Strategy, Reasoning by analogy, Homebuilding, Decision making


In 2016, William J. (Bill) Pulte, founder, and Pulte Homes’ largest shareholder called for the resignation of CEO Richard Dugas. In his letter to the board of directors, Bill stated the value creation strategy first proposed by Dugas in 2005 had been a major failure. Dugas had a bold vision and intriguing rationale for radically reshaping what he termed the “sleepy” homebuilding industry. Drawing from Toyota and Walmart’s strategies, Dugas argued that Pulte Homes could create greater value by scaling purchasing, improving construction processes, and collaborating with suppliers to lower overall costs while simultaneously refashioning and updating Pulte Home’s product line. By reshaping Pulte Homes’ strategy, Dugas re-imagined the homebuilding industry to be a more efficient and integrated competitive space. This case prompts students to evaluate and critique the validity of Dugas’ reasoning by analogy and underlying assumptions. The case also prompts students to identify industry structural and firm-specific factors that could impact the implementation of the business model.

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