Home Building: Grace Under Pressure

 

Carl Grace, president and owner of Grace HVAC, awakes right at 5 a.m., as always, even on a Monday morning after a busy weekend. No alarm necessary. After 30 years in the business, that and many other things are on automatic. Not so much for his son Jeff, a college sophomore-to-be majoring in, “I’m not sure yet.” Carl rouses him and says, “Be ready in 15 minutes.” Jeff is working in the warehouse this summer for Fred, a long-time employee. A former field installer whose knees can no longer take the climbing and ladder work, Fred knows how to get the loads organized and keep the inventory down to the “low end of insane.” Carl shakes his head just contemplating that. If only builders could learn how to schedule, manage their options and selections, and stop with the late change orders already—-even half as well as his best builder Able Brothers Homes—-Carl knows he could take the inventory down 50 percent. It hurts to just imagine the six-figure money that would save.

In the truck on the way to the shop, Carl thinks about everything on his plate today, which among many other things includes submitting final bids for two big projects that could fund half of next year. He had hoped to spend these morning drives with Jeff talking through business issues but Jeff, like most other 19-year-old college kids, had a long weekend himself and is already leaning against the door snoozing. When Jeff was small he followed Carl everywhere, wanting to be just like him. But after watching what his Dad went through during the housing crash, Jeff is not convinced HVAC is the right career, even as the heir-apparent. Carl is unsure as well. Jeff is a smart kid and could probably go any direction he desires, but the dream that Jeff will take over from Carl just as Carl did from his own father is on the sidelines for now. Carl’s wife Linda is adamant that Jeff make up his own mind so Carl plays it low-key. 

Almost to the shop, Carl thinks through “the Jeff plan.” Fred keeps putting off having those knees replaced, and the delay will help with managing the warehouse this summer. But the surgery will come and Carl has no idea what he will do during Fred’s months of recuperation. Next summer Jeff will work with Tony, one of his best crew leaders and a great teacher for the young ones. The summer following, maybe in the office working with Rudy the estimator and Wanda, the fast-graying woman who spends all day, every day, chasing down POs, VPOs, plan errors, mistakes in options and selections, and God knows what else. He smiles just to think of Jeff having to deal with Wanda and what she calls her “stupid builder tricks.” Wanda is tough on them but somehow most of the builders maintain a grudging affection for her. Carl knows he’d be lost without Wanda. Would working with her turn Jeff off to the business forever? “We’ll see,” Carl says aloud softly as he passes the doughnut shop he finally weaned himself from. “We’ll just wait and see.”

 

After a quick stop in the darkened office to start the coffee, Carl and Jeff greet Fred as they walk into the warehouse. “You’re late!” That’s Fred, probably here since 5:00, getting things ready for the week. On the left side of the staging area Fred has five loads all together with a big green check on the pick list. Carl knows without looking those are for Able Brothers. They always have their orders submitted well in advance and exactly how Grace HVAC wants them. On the right side, Carl sees multiple pallets for McCain Properties, largely in disarray with multiple red question marks on the pick lists. Carl sighs. In between Able Brothers and McCain sits an assortment of loads for smaller builders, in various stages of readiness. “Hey, Junior,” Fred shouts. ”Make copies of every one of those McCain pick sheets and meet Wanda when she walks through the door at 6:30.” Jeff hates being called Junior. He is named Carleton Geoffrey Grace III, but in addition to using his middle name, he has always insisted on spelling it “Jeff” instead of “Geoff.” Asserting his independence. “She’s gonna be real glad to see you this fine Monday morning, Junior!”

