Last year, in front of a BBC television audience of millions, Tony Pidgley promised change. His son has taken up the challenge with a series of management moves designed to engineer cultural revolution.
When Tony Pidgley’s son took up the managing director’s post at Berkeley Homes he swept out some of the company’s established senior management and brought in new mds and sales and marketing directors, who the housebuilding industry jokingly referred to as “Tony’s brat pack.”

The rest of the industry has since stopped joking. By bringing fresh faces on board, Pidgley was not looking for an acquiescent management team. He was looking for change.

“I believe Berkeley had a them and us attitude and that doesn’t work,” he says. “It made people nervous and people shied away from bringing new ideas.”

The new management are a strategically selected team (see Directors factfile for the new direction). To see how strategically, you only have to look at the pairing of established Berkeley player and safe pair of hands, Hampshire md Grif Marshalsay with his new sales and marketing director John Carney, who is fresh from residential development in South Africa. Berkeley was the only one of 23 top housebuilders to respond to Carney’s CV when he wanted to return to the UK.

Whatever their background, all of the management team are being encouraged to think the unthinkable, to bring the housebuilder up to speed in some areas where it has been found wanting - like market research - and to come up with ideas to advance the housebuilder’s processes and product (see factfiles). Pidgley is crystal clear about how he will operate with this empowered management team: “I am bringing the vision, the overview and the strategy. I will have failed if I am taking every decision,” he says.

Pidgley’s objective is to make Berkeley Homes into a concept developer, “adding the concept and the lifestyle to a scheme,” he says. “In Surrey we will still be developing the traditional-style five-bedroom detached houses, but with more technology, with products from further afield, and in different styles. We will still have design manuals in the armoury, but equally we may start from zero - which is most likely to happen in London.

“People still see new homes as boxes. I want to attract the 90% of people who buy second-hand homes. We could double or triple the number of new homes sold.” That’s the ultimate prize for The Berkeley Group’s crown prince.

Improving process and product

Mike Freshney is the man with the potential to make the most significant changes to product. The former chairman of Berkeley College Homes’ has been given a mandate to look at procurement, product design and specification, production and prefabrication, and customer service under the distinctly ordinary title of group commercial director. Of the four areas, Freshney is addressing the customer first. “We need to find out from the customer what direction we should be heading in,” he explains. Customer services executives are joining Berkeley’s regional teams, and market research is being lifted up the marketing departments’ agenda. “Berkeley has been notoriously bad at market research,” admits Freshney. Initially that market research is taking the form of regular telephone surveys of existing customers. “We have got to be constantly in touch with customers. We will be going to them two years after they have bought their home to ask if they are moving, and what their home aspirations are.” In the housebuilding process itself, Freshney is initiating the systems to improve fault-finding on site, and testing new products. “I don’t believe we should be absolute pioneers vis-a-vis the customer. But we can do prototypes. We can do a test house,” he says. In fact, the company has several test houses in the pipeline. Freshney plans to try out new products that have caught his eye in a prototype, while Berkeley Partnership Homes is developing an Integer Millennium House at Newbury in Berkshire that will allow it to trial technology, and the market’s reaction to Integer’s innovation. The Integer house will initially be rented by Warden Housing Association but will then be sold. “The acid test will be selling it at the end,” says Alisdair Chant, managing director of Berkeley Partnership Homes. “What we are trying to achieve is showing that Integer can work as an executive-style property.” This prototyping is one way of looking at the potential to update the Home Counties executive home.

What’s changed in the new London scheme?

Its architectural design was finalised before the recent management revolution at Berkeley Homes, but East London region’s upcoming Hermitage Wharf scheme by the Thames in Wapping, London, demonstrates how Berkeley’s schemes in the capital are putting on the specialist developer style. Adventurous architecture, courtesy of Andrew Cowan Architects, has landmark appeal and will appeal to Dan Dare fans with its futuristic curves and aerial-like projections. Air-conditioning, Kupperbusch appliances and stainless-steel cone-shaped wash basins are among the fashion statements in the 93 one, two and three-bed apartments to be marketed in October. “It’s a very modern, high-tech building and the finishing touches complement it,” says David Rick, sales and marketing director.

