In a year when most private builders are pulling back, Signature Homes is having a record year. How? By combining a customer-obsessed culture, breakthrough design, and tech-driven efficiency. In this first episode of From Silos to Systems, Signature’s EVP Tyler Belcher and VP of R&D Kyle Bear, and Higharc CEO Marc Minor join TBD’s John McManus to share how Higharc’s platform has unlocked scalable, standout architecture and a seamless buyer experience. Don’t miss this live conversation on how integrated systems, design, and marketing can create decisive competitive advantage.
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00:00Hello, everyone. We are going to give our audience a moment to get started. How are
00:10we doing today? Very good. Wonderful. Good. I am so excited for today's conversation.
00:21And I see that our audience count is ticking up. So without any further delay, I'm going
00:29to jump into some housekeeping notes. Welcome, everyone. Today's webinar with the Builders
00:36Daily is How Outlier Home Builders Win. I'm Alison LaForge, Managing Editor of the Content
00:43Studio at HousingWire. And we're so excited to have today's conversation, which will be
00:50moderated by the Builders Daily and is presented by HighArc. A few quick housekeeping notes before
00:56we get started. This is meant to be an interactive webinar. So if you guys have questions for
01:01any of the panelists at any time, you can use the chat, which is on the side of your screen
01:07or the Q&A icon at the bottom of your screen. Time permitting, at the end of the webinar,
01:12we'll get through as many questions as we have time for. Now, to get started with today's
01:18content, I'm going to pass things over to today's moderator, which is John McManus, the founder
01:25of the Builders Daily. John, the floor is yours.
01:29Thank you so much, Alison. It's so exciting to be with you today. And I'm really grateful,
01:34builders, developers, partners, for you making time. Your schedules are stretched. We're honored
01:40that you carved out time with us. As Alison said, we call today's conversation how outlier
01:47home builders win. Because if you look back through every housing cycle, you'll notice something.
01:53A small set of operators consistently manages to defy the gravity that drags a number of other
02:01operators of the industry down. They're not a mutant to turbulence, rates, prices, hesitancy,
02:09financing pressure, but they navigate it differently. They adapt with more resilience,
02:14more control of their destiny, and a sharper sense of what customers will not compromise on.
02:20That's what makes Signature Homes such a powerful case. While many private builders are pulling back
02:26this year, Signature is on pace to have its best year ever. They've built a culture and a system
02:32purpose-made for moments like this, part agility and part long game. It's a special privilege to have
02:39two of Signature's leaders with us, Executive Vice President Tyler Belcher and VP Research Development
02:46of Kyle Baird joining from their base in Birmingham, Alabama, and their fast-growing national communities.
02:53Alongside them, we'll also hear from Mark Miner, CEO of Hierarch, the technology partner that's
02:59helping transform Signature's design, sales, and systems into a seamless machine.
03:04Now, let's set the stage for why this conversation matters right now. Here's the reality. Households
03:12are on the fence. Mortgage rates remain near cycle highs. Prices are sticky and buyers are second
03:18guessing. If I buy now, am I overpaying? For builders, that uncertainty translates into hard choices.
03:26Do you cut price? Do you load up on incentives? Do you slow down land and lot pipelines? None of these
03:33answers feels particularly satisfying. That's why outliers like Signature stand out. They're proving
03:38you don't have to retreat to survive. Instead, you can lean into systems design, accountability across
03:46your organizations, and a customer-first execution that delivers both pace and profitability.
03:52That's why today's conversation and some exciting visualizations that will help drive that story
03:58is what outliers are doing differently and how other builders, regardless of your scale,
04:05can learn lessons from that playbook. So with that, let's welcome our panelists. Tyler Belcher,
04:12Executive Vice President of Signature Homes, Kyle Baer, Vice President of Research and Development,
04:18and Mark Miner of Hierarch. This is a rare chance to hear directly from leaders who are building
04:24differently and winning differently and winning differently, and they're here to share their
04:27strategies that you can apply in your own markets. So we're going to cue it up and listen to Tyler
04:34talk about Signature's experience in today's market conditions, traffic, pace, buyer psychology.
04:44So Tyler, why don't you take it away and set the tone for what Signature is facing in its two primary
04:51market operator areas? Sure. Thanks, John. Yeah, so as you mentioned, we're in Birmingham, Alabama,
04:59in Nashville, Tennessee. We do about 600-ish homes a year, just to give you some sense of scale.
05:05Most of it's single family. We do some townhomes. So as you mentioned, the market shifted.
05:14Post-COVID, supplies got tight. We were more focused on efficiency. Sales were really strong.
05:21Obviously, that's rolled over now. Mortgage rates are sticky. They're higher. And last year,
05:29we recognized, hey, they're higher for longer. So what are we going to do about it? And so as you
05:35mentioned, we kind of went on the offensive, especially last year. We went and redesigned
05:42our core plans to create more wow and less about efficient and more about compelling the buyer
05:51to act. Because we have to build something new so that they will, if it's the same as what's out
06:01there, they're not going to be likely to give up their 3% mortgage. So we really got to do a good job
06:05of giving them some compelling reason to buy. So, but there's no, you know, there's no secret
06:14sauce here that's, we have the foundation, things that help us out. We have a foundation of a high
06:20referral rate. So, you know, first you got to take care of your customer. So that allows us,
06:26when we have new product, we can go and lean on our existing customers. And we've been in business
06:3225 or so years. So we have a large customer base we can go back to and present. And we get a lot of,
06:38a good bit of resale through our referrals. So, so that's a big foundation for us that,
06:46that helps us get through this. We also focus on creating great community. So if we have great
06:53amenities, great community, great feel to our communities, we feel that's very important.
