Employ the six quality methods used by winners of the NHQ award and you are on the way to the highest levels of customer focused building excellence. Why reinvent the wheel when National Housing Quality award winners are blazing the quality path for our industry?
Every NHQ winner surveys homebuyers on their satisfaction with the home and their builder. Getting ratings on what customers like and don't like provides a clear course of action for improving their satisfaction.
K. Hovnanian Enterprises surveys every homebuyer 90 days after closing. In addition to questions on the product, their customer satisfaction surveys also ask about their satisfaction with each step of the sales, construction and warranty processes. This feedback is used to measure performance of individual departments and to track progress.
US Home surveys homebuyers on their satisfaction with the value received from specific features and options. This "voice of the customer" is used to design homes that include features that add value and eliminate features that cost more than buyers think they are worth.
Kennedy Community Development asks homeowners to rate their satisfaction with the quality of workmanship for painting, drywall, carpet and the other key trades. Results are shared with the contractors and used to set quality improvement goals.
NHQ builders use inspections to assure that constructed quality meets their quality standards. Defects found are targeted for corrective action and prevention.
Hovnanian has inspection checklists for each stage of construction. The checklists help prevent problems because trades have a clear understanding of what Hovnanian thinks is a quality job. And when problems do occur, they are fixed before they cause complications with other trades or delay closing.
US Home quality control system culminates with a commitment to closing homes with zero defects. A comprehensive home inspection is performed several days before closing with the aid of a detailed checklist. Every effort is made to punch out each item before final walk-through.
Trade Contractor Partnerships
NHQ winners create win-win relationships with trade contractors. They take a leadership position to help trade trades do things better, faster and save money.
Kennedy developed a system of communication with the trades, and the trades among themselves. Each trade has a scorecard created by Kennedy and the other craftsmen affected by the quality of their work. On every home, each trade fills out a scorecard rating the performance of the trades that came before them. In a monthly meeting scorecards are reviewed and discussed. Every month adjustments are made to help make jobs run easier and smoother.
Hovnanian created a Stakeholder Council of key trade contractors to address identify improvement opportunities. Each quarter the council identifies one significant improvement project and forms a team to carry out the initiative. The company and the trades share the savings.
Teamwork and Mission
NHQ winning builders have a strong sense of teamwork working towards a customer focused mission. NHQ winners help their associates align towards these goals by creating a written mission statement of the company’s fundamental purpose and guiding values.
US Home's mission statement articulates the company's quality strategy for enhancing shareholder value by "constructing homes and developing communities of unmatched quality, and providing our customers with products and services that exceed their expectations."
Associates at Kennedy Community Development participated in working session to jointly develop the company's mission statement. More important than the words themselves is the consensus the associates developed among themselves for the company’s mission.
After creating the company mission statement, Hovnanian worked to make it come alive in the minds of every associate. Ara Hovnanian, the CEO, leads the way by visibly demonstrating a personal commitment to the company mission by using it as guidance during decision making. The mission is also reinforced at meetings, company events and in personal contact with employees and trade contractors. The mission and values mission statements gain high visibility by appearing on wall posters, newsletters and business cards.
A critical feature that separates NHQ winners from other builders is their use of performance measures. If something is important enough to do well, they measure it. In this way they know how well they are doing and can track results of improvement efforts.
Kennedy Community Development posts their performance measures on a data wall in the office. Every month new graphs of customer satisfaction levels, financial indicators, sales, and product quality are there for everyone to see. There is no question as to what is important and how well they are doing.
One of the things measured by Hovnanian is how well the company lives up to their mission and values. Employees are surveyed to measure perceptions on a wide variety of topics including teamwork, job satisfaction and continuous improvement.
US Home’s customer-focused performances as well as profitability are the basis for bonuses, incentives, and employee performance reviews. This helps reinforce the message that everyone needs to pay attention to more than just short-term financial results for the company to be a success.
Organized approaches to find and create new opportunities are the hallmark of NHQ builders. There are two types of improvement systems. The first are planned improvements that result from a business planning process. The other system seeks to involve everyone to submit their improvement ideas and using an organized approach to implement them.
US Home uses monthly warranty reports of the top 15 reasons for callbacks to set priorities for problem prevention. Teams are formed as needed to attack the root cause of prevent the problem from recurring. Month by month success is seen as warranty items that were on top of the list drop off.
Opportunity For Improvement (OFI) is Hovnanian's term for a program to encourage ideas from associates. Over 500 suggestions have come from employees and trade contractors as part of their daily work. Ideas ranging from simplifying designs for buildability to eliminating unnecessary paperwork are captured on forms. A committee sets priorities for implementation and monitors progress.
Kennedy goes beyond the traditional annual sales and budget plans by setting a series of quality improvement objectives that support long range goals of the company. Among these are continued development of the trade contractor partnership program, changing the warranty service process to improve response time, and simplification of process flows to streamline administration.
Now is the time for you to develop a quality improvement plan for your company. Start by setting objectives to implement any one of the six quality methods that will best benefit your organization. If you are a builder who has a foundation of all six-quality management practices, you are among the quality leaders and should consider applying for the National Housing Quality award.