Charlie Scott has more than 25 years of hands-on homebuilding experience, much of this in senior management positions with an award-winning, nationally recognized Midwest builder. He credits a "Voice of the Customer" firm as instrumental in his home building company's strategic growth and success. Today, Scott is an owner of that "Voice of the Customer" firm—Woodland, O’Brien & Scott—and helps North American home builders grow their own customer-centric cultures, pursue operational excellence, and increase referral sales.
Most home builders and those that work in the homebuilding industry reside on the shore of the pursuers of happiness and have ingrained within them the work ethic to give this pursuit a grand effort.
Do you remember the last time you received a piece of personal U.S. mail (not counting bills)? According to a recent study, the average American receives a piece of personalized U.S. Mail every six to seven weeks – and this includes birthday, holiday and other family generated cards. Wow, what a metamorphosis in personal communications in the past 20 years!
I read thousands of customer surveys every year – THOUSANDS! This customer insight gives me a unique perspective on many home building topics, like today’s “Finding Your Special Agent 007s For Huge Sales Increases."
When I was part of a growing home building company we learned to be on guard for the newest “technology” coming down the pike that promised to revolutionize our home building business. We called the condition of falling for these fantastic technology claims the “allure for the sexy lady of technology.” Thirty years later, it is safe to say, some things never change. Before I expand on the latest siren of technology, let me give you the results of a couple recent studies.
It is not a secret to regular readers that increasing a home builder’s customer satisfaction increases referral sales. Many home builders blow away the 15% national average of referral sales and achieve 40-50%, by virtue of meeting the customers’ hierarchy of needs and having in place a respectful referral sales strategy.
The market bottom is clearly behind us, and this is validated by three very reliable indicators. First, annualized home starts have more than doubled from the Spring of 2009. Second, consumer confidence (and therefore builder confidence) continues an upward trend, and for regular readers, you know these are good predictors of sales activity for the next 6-9 months! Third, and my favorite market turn around indicator, is that the Salesperson Auto Indicator (SAI) has turned positive.
There is no question that Lance Armstrong has one of the most unique comeback and sporting histories of all time. He was a little known triathlete, cancer survivor, turned seven time Tour de France winner, and founder of an extremely successful non-profit foundation, before dramatically falling from public grace by virtue of the U.S Anti-Doping Association (USADA). As a fellow cyclist and racer, I held Lance’s accomplishments in very high regard, adorning my office with Lance posters and a picture from our meeting after his 7th tour victory.
The first lesson that I learn
We all know that teamwork is an important ingredient in building great homes and great relationships with our customers. This importance is substantiated by Woodland, O'Brien & Scott studies showing that a builder's teamwork rating is a good predictor of future referral sales. Given the importance of teamwork, particularly as we head into a busier year end construction and closing season, the following teamwork fable may be helpful.
In the days before civilization, out on the prairie, lived four oxen: Randy, Todd, Scott and Chuck.
Performance bonuses have been around the homebuilding industry for a long time. Salespeople earn commissions and bonuses based upon their sales productivity, and Superintendents earn bonuses for their Quality, Budget and Schedule performance. For the most part, customer satisfaction bonuses were left out of the equation…until that is…a particular marketing company decided to venture into the home building industry with their version of “Customer Satisfaction” awards. Regardless of the accuracy or merits of that award program, it proved to be a performance bonus game change
Team sports analogies have long been used in home building for obvious reasons. They both have the common component of individual performances that roll up into team results. Home building is the ultimate team endeavor, made up of internal employees and external trade partners numbering into the thousands.
Why is teamwork important in home building? The answer is potent – customers' teamwork ratings are highly correlated to customer referring activity and future referral sales!