06:57So that anchor is also there. And then the anchor is just build cool stuff. All right. So we just
07:05try to build cool stuff. And it's not as easy to build cool stuff. You try to take elements of
07:12custom and, and put it in our, in our production environment. You know, that's difficult, but that's
07:20really what we're trying to do. We've got great communities, build cool stuff and take care of the
07:25customers so that, so that they'll come back to us. Right. And, you know, a lot of that involved
07:31both product simplification and understanding that feedback from your customers to start to make
07:38product pivots. So how, what kind of signals were you watching to decide where to push and where to
07:46pull back, how to begin to pivot to a changing marketplace that we all saw coming at us,
07:54you know, as interest rates were remaining high and then all of the, all of the incentives that
08:02were in place started to kind of show some wear and tear through the months. And what were you
08:08listening to at that point for signals, Tyler? Yeah. So, you know, we measure backlog. We're
08:13primarily pre-sale builder. So 80 to 90% of our starts are pre-sold. So we're not a heavy spec
08:20builder. So obviously we, we are paying attention to our backlog all the time. So that's how strong
08:29is our backlog? How, how strong is our demand list? And obviously as we saw that waning and getting
08:35more strained to achieve our, our starts, then that's when we, you know, leaned into, okay,
08:42you know, this is not just a, this is, this is here to stay. And obviously the mortgage rates were
08:47front and center. Everyone, you know, knew what was going on there. Um, but that's, that's really
08:53what we, what we focus on is how, how's our backlog? How are we able to even flow our production?
08:59Um, and once that gets, gets strained, we know that, that, that we've got to do something and
09:05we're constantly trying to read the tea leaves the best we can. And, and, um, and when it became
09:11apparent that, you know, these rates were, we weren't, we weren't rolling back over to 4%. They were,
09:17you know, they're sticky there for a while. Then, uh, we knew, Hey, we, we have to, we have
09:22to go be aggressive and, um, leverage our team, which we have a fantastic team, uh, that, that
09:28we built throughout the years as in COVID help accelerate that. Um, you know, cause it, it
09:36was a boon for home, home building. So, uh, so yeah, that's, that's, those were kind of
09:42what we were, you know, what prompted us to do that, to do that.
09:46Right. And, and can you talk a little bit about how, um, hard, um, you know, how, how
09:52hard some of those realizations, um, were to, uh, appreciate and to form into priorities
10:02around how you would, uh, address those challenges, Tyler. Um, you know, you, you can't necessarily
10:08have felt like, Oh, we're, we're, we're just going to take all of this in stride. We've
10:13really got to do some, you know, gut checking on, on how we're going to meet, um, a changing
10:18market.
10:19No, it was, yeah, it was serious gut check. Um, you're, you're cruising along, you're
10:24building plans you've built the last few years. They've been very successful. Um, and
10:29so really challenging those of, Hey, are, is this the best that we can do? Uh, is it? Okay.
10:35Well, this plan has been a bestseller for years. Well, you know, it's, it's a little
10:39dated and it's got too many halls. Um, you know, it's, it's not clicking all the, all
10:45the right, all the right buttons. We've really leaned into two bedroom down plans, two bedroom
10:50down with an office. You know, the people still want offices. I think that that trend
10:55is, is here. So do our plans, you know, reflect what buyers demand? Um, and that's what we'll
11:04get into here, but by having our optionality, we learn a lot about what buyers truly want.
11:12Uh, and then we, we, we try our best to react to that.
11:16I think, um, Tyler is one thing is in that, in that process of the realization, it was a,
11:25like Tyler said, it was a gut check. It was quick. Um, when it, when the realization set
11:31in, you have to act really, like you said, aggressively and quickly. And we, when we basically
11:39came to that realization, we scrapped an entire community worth of plans that was about to
11:43launch and revamped plans. We were like, okay, we're not going to launch next month with our
11:49existing because this is not working. And basically scrapped eight months of work and revamped it
11:54in a month to meet that market need, you know, it was, it was an aggressive, bold move, but all the
12:01signs were pointing to that. Yeah. And could I ask, I mean, we're, we're, uh, talking about
12:09investing and committing, um, to using the feedback that you're getting from your customers to, um, put,
12:19put money into R and D when others, um, are starting to sharpen their pencils and, and, um,
12:25look to cut back on, uh, those kinds of expenditures that may not seem essential. So could you talk about
12:34how signature in its operational philosophy or its principles, um, kind of, you know, uh, makes that, um,
12:45core to how it goes forward, Tyler? Well, one, our, our leadership team has always thought long-term
12:51and always makes decisions, you know, conservative decisions focused on the long-term, how, how are we,
12:59uh, strengthened and insulated. So, uh, as I mentioned, COVID is, was a boon for, for building.
