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In the Midst of Uncertainty, (Home) Building for the Future

An interview with Ryan Marshall, CEO of PulteGroup
June 2021

When the COVID-19 pandemic sent America into lockdown in March of 2020, PulteGroup, one of the largest home construction companies in the country, moved swiftly into action, thanks to what it had learned in the last economic downturn that began in 2007. The company had tough conversations about how to reduce spending and preserve the health and wellbeing of the company, in addition to ensuring the health and wellbeing of its people, many now working remotely.

What the company and its CEO Ryan Marshall didn’t anticipate was that for home builders, a downturn never really took hold. While navigating the supply chain and pandemic workforce complexity that many other industries had to deal with, U.S. home builders saw unprecedented growth in consumer demand as a work-from-home population pondered a change of scenery — not to mention some fundamental changes to what they want and expect from their homes, which suddenly for many also became full-time schools and offices.

“We endeavored to move in a swifter, quicker way than I think what we did in 2007-2008,” Marshall said. “But in hindsight some of the actions that we took turned out to be unnecessary, because what we anticipated would happen didn't happen. It's been an interesting ride for sure.”

In the spring of 2021, Spencer Stuart’s Jason Baumgarten sat down for a virtual conversation with Marshall, who became PulteGroup’s CEO in 2016 after many years in leadership roles across the company. His efforts in the C-suite haven’t gone unnoticed: Among other accolades, PulteGroup was named in Fortune’s 2021 list of 100 Best Companies to Work For.

In this interview, edited below for brevity, Marshall talks about leading during crisis and opportunity, and how the pandemic has altered the things people value in their personal spaces.

Take us back to the beginning of the pandemic. From a leadership perspective, what were kind of the first big reactions?

Organizationally, we were focused on our people and making sure we put them in the safest position while continuing to operate our business which was considered an essential service. Operationally, we wanted to draw upon the lessons learned from the last major economic downturn, which hit housing really hard. We stopped unnecessary spending and focused on capital preservation. We worked to figure out how are we going to have people work remotely and keep them safe.

What we didn’t foresee is how important the home would become, and in particular the need to have the right home with all of the right features. Also, historically, high unemployment does not bode well for housing. Yet this pandemic had a disproportionate impact on the non-home-buying population. It really put a spotlight on the wealth gap that exists within the country, and how much of the burden households that make less than $100,000 have borne during the pandemic.

Looking ahead to the future in home building, what changes do you see?

About two years ago, we rolled out a technology package that became standard in every home that we offer. It was a commercial-style designed Wi-Fi backbone in the ceiling, like you’d usually find in commercial spaces or offices. It’s tough to do that in a house unless you design it there from the start. That’s now standard in every home. And in today's work from home world, Wi-Fi and connectivity are paramount if you're going to work from home at all.

Another design feature we've been offering for a while, but that more people are asking for, is rooms with much higher flexibility. So, we are incorporating flex spaces that you can choose to use for work, or school, or even a home gym. Having the option for those types of spaces has become really important for today’s buyers.

I also think that you’re going to see the use of virtual selling tools continue to accelerate. Even early in the pandemic, our sales staff went virtual. We were demonstrating homes on video and using virtual tours and other technology to help buyers with the purchase process. I believe those trends will endure past the pandemic. We're now in the process of rolling out the ability to pick your lot, your home, sign a contract, and provide a deposit entirely online, something that really nobody in the industry does today. That is a change coming out of the pandemic that will endure, and frankly I think, accelerate.

When you think about your own journey as a leader in 2020, what leadership traits were most important for you? Are there any personal habits you adopted over the past year?

One thing that emerged quickly was the need to communicate even the smallest of details. There's so much fear of the unknown, so much fear of uncertainty. I think as managers and leaders, we've all had to figure out how to continue to connect effectively with our workforce remotely. It's not the same as when we were in the office and you have more natural opportunities to connect with each other. To keep our team and our culture strong in this remote environment, we are all working hard to communicate and replicate the small quick, unplanned interactions that happen in an office environment.

I feel like I've become much more efficient with my time. I’m not having to travel as much, and a lot of that has been replaced by a 30-minute or 45-minute Zoom session. I still feel like I'm doing everything I was doing and maybe even more, but have taken all of the travel out. That has allowed me to have a better work-life balance, be healthier, eat better, exercise more, sleep more, which personally has been great for me.

As a leader, because I can’t travel to our offices like I used to, I had to evolve into virtual leadership, figuring out the right tone, the right cadence, the right frequency. There wasn’t necessarily a great playbook for that, so the big headline is overcommunicate even the smallest of details because I think it really helped alleviate fears that were rightly out there.

Empathy is, I believe, a trait that I've always tried to have as a leader, to put yourself in the shoes of your team. But in this environment, a double or triple dose of empathy has been called for and that isn’t likely to go away.