Take Your Trade Partners online
CraftMaster Homes builds single-family and multi-family homes in the Richmond, Va., market.
Final 2008 numbers aren't in, but even in this so-called “down market,” CraftMaster Homes built 87 homes in 2007, up from 70 homes in 2006. They have excellent positions in land options (around 300 lots wrapped up), and CraftMaster expects to survive and thrive even through the downturn. Their systems had room for improvement, though.
CraftMaster's homes sell for an average price of $285,000 and run approximately 2,300 square feet. They offer 23 plans overall, with structural options limited to about 10 per home and decorative options running around 30 per homes. With that many starts (87 in 2007), 23 plans and up to 40 options per home, that represents a great deal of house-specific information that has to be communicated from CraftMaster's back office to the trade partners on whom they rely heavily for every aspect of the home's construction. Also, because CraftMaster doesn't use a sales force or third-party sales tracking software, it depends entirely on local real-estate agents for its sales and contracts, further complicating the option's data collection system.
All of this activity keeps Tim Aloi, the vice president of operations, fairly busy, as he manages a staff of 10, along with 48 core trade partners. Of the 10 people on staff, four are project managers; three of them are always on-site, while one roves from site to site to tie up loose ends.
Beyond Paper-Based Communication
Until somewhat recently, CraftMaster was stuck in a paper-based world when communicating with their trade partners. CraftMaster is dependent on trade partner loyalty, and it has gone to great lengths to establish long-lasting relationships and treat them fairly. In exchange for that loyalty, CraftMaster reports it is always prompt to pay and offers as much warning as possible for upcoming work.
But CraftMaster's commitment to stay lean, nimble and customer-focused creates huge amounts of information that need to be communicated to the trade partners, sometimes with just minutes notice. Before some recent software implementations, CraftMaster's back office was spending a great deal of time on the phone with the project managers and trade partners to adjust schedules and make changes that naturally occur on each job. These adjustments and changes ran the gamut, from purchasing details to changes in costs and payments. Though CraftMaster could easily track these changes in its back office, it was still dependent on a paper-based communication system to send faxes or mail on a weekly basis to their subs in the form of purchase orders.
CraftMaster's purchase order is really a “super PO” because it serves multiple purposes. It's a combination work order, purchase order, and parts list. All the information a subcontractor needed is embedded in that purchase order, and it is the purchase order that the site super signs to authorize payment for work complete. You can only imagine the data reconciliation nightmare if a purchase order is changed or cancelled and has to be reissued. It was a document version-control nightmare. When accounts payable did its work (CraftMaster pays every two weeks) the employees responsible for accounts payable had to scramble to match a signed purchase order with the correct original, while noting variances, rectifying discrepancies and issuing payment, all the while fielding calls from many of the trade partners who were looking for their purchase orders because of lost papers, bad faxes, overcharges, etc. The estimator was called in to re-fax and reprint documents or argue changes that were not completed or signed off on in the field. The field employees' time was spent relaying information to the trade partners, as well as tracking down the correct purchase orders. CraftMaster was under severe pressure because of a flawed ability to communicate.
When CraftMaster Homes spotted a new Web portal for trade management, they jumped on it, and it has paid off in real dollars for work saved, staff reduction and some very happy trade partners.
Here's how it works. The Web portal that CraftMaster uses allows CraftMaster Homes to instantly share, in real-time, detailed information with its trade partners. There is no software to distribute to the trades, nor faxing, printing or filing. The portal allows CraftMaster to maintain a single database of its schedule, workflow management and transactions yet allows subs to access that workflow and view detailed information about purchase orders, work orders, schedules, warranty and payment status through any Web browser, 24/7. With its Web portal, CraftMaster Homes has taken an inefficient paper-based product and pushed it all onto the Web.
How was adoption of the Web portal by the subs?
“The trade partners love it,” says Aloi. “And believe me, I would know if they didn't because if anything goes wrong, I am the first guy they call.
“We required that every trade partner have access to the Internet and use the Web portal if they wanted to work with us. They saw it as an opportunity to get their paperwork in order. They are getting on the Web each night to check their schedules, pick up their POs, and see when their checks have been mailed. It's all on one screen.”
With the Web portal, each subcontractor or trading partner has a unique Web site that accesses a record of his or her activity with CraftMaster. A customizable “dashboard” showcases any updates or events that affect the trading partner while also offering a portal for best-practice sharing, company news and event information. Every Web portal uniquely provides secure viewing screens that offer critical data for individual trade partners, such as approved, issued or cancelled POs. It even allows trade partners the ability to assign which crews did the work associated with any purchase order or event schedules. (The schedules can be viewed by projected, scheduled or completion dates.) Schedule notifications can be automatically triggered through the Web portal's scheduling tool and delivered to any individual Web portal, or they can be redirected by the builder or subcontractor to an e-mail box or wireless device. And if CraftMaster wants to send documents or attachments, these also can be sent via the trade portal for all of their trades and subs to download or view.
Aloi estimates that CraftMaster Homes saves one full-time equivalent, as well as five to eight additional hours of existing staff member's time each week. So, over the course of a single year, the Web portal saves CraftMaster Homes two full-time equivalents (FTEs). “But the labor saving is nothing compared to the ease of handling information.” Learn more with a visit www.craftmaster-homes.com.