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Why is a business model important to me?

The answer depends on whether you are a business person or a customer, but it is important to both.This blog reaches to both contractors and property owners alike, so I will address the importance to both.  Design Build Solutions, LLC serves both in differing relationships, but one capacity – improving project communication; thereby reducing headaches, making happy clients.

Homeowners

I speak to homeowners generally because they are our largest client base, by project numbers, but this applies to all property owners.  The model is important to homeowners because the model will affect how they are treated by their service providers (designers, architects, and contractors).  Remember what was stated before:  some business models are not fully intentional.  The business model of your chosen service provider will affect how you are treated by said provider before, during, and after your project.

How many times have we heard of homeowners getting the short end of the stick during their remodeling project?  But what about those projects in which the contractor or designer didn’t get fired?  Is the contractor pushing too fast to move on the project without complete review?  Is the project drawn as a 3D model and used to give a better perspective of the building process?  Does the designer or contractor leave his or her ego at the office?

Answering any one of those questions in the wrong way will negatively impact your project, and most often adds time and money to the project.  (Click here to see a short video of remodeling business model I espouse.)  Their business model will also affect how they perceive themselves in relation to you, the client (see the example business model below).

Service professionals

I speak as a service professional in the trenches with you.  Your business model is extremely important.  It is easy to start a business and assume that a business model either 1) isn’t needed, or 2) will come naturally.  Both assumptions can be fatal.  Your business model will affect your marketing, sales, communication, financial, and production.   If the business model isn’t firm and clear, the marketing and sales teams will make everything look peachy to potential clients, but production and return trips will kill everything that you’ve worked for, and ultimately ruin the financial outlook.

This is often the reason why business owners can’t move forward in their business; they cannot articulate a clear model for the whole team to follow, and thus they feel they have to do everything themselves. Having clear direction, coupled with clear communication, will make any business almost self-sustaining.  Both internal and external teams to the company will be happy to work, and ready with “the message” for everyone who asks – and sometimes those who don’t.

Example model

My video The Beauty of Design/Build was featured recently on a popular remodeling business blog (click here to see the video).  Some commenters believed that the diagram should be a triangle between homeowner, designer/architect, and contractor, instead of the circle I created in the video.  They felt that a triangle would better represent the symbiosis of Design/Build.  I understand that Design/Build is trying to improve the TEAM approach to remodeling, and I’m all for that, but let’s look at the triangle.

Consider the triangle TEAM approach.  Remember that the Design team and contractor team are delivering a service, not a commodity.  The Homeowner is the client.

Looking at this triangle, there isn’t much that defines which person is the client.  Each party in this relationship is equal to the other two.  It looks to me like the homeowner will have to manage both designer and contractor, the designer will have to manage both homeowner and contractor, and the contractor will have to…you get the point.  Let me ask you this…Do you want to be managed?

Compare this triangle with the circle I drew in the video.  The homeowner is in the center of the circle.  No, this doesn’t put the homeowner in-between the designer and contractor, and it doesn’t stop communication with the homeowner.  In fact, a circle model will force the designer and contractor to work with each other, not at odds.  As I stated in the video, “Now we’ve got a loop, or feedback system, that manages what the project looks like and how much it costs at the same time.  [This system] shows that both the designer and contractor are listening to the homeowner, and proving that both are working in the homeowner’s best interest.”

It makes a difference in the project no matter the size.  I’ve seen large and small projects benefit from this business model, and I’ve seen large and small projects fall using other models.

So, how’s your model?

So, I read about business and entrepreneurialism.  And I come across a hard truth.  The title of this article says it all…”It’s Not the Receission, You Just Suck!”

OUCH!

The author’s realm is in online marketing, but it can be applied to remodeling, restauranturing, chiropractic, or other businesses as well.

I’ll let you read the entire article at her website, but just repeat her 6 main points:

• Learn something new
• Work harder than everyone else
• Do the leg work
• Surround yourself with fighters
• Take risks
• Shut up!

Yes, I realize that there is almost 10% unemployment, and foreclosures are skyrocketing, and the future doesn’t look great.  I, too, have been party to complaining and whining about what has happened to me – and it is scary.  But, lately I’ve been thinking that this circumstance is an opportunity for me.

