Since homebuilding is an industry that leverages equity with debt, the best indicator of economic return is some measure of Return on Assets.  The expanded view of ROA presented in the DuPont identity makes it clear that economic return has two components:  Margin (reflected as Return on Sales) and Velocity (reflected as Asset Turn).

It says this:  In order to succeed – in order to survive – homebuilders need to succeed on both sides of Return on Assets – the margin side of ROA and the velocity side of ROA.  How much can my company make on every house?  How many houses can my company build with a planned, finite, and controlled amount of inventory and production capacity?

As a builder, consider this scenario:  if you generate a Gross Margin of 24% and turn your inventory twice a year, you will be outperformed – more than two-to-one – by a builder that generates a Gross Margin of only 18%, but turns its inventory four times a year;  outperformed in terms of Net Income, outperformed in terms of Return on Assets.

And so, you will struggle to survive.

Operationally, it is a picture of the difference between you as a builder with 180-day cycle time and a builder with 90-day cycle time.  If, in your view, that picture is too stark, consider a more subtle scenario:  the same building company with an 18% Gross Margin and a 4x turn produces almost the same economic return you would with a 24% Gross Margin and a 3x turn; a picture of 120-day cycle time versus 90-day cycle time.

In the face of clear differences in economic outcomes, note that the builders represented in these scenarios – you and your competitor – are exactly the same size, when the real, operable measure of size is the amount of work-in-process each of you has to carry;  you each have the same resource overhead, the same working capital requirements, the same risk profile.

Homebuilding is relatively immune from the penalties that elasticity of supply and demand would impose downwardly on prices in the face of modest, wide-spread, capacity-driven increases in supply.  Homebuilding is, for the most part, a build-to-order process, which tends to regulate short-term supply.

This is not a choice forced between higher margin or higher velocity;  it is the challenge – and the opportunity – of doing both, of maintaining higher margins at higher velocities.

And, yet, despite the obvious advantages of doing so, the demands of achieving higher velocity – the demands of achieving higher productivity – are so hard, require so much rigor, so much discipline, so much resolve, most homebuilding companies won’t make the effort.

And, therein lies the opportunity for sustainable competitive separation.

Pipeline workshops™ are a two-day immersion into the production physics – into the production principles and disciplines – that enable homebuilders to thrive on the velocity side of economic return®, that enable builders to thrive on the velocity side of Return on Assets.

The understanding and expertise delivered in a Pipeline workshop™ pulls extensively from the best book on the subject:  The Pipeline: A Picture of Homebuilding Production©, now in its second edition.


“The simulations were a brilliant way to demonstrate and drive home the significance of cycle time improvements and improving trade partner efficiencies on ROA and Net Income.”   (Keith Porterfield, COO, Goodall Homes, Gallatin, TN)

“Pipeline workshops, through hands-on simulations and classroom instruction, provide excellent learning experiences to see WIP turns at different velocities, and the effects on Return on Assets.  The principles and disciplines, if applied in the field by you as a builder, will increase your ROA.”  (Scott Jagoe, President, Jagoe Homes, Owensboro, KY

“I participated in the first-ever [Pipeline workshop™], spending two days exploring the ins-and-outs of production, inventory, and scheduling.  It was quite intense, challenging, and not for the intellectually lazy.”  (Scott Sedam, President, TrueNorth Development, from the April, 2014 issue of Professional Builder, “Taming the Chaos”)

“At the end of the day, running a successful business is about how much money you make on the amount of money you invest.  The Pipeline workshop™ helped me understand this better than any workshop or seminar I’ve ever attended.  I highly recommend it.  This workshop was really eye-opening!”  (Charles Roberts, Vice President – Operations, Providence Homes, Jacksonville, FL)


  a strong, visual image of a homebuilding production system – its purpose, its size, its cost, and its capacity.

  a simple, elegant, actionable understanding of how operating decisions drive business outcomes, and how the measures of operating performance connect to the business outcome measures of profitability and economic return.

•  an ordered manner of thinking and reasoning – a set of mental models – about the relationship and interaction of the dependent parts that comprise a homebuilding production system, providing (1) a systemic approach to solving production problems and managing finite production capacity, and (2) a blended approach to process and project portfolio management that addresses the attributes and parameters particular to homebuilding production.

  a set of velocity accelerators – deeper dives into the tactics, techniques, and practices for dealing with specific areas affecting production management – some immediate, some forward-thinking – all of which contribute to production systems with less variation and waste, fewer errors, shorter schedules, faster build/cycle times, increased production throughput, controlled levels of construction work-in-process, and a more savvy, more motivated, more mutually-accountable homebuilding team.


Pipeline workshops™ are not about job titles, operational scope, or company size.  They are designed for anyone charged with the critical, economic do-or-die responsibility of managing – or managing the interaction with – homebuilding production at some level of a homebuilding enterprise. 

Pipeline workshops™ are for those who must understand homebuilding production and drive results, including:

  • C-Level Executives – Presidents, CEOs, CFOs
  • Division and Regional Managers
  • Vice Presidents of Operations and Construction
  • Vice Presidents of Sales and Marketing
  • Production Managers
  • Construction Managers
  • Design, Estimating, and Purchasing Managers

Pipeline workshops™ are also recommended equivalent positions with building trade partners – for the manufacturers, distributors, suppliers, and subcontractors who must interact with builders in the value stream.

DATE AND LOCATION:  March 23-24, 2022, at the Ponte Vedra Inn and Club, in Ponte Vedra Beach, Florida.

COST: $945.00 per person.  Early Registration (December 13, 2021 through January 14, 2022):  $795.00.  Attendees are required to stay two nights at the Ponte Vedra Inn and Club.  For team pricing, contact:  flgroves@saiconsulting.com.