Logan Homes: BIM Case Study

Logan Homes

In the early 2000’s Wilmington, NC-based Logan Homes was known for its 20+ year track record of building fine custom homes. That was until company president D Logan decided he had had enough of the complexity. The company would remain mostly in the build-on-your lot niche, but would take a more production approach. “I decided that we would offer a predefined set of plans,” he says.

While that was a big step towards simplification, the company’s custom legacy followed them. They still offered a nearly unlimited array of options, which were causing inefficiencies and an unacceptable variance rate. Attempts to get the sales staff to limit options had been unsuccessful.

When Logan heard about BIM, however he realized it could be the key to solving the options problem and achieving his vision of streamlined design and estimating. After looking at several software products, he settled on Simpson Stong-Tie’s Vertex BD building design and Pipeline estimating programs.

Despite great software, however, Logan quickly realized that getting to his vision would require discipline and determination. It’s a lesson any builder going down this path should take to heart.

Making Things Simple

One big benefit of the BIM system is that it made it possible to completely eliminate custom options. The company still offers a wide range of options, from faucet and cabinet upgrades to sunrooms and porches, but salespeople can only see, and can only sell, those that have been pre-defined. “If it’s not in our brochure and our database it can’t be sold,” says Logan. This has greatly reduced design and estimating time. “We can create a lot-specific plan in about 1 1/2 to 2 hours,” he says. In addition, the Pipeline software will quickly generate a hyper accurate bill of materials.

Achieving these benefits is where discipline really earned its keep. “The Simpson system is completely trouble free, but getting everything converted to BIM and working the way we needed it to work took about three years,” he recalls.

The first half year and a half consisted of setting up the software, creating the BIM database, and standardizing definitions and descriptions of all the items in that database. It also included customizing the software to how Logan built. “The provider’s initial quote didn’t really address the way we did things,” he recalls. “We had to revise it for the windows we used, the way we do tie-downs and a lot of other details.”

The rest of the time was spent converting plans into Vertex and integrating them with the BIM database. “We had three full time drafters and a project manager working on 50 plans,” he recalls. “We also had a good consultant to help us, which proved invaluable.”

Logan realizes that he’s unusual and that most builders will start by converting just some of their plans to BIM. Based on his experience, he believes that by partnering with a good consultant, a company with 15 plans can set up and configure the software in six months and convert the plans in another six months.

Measurable Returns

Today, Logan’s job estimates require a fraction of the time they used to and plans automatically adjust for each option. For example if a customer upgrades the master bath faucet, the system will automatically switch out the parts and adjust the pricing.

And if the company decides to change a global construction detail, the change will apply to all plans. “Say you decide to switch from 2×4’s 16 on-center to 2×6’s at 24 inches. With the right software setup, if you change stud spacing on one plan, the rest of your plans will automatically update.”

The system’s accurate estimates have made it possible for the company to track what’s being wasted, where and by whom. “If the software says you need 152 sheets of plywood you can count on it. It’s not almost right, it’s exactly right,” he says. “So if the job takes 174 sheets then you know you have a problem.”

In fact by getting together once a week to compare estimated and actual costs, Logan and his management team have been able to identify a range of variances and work with crews to greatly reduce them. “Three years ago our variances we were averaging $30 to $40,000 per week. That quickly fell to $12,000.  Now we have weeks with just $5 to $6,000 in variances.”

Logan says that the system has has also lessened the company’s reliance on skilled designers. “Once the software is set up everything becomes easy. You can hire a drafter right out of college and have them fully trained in 2 to 3 months. You don’t need the experienced construction expert to make sure the plan details are accurate because the system ensures that.”

These efficiencies have made it possible for each staffer to produce more work, which has allowed the company grow its volume without hiring. “We haven’t cut staff because the company is growing 20-30% per year,” he says.

Resistance Must Be Futile

The road to these benefits included resistance from various parts of the company. “It caused a big uproar,” says Logan. Overcoming that resistance is where his determination paid off.

For instance the company’s salespeople naturally wanted to please customers, but doubted they could do so without custom options. To find the truth, Logan asked other builders that had used BIM to eliminate custom options for their experiences. They told him what he already suspected: that salespeople just needed training on how to show customers how those standard options would satisfy their need and wants. “Those other builders confirmed that customers would respond to suggestions presented in the right ways, and I’ve since found that to be true.”

The new system also brought a shift in how the company paid subs and suppliers, something the accounting staff didn’t exactly welcome. They insisted that vendors wouldn’t pay from purchase orders but the truth was that they didn’t want to change the way they did things.

The bottom line is that while BIM requires people to adapt, they will do so if you combine training with the message that there’s no other choice.

“If you want to set your company apart you need to do things others aren’t willing to do,” says Logan. “In the case of BIM, the company owner has to be all in and has to make it clear that this is the new way of doing things. That kind of commitment is an attribute of all successful people.”