Doyle Wilson believes you can build a fast company in a slow industry. He should know: his company changed the game in an industry that’s neither glamorous nor high-tech, but that touches millions of lives — and that most people associate with missed deadlines, broken promises, and cost overruns.
Wilson is president and CEO of Doyle Wilson Homebuilder, Inc., a privately owned company in Austin, Texas. Last year, Wilson’s operation built and sold 404 homes worth more than $56 million. This year he’ll sell 430 homes at prices ranging from $70,000 to $300,000, generating gross revenues of nearly $60 million.
Doyle Wilson is not the biggest home builder in Texas, or even the biggest in Austin, but he’s one of the most innovative — in Texas or anywhere else. Two things distinguish his operation from the competition. First, he actually builds homes fast. His company is obsessed with finding ways to shave time off the construction process. Nine months ago, the average construction time for a Wilson home (from the moment the permit process begins to the day it’s ready for occupancy) was 165 days. Today it’s down to 124 days — a reduction of 25% — and still declining. Faster means cheaper: Wilson offers homes at a discount of as much as 10% off prevailing prices.
Second, Wilson takes management ideas seriously. He has rebuilt his entire company around the quality precepts of W. Edwards Deming and the lean-manufacturing principles developed at Toyota. Wilson’s Web site (Editor’s Note, May 2000: This site no longer exists.) is more than just a marketing tool; it’s a primer on new business thinking.
All of which has made Wilson, 44, a minicelebrity. Last year, his company won the National Housing Quality Award, the Malcolm Baldrige Award for home builders. This spring, the Lean Enterprise Summit, a prestigious gathering of experts on world-class manufacturing, invited him to explain his company’s transformation.
“Once you see what your limited vision has created, you understand there are huge opportunities,” Wilson says.
Doyle Wilson got a quick start as a fast builder. As a student at the University of Texas in 1971, he formed his own roofing company. By the time he was a senior, the company had become one of the largest roofing contractors in Austin. After leaving school in 1972, he made the leap into home-building.
But Wilson’s big breakthrough occurred in 1991 — and it involved cars, not homes. Shopping for a new car, he ended up at an Austin dealership that practiced customer- satisfaction techniques based on Deming’s principles of quality. Wilson signed up for a seminar led by Deming himself. Soon after, he discovered The Machine That Changed the World, the best-seller by an MIT research team that explained Toyota’s “lean-production” system. Wilson saw the power of both approaches, adopted them, and reinvented his operation.
Wilson vividly remembers the day he sprung his agenda on the company: “I called a meeting of the management team and said, ‘This is what has to be done. You guys lead the charge.'”
The reaction? “They said I was crazy, that I was throwing the company away. I just wanted to speed things up and drive out defects.”
The transition wasn’t easy. “I’d walk around the construction sites trying to drum up enthusiasm,” Wilson recalls. “The workers would say, ‘We can’t do this, we can’t do that.’ I’d say, ‘I like your can-do attitude. Let me know when it’s done.'”
To move the change program forward, Wilson imported a number of techniques straight from the quality movement. Throughout the company’s offices, he implemented the well-known “flag system.” People responsible for certain aspects of the process — architects, auditors, loan applicants — hoist a flag as they deal with a specific step — a red flag for a delay, a green one for a step that’s going smoothly. He’s now experimenting with flags on the building sites themselves.
Wilson also broadened the scope of his thinking. He realized that many construction delays happen long before the first nail gets hammered. So he went to Austin’s building department to identify ways to speed up the permitting process. The result was more constructive relations with the city — and a staggering decrease in permit-issue time, from 7-21 days to 24-48 hours.
Then Wilson tackled his supplier base. He reduced the number of suppliers and subcontractors from more than 100 to about 40, and worked closely with those who made the cut to slice lead times.
Doyle Wilson is pleased with his progress so far, but he knows there’s a long way to go. “We operate under the principles of continual improvement,” he says. “And continual improvement is all about continuing.”
Sidebar: Can’t You Hammer any Faster?
If speed were all that mattered, how fast could you build a home? Some years ago, the Building Industry Association of San Diego County sponsored a competition among builders to answer that question. The home had three bedrooms, two bathrooms, and was made from standard materials.
The fastest time: 2 hours and 45 minutes. How do you build a house in less than 3 hours? By forgetting everything you thought you knew about building a house. The winning team used 700 people divided into subgroups of carpenters, plumbers, electricians, and other tradespeople. For weeks, the teams practiced to find ways to accelerate the process. During the competition, the winners managed to complete the rough plumbing in 8 minutes and set the main roof in just over 9 minutes.
It was fun — and the experience also generated useful insights. Which is why Professor Tom Malone, of MIT’s Sloan School of Management, shows a video of the competition to his students and executive audiences. “I use it to illustrate the power of speed,” Malone says. “Not just as a way of satisfying customers but of inventing whole new industries. It helps people free up their minds to think about how to build organizations for the 21st century.”