Move-up buyers are a fickle bunch, and this blog entry focuses on a Lean Design for that group.
Tomnitz Is Mr. Manager
Ego is a major force in the home building business.
Ego is a major force in the home building business. In the past, success stories usually involved ego-driven entrepreneurs compelling events to conform to plan. Horton’s story is different. Ego is still a driving force, but there’s probably more of it on display in the far-flung divisions, which operate with a high degree of entrepreneurial autonomy, than at the top.
|Mr. Manager: Don Tomnitz|
D.R. Horton Inc. is certainly Don Horton’s company. He founded it, and his vision guides it. But Horton’s ego is hard to find. The firm is led by three men, not one, with vice chairman Don Tomnitz and president Rick Beckwitt joining D.R. in an executive triumvirate. In Don Tomnitz, Horton found an organizational talent to pull together the disparate local businesses the company would acquire into one lean, mean, nationwide competitor. Today, all the region presidents report to Tomnitz, and he spends three days a week visiting divisions across the country.
There’s a lot of American military theory on display in Tomnitz’s methods. The U.S. Army trains field commanders to seize initiative and complete their missions even when cut off from higher authority. So does Tomnitz. It should come as no surprise, then, that Tomnitz comes from a military family and spent four years as a field officer in the U.S. Army.
Tomnitz, 51, graduated from Westminster College in Fulton, Mo., in 1970 and entered the Army as a second lieutenant. He left it in 1974 as a captain. "I grew up an Air Force brat," he says. "My father was a career noncommissioned officer. We moved to a new state or country every couple of years. I really grew to enjoy that way of life. I wanted to continue it myself as a military officer. My most important learning came during my four years in the Army, but my wife wasn’t as thrilled with that lifestyle as I was."
Tomnitz went back to graduate school and completed an MBA in finance at Western Illinois University in 1975. He taught there for a year while his wife, Sharon, completed her master’s degree. Then they moved to Dallas, where Tomnitz went to work for Republic Bank.
"I became an officer in the national accounts division, with New York City as my territory," Tomnitz remembers. "I called on Fortune 1000 firms as well as the Wall Street brokerage and investment banking firms. I loved New York. I was enthralled by big business. When we took Horton public in 1992, I loved it because it got me back to New York. I knew all the places; I was on familiar turf."
The couple contemplated a move to New York City in 1979, but Sharon was working on another degree at Southern Methodist University in Dallas. So instead, Don joined Crow Development Co., an affiliate of Trammell Crow Co., as a land developer selling lots to builders in suburban Arlington, Texas. That’s how he met Don Horton.
"I joined Horton in August 1983," says Tomnitz. "Of all the people I’ve met in business, Don Horton is the one I respect most. He’s an honorable man, true gold. You can’t say that about a lot of people in the real estate business."
Tomnitz started with Horton in land development and made all the requisite stops on his march to the top. From 1986 to 1989, Horton and Tomnitz traveled the country together to pick markets for remote divisions. From 1989 to 1992, Tomnitz ran the Houston division. From 1992 to 1994, he helped Horton launch the fledgling public company as vice president of land acquisition across the country. From 1994 to 1996, he headed the western region from offices in San Diego.
Through all those years, he maintained one trait that made it easy for him to stay on Horton’s good side. "From my days in the Army, I’ve been an early riser," says Tomnitz. "The Army does everything at ‘O-dark-30.’ It’s always at 4 or 5 in the morning. Of course, Horton is up at 3 a.m. When I was in San Diego, he used to call me at 2:30 a.m. Pacific time, and he’d been up for an hour. He’d say, ‘Are you up?’ And I’d say, 'Oh, yeah, Don, I was just laying here waiting for your call!'
"But I still get up between 4 and 4:30 every morning and run 4 to 6 miles. It’s the very best time of the day to think."
Of his relationship with Horton and president Rick Beckwitt, Tomnitz says, "We complement each other. Horton’s the best in the business with small groups. Because of my Army background, I’m more comfortable speaking before large audiences. Rick has talents on the acquisition side that neither I nor D.R. possess. We are synergistic. Ego drives a lot of the other companies in this business, but it does not drive this one."
Away from the business, Tomnitz has a young family to keep him busy. "We didn’t decide to start our family until Sharon and I had been married for 15 years. Our daughter, Taylor, was born in 1986," he says. Sharon left her position as a controller at Xerox Corp. when son Blake came along in 1989. They are all avid skiers. "We ski together three or four times a year."
Do the three leaders socialize together away from the business? "Not a lot," says Tomnitz. "We spend so much time at work that when we get away we really just want to spend time with our families. However, Rick is a skier, and we’ve joked about moving our headquarters to Denver. That’s about as likely as us ever getting D.R. on skis."
D.R. seems to have a better chance converting the other two to his hobbies. "Ever since the company bought the ranch in southwest Texas, I’ve learned to love it," says Tomnitz. "D.R. took me hunting last year, and I shot my first wild turkey. I humbled him because it was a 150-yard shot."
D.R. Defines Strategic Vision
Beckwitt Is Horton's Acquiring Mind