Case 5.2 KB Homes - discussion question 2

Case 5.2kB Homes If 1956, Dounald Kaufman and Eli Broad launched a Detroit homebuiling company, Kaufman and Bmad Horse Corporation, with a vision of atreamlining the construcrion process for inge-family bornes, driving dowa construction casts, and creating affordable bomes for fier-time hamebuyen. Today, 65 yrans later. KB Homes is recognized as a leading homebuilder and has constructed 655,000 homes acrom 38 U.S. market. KB Homes has continued to pursue innovition in sustainabdity, puhing homebulding industry inno. vation forvard as well. In 2000 , KB Homes first committed iself to building ENERGY STAR" contified bomes, and ir went on to develop its corporate strategy around sutaituble buileting An carly adopter of sustainabitiry in home construction, KB Homes subsequently built is corporate strategy on sustainable building, distinguishing the company from its peen and providing vision and clarity for its long-term corporate objectives: As carly as 2006, the company was named "Most Admirable Homebuilder." a distinction it has also carned multiple times since then. In 2007 , the cormpany published iss first sustainability repors, making its efforrs in the areas of etrvironmental and economic sustainability and social responsibility public. In subsequent ycass, KB Homes has contisued to challenge itself to construction innovation in response to emerging environunental issues in order to benefit its customers, the environment, and human sociery at large. In 2011, the company incosporated solar panels in new communities and launched its first net-zero-energy home, a term describing a home that uses the same amount of energy that it generates with renewable energy, In the same year, KB Homes introduced its first community with LEED* (Leadership in Energy and Environmental Design) Platinum certified homes, constructed with sustaimable materials and fitted with energy- and water-saving features, enhancing the operational efficiency of each home. In 2019 , the company stiowcased its KB Home ProjeKt, a home that incorporates smatr rechnology as the home's "wellness brain" to moaitor air quality, water filtration, cireadian lighting, and the presence of allergens and other airborne substances. KB Homes is a company thar has benefitted from careful study of its customers and its external environment. Through careful evaluation of its industry, its peers, and the changing external landscape, KB Homes has achieved strategic and operational success, fine-tuning its competitive advantage by building affordable housing that is energy efficient, environmentally forward-looking. and wired for smart use. The company illuserated its rematkable ability to respond to changing external conditions during the COVID-19 pandemic when it introduced a new home decign to accommodate the considerable shift to remote work experienced by home buyers. The company introduced the KB Home Office into irs home design, facilitating ease and comfort for those working from home. The KB Home Office created a professional working space within the home, incorporating a designated office into the home's floorplan with a built-in workstation, cabinet space, shelving for displays, books, files and other accessories, and an upgraded electrical package that includes high-speed USB charging outlets, phone jacks, and teleports comparable to what one might expect to find in a professional environment. The company anticipates this trend in home design will outlast the pandemic. By year end 2021, KB's numbers were up across all indicators, and the company is exhibiting strong profitability. As far back as 2010, a research and investment management company focused on responsible investment, Calvert Investment, named KB Homes the #1 Green Builder the year, establishing a precedent that the company has successfully maintained over the past decade. In Aptil 2021, the company published its 14th sustainability report, underseoring both the company's commitment to sustainability and the competitive advantage it has cultivated in sustainable bome building. The success of KB Homes long-term strategic planning was evident in early 2022, not only through increased revenues and profitability measures but also through such recognition as Newsweek's identification of KB Homes as one of "America's Most Responsible Companies" and Fortune magazine's citation of KBB Homes as one of the "World's Most Admired Companies" for its ESG performance. Certainly, the future is looking bright for KB Homes. Discussion Questions 1. Recall earlier in this chapter a grand strategy was identified as an overall corporate strategy for growth, stability, turnaround and retrenchment, or for some combination of these. In what way does KB Homes "sustainability as strategy" act as both a growth strategy and a stability strateg?? Please briefly explain. 2. Consider the different types of competitive strategy described in this chapter that companies might use to develop a competitive advantage. Which type best characterizes KB Homes' competitive strategy? 3. At one time, KB Homes had a wholly owned subsidiary, Kaufman and Broad SA, a large homebuilder in France. The company sold Kaufman and Broad SA in 2007 to focus its strategy on its core homebuilding operations in the United States. Describe this in terms of corporate-level strategy