13:06So we did well, uh, and then we reinvested that, um, you know, because otherwise,
13:14uh, we don't want to compete on price, you know, we're, we're not, we can't be the low cost
13:19producer. So we have to differentiate, um, in, in other ways. And we've got our team built up and
13:26we want to, uh, keep our, if we can keep our trades busy and keep, keep our team, uh, you know,
13:33optimized, uh, it's worth that investment to not have to lose subs, lose employees, uh, keep our turn up,
13:43you know, maybe we sacrifice some margin, um, percent wise, but, but that's, uh, uh, so that's,
13:53that's our, you know, that's our philosophy there. Right. And, and Kyle, uh, how does the R&D
14:02translate given that, uh, the market certainly is presenting challenges for households, um, both
14:10financial and psychological, how does the R&D translate into homes that kind of cut through
14:18on that emotional level with today's buyers? Um, yeah, uh, part of it was, you know, we, we do a
14:28lot of market research and actually go and see custom stuff and see what outside of the production
14:35world, what people are buying and what, what drives, um, emotion houses. Right. And then we came back
14:43to, um, kind of our core and said, okay, how can we implement some of these aspects into our plans
14:51that make them more, more of a custom feel, more of a, this person is getting exactly what they dreamed
14:58of instead of a, um, what they settled for. Um, and a lot of that was just comparing, you know,
15:09kind of like I said, custom, but like we're, we try and emulate that the best we can and do it in a
15:15production environment that we can get to look, but it doesn't break ourselves. It doesn't break our
15:20systems. Um, and we can still offer it. Like Tyler said, keep our, our turn rate the same. So that
15:27that was the bigger challenge to me that demanded, like, how do we do this, but not break everything
15:33else we do. Right now, Mark, I want to bring you in here because we're talking about a business
15:41challenge, um, and a, and a market challenge. And if you could talk about how, from a systems
15:48perspective, um, how does hierarchy enter, um, the conversation and the, and the need to, um,
15:56become part of a workflow that, um, uh, adds value to the, the value stream from a leadership
16:05standpoint? Well, hire can create a kind of operational capability once it's stood up for
16:13a production builder. And what I mean by that is, um, changing product, uh, is, can be difficult
16:21in a production home building environment because you have to keep your turns up because everybody
16:26in the business is kind of in the business of keeping the business running in every community.
16:32Um, and the problem with changing product is now you have to, not only do you have to change the,
16:38um, uh, the actual drawings that, um, are the kind of source of truth for what a product is,
16:45the home is, but then you have to pass those drawings around to everybody else in the business.
16:50And then they have to go and do their part, whether that's the sales and the marketing team
16:54who has to transform those drawings into, um, something that can faithfully represent them
17:00to buyers in a compelling way, or whether that's to the estimating, the purchasing teams who now have
17:05to go and do revisions with their trades and potentially with, with suppliers. And that can just,
17:11um, that can be difficult and it can take, uh, quite some time and it's all rooted in the problem
17:15of drawings needing to be passed around. So hire can create a kind of, we're, we're a class
17:20of software that's about automation and, uh, eliminating the, the need to kind of repeat
17:26yourself. Um, and we do that by replacing drawings with more of like, um, think of it like, uh, if the,
17:34if the drawings turn into software, where when you change them, all the other things we talked
17:38about can change automatically. So it kind of gives you an operational ability to change as a builder
17:44that can give you the confidence to actually offer more options or try something out in the market
17:49that, um, maybe it's not as the stakes aren't as high because you can always change again if you need
17:55to. Right. And, and you've had, um, experience in enough operations in addition to a signature to
18:03have some learnings as to, um, how in a, um, heightened, um, pencil sharpening expense
18:14reduction, uh, mentality, uh, that many home builders are pursuing right now so they can
18:21mark their home products to market and, and, and price to, um, reach some pace. So, um, can you talk
18:29about what data you look at that, that helps to bring, um, velocity, uh, to the product development
18:38and the, and the construction process as a solution that's a near return solution, um, as well as a
18:45strategic one? Well, I don't think there's a silver bullet when it comes to implementing systematic,
18:52like, um, um, like operating, think of it as like an operating system level technology, whether it's an
18:59ERP or, um, a plot product platform like higher, higher is a connected product platform. Um, and, and,
19:08um, so implementation, it will take time for a production builder is running a, um, a sizable
19:14business where the homes are the products and the cost of failure is high. And that's rightfully
19:20something that I think a lot of folks, um, approach with some fear and trepidation. And so it takes a
19:25kind of first commitment to leveling up the, uh, the sort of operational, operational aspects of the
19:32business, not just software, but kind of process and product strategy, you know, um, like the
19:38idea that you could have a single, um, uh, uh, uh, master set to leverage across many communities,
19:46you know, then you can do, you can derive your community level, um, set of, uh, drawings from one
19:53set of documents instead of kind of separating them and managing many products. This is a different
19:59way of thinking sometimes for folks. So it's not just software, it's operational, but I think once you do
20:04it, you get this amazing, um, new operating mode where you can just cut out lots of steps,
20:10right? Like one person can do the work of like five people, right? And once you're running, like
20:16with this thing, it's like, let's say you've got a new community and you're taking an existing
20:22plan and you're just configuring it for that community with options. You're eliminating the
20:27need to go back to drafting and design. You're eliminating the need to like go out to a third party
20:32for marketing. One single person can actually do a lot when they're empowered with kind of this
20:38control, control capability of homes as products on, on the web. Right now that let's hear that from
20:47Tyler's perspective in terms of why Signature felt that Highark was a part of its solution and given the
20:55challenges. Yeah. A single source of truth, you know, is what Mark's talking about where before,
21:02everything's disconnected. So if you change something here, I got to change it in three
21:07other places and roll it through estimating. So this software that the main thing, the greatest
21:16thing it brings is if we change a plan, it's changing the marketing automatically. It's updating
21:21the takeoff automatically. Uh, as he mentioned, there's, there's a lot of work involved. You know,
21:26build your templates and build it right. Uh, but the, the ability to leverage it is, is awesome.
