Kenneth Ahlmer, 29, a computer programmer, and his wife, Glenna, an executive secretary, live in a 9-year-old Schaumburg townhouse they bought five years ago. They are shopping for their first new single-family home.
”We want to buy in the Fox Valley area between Elgin and Crystal Lake in a price range of $140,000 to $170,000,” Ahlmer said during a recent visit to the Parade of Homes in northwest suburban Algonquin. ”When we find that product, however, our main concern is that it`s produced by a reputable builder and will hold its value. We don`t want hassles and built-in headaches.”
The Ahlmers are not alone in checking out the reliability of their prospective home builder.
”Customer service is the single most important thing a home builder has to be aware of today because his reputation comes from the quality of his homes,” said Maurice Sanderman, president of Rolling Meadows-based Sundance Homes. ”More than ever, the focus in the 1990s is on the builder. Customers today want to know who he is and what kind of homes he builds.”
Roger Mankedick, executive vice president/sales and marketing of Arlington Heights-based Lexington Homes, agrees.
”The 1990s are consumer-oriented, and a home builder needs a competitive edge today in what is a service-driven economy,” he said.
”The level of competition has required all builders to be more aware of quality and customer service,” adds Roger Gatewood, senior vice president of the Home Builders Association of Greater Chicago and president of Gurnee-based Westfield Homes. ”No home builder can get by in the `90s with shoddy construction nor without a high-level of customer service.”
Gatewood`s admonition to the industry may be more of a devout wish than a proven truth since a ”perfectly constructed” house is an elusive goal.
Home buyers understand that, but traditionally have been frustrated by delays, inconvenient scheduling, poor workmanship on repairs or subcontractor indifference.
Most warranty repairs are mechanical in nature, and concern appliances, furnaces or air conditioning that are covered by manufacturers` guarantees. Other problems may involve such things as carpentry or floor levels, and builders say their biggest headache in the Chicago area is water penetration in the foundation, basement, windows, flashing or roofs.
Recognition of the need to strive for higher performance standards has compelled Chicago-area production builders to assign even higher priorities to construction quality and customer service.
Lexington Homes is an example of a firm that is addressing such priorities with its Home Care Team program, introduced this spring at 16 developments in metropolitan Chicago.
”Buyers today are concerned about quality and whether or not the builder will stand behind his product,” Mankedick said. ”We`ve made a major financial commitment in people, equipment and training to facilitate this program.”
More than 30 full-time people have been assigned to a new customer commitment department located in a building adjacent to Lexington`s Arlington Heights headquarters.
”The Home Care Team is responsible for servicing a home during its warranty period,” explained Joe Donahoe, vice president/quality assurance and customer services. ”Everybody in this business wants to talk quality but nobody wants to walk it. This new department is evidence of our desire to provide the quality and service that the consumer wants today.”
Basically, Lexington has shifted responsibility for home repairs under warranty from subcontractors to in-house specialists who Donahoe said handle most of them more efficiently and in a more timely fashion.
”Under the old system of putting your request in writing and referring it to a subcontractor, repairs usually were made within 28 to 30 days, which was regarded as good,” said Donahoe. ”Now completion is within two to four days and accomplished on a schedule suited to the homeowner.
”Subcontractors are not committed to follow-up work, thus leaving the customer often caught between the builder and the sub. Now he makes one call to Lexington and we assume responsibility for everything.”
Since launching the in-house program four months ago, Lexington has made follow-up calls on its service and found a 96 percent customer satisfaction rate for scheduling, workmanship, knowledge, neatness and courtesy.
To facilitate service responses, Donahoe has established a computer data base of all new homeowners, their specific house model, options purchased and previous repairs. Once the repair is logged into the system, customer service manager John Rappaport checks to see if the item is under Lexington`s warranty and whether necessary repair parts are available in the warehouse.
”Each of our 12 customer service technicians reviews his repair calls for the day, picks up the necessary parts and loads his Home Care Team van,” Donahoe said. ”We follow up by phone to determine if the work was done satisfactorily.”
But he said that Lexington`s quality assurance effort begins long before the need for warranty repairs.
”All new buyers first are invited to an orientation seminar to learn about the builder, understand the construction process and meet the Home Care Team,” Donahoe said. ”The buyer has four escorted walk-throughs of his home during construction and up to closing. These inspections not only familiarize customers with their new home but also serve as a quality check.”
Donahoe joined Lexington in 1991 from Pulte Home Corp. Illinois Division, where he headed the service department for its 11 west and northwest suburban subdivisions.
”I came to Lexington with the assignment of creating an independent customer commitment department with clout and authority,” he said.
”Significantly, I report to a senior vice president, not construction, so the fox is not running the henhouse.”
Donahoe said it took him a year to develop a staff and educate employees to create an attitude and priority for quality service within the company.
”My goal is to put my department out of business because our homes are so well-built. We want to be the Maytag repairman of home building,” he said, referring to a widely shown TV commercial.
Donahoe said he adapted and fine-tuned his Home Care Team concept from a similar service program at Pulte that has been in operation for four years.
”We start with customer orientations grouped by community to familiarize buyers with Pulte and the various phases of construction,” explained David Branch, Pulte vice president/sales and marketing. ”This is followed by a pre- dry wall inspection to show what`s going behind walls and why, with another orientation and inspection before closing.”
Branch said each of Pulte`s developments has a project care manager who handles and follows up on all warranty requests. Most repairs are handled by the firm`s own technicians, usually within 72 hours or less.
Sundance Homes launched its quality-control program in 1988 with an internal program of education, testing and inspection for employees and subcontractors that Sanderman said culminated in 1990 with a ”Knock On Any Door” promotion.
”We invited our prospective buyers to knock on any door in the community and ask about the quality of their home and the way they were treated by the builder,” he said. ”Eighty percent of our buyers did so.”
What most pleases Sanderman, however, is that his service department staff has been cut by 80 percent because demand has dropped so dramatically since the quality construction program was launched.
”The essence of a quality program is that the house is built right at the outset,” he said. ”The real proof of quality is that you don`t have a lot of customer service because the house is built right in the first place.” Sanderman`s goal is shared by Hoffman Estates-based Centex Homes.
Calling the practice of listing defective items on a punchlist at the last minute ”counterproductive,” Lon Marchel, vice president of
construction, said Centex two years ago set zero defects at closing on all homes as its only acceptable standard.
”That`s zero – not one percent or one per home,” he said. ”The idea was to deliver a defect-free home, thereby eliminating the need for punchlists altogether.”
To achieve its goal, Centex developed a variety of corporate training, system and reward programs as well as a grading system for those situations where zero defect goals have not yet been realized.
Marchel said Centex has been well-rewarded for its efforts. ”During 1991, out of all homes closed, 98 percent were defect-free,” he said.
The home builders agree on the long-term benefits of quality and service. ”For the buyer, quality construction adds value to his house,”
Mankedick said. ”For the builder, it becomes a selling point and provides referral business from satisfied buyers.”
Referrals also are sought by other quality-conscious builders.
”The reward of quality-built homes is that 20 percent of our sales today are from referrals compared with 5 or 6 percent before 1988,” Sanderman said. ”Our buyers are our best source of advertising,” Pulte`s Branch said.
”Word of mouth generates more customers. A reputation for quality through the years has kept Pulte in a position to maintain a constant rate of business. Today, 28 percent of our sales come from referrals.”
