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Hi Friend,
I haven’t much time. It’s snowing, again, and so beautiful here at Inchoate. I am feeling tired, run down, and sad to see Chloe leave so soon after I have returned from Colorado. I’m excited about all the tasks I have before me, and feeling like I have an awareness of the critical path like never before.
I’m leading into how this relates to housing in Maine.
I can best relate it to windsurfing – that epiphany of learning to steer by moving the mast around, changing the center of effort in relation to the apparent wind. It’s this complex dynamic system which would take an hour to explain, and yet your body just learns to intuit the necessary inputs. It is like magic, and when it happens, you go exactly where you want to go, as quickly as possible.
Knowing how the process has to work, by feel, as you step onto the board – it is a strange feeling of anticipation which is so difficult to describe.
My work for CCR and my work for town government are giving me opportunities to flex muscles which have been dormant since RMS. I love small scale, and I love being a tiny crucial part of some larger system. It gives me an opportunity to really observe what is working and gain confidence in my insights.
My friendship with DS has been so confidence inspiring, too. He has reminded me of a belief which, frankly, was beaten out of me those last couple of years with RMS, which is that if you focus on a crucial idea, and share it with people, that is the most valuable change one can hope to make. It is the opening of minds and the re-attunement of focus.
In project management, the critical path typically described as “the longest sequence of tasks that must be completed to complete a project. “
What this is trying to say is that there is a difference between stuff you can do in your downtime, while waiting for something, and something you must do immediately or the project stalls out.
In other words, if you need to order a part before making a repair, you want to get that part ordered and shipped as quickly as possible – or you might be waiting around for days before making the next step of the repair.
If you’re making pizza, you want to let the dough rise the night before – the rest of the process goes quickly, especially if you prep all your other ingredients and preheat the oven before the dough is ready.
My critical path to making an impact in housing in Maine requires a certain confidence. I have been previously loathe to take a stand because I assumed many smarter and more talented people, people with real experience in housing, were already trying what I’d suggest. I’m not at all confident in this anymore.
Really, I’m more confident that even if anyone else is addressing the problem this way, my optimal course of action is to assume they are not, and generate noise until someone tells be differently.
There are so many flawed ideas being advocated that even if what I’m suggesting is also highly unlikely to succeed, the cost of one more bad idea is very small compared to the possible benefit of one good one. I am already applying decision analysis in new ways, and I haven’t even finished applying to Minerva yet.
So here are the ideas I want to commit to and see where they land:
- A value stream map of the costs of developing housing
- A better data dashboard from MaineHousing to allow communities to make real decisions
- A push to preserve more livable housing for people
Why these three things?
Value Stream is everything. We cannot get out of the housing crisis just by moving big pots of money around, we must create value. Housing, because it involves large sums of money, has become totally warped by politics, wall street and big banks.
It is a reality that real change in housing will require massive investment, a.k.a capital.
We must choose our poison, and I’d rather choose to view this as a huge market ripe for disruption than as a tool for wall street to generate reliable returns. We need a model which shows a significant upside potential in order to be worth investment. This begins with looking for specific opportunities to dramatically reduce costs.
(This is where I’d usually mention Elon Musk’s philosophy behind SpaceX but sadly he’s become so toxic lately.)
The big costs are:
- Materials
- Labor
- Transportation
- Inventory/Work In Process
- Administration & Overhead
Data Dashboard
Let me tell you, if you went into a manufacturer of cars or smartphones and told them you had market data on their median customer, they’d laugh at you. Similarly, it is ridiculous to have such crude metrics on housing demand. We need 10,000 to 50,000 houses, people say. How is that measured? What is the error range? When do we need them by? Who is building them? What price must we sell them at for there to be a market?
Most of this can be figured out by timely data. We need to understand what the pipeline and demand are for our product, and start thinking about this as if it were a process we can control.
We should make enough houses at the right price and location for various market segments, and we must figure out ways to both stimulate and retard housing development, at scale, in order to build the homes people actually need.
Preserving What Exists
This is related to the data problem. We need to know how quickly existing housing is becoming unavailable. In sales this is called the “leaky bucket”.
You need to know how to balance your energies between new customers and existing customers, or else you can put all your efforts into acquiring new customers while old ones stop buying. The bucket needs to be filling faster than it’s leaking, or else you end up eventually with an empty bucket.
Maybe this is less of an issue in urban planning, but in rural places, homes are falling into disrepair at a level unaffordable to the majority of buyers, or are becoming so desirable that they are selling at prices out of reach to the majority. We need to stabilize the livability and prices of our existing housing stock, or we will end up with extremely high vacancy numbers (even if our crude data dashboard fails to show the true vacancy rate).
So this this my three point housing plan. This is my critical path of focus. What do you think?
Love,
Brad