21:34Uh, and once you get your templates built, you can draw very fast and you eliminate the even
21:41possibility of making those simple clerical errors where maybe you, you know, forgot a step or clicked
21:49on something wrong because you're, you're building a template and then, and then you go, right? So we
21:54don't have to draw. If we want one by six trim on all our windows, we built that template and it puts
21:59one by six trim on the windows. So we don't have to think about it. So, um, there are a million
22:05examples like that. So, um, so we've seen it drastically improve our, our times to, um, to actually draw
22:14plans. And then of course us, we're, we're leveraging that into more stuff. We're not,
22:20we're, uh, so we're, we're taking our, our, that time that we're saving and leveraging that into
22:27better product. So that's, and that's, so ultimately that's helping us with sales, especially
22:33in this tough market. We've reinvented what we're calling our signature series, which is what we
22:38did last year, uh, where we got rid of our hauls with more dramatic, really compelling people to buy,
22:47uh, something new has, what wasn't being seen, uh, except in a really high end stuff. Uh, and now
22:54we're figuring out how to, with hierarchs help a big ability to, to scale that, to scale that. Wow.
23:01Um, so yeah, here's, here's a original on the screen is our, this was one of our first signature series.
23:10And, um, um, yeah, it's an awesome house, lots of two story spaces, curved stairs. We really pushed
23:18the envelope on this. Um, and this, you know, this home sells for around 800,000 in Birmingham,
23:26a little over a million in Nashville, uh, for the, for the base price. Uh, but you can see Mark,
23:34what he's showing there. And we'll get into that and more about how we can present this quickly.
23:39You get the scale, the sense of scale and, uh, you get some configurability,
23:44but it's not too much configurability where it becomes paralyzing. Uh, the paradox of choice is
23:52real. You know, that how much choice you show the buyer is something we're always wrestling with.
23:58Um, we went too far in that direction. We've gone too far in that direction at times,
24:03and then, then it becomes confusing and we're losing the, losing the impact.
24:09Yeah. Can I, can I ask, uh, if, if we could back up just a little bit and maybe Kyle,
24:14you could lead on this, um, to talk a little bit about the before, um, not at an abstract level,
24:21but, you know, how you were evolving your plan set from a before to after, um, so that there's just,
24:29uh, an understanding of, uh, um, just in kind of the, um, the, the real and then, and then going into
24:38the capability, um, that allowed you to simplify plan management and, um, then kind of streamline and,
24:46and get to these, um, new set. So just take us to the full before plans and then how they evolve.
24:53Uh, yeah. Thanks, John. Um, the, I mean, we, we transitioned about four years ago. We were in CAD,
25:03we tried to have this, that, that source of where we just used one master plan, um,
25:10quickly ditched that when we were in CAD and had too many versions, too many things to control,
25:14switch to Revit, um, and kind of push Revit to the max, right? Like we, um, hit a lot of roadblocks.
25:22It's super customizable, but everything's manual. And then you reach a limit where we're still ending
25:28up with, like, if I have a plan that has three versions and three elevations and it's in three
25:33communities exponentially, I, uh, you know, 27 plans out there that I'm having to maintain essentially.
25:39Um, so that became almost unmanageable, you know, um, in a, in a sense of you can create it,
25:50but keeping everything updated and at the same pace, right, was where that got really hard.
25:55Um, and we are, as we quickly adapt to the market, every time we release a phase,
26:00we might be making updates to the plan based on the, the market's feedback from the last phase of that
26:05community. Um, and, and now with what higher gives us the ability to do is like Mark said,
26:12we have that one master plan. Uh, I have operational options that I can control that
26:17isn't something the home owner is going to select, right? It's something we control on the front end.
26:21And when we set up a community that says, these are the standards, these are the included options,
26:27right? Like stuff that is like an included level of optionality to that community.
26:31And then we can do that exponential, however many communities we need. Um,
26:40and, and then at the end of the day, I'm managing one file because now my elevations also live within
26:46the same file because it's an optional control. Um, if I may, if we find an error or we find something
26:52we need to make an update to, I can update that one core file and it can fix every community worth of
26:58plans in one click, you know, like it just pushes downstream. So that, that, uh, operational
27:04efficiency we gain in that is just massive. And it also eliminates, we don't end up with the,
27:11you know, I got eight of the versions. I missed this one. And now I have this home buyer that thought
27:15they were getting something other than what they actually are, you know, because we just a human
27:19error and that's where it's huge is using technology to bridge that human error gap.
27:23Yeah. Keeping up with the pace of change, John, you know, keeping up with the pace of change is huge.
27:29So this allows us to do that with, with a changing market and react quickly, um, and much more,
27:38much more efficiently than we, uh, were able to before.
27:41Right. And at the pace of change telling you the market, telling you that personalization
27:49is very, very important and, and potentially, you know, get you across the goal line with,
27:53with customers and being able to personalize. And then as a business, you need to be able to scale
27:58that person that personalization, right? So, um, that's what we're getting with the, with the
28:04cutover from how you were doing things before to this new way with hierarch, right? Um, that you can
28:13achieve both the customization that your customers need to feel like they're getting now and do it in
28:21a way that's elegant, um, and, and very manageable from the standard point of buildability and, um,
28:27the accountability of your, your whole team.
28:30Yes, sir. So take that plan we had on the screen. That was the original version.
28:36And you can see it's very large house and two stories everywhere. Uh, well, not everyone can
28:41afford to do the entire thing, especially with, with, uh, the rates where they are. So we've actually,
28:49we actually have smaller versions of that house now, and then we scale it up. So we have that house
28:54now has a $200,000 range from the base version to the, uh, largest version. So if you want,
29:03you know, if you really like that house, but you know, you're willing to just have a, you know,
29:07some of the wow, but not all the wow, maybe you have the two story foyer and the, uh, but not the
29:13two story living room, a little bit smaller upstairs. You don't need that much space. It's
29:174,300 square foot house. So that's, and by doing that too, we're going to learn a lot. So this next
29:23iteration, we're going to roll out multiple versions and we're going to see, you know,
29:29what works and it'll probably be different. What works in Birmingham will probably be different
29:34than what's working in Nashville. And, um, you know, this software too, gives us the flexibility
29:41to easily maintain all these options and then we can turn them on and off, you know, by community,
29:48by division, you know, however we need to, to show what we want to show.