I’m a technical guy, and I love the service sector.  I’ve got some ideas up my sleeve to leverage my abilities and grow my income.  What can you do?  Remember, surround yourself with fighters!

Share your thoughts (no proprietary info though) and be counted as a business fighter!

However, to state empirically that the designer/architect should always take the lead on projects doesn’t add up to me.  My experience shows that clients do benefit greatly when the builder takes the lead.

Am I slamming architects/designers?No!  I am a designer – it’s hard to slam oneself.  But I do have reasons for saying that the the builder is a valid choice.

First, the builder is the one that is actually producing the physical product.  Whether the client is building a new custom home, or has commissioned a home improvement project, the contractor will be onsite and working with the client for the much larger majority of the time over the architect.

My next reason for stating this is the financial piece…the contractor will be invoicing the client for much more than the architect/designer.

This third reason may be seen as controversial, but I hope you will hear me out.  Relegating the design team to play second fiddle isn’t always a bad thing.  I can hear the hollering now; but I ask you to hear me out.  Since the contractor will be constructing the project, it makes sense that he/she have some serious input on the design phase.  An underlying point here is that the design phase affects the final investment cost, and since the contractor (not the designer) provides the financial piece of the puzzle, it would seem to make sense the the contractor has serious input.

Another reason that the design team should play second fiddle is that the design team – no matter how good they are; or how many awards have been won – will most likely never live in that project.  I agree that good design is great.  I can see that it might be important.  But it might not be as important to our client(s); who, by the way, is paying for our service, not our ego.  In reality, they are paying us for their ego!  And, that’s not bad.

I have presented many times, in many ways, that the Design/Build model should be a 3-way relationship:  Client/Design team/Production.  Having two of those parties (Design team and Contractors) argue over who should be in the lead – most often it happens because neither wants to play “second fiddle” – puts the most important player (client) out of the ring, and builds animosity between two important disciplines.

So, all of this aside, who should the homeowner call first – a design team, or a contractor?  Call someone whom you trust.  Call someone who has a reasonable system to handle your needs, dreams, and desires.  Potential clients, pay attention to how much the salesman talks.  He or she should listen 70-80% of the time, to you!  A professional salesperson will have insightful questions about you and your goals, not just your project.  Ask your salesperson about their team – do they work well with the other discipline?

Any project is a delicate dance of leading, following, speaking, and doing.  Which of those one is to do, depends upon many things.  Ultimately, final decisions are in the lap of the client.

Design Build Solutions works with homeowners and contractors; willing to lead, and willing to pass the baton when necessary.  Our team will make reasonable suggestions and passionate statements when necessary.

What do you think?  Do you have a different perspective?  I lean toward the builder taking the lead.  When we do start a project, and take the lead, we work quickly to getting the contractor involved, and allow the right person to “take the lead.”

When interviewing a remodeler remember this:

You are the client!

This means that you must ask the questions that protect yourself.  You know nothing about this remodeler sitting across from you selling their services.  How do you get to know the inside reality of this contractor’s business, and how will that affect you and your kitchen improvement?

Watch this video for one topic of discussion.

How do you ask questions of a remodeler (and how will a professional respond)?

I would hope that you can ask politely, and without shooting at will.  However, keep open to the idea of waiting to make up your mind.  Don’t make your decision in a vacuum, and don’t keep yourself waiting.

A professional remodeler will respond confidently, and with many questions of his or her own.  A professional remodeler will not start the meeting with a tape measure!  There are so many more items to address before you both address that bathroom that needs remodeling!

When you need help

Either you’ve never gone thru a remodeling project before, or, as more of our clients are reporting, their last remodeling or new construction project went so badly, you want to do this one differently.  Design Build Solutions is here to help you.  You don’t need to worry that your bathroom project is too small, or the kitchen remodel will not need help.  Our services are tailored to the need of each project, and we work accordingly.

Use the Google Voice icon on the right, or use the email before beginning that home improvement project.

Bathroom remodeling update

The bathroom above turned out much better.  Here’s the evidence.

Alert to Remodeling Contractors

This information is getting out to your clients.  Do you want to know how to do this mini-game effectively, within a system, producing repeatable results?  I would love to introduce you to several contractors who have done this, and the man who has created this system.

