An era of upheaval

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We are in a transition period between two historical eras. We're in the waning days of the Industrial Revolution and the start of a new age. We don't have the perspective to know what to name this new age, but many have taken to calling it the Information Age. You're likely wondering what that has to do with remodeling.

October 01, 2009

Paul Deffenbaugh,
 Editorial Director

We are in a transition period between two historical eras. We're in the waning days of the Industrial Revolution and the start of a new age. We don't have the perspective to know what to name this new age, but many have taken to calling it the Information Age.

You're likely wondering what that has to do with remodeling. Excellent question.

During times of change there is considerable upheaval. And in the midst of great change — epochal change — the upheaval is gargantuan. Even within this change, we have microcosmic upheaval occurring such as the transition of the dominance of the Baby Boomers to the Echo Boomers. (Sorry, Gen Xers.) And there's the rise of two new economic superpowers in China and India.

The only thing we can be certain about in housing is that the industry we have known since World War II is no longer the reality. How can businesses survive all of that upheaval? The companies that survive will all share these characteristics.


The remodeler used the resources he had and applied them in a new way. His company survived.

Low Overhead/No Debt: Few remodeling businesses take on much debt because they grow the business on retained earnings. But too many have been adding to the overhead during the good times. Now that job sizes are shrinking that nut is harder to cover. Cut your overhead; get out of debt. You need the freedom to react to the opportunities, and your overhead and debt will squander opportunity before it even arises.

Learning Culture: If your company has been operating a niche and doing things the same way for years, then you probably do not have a culture of learning. Learning companies take what they're learning and implement it throughout the company. They improve processes and are willing to take on new ideas. Just that willingness can help you be more flexible, adapt to new opportunities quicker and not hold on to the way you used to work that is currently dragging you down.

Not Leader-Centric: This is probably the hardest of all the characteristics for remodelers to overcome. Owners of most remodeling companies are the franchise. If he or she leaves the company, the value plummets. In tough times, having a leader who doesn't delegate prevents a company from reacting to market conditions, meet customer demands and improve quality. What good employee wants to work for someone who holds all the information in a vault and doesn't allow motivated, smart people to make decisions? Clear responsibility and accountability that come with a clear vision is essential for survival.

Flexibility: All those characteristics allow remodelers to meet the most important one of flexibility. During the early '90s housing downturn, a remodeler in Oregon ran out of leads and had no jobs. To keep his company going and his crews employed, he took work clearing land for a local farmer. It wasn't remodeling, but he used the resources he had and applied them in a new way. His company survived. Will yours?

Contact me at paul.deffenbaugh@reedbusiness.com or 630/288-8190

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