  4. Can the builder run a report with data from all four BOB modules? An example may be where the CEO requires a field from warranty to be included in a required accounting report. As a general rule the BOB supplier would recommend that the builder set up yet another database to consolidate the reporting.
  5. The vendor portal in most solutions does a good job with purchase orders. However does it integrate to the accounting software to the extent that the trades can see the check number and amount that paid the purchase order?

I could go on and on but true integration that pays back to the builder.

One objection pointed to the ERP vendor is that you have “all your eggs in one basket”. Check out the ERP vendor you are dealing with as it may be that the vendor is on very solid financial ground. In a BOB solution you must do due diligence on say four vendors, any one of whom could bring down the solution which no one really owns. Will any one or all of the vendors continue to be a best of breed vendor? Who decides this?

When problems occur in an ERP solution it is one call to one vendor. In a BOB solution you would be faced with four numbers. Many times they may say the problem is another vendor’s problem.

Don’t get me wrong, I have seen BOB solutions function but usually to the extent that IT resources are hired to run it. The running cost of a BOB solution has to be higher because of the databases involved and the resulting reporting requirements.

I ask the reader one question. If you built a software solution, would you not want to be in complete control of it?

Share this article or connect with Simon via LinkedIn.

LinkedIn: Simon Gardner

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BIG BUILDER: Four Live-or-Die Dimensions

You can’t manage what you can’t measure; you can’t improve what you can not recognize.

An excerpt from Fletcher L. Groves, III via Big Builder…

Over the years, I have learned to reduce everything to its essence. Improving operating performance and business outcomes comes down to getting the job done in four critical areas: (1) developing a strategic and marketing discipline; (2) having a clear perspective towards how value is created; (3) creating a business context in which everything makes sense and generates the right sense of urgency; and (4) developing a focus on managing operations and solving problems as a system.

…a Strategic Discipline.
…a Horizontal Perspective.
…a Business Context.
…a Systems Focus.

…continue reading via Big Builder.

Before we begin implementing software, we sit down with homebuilders to plan how their software will impact their business, and vice-versa. We call this a business process review (BPR), and it sounds a lot like Groves’ step 4. With your strategic discipline, horizontal perspective and business context in mind, we take a deep dive into your current processes within the framework we have developed over years of working with large homebuilders.

The first step in a traditional BPR analysis is to define all projects expenditures, creating a structure to collect and evaluate costs, making sure that no elements are overlooked. Similarly, the BPR analysis creates a framework for understanding and quantifying the potential benefits that a solution can deliver. Many believe that it is too difficult to quantify potential benefits, and therefore avoid evaluating their processes. However, by decomposing the potential benefits of savings, and tallying the business processes researched into non-denominational units of effort (Effort Units), it becomes easier to uncover potential gains, and begin the quantification process.

Request a consultation, a demonstration, or a full business process review.

 

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