29:55Yeah. Right. Uh, two is like Tyler said, it's almost like the signature series your way,
30:01you know, it's that given the buyers, the ability to pick and choose a few key aspects, um,
30:09of that plan and not have to go for the whole thing, you know? Um, and also the, the, the data
30:19that we're going to get from it right now, we like that price gap, they're either, they buy a
30:25I guess our standard series or they buy a signature series and we don't know what piece of that signature
30:29series truly sold them on that house. Or now the way it's optioned out, we'll be able to know
30:35exactly, um, kind of what's perceived value to the home buyer. Right. And that's a, that's a big key
30:44for making future decisions. Mark, would you go back to that previous floor plan? And so go,
30:50if you go to the second floor, you can get into the, I believe this has the, where you can, so that's
30:58see a very large second floor and there are multiple versions of that second floor that are,
31:03that are different sizes. Now we're, we'll, we'll be able to basically chop that second floor in half
31:11for someone who doesn't need that much space and can save, uh, you know, save that cost.
31:19Yeah. Mark, also you can go to expanded den options and shrink it down to the standard den.
31:25And that'll show you the very base level of that house.
31:33But the point being is that this thing's extremely flexible and, and allows us to hit the market
31:40where the buyers are. If we're in a more price conscious market, we can do the more price focused
31:45version of this plan. If we're in a higher end market, we get an infill piece or something where,
31:51where the, um, the demand for that, the, the largest one is there, then, then we'll,
31:58we'll, uh, market that one. So it allows us to be really flexible and keep our plan countdown.
32:09So can you talk to, um, I, I think, I think we're experiencing a couple of different, um,
32:17applications here. One redounding to the operational construction, um, product design and, and then the
32:26other of the visualizations that the, the, the customer prospects would be, uh, you know,
32:33experiencing. So, um, just sort of break out, um, how, uh, some of the variations on, on that master
32:42plan, uh, plan would impact, um, the, the, the product development and the construction cycle and,
32:51uh, um, uh, interlinks with, uh, your trades and, and that sort of thing in terms of buildability.
33:00Sure. So, and Kyle, you can chime in here, but, but we have, uh, we'll take the Cantor plan. We had
33:06three versions of that plan originally, um, all shared elevations. It's a little confusing for the
33:12buyers because it was all the same core plan, but they had different interiors, but the interiors
33:18were so different that we could not manage it before an all-in-one file. So we had to create
33:24separate plans. So you have a lot of redundancy where, where vendors are managing, uh, multiple
33:32things that aren't really changing, uh, redundancy in our system. As Kyle mentioned, that exponential
33:38was three times three times three. We were having 27 different versions instead of one, uh, and we
33:44have 27 different budgets. And, uh, so we'll still have some of that, but it will, it will simplify
33:51it a great deal with, with how we manage. We manage it via option. Uh, and also we don't have to,
33:58if we're going to go build a version, we may have an option that never sells. And then if so,
34:03we won't ever spend that overhead time figuring out, you know, doing, going and designing that exact plan,
34:10uh, or, or, or costing that exact plan, or when it's a master plan, you know, we have to go bid that
34:16one out and cost it and get it, get it dialed in. So, uh, the, we have a very large number of few
34:24of iterations and versions of the plans that can be built.
34:29Right. And I also think the operational efficiency of
34:32of the way we do business, we like, we typically don't, uh, we won't, we won't spec these houses
34:40and go and build them before we sell them. So we'll use the, the 3d model or the valuation to do that.
34:47And then, um, as we go, we'll go and do audits, make adjustments if we need to for the field.
34:54And before, you know, you have 27 versions, it's like you're having to go either manually update every
35:01version with what you learned walking that one house in the field, or, you know, seeing if it
35:07even pertains to that version, you know, and need someone to go do an evaluation where now we take
35:14those updates, make an update and one model, one file. And if it pertains to that version,
35:20it'll be affected in that version. If it's, if it's not affected, then it doesn't update essentially.
35:26So it, it gives a level of where we can manage change with less human having to manage change,
35:35right? It's more, um, technology that's helping us manage that change.
35:43Right. And, and may I ask the, maybe Kyle, um, when, when these plans in real time in the,
35:50in the present moment when there is, um, hesitancy, um, what are you learning from,
35:56what, what can you learn from the customer as they experience, uh, these, these visualizations,
36:02these, um, abilities to experience the different, uh, options and opportunities there?
36:09Yeah. Um, no, that's, that's a, that's a huge impact. Like Mark was showing the dollhouse view
36:14and that 3d view is, it's massive, right? Like that, that's called showroom. Um, and when you,
36:21when we get to this level of choice that we're giving our buyer, um, you know, we're, we're
36:27essentially a retail company, we're a sales driven company. So we want to give them the choice, but you
36:32have to give them that choice in a way that's easily digested and the days of 2d collateral.
36:38And, you know, if we have that many options on 2d collateral, our agents and our designers can't
36:44even understand that level of collateral, let alone a home buyer that might look at a floor
36:48plan three or four times in their entire life. So that the ability to show them in a way that's
36:56very simple, like, okay, I see how this changes. Um, and it's very clear. It sets good expectations.