Email me to improve your business systems and win more clients!  I won’t sell you anything, just introduce you to those that are playing the game.

It does seem to be an oxymoron to say that one can save money by spending it.  Old adages about saving & earning pennies, getting what you pay for, etc., often lead one to sidestep what could be the most important part of any project: planning.  In order to save money on your next remodeling project, I believe we must discuss Proper Planning, Effective Presentation, and Critical Collaboration.

Proper planning

First, using the proper techniques of research and planning will fulfill a homeowner’s needs much better than what is often portrayed in popular TV home improvement shows.  Those shows only have 30-60 minutes of airtime, and interviewing a homeowner isn’t the glitzy, glamorous TV stuff that producers want to air.  Also, designers need to listen to their clients more.  There is nothing more frustrating to me than to hear a designer going on and on about what he or she sees in this project.  Let’s get this straight, the homeowner is living there, not the designer!  Ok, I digress, back to planning.

When a designer asks questions such as, “How many people do you entertain at one time?” or “What would you feel about something different, say moving the laundry somewhere else in the home?” he is looking for your taste and thoughts of how to provide an equitable solution to your needs.  There have been many occasions where a homeowner has one idea of how to provide a solution, where there may be another, even less expensive way to solve the problem.

The example that comes to mind is when I was first starting this business.  A local doctor was needing some more space, along with other needs to accomodate the handicapped.  Their thought was that they needed another 20 feet added onto the office.  After studying the floor plan, and the typical traffic patterns of the staff, I found that an 8 foot addition would provide the space they needed.  Planning saved them about 300 square feet of addition materials and taxes.  There are many other similar stories where we found the ability to make the project work using creative methods to not cause the typical “scope creep” or “Remodeler’s 15″ which both create a greater cost.

Effective Presentation

I find it amazing with the technology capabilities and availability we have, some are still working with tools from decades ago.  Many of our clients appreciate the ability to see their project in 3D before they settle on the design.  The accuracy and quality we maintain to build that model also helps the contractor make educated decisions about building the project.

Effective presentation also means that we are not stuck on the design we present.  This means that we don’t argue with the homeowner if they want it changed.  The good news is, many changes are easy.  Granted, it is rewarding when the client says that they love the design.

Critical Collaboration

The last key to saving money by design is the collaboration piece.  I say it is critical because ultimately, every project owner wants to control what the project looks like, and how much it will cost.  Consider the roles: the designer works on the looks, and the contractor works on the cost.  There must be collaboration – which requires communication.

If a homeowner does not include both contractor and designer from the beginning, control of both looks and cost will be lost.  A professional design/build team actually ensures control in such a manner that homeowners cannot get elsewhere.  If this collaboration and communication drops, then money is being spent to spin wheels.

Also critical is that collaboration provides a team effort on your project.  I recently heard of one woman who opted to hire another company to draft her project.  She chose not to have our team design it.  Some ceiling leaks, 18-24 months and several thousand dollars after the project was completed, her dormers had to be moved.  Yes, she would have paid us more than the other company, but had much less stress of another minor remodeling project down the road, and most likely, less output in the long run.

Let me tell you that as easy as those young kids make it, it ISN’T!  I’ve seen these toys before, and often wondered how they did it – on two wheels that swivel, no less!  I fell off many times this afternoon, while my daughter and son were offering their sage advise: “Maybe if you were younger, Daddy” and “Dad, you just start by pushing off and then move your feet.”  Ah, the great wisdom of a 7 and 9 year-old!

At certain times during the falling off, try again, falling off routine, I felt like giving up.  A couple of times I did go inside and get a drink, and then went back at it again.  I was close to giving up, when I realized that I really wanted to conquer this little barrier.  I kept trying, after watching my 9-yr old son and his friend “show me how”, and I was able to finally stay upright for a few feet down the driveway.  (Yes, there are small joys in life.)

I walked inside realizing that this is similar to many adventures we take in life.  These adventures may take the form of anything from business to home remodeling.  My wife just had a similar experience yesterday, sewing invisible zippers in some dresses.  Just like I’ve had “experience” on a typical skateboard (I am NO Shaun White, mind you), many Americans have had a bit of “experience” in their own adventure.