Back in his office now, Carl sits down to make the crew lineup. Every week he resolves to get this done on Sunday night and each week he puts it off until Monday morning. Why ruin a good weekend? Twelve crews now, quite a bit better than the five Grace HVAC dropped down to during the housing slump. Still far short though of the 20 crews they were running just before his dad, Carleton, retired. He was glad his parents moved permanently to their place in Florida before the business completely tanked. Carleton offered to come back and help, saying he’d even cut tin, but Carl refused to consider it—45 years of toil was quite enough for one man. As he looked down at his own hands he could easily see the difference between the scars earned during his early days in the business and the more recent ones. When Carl dropped out of college after two years, Carleton’s idea of penance for wasting the tuition money was to put Carl with the very worst crew leader, on the worst job, no matter what. The fact that Carl worked twice as hard to prove his worth over any other apprentice was carved across his hands and forearms. When Grace HVAC reached its low point and Carl returned to the field for two years to install equipment in addition to running the business, he was surprised how much he had missed the simple joy of building something well with his own hands. Carl frequently planned to get out there again and bash some tin with the guys, but the current growth and requisite headaches just didn’t allow it.

 

Carl is jarred awake from his daydream as the back door slams open and Wanda’s chalkboard-scratching voice calls out, “Another week in the salt mines!” Fifteen minutes and the crew lineup is still blank. The guys would pull in any time now. The first ones were easy—-the five best crews went to Able Brothers. No-brainer. The loads are ready and 100 percent correct. Each job ready for the guys when they arrive. Sites always clean. With Able’s detailed, site-specific plans, clear specifications with accurate options and selections, Grace HVAC got the bid right the first time and they could actually build what they bid exactly according to plan. That should not be rare, but that’s the reality. Able Brothers also gets Carl and his team together to review the new plans in the early stages, along with the framers and other mechanicals. The time saved when there are no mistakes, redos, and wasted trips cannot be overstated. Why can’t all builders operate this way? Well, Carl thought, they could, but only a couple actually did. And Able pays on time, every time, like clockwork.

 

Everything is different with the big multidivision builder, McCain Properties. Their plans stink. The PO’s are never 100 percent complete nor are they accurate, and their field supers seem to believe in a correlation between the decibels of their voices and effectiveness. Even worse is the quality of the framers that precede Grace HVAC in the house and the plumbers and electricians who follow. McCain’s new regional vice president of supply chain, fresh from one of the big box retail outfits, recently declared a new strategy of being the “low cost provider.” Yet it is evident that the only factor in his cost equation is bid price. The results are new suppliers, trades, and crews that Carl’s guys have never seen before. With bad plans to start with and trades that understand less, it’s a perfect storm. Whereas at Able Brothers, there is almost no trade damage. In the rare case that it happens, the trades and suppliers all know each other and work it out. At McCain projects, the situation escalates into a war. Carl cannot even recall the last time he saw a back-charge from Able Brothers and his anger rises as he eyes the stack from McCain on his desk, all of which he feels are unwarranted.

 

Grace is never invited to work upfront on McCain’s plans, let alone walk the first model at frame stage with the other trades. If they had, the chases would be in the right places, properly sized with virtually all conflicts and collisions with framing and other mechanicals eliminated in the beginning. McCain’s schedule is so jammed as a result of their lack of upfront detail work that you can virtually guarantee the plumbers and electricians are coming in on top of you—-if, that is, the house is ready when you get there. And with that Carl begins to panic as it dawns on him that Gus, his faithful “scout,” is off on vacation this week. That means Carl will have to check the new jobs each afternoon to see if they are ready, something he never has to do with Able Brothers and a few other good locals. With McCain, it’s standard operating procedure.

A honk to open one of the warehouse doors tells Carl the first crew has arrived. Carl staggers them—-four at 6:45, four at 7:00, four at 7:15—-otherwise too many guys are just standing around. A few more good deals and he can install more doors and stage everything more efficiently. As much as McCain Properties drives him crazy, he needs their volume to fund his plans, which he hopes includes his son Jeff. “That’s the rub,” Carl thinks. McCain says they want five crews today, which would leave him only two for the loyal locals. Most of them are small fry, but they are great to work with, they look at more than just bid price and many began working with his dad years ago. How these guys love to tell stories about Carleton in the good old days. Now that Carl is older he finds it funny how sometimes they’d change a story or even stop in the middle of one, thinking they might divulge something Carl should not know. He loved those guys. They taught him as much about the business as his father did, and he hated to shortchange them. But McCain needs the crews and they will decide on his bid for 200 units this week. “This just sucks,” Carl says in a voice that he hopes no one else hears.