37:03And it also gives us a better, um, you know, a better experience for our home buyers essentially,
37:11because it's a much clearer, easier to understand process to know what they're buying and getting
37:16exactly what they want. Yeah. And this is also forcing us to draw, we, with Revit, we could take,
37:27we didn't always draw all the elevations of the different options. Now we, we draw all the
37:34elevations. We find all the problems before we build the house. Uh, so we talked about earlier
37:40about keeping our cycle times up or cycle times where they are not losing days. Uh, we're, we're
37:47running a hundred days from frame drop to, uh, our pre delivery inspection. So we go fast. Uh, so
37:53building these homes in that speed requires us to have, you know, accurate plans. Uh, so by having
38:01these options drawn out and the software actually helps you draw the roofs very quickly, uh, you know,
38:09it, it eliminates those errors and allows us to keep our turn up and not let this, this level of
38:15complexity just bury us internally, which is kind of what was happening before. Yeah, definitely.
38:22That's huge, a huge outcome benefit that we've had going from Revit where everything was manually drawn
38:30and higher it's more, we keep, there's a lot more reuse in the actual modeling fields that we can do
38:37in high arc that just saves time in their initial drawing. And like I said, like that, that ability
38:45to draw all of our unique iterations, um, and then see them in 3d cut section views, um, you know,
38:55pan around the house, make sure everything looks good from every angle. Also make sure you don't
38:59have conflicts. The ability to do that quickly is huge. It's an ability that Revit, like I said,
39:06Revit gives you that ability essentially the same way, but it's all manual. It's, it's a huge,
39:10it's a heavy lift. It takes a lot of drafting power and a lot of time to equal a similar level
39:16of execution in high arc. Yeah. Well, I, you, you brought up some amazing points. You've got
39:23great engagement here. Um, the, the pictures, and then your commentary have spurred a lot of questions.
39:28I'd like to just thank you for this part and we'll go into, uh, questions.
39:36All right, John, you ready for me to handle the questions?
39:40Yes. Okay. Uh, let's start with, uh, how did signature balance the cost of investing
39:48in higher arc with ROI on sales and buyer experience?
39:53Yeah. So I'll, I'll talk about that. I mean, one, uh, overhead efficiency. So we, we, uh,
39:59um, we're obviously saving time. We're saving time. Uh, so we, we have less people doing, um,
40:09repetitive tasks. So once you get it, once you get it, um, built, uh, so you can either use that to,
40:17you know, grow your business more or also, um, add more product. So right now we're,
40:24we're adding more products so we can maintain our sales pace that we have, you know, that we,
40:29that we've been accustomed to that we've built our business around. And so that's how we're,
40:34so it's, it's a net cost, um, because we're, we have not, and we have offset other overhead
40:42as well. We're looking at what overhead are we offsetting? We were doing, um, some ad hoc,
40:47we're doing other 3d softwares and, um, how we presented to the market. So obviously we have a
40:56net savings there immediately, and then we could have some overhead savings, but we've chosen to
41:01leverage our overhead rather than, uh, save any overhead. And then of course, the biggest thing
41:06though, that's, that's harder to quantify is how many net sales are we getting from that new product?
41:12Um, but bottom line is we're keeping up with our, with our, uh, start space. So it's, uh, you know,
41:21it's working where we, where we've adopted it. And that's, that's probably the main thing we're,
41:25we're gauging is are these new plans selling, uh, and is this, are we getting the bang for our buck
41:31from this? And, uh, Pierce, uh, so far we've been very happy with that. Yeah. I'd also say that we, uh,
41:39uh, um, on the operations side, like we, in our product development, we, we want to offer what we
41:47want and how we want to offer it. And, um, we did like the higher removes that the issue of software
41:57being a limiting factor. So there's an inherent cost we're willing to pay to have that, that limiting
42:04factor of software removed, you know, there is, we had reached the limit of what we could do with
42:10Revit and optionality and everything else inefficiencies. And we were trying to keep
42:16progressing with the market and keep progressing on what we offer. So that was a big piece for the,
42:22the product development that just the, the internal teams on the operations side.
42:26Yeah. Yeah. It allows us to lean into our secret sauce, which is bringing, which is building cool
42:32stuff. Yeah. Okay. Uh, the next question that I have are what lessons can other builders learn
42:39from the shift to scale the wow? Um, one that's, that's your first idea is usually,
42:47you know, not going to be where you end up. Uh, so you just keep tinkering with it. Uh,
42:53cause we started with, uh, with that larger version. It was six, some plans were successful
43:00in some markets and other markets. It was just too expensive. It doesn't, it didn't sell well.
43:05Um, so, you know, being willing to change and, and that's where it's cause we were already going
43:13down a path of, of how do we, how do we change this? But it was going to be very, uh, tedious to do so.
43:21And so that's where, again, hierarchy helps it from being as tedious so that we can learn from,
43:27okay, this worked in this market. It didn't work in this market. We're getting feedback from sales
43:31that, Hey, if you could do this, this would, this could be, if this could start at a lower price,
43:36you know, I would get more sales, but right here, I'm just, we're just tapped out. So, um,
43:42so yeah, so, and doing cool stuff at a reasonable price is difficult. So it's, uh, you just keep,
43:49keep tinkering with it and figuring out what is creating value. You know,
43:53what is creating value is what we're trying to figure out.
43:58Yeah. We've had some, like, so we've had some hit and some miss, and then we've also had some
44:02situations where, you know, as we rapidly change also rapidly evaluating what we're doing, you know,
44:09and then looking back and okay, like we can make minor changes that don't affect what people love
44:17about this house and save a bunch on costs. We can get the price down, you know,
44:23but you have to be able to move rapidly and make those adjustments quickly.
44:25Okay. Uh, I've got another question, uh, about, it's about team, uh, culture. How does your team's
44:34culture of capability play a role in your commitment and investment and hierarchy's potential for impact?