Home improvement projects are no exception to this analogy.  While one may know how to draw a scaled sketch, cut a 2×4, or mix some drywall mud, there may be some knowledge yet to learn.  New technology arrives almost daily…just look at what pops up on the internet (another relatively new technology of itself).

Getting back up doesn’t have to be by yourself.  You may want a hand to hold – you know, like someone did for us when we learned to ride a bike.  If you’re sewing, call my wife; if it’s business, I would enjoy introducing you to a friend of mine; if it’s home improvement, I may be able to help you…or I can find someone who can.

No matter what, if you are trying to get “back up”, I would encourage you to try it again.   Comment below to share your story of getting back up, or how you are trying to get back up so we can encourage you!

One such party that could take responsibility is the university.  For the sake of this article, the university could be likened to a service company – they provide the students with the service of education.  Consider the position of “Aid Administrator” paid by the college.  Since the college doesn’t print money, the Aid Administrator’s salary is really paid by the students who attend that particular institution, not necessarily those who use the administrator’s service.  Now, consider that the Aid Administrator wants to keep his or her job – not highly unusual, right?  Therefore, this person giving advice and assistance to the person consuming the service (the student) will find it hard to give advice that the consumer may want to choose a less-expensive service option.

Let’s assume that someone chose to change the system, and become an independent counselor.  The Aid Counselor would be paid directly by the consumer and could give advice that best meets the consumer’s needs.  Now, the school could effectively do the same thing by charging you for the advisor’s time.

The same thing happens with the revered “free estimate” that many consumers request.

Any “estimate” takes time, and that time must be compensated in some way.  The contractor that gives free estimates just wraps that time into the cost of overhead.  Meaning, that if you sign a contract with ABC company (which gave you the free estimate), you’re paying – in overhead cost – for your estimate, and the 3 estimates before you that did not sign contracts with ABC.

There is another argument against free estimates that is, in this this author’s opinion, of greater weight than the first.  By pushing the cost of time for the “free“ estimate into overhead, the salesman will, by default, cut corners on the time spent researching the projectand preparing the estimate.  Now, some projects do not require a great amount of planning.  A sink drain replacement, for instance, will take 3 or 4 pieces of plumbing, possibly some glue and putty, and 30 minutes for a professional plumber.  For the sake of this article, projects of such straightforward nature will be excluded.

This brings the subject around to a “simple” porch addition with exterior living space and a ramp recently completed by this firm.  Please recognize that the scope of the project did affect the cost of planning.  The cost of planning and designing this project was less than, say, that of a whole house renovation.

However, the client paid for the direct cost to their project of planning and designing their project, and they received the adequate service and ideas needed for their project.  Solutions were found that had not been seen previously, and both contractor and homeowner were able to see exactly what was discussed and planned.  What began as this “simple” project had some not-so-simple issues which required attention that no “free estimate” could have addressed.

So many times, a homeowner says, “my project is just a simple addition.”  Typically this means, “I want a free estimate” or “I won’t be paying for designing or planning services.”  As respectfully as possible, experience has shown that there no simple projects, and no project is small enough that it doesn’t need planning.  No, this is not arrogance speaking, but experience.  To say that this level of planning is not needed because “the project is too small”, ignores every homeowner’s basic need to manage both look and cost of the project – at the same time.

Yes!  This article again, unashamedly, is promoting Design/Build.  In the spirit of the upcoming US Open, Advantage Homeowner.

• See what the homeowner in this article thought about this Design/Build process.
• Learn how the Design/Build process helps homeowners control their project.

Since this blog is specialized in advocating for homeowners, the stories and situations will be geared toward that.  Some clues can be applied to other service professionals, but this will be directed to those looking to hire a contractor or design professional.

Both remodeling an existing home and building a new home can be filled with headaches.  Any homeowner needs to be sure that he or she is very comfortable with the person(s) with whom they will be working in the next bit of time.   People work together best when there is a high level of trust and accountability between them.  A professional must trust that the client will pay for the services on time and is telling the truth during any decision process.  The client must be able to trust the professional for the expertise he/she brings.

This is not to attack any industry as a whole, but a challenge to recognize those individuals within any industry who will not provide professional service.  Unfortunately, we are hearing of more clients being soaked by the professionals they chose.  One architect drew plans that the client realized did not meet the needs of their handicapped son – tens of thousands of dollars later.  One homeowner had their project red-flagged (and work stopped) by the building department because there were too many code violations.

