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[Note: This second part of a two-part series on Construction
Quality prioritizes those ‘quality’ elements which are most
important to homebuyers. Part I, which appeared in the
Nov./Dec. edition of Builder Digest, ranked those elements which
receive the lowest satisfaction ratings from homebuyers.
–ED.]
In
Part I of this series, I reviewed the results from our
ongoing “Home Quality” survey, administered each year to well
over 200,000 new-home owners near the end of their first year of
ownership. Based on the results of surveys administered to
900,000 homeowners, I identified the survey categories and
questions which had received the lowest level of satisfaction.
Each of the survey’s 14 ‘Quality’ categories contains a number
of detailed questions (74 in all) which are designed to provide
builders with a prescription for improving the performance of
their subcontractors, vendors, purchasing agents, and other
employees. While our 70+ builder clients use this information to
see how they rank against some the country’s best builders, the
most valuable use of this information is to guide the
establishment of ‘Action Plans’ designed to improve the
builder’s performance on those key issues having the greatest
impact on buyer satisfaction and, ultimately, referrals.
Given a list of 74 quality issues ranked in order of homebuyer
satisfaction, would your ‘Action Plan’ simply start with the
lowest rated issue and work its way up the list? Hopefully not.
Why spend time working to improve a ‘quality’ issue which your
homebuyers rate low on the satisfaction scale, but also low on
the importance scale? The key is to spend time, energy,
and money on improving those problem areas which have the
strongest impact on overall buyer satisfaction and future buyer
referrals. This “Opportunity Selection” process is critical to
the cost-efficient utilization of your customer satisfaction
survey data.
The Key to Referrals is Service
On our “Home Quality” survey, there are 10 questions on
Customer Service and 74 which ask the homeowner to rate
various aspects of plumbing, painting, storage, flooring,
countertops, and nine other categories of construction quality.
(These detailed questions also assist our builder clients in
holding their subcontractors accountable for meeting quality
standards.)
When these 84 issues are listed in order of importance to
the ‘buyer’s willingness to recommend the builder to a
friend’, a striking fact becomes immediately apparent.
Although only 10 of the 84 survey issues are on the subject of
service, 4 of the “Top 10 Importance” issues are service
related! In fact, the #1 issue--that issue having the
greatest impact on future referrals from your current
homeowners--is a service issue (see below).
Top 10 Importance Issues
During the first year after move-in, which issues should you be
tracking in order to maximize homeowner referrals? Here is the
list of the “Top 10 Importance Issues”. Strong satisfaction
scores on these issues are correlated with high ratings on the
‘willingness to recommend’ question; low satisfaction scores are
correlated with low ‘willingness to recommend’.
Issue #10:
Solid roof. Buyers are typically happy with their roof. Most of
them never notice the roof unless their family room turns into
an aquarium whenever it rains. So, although a solid roof rarely
helps your satisfaction ratings, a leaky roof is a deal killer.
Issue #9:
Windows are easy to clean. Recent buyers rate window trim and
molding as most important, but after one year, the ‘ease of
cleaning’ becomes a very important issue to future referrals.
Issue #8:
Walk-thru items are corrected within promised time-frame. This
is certainly a service issue, and it has to do with
response time. In every region of the country, in every price
band in the market, in every demographic segment, the builder’s
speed of response to punch-list items and to warranty and repair
requests is one of the key ‘Referral Drivers’.
Your consumers are being constantly being spoiled by retailers
and Internet sites which provide world-class service.
Consequently, your buyers expect nothing less from you. Speed of
response to service questions and requests is the fastest, most
cost-effective way to win your buyers’ hearts…and referrals.
Issue #7:
Service representatives are knowledgeable about the
buyer’s home. Today’s buyers are looking to build a relationship
with a builder they can trust. The first factor in determining
trust is the credibility of the builders’ personnel, and the
initial measure of this credibility is the product knowledge
possessed by the builder’s personnel.
Interestingly, in a study of recent homebuyers commissioned by
BUILDER Magazine several years ago, we determined that the most
important attribute of a sales person was also… product
knowledge.
Issue #6:
Builder supplied fencing. Once again, this is the kind of issue
that buyers expect to be perfect, and you will not get credit
for being perfect. But when that gate in the fence doesn’t close
perfectly…
Issue #5:
Driveways and walkways are without cracks and defects. Again, no
extra credit for including a driveway without cracks. Just
realize that when you do have a homeowner with problems here,
your response-time will be the deciding factor between a
disgruntled homeowner and a homeowner who becomes a willing,
unpaid member of your sales team.
Issue #4:
Service personnel are courteous and respectful. This
should be a given. It is hard to understand how any builder can
be happy with any score below 95% on this issue. Yet, many
builders do receive scores that are considerably below the 90%
level.
Issue #3: Drywall. Most buyers do not even notice the
drywall unless it’s wavy or full of nail pops. They fully expect
their walls to be straight and square, and will be upset it
their home falls below these expectations.
Issue #2: Cabinet Material. For years, our surveys of
home shoppers have shown that in model homes, shoppers look
carefully at the cabinet material as a measure of the builder’s
quality. Now it is also clear that homeowners’ willingness to
refer their friends is strongly affected by the perceived
quality of their cabinet material.
Issue #1: High quality of repairs / service. This is far
and away the survey issue with the strongest impact on overall
satisfaction and future referrals. For many years, I have been
saying that the Customer Service department should be considered
a profit center. Now it is perfectly clear that a well run
service department not only saves money by reducing the cost of
potential litigation, but it also helps generate referrals from
homeowners who are ecstatic with the service experience.
While you should always try to improve all your systems, it
makes sense to focus on those issues which return the biggest
bang for the buck.
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