 

From the outer office he hears Wanda’s voice rise and the undeleted expletives flying. Carl half groans and half laughs at the thought of Jeff standing there, handing over the pick lists covered in red marks from Fred. “Those $%!#&@ McCains will be the death of me, I swear!” Wanda shrieks. “This is getting to be their standard freakin’ operating procedure! And do you know what’s even worse, Jeff? Well, do you?” Carl walks through the door just as Jeff is stammering, “Uhhhh...I hear they aren’t very nice?” “Nice?” Wanda replies incredulously, “Nice?! When I call them to straighten this mess out, they will act like complete jerks, as if it’s my fault they can’t draw plans, get simple specs right, get the options down, and quit letting their customers change them after the rough is finished! If your dad had half a brain, he’d tell those @%&$#&#s to...”

 

“Good morning, Wanda. Nice weekend, dear?” Carl already knew what Wanda wanted him to do with the McCain account and thought it was time to let Jeff get back to relieve Fred’s aching knees.

 

“Why, yes, Mr. Grace,” Wanda said in a syrupy sweet voice, with artificial charm and a wink toward Jeff, “Thanks for asking, sir. If you will excuse me I need to call our dear friends at McCain Properties and see if I can help them from wasting any more of your son’s hard-earned inheritance.” Wanda drives Carl nuts half the time, but she knows the business and the clients inside out and is as near to irreplaceable as anyone he’d ever hired. While this is going on, Sherry, the company secretary, accountant, expediter, scheduler, and smoother-of-feelings-hurt-by-Wanda has settled in at her desk after snatching the crew assignment sheet from Carl as she walked by.

 

Sherry looks up at Carl. “Okay, crew numbers one to five for Able Brothers and I know who they are, but another five for the Evil Empire? Which five? And are you really going to stiff Yancy and Prestige today, not to mention Chuck Ellis and Nelson Polsby? “Just wait, Sherry,” Carl says and turns back toward Wanda’s desk. Before he can ask her, she sticks out two pick lists attached to McCain POs at arm’s length, holding them like they were dirty underwear. “These stink so bad even McCain cannot expect to see our guys on these jobs. Well, they will anyway but here’s your ammo, boss,” Wanda says. 

 

“Alright, so let’s go with Chico, Ralph, and Ned for McCain, send the other four crews to our homies however you like, except for Nelson Polsby, don’t send Rick there, he doesn’t get along with Nelson’s superintendent. Push Prestige back ‘til Wednesday. Call in a favor.” Sherry looks up and says, “I think we’re all out of favors owed, boss, but I will make them an offer they cannot refuse.” Carl shakes his head and flees back to his office sanctuary, not even bothering to ask. It’s a few minutes after 7:00, the first trucks are just departing for the jobsites, and already things are in disarray—-and most of the problems are due to one renegade builder. “If they were only half as good as their ego,” Carl thinks as he sits back down at his desk with his third cup of coffee, “they’d be twice as good as they are.” A lot of big decisions to make yet today, and he’s just getting started.

 

Coming in next month’s issue: “Grace Under Pressure–Part II.” PB

 

Scott Sedam is President of TrueNorth Development, an internationally known consulting and training firm based in the Detroit area. Scott welcomes your comments, questions, and feedback at scott@truen.com. Find Scott’s LeanBuilding Blog on www.ProBuilder.com or www.TrueN.com, where you will find archives of past articles. You can also join “The LeanBuilding Group” on www.linkedin.com.