Here are some thoughts that can help you stay out of the fire!

• Does the provider return your communication quickly and with the right information?
• Is the professional listening to your needs and your ideas? (discussed in Remodeling:How to Find a Professional)
• Is the salesman pressuring you to buy today? (Today Only sales are for retailers – not professionals)
• Can the salesman provide a clear plan for the future of your project?  (step-by-step with inspection, 3D modeling, pricing, and project delivery)
• Can the salesman answer tough questions without being defensive?

If you had to answer “no” to any of these questions, you may not want this professional on your short list.

Exterior remodel - night view

First, let’s define Building Information Modeling.  BimWiki states that, “BIM is the virtual representation of the physical and functional characteristics of a facility from inception onward. As such, it serves as a shared information repository for collaboration throughout a facility’s lifecycle.” – Patrick Suermann, PE. NBIMS Testing Team Leader.

Note the comment that BimWiki user, beartoe, submitted regarding BIM.  He states, “I think any discussion of BIM (“little bim”, the desktop technology) is incomplete without a corresponding discussion of IPD (integrated Project Delivery, aka “BIG BIM”.) It is reasonable to argue that “little bim” is really just better CAD, while IPD is the change in the construction industry that will deliver the greater benefits. Because IPD requires a high degree of collaboration, communication, and pro-active project planning in a non-litigative legal setting, it may be that IPD is what really delivers the goods, even more than the desktop technology.” (emphasis mine)

Aha!  The secret is out.  But was it really a secret?  Fancy talk can muddle the mind.  BIM is just a tool – just like EKG, .com, and screw-drivers are tools.

BIM Roof framing

Certainly, EKGs are technological wonders that can help us see what is inside our body, and BIM can do the same for our dwellings, but the real secret is the team behind the technology.  Previous articles here have mentioned TEAM playing, the troubles homeowners run into when hiring a contractor, and others, for the purpose of helping homeowners find that system that “really delivers the goods.”  These articles are also geared toward contractors who are looking to “deliver the goods.”

This article is not saying that BIM should not be used for residential projects.  In fact, BIM is well worth the investment for any project, no matter the size.  However, some doctors can operate and read EKGs; others are exceptional.

Integrated Project Delivery – delivering the better project.

I call it Design/Build.

Consider your business or a business you know.  If that business is a one-person-gig, does it do well?  Does it operate smoothly, or have a roller-coaster ride in profits, quality, service, communication, marketing, production/delivery, sales, etc.?  Could that business do better?  Consider that even a one-person-show can still have team-members.  That team could consist of sub-contractors, a business coach, clients, trade professionals, and more.

This business has seen this time after time.  By offering an inside view of our reality thru online design sessions, information has been collected.  This gives the opportunity to introduce others to business partners, and vice-versa.  Since this team has been created and running smoothly for six-plus years now, it runs smoothly and on the same page.

The value that this team gives to a client is the strength of knowledge, talent, accountability, and delivery.

No one person has the ability and talent to do everything for a client, let alone all clients!  So the team brings greater value thru greater ability and talent, but the greatest value that I believe a team has for its clients is accountability.  If a team is not accountable to each other and self-correcting, the whole team will be going down, the client won’t be happy, and the whole process will be at the bottom of that roller-coaster ride.  Then we all know how fast bad news travels!

Please don’t mis-understand: accountability isn’t always fun.  Correction never really feels good, but it is a great feeling to know in the end that you have given the client the value they deserve from your service.

The TEAM has succeeded!

This is why we support the Design/Build process – it is a TEAM approach.  Best of all, we include the client as a TEAM member!  Subtle, but different.

Family time has been increasingly special to me.  I’ve found hard work to be very rewarding, yes even the diminished buying power-it has given new perspective on priorities.

One business related benefit is a better understanding and practice of networking.  Since I have the floor, I’d like to put it in the negative for now.  In the future, I’ll write down a plan or thoughts/ideas for positve networking.

Networking is NOT …
… attending a lunch meeting
… trading business cards
… joining the local chamber of commerce
… going to a tradeshow

What ideas or experiences do YOU have that networking is NOT?

For a bit of a positive note, this recession has taught me ways to positively network for new relationships.