Fidelity's Process Architect
Fletcher Groves III designs and maps processes to provide a framework favoring a key business driver.

Bill Lurz

	In this ninth installment of our series on the startup of a home building company -- Fidelity Homes -- in Sarasota, Fla., Ponte Vedra Beach, Fla.-based consultant Fletcher Groves III works with principals Todd Menke and David Hunihan to build process maps (from scratch) that define in detail how to achieve one of their key business drivers: trade partner prosperity.

Fletcher Groves III, a Florida-based expert in the art and science of process mapping, asked to be added to the "From the Ground Up" consulting team. He sees the Fidelity Homes startup as an exciting opportunity to build stellar processes from scratch, a welcome respite from his usual challenge of fixing broken ones.

Fidelity principals Todd Menke and David Hunihan jumped at the opportunity. "We decided to concentrate on the trade partnering process," Menke says, "because that key business driver -- trade partner prosperity -- has the potential to positively impact all our other key business drivers. After all, good trade partners build quality product, and that breeds happy customers."

Hunihan was familiar with process mapping from time spent with a General Electric Corp. "black-belt" consultant while working for his previous employer. "Part of the black-belt discipline at G.E. is to use process mapping to weed out unnecessary activities and streamline processes," Hunihan says. "Fletcher Groves is a terrific process mapping facilitator, every bit the equal of a G.E. black belt. We might have tried this exercise on our own, but it would not have been as successful because Todd and I, like most builders, are very big-picture-oriented. We want to move fast and get to the answer.

"Fletch kept slowing us down, forcing us to analyze every detail of the process and work flow."

The various methods of mapping processes range from simple diagrams and flowcharts to computer-aided design and simulation software. Groves uses a graphics- and text-based notation language known as IDEFO. Using software called iGrafx IDEFO from Micrografx, he develops process models composed of hierarchical series of graphic diagrams, supported by text, that gradually display the increasing levels of detail in any process.

Under prodding from Groves, Hunihan and Menke settled on a partnering process objective -- to have Fidelity be known in its market as the leader, the employer of choice. They call this position "legendary partnering."

	Fletcher Groves III

To reach that status, they decided Fidelity needed to deliver to trade partners both profitability and consistency -- even-flow production, reliable job scheduling, shared processes and business support. "In many respects, 'legendary partnering' is a continuous and never-ending process," Groves says, "an ongoing collection of initiatives and programs designed to foster hand-in-glove partnering relations. But Fidelity also wants its new trade partnering process to be a progression -- a series of milestones that gradually moves a trade or supplier into a trusted and committed partner."

Menke, Hunihan and Groves decided on a three-stage process in which a trade or supplier begins as a qualified trade partner (QTP).

"At this level, the relationship is based on agreement," Hunihan explains, "agreement to meet our minimum requirements, to produce work that conforms to our scopes of work. In return, the trade partner can expect superior project coordination and payment upon work completion."

The next level is certified trade partner. A CTP shares work with only one other company in a community and is guaranteed a certain percentage of the jobs in exchange for demonstrated quality performance and "most favored builder" pricing. "At this point, the relationship is based on trust," Menke says, "the assurance of our business in exchange for their assurance of best pricing, on-time performance and integrated teaming to reach higher levels of efficiency."

The Fidelity principals decided certification would require a minimum of six months of superior performance as a QTP, verified by scores on trade partner completion approval checklists (developed cooperatively by the builder and the trades). Initially, Fidelity plans to award a minimum of one of every three jobs in a community to a certified trade partner.

"We may have one CTP getting one-third of the jobs and another getting two-thirds," Menke says. "We want every trade constantly striving to reach the next level -- the QTP trying to become a CTP, the CTP with a third of the work trying to get to two-thirds, and the CTP with two-thirds trying to get to ETP."

Exclusive trade partner is the top of the heap, a CTP that becomes a single source -- awarded every job within a division. "At this level," Hunihan says, "the relationship is characterized by commitment on both sides. It's a seamless relationship of pledged cooperation.

ETP trades are also expected to take part in progressive quality initiatives focused on continuous improvement. "Builders should take note that measurement is an essential ingredient in every process," Groves says. "We include measures such as approval checklists throughout this process. Over time, David and Todd will probably add measures related to joint product development and shared initiatives in continuous improvement. The point is, you need to build the measures into the process."

Only at the QTP level is bidding a part of the process. At the CTP and ETP levels, Hunihan and Menke anticipate that the efficiency of their jobs and consistency of work will drive prices down to "most favored builder" levels, below those for other builders in the market. At these levels, they expect to continue driving costs out of the production process shared with all the trades to the mutual benefit of every firm.

"We have to realize that, initially, every trade contractor is going to look askance at this whole initiative," Hunihan says. "They are going to ask, 'What's in it for me?' And we've got to be prepared to answer that by showing them that our partnering program will bring money to their bottom lines, peace of mind in their own lives and well-being among their work crews. We want to build our success on theirs. We want to reach a point where we are engaged in open-book management with our trade partners at both CTP and ETP levels."

Groves also took the Fidelity principals through an important subprocess of trade partnering -- how to handle buyer requests for changes after the start of construction. He forced Menke and Hunihan to confront every implication of every possible change that could be requested, and how management of buyer expectations could affect each case.

Hunihan and Menke are adamant that they will not be trapped into becoming custom builders. But at the same time, they see the ability to make some changes -- even after the start of construction -- as a competitive advantage over large production builders. That process map is available below. Have a look.