If there’s one common thread among the six builders featured in our article on fast-growing builders (“Big Gainers” ), it’s the absolute importance of keeping the core team intact during the downturn. When the housing market started to crash in 2006, builders understandably kicked into survival mode. Many chose to let their most experienced and talented (and costly) employees go as part of their operations trimming process.
Not this group. They made the strategic decision to retain their best and brightest employees, even during the market’s darkest hours. Take Washington, D.C.-area builder EYA for example. The company saw revenue grow 24.5 percent from 2010 to 2011, to $113 million, and nearly 100 percent from 2008, thanks in large part to its investment in its core team, according to EYA president Bob Youngentob.
“It was hard to carry the overhead through that period of time,” said Youngentob, “but we felt it was something we had to do because we knew the cyclical nature of the business meant we were going to come back. And having to go out and re-hire key people would have been much more challenging than taking the hit to keep them on board during the downturn.”
If you’re like EYA, and some of the other big gainers on our list (namely Lombardo Homes and LGI Homes), you too are likely reaping the rewards of keeping your core team intact. However, as the housing market comes back to life and builders across the country look to expand their reach to capitalize on the growing demand for new homes, the search for talent is heating up. If you think keeping your superstars was difficult before, just wait for the opportunistic builders and headhunters to come calling for your most valued employees.
One builder who made our list of fast-growing firms declined to be interviewed strictly out of fear that headhunters would target his key team members after seeing the press coverage. The builder, who asked to remain anonymous, said: “My market is really starting to heat up, and everyone is fighting for trades, superintendents, salespeople — it’s a slugfest,” he said, adding: “Keeping the team together is without a doubt the key to our success. These are the best of times, but they can also be the worst of times if you’re not careful. As the public builders heat up and want to throw cash out there, they’re going to need to ramp up with people.”
My advice to you: If you haven’t done so lately, sit down for a one-on-one conversation with your most valued employees. Make sure they’re happy, fulfilled, challenged, and feel compensated for their work. If you hear any doubt in their voice, then take action, because other opportunities are going to present themselves during the housing recovery.