Currently Reading

Garman Builders: Building a System for Growth and Excellence

Advertisement
National Housing Quality Award

Garman Builders: Building a System for Growth and Excellence

2019 National Housing Quality Award – Silver Award Winner | Garman Builders


By Mike Beirne, Senior Editor October 4, 2018
Garman Builders' senior management team
Since graduating high school in the 1980s and ’90s, the Garman brothers have worked full time in the business their father, Ivan, founded. From left: Jason, president of construction and customer care; Shawn, president of operations; and Mike, president of land acquisition, development, and sales. (Photo: courtesy Garman Builders)
This article first appeared in the October 2018 issue of Pro Builder.

When the Garman brothers won their 2016 Bronze Award, the NHQ judges commented that Jason, Mike, and Shawn were good builders but they needed to figure out where they want the south central Pennsylvania company to be in the next five years. Garman Builders had to identify and understand what would be required for future land acquisitions, capital, staffing, process, technology, and training to achieve consistent quality management.

 

Garman_Builders_Fact_Box

 

Three years later, this 2019 Silver Award winner has moved leaps and bounds from merely having vision, values, and a mission statement to formulating one-, two-, and three-year strategic plans with supporting goals and metrics to gauge progress. The trio became more proactive by forming a leadership team with department heads who collaborate on strategic planning six times a year with a consultant. The senior managers then share the plans with their departments. 

They also delved deeper into developing an organization that is system- and process-oriented. When departments recognize that a process is absent, they create one—as the construction department did by drafting a written policy to define the purpose of trade partner surveys and when and how to use them. Job prospects are screened using a 12-step process that grades applicants as A, B, or C players before selecting candidates for a series of interviews. New hires are onboarded into a customer-centric culture inspired by Steven Covey’s book, The 7 Habits of Highly Effective People with an experience that includes meetings with supervisors 30, 60, and 90 days after starting to review goals, expectations, and needs. 

Garman Builders_Davenport model.png
Garman Builders' Davenport model.

Garman generated $27.9 million in revenue, 74 closings, and had 43 employees when it was a Bronze winner. Last year the builder’s annual revenue was $43.6 million with 136 closings and 85 employees. The company aims to close 200 single- and multi-family units by 2020, and has an audacious goal to hit 500 sometime during the next 10 to 25 years. It’s also opening a $1 million design studio in January. 

“We have gone through the NHQ process twice, and we couldn’t have gotten here without it,” says Mike Garman, president of land acquisition, development, and sales. “I haven’t even contemplated if we could have gotten here without NHQ. Between the self-evaluation and the process that the rest of the team had with their parts of the application—I’m looking at NHQ binders that are 2 ½ inches thick—it’s just an incredible amount of information we pulled together that we use to sell homes every day, and it also makes us a better home builder.”

NHQ and strategic planning have given the Garmans a better handle on land management. They use a system that correlates turns per year and how long it takes the builder to go from lot to house, with lot inventory, absorption by community, absorption by quarter, and other data to forecast how much land they need, when a neighborhood is going to finish, and what will be needed for the next community Garman is moving on to. 

“One of the things we realized through our strategic planning and specifically looking at land was the need to set realistic expectations,” says Shawn Garman, president of operations. “We used to think that once we got a piece of ground with finished or improved lots, we could be selling a house within five to six months, when really it was closer to 10 months out. So just having realistic expectations set us up for success versus failure, which is a really big motivator for the team.” 

Garman Builders is also in the beginning phases of analyzing market research to identify buyers. The builder is well acquainted with its base of 55-and-older customers, but there also are young families and other groups that can be organized by county and neighborhood into categories of people who buy for prestige, convenience, lifestyle, location, and other variables. The research so far has led to identifying 10 homebuyer groups.

“We are early in that process, and as we go through it we will better be able to target who is our No. 1 buyer group, who is No. 2, and No. 3. That will allow us to also seek out land, lot sizes, and home sizes for those potential buyer groups,” Shawn says. 

Garman Builders_Davenport_great room.png
The great room in Garman's Davenport model.

The Garmans knew back in 2015 that they build good houses, but they also understood that they needed to become business professionals if they wanted to scale up. Since then, they’ve operated with a mindset of finding and honing a process. During the on-site visit, one of the judges asked the brothers: If you had to leave town tomorrow and couldn’t check on the business for six weeks, when you got back, what would be the first two questions you'd ask to find out what was happening at the company? 

That question may have been posed to expose a weakness, or as NHQ calls it, an “opportunity for improvement,” but Jason Garman, president of construction and customer care says he took it as a process and systems question. “My thought process from that exchange was: What report can I get from my team, so I would know what questions to ask?” he says. “What reporting mechanism can I put out there that shows our strengths and weaknesses, and what questions am I going to ask that can help me expose the problem? And then, behind all that is the work needed to develop a system that will allow you to get those questions answered.”

See more 2019 NHQ Award winners

Written By
Senior Editor

Mike is the senior editor of Pro Builder and Custom Builder magazines. A two-time Jesse H. Neal Award winner, Mike has nearly 30 years of journalism experience plus numerous news and feature writing awards, including honors from the Society of Professional Journalists, the American Society of Business Press Editors, and the National Association of Real Estate Editors. He also operated a masonry restoration business for more than two decades. [email protected]

Related Stories

National Housing Quality Award

Apply NOW for the National Housing Quality Award!

Applying for the housing industry’s top business award will help your company improve profitability, achieve better customer satisfaction, and sell more homes

National Housing Quality Award

The National Housing Quality Awards Journey

Our four 2021 National Housing Quality Award winners experienced both validation and reckoning through the judging process this year. On this…

National Housing Quality Award

2021 NHQA Winners: 4 Home Building Companies Striving for Better

The annual National Housing Quality Awards recognize four home builders for their commitment to continuous operational improvement

Advertisement
Advertisement

More in Category




Advertisement
Advertisement

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.