Taylor Morrison
Q & A with CEO Sheryl Palmer
"You cannot envision the future until we have stability in the industry. We still have a tough road ahead. Any level of sensibility and predictability will be welcomed."
Sheryl Palmer is president and CEO of Taylor Morrison Homes. She recently spoke with Arizona Homebuilder regarding her company, her personal journey and the future of the industry.
HB: How did you get started in the homebuilding industry?
SP: I was in marketing and advertising and became advertising manager for one of my accounts, Del Webb. Corporate culture wasn't quite my thing, and someone talked me into going into the field. I got my real estate license and became sales manager at Sun City West in Phoenix. That was my first experience in the field and I loved it! I continued through operations and then left Del Webb and went to a private company in Northern California called Black Hawk then with Pulte. I've now been with Morrison for almost two years.
HB: Why do you think the merger will be a successful venture?
SP: The success and skill sets of the two companies really complement each other. Morrison Homes had a large homebuilding operation and Taylor Woodrow had a larger land development operation. Which one was larger depends on whether you are talking about home sales or revenue, but from an employee count and geographic footprint, I'd say they were pretty close. That's what made the merger so ideal. It's very exciting, actually.
HB: Did you know you would have the position of CEO after the merger?
SP: Oh, no. I started in May 2006 and really liked where they were with their growth plans but we didn't know anything about the merger until the first quarter of '07. That's when this opportunity presented itself. There were two of us who were in the same role. The board knew the other gentleman before I met the chairman of the board. I went to London and interviewed?and it all just happened.
HB: Where does Taylor Morrison build?
SP: Our parent company is in the UK?we're actually privately owned for a public UK company. We have divisions in California, Arizona, Colorado, Texas, Nevada and Florida, and we obviously have our Monarch division, which is a Canadian business. We are in the top 15 U.S. builders and in the top five in world.
HB: How many employees does Taylor Morrison have and how many homes?
SP: Presently, we have about 1,300 employees. We built approximately 7,000 homes last year.
HB: What is the company philosophy in general?
SP: We're a great balance between a national land developer, master planned community builder and homebuilder. To talk about long-term strategy in today's environment, you have to break it up into pieces. In the short-term, we are in an environment to maximize cash. We need to make sure our store is in order and we are managing assets appropriately. But we are partly a public company and really position ourselves for the future. What it takes is a relentless focus, community by community.
HB: So, you're saying the strategy is different in each specific market?
SP: We may have a global strategy in common?making sure homeowners get the best value?but when you're talking about overall strategy, the strategy in Maricopa will be very different than in Scottsdale. In the same way, you can't generalize across the U.S. Where the industry got a little ahead of itself is that we looked at the whole business universally. You can't lose sight of market differences.
HB: How does having different strategies work in a large company?
SP: I think you start the process at the acquisition standpoint by understanding who the home buyer is. That planning part of process is key because that's where you add value. Then supply and demand is what it all comes down to. We all collectively embrace the idea of building it right the first time but it is our internal cultural to live and breathe in [each market's unique] environment.
HB: How do you promote that internally?
SP: It's really about open communication and empowering our chains. I think our success is in taking advantage of a large organization that is geographically diverse and empowering the management team to make differences. So we can have a culture within the culture. We send a survey to all employees on what's working what's not, and we really care about what they say. The last one we did was right after the merger. We took in that info and established committees to find out the needs and wants of those groups.
Our greatest asset is our people and we care about their futures. That's hard when you're downsizing an organization because the business isn't there. You really have to be responsible to the people who are still there.
HB: What makes your homes appealing?
SP: From a design standpoint, it's the character of our houses. We have a great history of not being the cheapest low-end buy. It's about knowing every submarket and who your buyer is?about taking the time to know. I think that's why Disney selected us to build the "House of the Future."
HB: Tell us about the Disney project.
SP: We couldn't be more excited about. It's very different from the House of the Future that folks will remember from the '60s. This house is really about livability and accessibility. Many features in the house will be things that are available today but aren't well understood yet. Having the opportunity to demonstrate innovative design alongside our group of partners, Microsoft Corp., HP Co and LifeWare, is really quality by association.
HB: What features of the house will probably be adopted in homes in the future?
SP: There will be voice activation features. That technology is here today but it's cutting edge. And then there's the way the technology is tied together throughout the house?everything is computerized. The thing I'm excited about is its accessibility. The innovations are inspiring. We're not far away from announcing an opening date.
HB: Getting back to today, what are the biggest concerns in industry right now and where do you see it heading in the future?
SP: The biggest issue we're still dealing with is consumer confidence. It's depressing when you read the newspaper but I don't think the media shares the full story. Generally what you hear about is the concerning news that is focused on the negative. Without all the facts, the consumer is paralyzed.
As far as the issues we're dealing with regarding inventory and mortgage issues, time is going to help us. It won't go away over night. And it's not all bad. Good change is happening concerning lending practices that maybe were a little over-zealous.
Globally, consumer confidence is a critical factor in getting the economy moving again, and I think we are starting to see movements in certain markets. We are seeing traffic in our sales offices that is encouraging. In fact, we had a record month in March?we actually exceeded our budget. I think we've seen pricing in markets get to the bottom.
You cannot envision the future until we have stability in the industry. We still have a tough road ahead. Any level of sensibility and predictability will be welcomed.
HB: What is it like being a woman who has gone so far up the ladder in a male dominated industry?
SP: It's funny, you're the first one to ask me that. I've been in the business a long time and it has always been a male dominated environment, so I've become numb to it. There are things I'm good at that may have to do with having the female touch, but the opposite can be true for men also.
The most important thing is that we have an appreciation for each other's approach and style. Success is really about relationships with people. You must have the confidence to surround yourself with great people.
What has been most humbling for me, however, has been the reaction of my family. For them, they see it with pride. I didn't have a long term plan to be CEO of a homebuilding company but I've been flexible and have surrounded myself with great people. It's an exciting time in business and I feel incredibly honored to be a part of it. I always remember that I got here with the help of some great people.
Builder Facts
Corporate office: Bradenton, Florida
Founded: 2007 (merger - Taylor Woodrow and Morrison Homes)
Community: Estrella's The Foothills at Wingfield Springs
Models Opened: October 2006
Community Size: 83 lots (80-by-100)
Sales to Date: 36
Floor Plans: Four floor plans from 3-5 bedrooms, 2,138 to 3,320 square feet
Price Range: From the upper $200s to the upper $300s
What home buyers should know:
That we care. That we're there to help them create a lifestyle experience. Also, no surprises at finish line. It's an important life decision, so surprises are not acceptable.
What trade companies should know:
That we are always looking for ways to improve and that we build the relationships with trades that are executed to the best of our ability. I call them trade partners because we can't do it alone.
What sets Taylor Morrison apart from the competition?
That's easy. It's our people.