44:41Yeah. I mean, I can take this one, Tyler, since, uh, we're, we've been rolling pretty well, um, hierarchy,
44:49you know, it's, it's a new thing. It's, it's a new software. Um, everything's got challenges, you know,
44:55and I think Mark said it well earlier. It's not a silver bullet. Um, it's, it takes real work and
45:03you have like real brain work to set up, right? You have to do a lot of the thinking and the logic
45:09to how you, how it works for your company, um, on the front end. And luckily we have a team of
45:16people that just have that, you know, the do or die, don't quit attitude. Right. And they're like,
45:21we're going to power through this one way or another and find the solution because at the end
45:25of the day, you gotta keep the eye on the target of what we're trying to offer and what's the,
45:29what's the core of what we do as a, as a home home builder. Um, and having, having the teams that
45:36are all of that like mentality that, that, that culture just allows us to kind of push through the,
45:44uh, the stress of, you know, not only is market changing, but also bringing in a new software
45:49and figuring that out and how are we going to evolve two aspects of our business in one, one time.
45:59Okay. Uh, I've got another one from, uh, Mike, uh, D Giovanni said, I assume you have spec homes
46:06because you talked about managing even flow. How do you discern the data of options chosen by an actual
46:13home buyer versus when selected by your team as a spec home? So we are about, we, we typically are
46:21a presale builder. We build 80 to 90% presales. So we have a ton of data, uh, from what buyers are
46:29choosing before they build. Uh, and then we use that to influence what we, what we put in our spec homes.
46:36Our spec homes are primarily used at launches to get the products on the ground and get us moving as
46:42quickly as possible. And then for gap fillers for our, uh, even flow production, uh, we'll, we'll use
46:48specs. So we're, we're relying on that data of, of, uh, of what's been selling to our presale customers.
46:55Awesome. I think too, we, uh, we do have in our system where we can discern whether it was a
46:59presale or a spec. So when we're evaluating, uh, take rates on options and stuff, we, we call out
47:08anything that was a spec. We take that out of our data, right? You know, it's sold and people love
47:13it. We want the, the presale data when we run our numbers.
47:19Okay. Uh, I have another one from, uh, we have, depending on this, how long this answer is, we
47:25have room for this one. It may be one more, uh, this is from Scott Fitzpatrick. Have you integrated
47:31procure into your operations? If so, what was your procurement strategy before implementing procure? And
47:38how has it changed? Yeah. So we are, um, procure is actively being implemented right now for our
47:47first launch, which will go live and Q4 this year. Um, that's like on our website, uh, Q4,
47:54early Q4 is when everything will go live. We have it in our sandbox right now. Um, but nothing's out
47:59there to the public. We're just internally testing and procure kind of really, if it fits to what we do,
48:06we are like our, our approach is pieces and parts, you know, as much as possible. We want to control
48:12costs down to the, the, the stick of trim, right. Um, where procure is set up in a way that allows us
48:19to do that. Um, and it, it, it works really well, like for how we, we do our takeoffs existing,
48:29we were able to kind of bridge that gap right into procure for the stuff to get, we, we run,
48:35I guess primarily I'd say entirely jumping if you think this is accurate or not, but about
48:40probably 85 to 90% of our takeoff is pieces and parts. Very few things are turnkey. So that's the
48:48data, the data that hierarchy is giving us is the data we use to drive those pieces and parts number.
48:53Yeah. And to answer the question specifically before we were using plan swift primarily,
48:58uh, now we've eliminated probably half of what we're getting out of plan swift and
49:04we'll continue to eliminate. So we're probably getting half our stuff out of, uh, procure now,
49:10and, but it's in a short implementation period and we'll just continue to add to that number.
49:15Um, what, you know, where it makes sense. There's some things that we're, you know,
49:19we're working out the kinks with how we want the data to, to come out. Um, uh,
49:25but before it was with plan swift primarily and, you know, manual takeoffs.
49:30Okay. And what, this is from, uh, another one from, uh, James Mott or James Matt. In what ways
49:39is signature gathering data to be proactive and how do you quantify this to be predictive
49:44since data is typically lagging in home building? Um, so from, you know, a market perspective, we,
49:54we, we do several surveys and get lots of data on the market at large. Uh, and then obviously
50:02we're, you know, paying attention to as much of the market as we can and, and listen to a lot of
50:08sources, uh, from a buyer perspective. Yeah, it is. We are running take rates all the time. We have
50:16automated reports that run our top sales, top options, top design options, top, top what we call
50:22drawn options. Those are our structural options, uh, top plans, you know, by elevation, we're,
50:29we're culling plans, adding plans. Uh, so, uh, and then anecdotally with the, with real time
50:38feedback from the sales team and design team. So talking to them to get that, you know, up to the
50:44minute and you have to parse that out, you know, cause you're not always getting good data. When you ask
50:48someone, they might be thinking about the latest thing in their, in their mind. So that you, you
50:54weigh that against the data and what you're seeing and, um, and, and that's, that's how we go about it.
51:02Okay. Uh, I know I said, uh, one or two, but I, uh, it looks like we got some time for just a,
51:07uh, a few more. Um, what were the tools needed to consolidate eight months of abandoned product
51:16development work into one month? So, yeah, um, sure willpower. Um, no, it's, uh, so product
51:28development cycles typically it's a, it's, uh, it's an overlap cycle, right? Like we have multiple
51:34communities and we have this overlap where we're running through these parallel phases.
51:38Right. And so in reality, we, uh, you take what would take to, we worked on for eight months.
