Do What Only You Can Do

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That we're near the end of a year that feels like it began yesterday astounds me.

December 01, 2002

 

Heather McCune, Editor in Chief

 

That we're near the end of a year that feels like it began yesterday astounds me. Along the way, each of us had days that would never end and weeks that flew by. Wrap the long and the short together, and 2002 soon will be but a memory.

In our industry, these past 12 months have been the stuff of both dreams and nightmares. Low mortgage rates and pent-up demand resulted in new home sales rates that have been the one bright spot - as well as the prop - in an economy still struggling to find its way to sustainable health. This stuff of dreams can turn a bit dark around the edges when we get caught up in the "national" picture of the housing industry. What we all know and what almost all the commentators forget is that housing is the most local of businesses.

Getting too focused on the national picture can divert attention from a local market condition that may be very different. For this reason, a comment by Pam Sessions should resonate with all of us. Ask the CEO of Hedgewood Properties, PB's 2003 Builder of the Year, what her goals are for the company, and you'll probably get the same Jerry Garcia quote I did. "Don't worry about being the best of the best. Just do what only you can do."

What a perfect statement to describe the mission and focus of the company that PB's editors believe best demonstrates a successful model for top- and bottom-line growth in home building today. Hedgewood Properties builds in the Atlanta market, where housing has averaged 30,000 starts a year. The company, run by Sessions and her partner and husband, Don Donnelly, isn't a big player in this market when the tally is counted simply in units. In every other measurement, Hedgewood is one of the market - and industry - leaders. The short list follows; the long list - and the ways you can learn from Hedgewood's success - begins here.

 

 

 

 

  • Infill locations: Rather than fight the volume-building Giants for large tracts of land, Hedgewood seeks out desirable smaller development parcels. Lots in established neighborhoods carry a healthy premium and keep Hedgewood out of the head-to-head price competition - and margin erosion - that afflicts builders in new home alleys.

     

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  • Sustainable construction: To Hedgewood, green building isn't the latest fad; it is an obligation. EarthCraft, the green building program developed by the Greater Atlanta HBA and Southface Energy Institute, is the tool Hedgewood uses to ensure that its homes offer buyers a healthy home environment that costs less to operate and ages well.

     

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  • Authentic design: At Hedgewood, home design is the brand that sets the company apart from the competition. Delivering distinctive design means monitoring thousands of details. The only way to accomplish this: put responsibility in the hands of the community builder and sales agent, who know the Hedgewood way, and marry their knowledge to the voice of the customer.

     

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  • Flat organization: Near-total P&L responsibility rests with the builder and sales agent in each community. The role of Don and Pam: to coach their entrepreneurial staff on how to do rather than doing themselves.

    Like a lot of midsize, single-market builders, Sessions and Donnelly didn't get this successful or this smart the first time out. Hedgewood, seeking to capture a larger share of the Atlanta market, reorganized for growth. Layers of management, a new computer system and a lot of volume resulted. So did a disconnect from the customer and a general sense that the essence of what made Hedgewood unique was disappearing.

    This brings us to our second quote that seems to describe Hedgewood - and all companies that seek to be successful. This bit of wisdom comes from Alvin Toffler:

    "The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn and relearn."

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