By Linda Case. Design/build is alive and well and continuing to evolve. Last month, I talked about some new operating methods design/build companies use to improve their businesses. This month, I'd like to share some ways companies prevent themselves from getting stuck at the design stage.
Put design in the schedule. Design benefits from scheduling just as construction does. You, as the expert, should be setting up the system within which the client operates. Clients need to know how the process works. That includes timing. As soon as they sign that design contract, show them the typical design schedule for a project of their size. Set those up-front expectations. Will it work every time? No. But it will work often. You will not only be imposing client discipline, you'll be imposing discipline on your company not to wallow in the design swamp as so many companies do.
Use a letter of intent. Many design/build companies suggest that their clients sign some sort of binding legal document once the design is far enough along to meld budget and scope. The client puts up a significant retainer/deposit and a place is reserved for them on the construction schedule. This creates a sense of urgency for signing on for construction.
Corral the product selection demon. Getting product selections from clients is a difficult issue for design/build companies, especially when working for the truly wealthy client. There's no cut-and-dried formula, but I have heard of some clever solutions. One company puts their own selections in bold and replaces them with client selections when, and if, they're made. If the client can't select on time, the company's choice is installed instead. Another company builds a 2% bonus line item into the bid. If the client makes all selections on time, this 2% is returned to the client. Another suggestion: Build 10 hours of an interior designer's time into the contract. The designer will help make selections and add creativity to the project.
Use a procurement schedule. A procurement schedule is a subschedule detailing the steps involved in acquiring special order materials for the project. The procurement schedule indicates, for instance, that the ceramic tile for the bath that's scheduled for installation on February 20th needs to be ordered by November 18th. Using a procurement schedule ensures the on-time flow of materials to the job.
Add a "packager." As design/build companies grow, they often develop a new position to act as the liaison between sales and production. The position requires a detail oriented person to take rough paperwork from sales and package it for production. This is necessary because, often, top salespeople are not detail-oriented. Yet production needs to have all those details nailed down before the job starts. In smaller companies, this function can be undertaken by the estimator.
Standardize, standardize, standardize. Are the products you supply standardized with exceptions made for custom selections by the client? Do your subs have a list of standard specifications that will prevail unless otherwise noted in the paperwork? Are your plans standardized so it's clear what kind of information must be included and where that information will be found? Standardization, even in a custom business, will save you time and money. It will also reduce errors.
Remodeling is an industry that can be slow to change. But by getting out and about with your fellow remodelers, you'll be on the cutting edge of the innovations that occur. So get schmoozing. The up and coming Remodelers' Show is a great place to start. I look forward to seeing many of you there. I will be teaching a three-hour workshop on "Superstar Employees: How to Hire, Train, Motivate, Pay, and Keep Them," and a 90-minute seminar on "Defining and Developing Your Company Culture," a critical issue for the larger company but highly pertinent to all. Come by and see me.
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--Linda Case, CRA, is founder of Remodelers Advantage Inc. in Fulton, Md., a company providing business solutions through a network of experts and peers. (301) 490-5620; [email protected]; www.remodelersadvantage.com.