51:44If you just throw everything else out the window and you're like, all we're going to focus on is
51:49this until it's done and take the entire team and just crumb, just crunch it. I mean, it was basically
51:56all hands on deck for a month, maybe five weeks, just grinding through of how, you know,
52:03redrew the, the core base plans and reviewed them and mark them up and made changes in the first
52:09week. And then you're going through, you know, the second week of, you know, taking them from
52:14a design drawing to a bid set, reviewing everything, making sure everything's working out the way you
52:18want. And week three, you're, you're basically taking steps that took a month and our typical
52:24product development cycle and just doing them in a week with just long days, lots of people.
52:28Yeah. And you're, and you got the core plan that was, we, we kept, we had the core plan
52:33to build on. We had made a lot of decisions on, so a lot of the decisions were still there.
52:39It was okay. How do we, let's, let's add to what we've got here. So it wasn't redoing the
52:45entire eight month process, but it was a very focused, targeted with, with a lot of intensity,
52:51uh, group of people that, that went and got after it.
52:57Okay. I've got another one for, uh, from Chris Winter. We currently hire a third party
53:03for renderings with this software. Do you still need to hire out separately for renderings?
53:07No. Single source of truth. The, the, the, the renders are driven from our models in hierarch,
53:16right? Hire, Mark, feel free to jump in if I butcher this, but they're basically,
53:22they take our model, run it through a rendering engine and that's the rendering, right? It's not,
53:27it's no disconnect. It's not the, the plus, right? It's also a minus. If you model it wrong,
53:33it's going to show up wrong in your rendering. And we have, you know, if Mark was sharing,
53:38we were sharing earlier, some of the, the one that comes in the showroom and then you can
53:43do photo real ones. Uh, you can opt to spend, you know, do it, spend more time and do the photo real
53:48ones. Uh, but that's all still coming through hierarch. Or you can use the ones that are can,
53:54that come out of soft, that come out automatically. Uh, now you have to set it up, right? We had to
54:00hit our designer to give them our exterior pallets. They went and build those. Uh, we reviewed them
54:07and, uh, and then it's off and run. Okay. Uh, I've got, I think our last one here from, uh,
54:14Margaret Potter. Can you elaborate on what type of changes you made to your plan as a reaction,
54:20uh, as a reaction to what was happening in the market? Um, yeah, I mean, largely it's, you know,
54:32we had gone to, you know, during COVID, it was a lot of efficiency. They wanted, you know,
54:39two bedrooms down with a flex, you know, and you end up with a plan that becomes more segmented and more
54:46cut up, more cut up, more hallways. Um, and then we went to this, this mindset of a sight line,
54:52right? Like you want to, we pride ourselves when you can walk in the front door and also see out
54:58like the, the, like on a typical 55 foot wide lot, you, you walk in the front door and you can see
55:04out the windows of the backyard, you know, like get these sight lines where they open up and get bigger.
55:08Um, you can look upstairs and see 60 feet behind the, or 60 feet back into the house of just open
55:15sight lines. Um, just eliminating hallways. Like we got really excited when we could do a plan and
55:22have like less than 50 square foot hallway and a 4,000 square foot plan. Like that's good to use a
55:27space. So like those challenges, that's what we're aiming for. We had a rule called the 39 rules. It was,
55:35you know, three seconds, nine paces to, to wow someone. And now it's basically the zero,
55:42zero rule. We want, as soon as you open the door that, that you're wowed. So that was probably the
55:46biggest thing as Kyle mentioned, less compartmentalized rooms, more, more open floor plans. Uh, and then
55:54now we're leaning into scaling those floor plans. And then obviously, you know, we, we doubled down on
56:01two bedrooms down offices, town, those types of things that are, that are really popular.
56:06Yeah. I think too, the, that wow. When you go through the front door, right? Like
56:11one of the, the biggest compliments of the new product, I was walking, uh, some of the new product
56:18just went, it just got into a finished state and released to public. And I kind of wanted to see,
56:22you know, just how all the design, everything came together. And a homeowner walked in,
56:26looking at the house and stopped at the front door and was just like, this is the coolest house I've
56:30ever seen. And they stepped in the house. All they did was open the front door, you know?
56:35And that kind of meets that goal.
56:39Someone had a question about grading, just real quick. You can draw as detailed as you want with
56:44the grading. Uh, we've gotten pretty granular on it here lately. We've been playing around with it.
56:49It's a lot of fun. Mark was showing the basement house that was, uh, that shows a lot of grade, but we
56:54can, we can draw our driveways exactly how we, you know, how we want. You just have a little,
57:01a little knowledge of, of your grade and, and then you can put the 2% slope on it or 10% or whatever
57:09slope you want and draw it out and you'll get a good visual of what's going on with your, with your
57:14site grading. Yeah. We went a little, a little overkill when we got the, there's a newer feature
57:20and we were, we were out there drawing grade lines and, you know, every foot and just then
57:27like, all right, this might be a little overkill, but you can go in and kind of, um,
57:32basically anything you can draw in like a simple 3d or any type of 3d program you draw
57:36similarly in the high arc for your grade, your driveways, um, you know, retaining walls, all that.
57:42John. Okay. John, Kyle, Tyler, and Mark, uh, thank you all for, for, for joining us. That about wraps up
57:52our webinar, uh, on how outlier home builders win. Sorry. How outlier home, home builders win.
57:59You can't, uh, talk today. So a big thank you to all our panelists for sharing your expertise and for
58:05all of you, our audience, thank you for joining us. Um, if you submitted, if there are any other questions
58:10that were submitted between that last, uh, that last answer and now, uh, we don't have to, uh,
58:16time to cover it. Don't worry. We'll pass over any of the unanswered questions to the panelists
58:20and the, uh, higher team. The builders daily, we'll be sending recording of today's session to
58:25all the registrants next week, and you'll be able to access the full webinar on housingwire.com slash events.
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