Q: How do you learn from your job cost variances?
A: We have developed a culture and system so that actual learning takes place. New Home construction is dynamic and ever changing. A culture of continuous learning is key to managing and learning from a variance.
It starts with the people.
Egos can impede the learning process. We manage egos from our co-workers, subcontractors, vendors, municipalities and clients. A core understanding that we are all in this together to help achieve the same goals is paramount. Holding people accountable is harder now than ever. We must have people that work with us that are willing to be held accountable. A key ingredient for success is to think long term in short term situations. Sometimes egos have to be parked for the greater good. We have found thinking long terms helps park the ego.
A system to track and keenly document the variance is a must.
Our learning begins once we know about the variance. We conduct a detailed analysis on why the variance occurred and what we can do prevent that variance from happening on a future job. We must have patience to do this correctly. At times people are in a hurry to handle their daily tasks. We are fanatical in slowing them down when we are dealing with variances. Our goal is have all of our team members to understand why the variance occurred and have their involvement in developing strategies in preventing them in the future.
We are very careful in how we approach variance management. Working with people rather than attacking them is most helpful in creating a learning environment. That is job #1 for us.
Next week I will discuss different types of Green Building programs.
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