by Dennis Jones

In 1971 when Southwest Airlines began running flights out of Love Field, few imagined the upstart airline would become the darling of the industry thirty years later. When asked in a December 2005 Wall Street Journal interview how Southwest Airlines has become so successful in today’s cutthroat environment, CEO Gary Kelly pointed to one of his five management tenets, “Recognize that change is inevitable – if competitors change for the better, so will we.”

The certainty and constancy of change is by no means a new concept, and has become a cliché of consultants, self-help therapists, and even those in our own industry. Instead what struck me the most about this message from someone who knows, is that too often change is viewed negatively. We all know change is going to occur, but we do all we can to fight it. We admit its inevitability, but refuse to accept it. This happens in many industries, and in the modular industry as well.

The question I have is why?

Modular year-over-year growth leveled in 2005 while the site-built market made gains. Our growth over the past few years has been tremendous, but an estimated 42,900 homes in annual modular production compared to new home sales of 1.28 million should hardly make us resistant to change. What’s more is there is an increasing number of new entrants into the modular housing marketplace bringing with them new capital, new ideas, more production capacity, and new distribution capabilities. These people and concepts should be embraced, not shunned. The industry needs to do more to welcome those who want to produce and build with modular homes, not stonewall them. As an industry we have a duty to show those how to do it the right way, not cast them off only to have them do it the wrong way. It takes a positive attitude, not a combative one.

Change is not easy, and can often be tedious and challenging, but the NMHC strives to build consensus within the industry, knowing that the best way to resolve differences is by joining together and having mutual respect for each other rather than firing broadsides at a distance and accomplishing nothing. If you haven’t participated or contacted the National Modular Housing Council or the association in your state, I invite you to do so by visiting www.modularcouncil.org. Membership and industry involvement is vital to our success, as it is for yours.

It’s not everyday that someone suggests Southwest Airlines and the modular industry have a lot in common. But the gains of the upstart-now-giant and modular residential housing market may have more similarities than you might think. Healthy competition, and change, brings success to us all, and increasing the level of competition invariably will grow the marketplace, make it better, and do the same for our industry.

As always, I welcome your thoughts and comments. I can be reached at dennisj@r-anell.com.

Dennis Jones
Chair, National Modular Housing Council
President, R-Anell Housing Group