Marketing by design

The fast-moving London market is the right location for progressing traditional house design to something more adventurous, especially when the new md of West London region is Angus Boag, former director of trendy, alternative loft developer Manhattan Loft Corporation. For him the career move to a mainstream developer was an opportunity to take on more challenging schemes. “You need to be a bigger organisation to do that,” he says. He is already challenging Berkeley’s design orthodoxies. Although he only took on his new job in July, he is “getting away from the normal” by bringing loft development, and maybe even shell units, into the Berkeley portfolio with a scheme at Brook Mews in Bayswater. In Tooting and Fulham the company is planning to do houses that again depart from the design norm. Designs have yet to receive planning approval, but Boag says: “They will look modern from the outside, with lots of glass. The site in Tooting is surrounded by Victorian houses. Buyers would either want Victorian or modern style. Our view is why do pastiche? How can anyone say that people won’t buy good modern design? I believe that good architecture adds enormous value.” In east London, new managing director Darryl Flay, fresh from another London developer Nicholson Estates, has also signalled design changes by putting heavy duty stainless-steel Kupperbusch appliances into kitchens at the Benbow House apartment scheme beside the Thames at Southwark, and has his own high-profile, landmark schemes. Flay and Boag talk to each other “regularly”, another change from old Berkeley days when several regions could find themselves bidding for the same site. Boag has introduced other procedural innovations to make his division operate like a specialist London developer. He has established an in-house design innovation team to pick up on smart ideas from around the world. “They won’t be designing the houses. They will come up with little ideas like fold back walls or clever kitchen units,” says Boag. Staff in the west London office are being reorganised into teams to change their mindset. “There’s a different mentality to this,” says Boag. “There are physical problems like party walls and rights of light to deal with. And London has lots of markets and you need to clearly define what you are going for”. Six years of developing apartments for smart Londoners taught Boag a lot about the growing sophistication of the capital’s market, and he found that the Manhattan Loft name in itself mattered. “There is beginning to be a snob appeal in the market,” he acknowledges. Boag aims to make sure that Berkeley is the right designer label.

Alchemy: converting enquiries to sales

“UK housebuilders don’t have a database. They don’t do relationship marketing. They don’t ask clients what they are looking for.” John Carney, sales and marketing director of Hampshire is clearly astonished at the way the UK housebuilding industry works. He used to be part of it - at the tender age of 20 he became Wimpey Homes’ then-youngest sales negotiator - but having spent time working in South Africa on its premier waterfront developments he has been instilled with a more sophisticated approach to marketing. “I spent a month last year travelling around the world, with an architect and a project manager, looking at schemes, to see how others dealt with issues like parking on waterfront schemes, and learning from others’ mistakes,” he says, describing the kind of job that any UK sales and marketing manager can only dream about. Berkeley has not yet given Carney such a roving brief, but they have given him the chance to apply his marketing theory to one of the company’s schemes. For the Imperial Apartments conversion in Southampton, Carney began marketing early and surveyed the 420 people who enquired about the scheme. Their responses are influencing the product, which is constrained by the existing building, and its pricing. The customer questionnaire covered such issues as: whether buyers wanted parking, because the number of bays was limited; whether they would prefer to be on the inside or the outside of the central core, to assess relative pricing; whether they wanted a smaller 1.5 m bath or a big shower in one-bed units, available bathroom space again being limited; and whether they wanted open plan kitchen/lounges or separate kitchens. The answers allowed Berkeley to tailor its product, and yielded direct benefits in sales. Of the 420 people surveyed, 240 people replied and 190 of those made appointments to come to the sales centre. Subsequently, 34 of those people bought. “It made people feel important,” says Carney. “With direct mail you would expect a one in 10 response, and expect to convert one in 100. We converted around 8% and that was without a show flat, and we maximised values so the build budget was under less pressure and we could actually put more into the scheme.”

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