As I am reaching 75 years of age, Emma and I have been talking seriously about retiring. But I don’t think we will ever fully retire. Recently, someone asked me if they could still reach out and if I will respond. The answer is we will always respond. My definition of retirement is changing the priorities to spending more time with the nine grandkids, sailing on our boat, and a few other items on the bucket list.
Over the last few years, I have been actively planning to make sure the legacy will continue. We have in place an extraordinary team I have been working with for over 20 years and who are dedicated to our teachings. They are very knowledgeable, with many years of experience in the industry and ready to continue our work of fostering excellence in management, customer service, and operational performance with the reward of superior profitability.
I have been gradually turning over more and more of the seminar training and consulting to the team. Shinn Consulting has had a strong history of demonstrated results, and my team will continue that track record. Many of our clients are repeat award winners and leaders in their communities and achieve superior profits consistently. We help clients transform their organizations by addressing problem areas and building systems to deliver results that will endure.
On the Builder Partnerships side, we started 13 years ago with a group of 35 builders. Today, we have more than 1,300 builder members and 75 manufacturers and service provider members, and we continue to grow and innovate.
As Emma and I transition from the day-to-day operations and pass the torch to the team, we plan to summarize our 50 years of experience, observations, research, and involvement in home building by writing a book on how to manage and operate a well-organized, highly profitable private home building company.
Here is my challenge to you. Always stay vigilant and don’t get complacent. The housing industry is highly leveraged and cyclical. During my 50 years, we have experienced four housing cycles, each having over a 52 percent drop in housing activity. During the last cycle, the industry dropped 80.25 percent. The builders seem to always be caught off-guard when the cycles occur. They are over exuberant when they should be cautious. Watch your leverage on speculative inventory homes and land. Land forces builder bankruptcies, so watch your land acquisitions carefully.
Pay attention to management principles, implementing systems and procedures that are consistent, reliable, efficient, and effective. Maintain the discipline to enforce the adherence to established policies and procedures. Continually strive to improve your company and team.
There is no finish line. You can always do better. Establish goals throughout the company for improvement in scheduling, purchasing, product design, customer service, productivity, and profitability. The goals have to be motivational and obtainable.
Develop a plan for reaching each of your goals and document every variance from your plans. Take action to eradicate all variances. Once you reach the goal, establish a new goal and develop a new plan to reach the new goal. We have builders consistently making over 20 percent net profit, but it didn’t happen overnight. It was a consistent ratcheting up of the goals over years of dedication.
Emma and I have had a great ride helping the industry move from a cottage industry with little or no management systems and discipline, into the mature industry it is today. During our tenure, the baby boom generation dominated the industry. As we turn the reins over to our next generation of management consultants, the industry is changing to meet the millennial generation which will
be driving the housing industry into new challenges.
We wish you the best in the years to come. Please reach out every now and then to let me know how you are doing. I love hearing from all my friends!