EPM

Survival of the Fittest Part 2

We all have heroes. My heroes are people who have built great businesses, who have provided opportunities for others and who have innovated better ways to serve our clients and customers.

Michael O’Sullivan, Principal of Prudential Real Estate Campbelltown asks, “Can we survive without an education revolution?”

We all have heroes. My heroes are people who have built great businesses, who have provided opportunities for others and who have innovated better ways to serve our clients and customers.

Amongst these heroes from the past is a guy called W. Edwards Deming, an American statistician, mathematician, and quality control expert. Deming’s place in history was established in the 1950’s when, almost single-handedly, he developed the systems that catapulted the Japanese manufacturing industry to a winning position over their US counterparts by simply producing better products. He later became responsible for turning around the financial fortunes of corporate giants such as the Ford Motor Company.

His most famous quote is, “Learning is not compulsory, neither is survival”.

Right now things are changing in real estate. It was only 10 years ago we were still considering whether it was worthwhile investing in a website. And 5 years ago we thought Facebook and similar social networks were simply a fad. Today both of these “new technologies” have made and are continuing to make substantial impacts on our industry.

Keeping up with change, especially the roller-coaster ride of current changes bought on by technology, requires a commitment to learning new and better ways to serve our clients and customers. As Deming warned, if we are to survive these rapidly changing times then learning must be compulsory or there is no guarantee of our survival.

Is learning compulsory at your office? Sadly, in many real estate offices this is not the case. Both staff and management at many companies consider, “What we did, and the way we did it, yesterday will be OK for both today and tomorrow”. Unfortunately the consuming public is changing, their standards are increasing, and their demands for more, more and more are deafening. Their needs and the way they expect to be served today are far different from what they might have accepted yesterday. Real estate offices that fail to grasp these changes and learn new, faster, and more satisfying ways to serve our rapidly evolving clients will simply disappear.

Change, however, is difficult. Try giving up cigarettes, getting fit or keeping New Year’s resolutions – these are difficult changes. But change is necessary simply to keep up with your competitors. After all, if you’re not changing, learning, and improving I can almost guarantee there’s another real estate agent in your area that is. Maintaining your market share, your profits, and your job over time requires change.

What needs to change?
First, like all revolutions it begins with you. You have to learn. You have to change, improve and become a more valuable asset to both the clients you serve and to your team. In order to secure a job in real estate, be it as a salesperson or as a property manager, you are already required to obtain a certificate of registration. You could, if you wanted to improve, continue on to a Certificate 4 in Property Services, and later obtain your licence. You could go further by undertaking courses, for example, in diary management, people management, and business management. And as you complete each new course you would become more knowledgeable, more able to perform better for each client. Better still, as you become more valuable to your clients you will automatically become more valuable to your team and your boss. Can you feel a pay rise around the corner? Learning more will inevitably lead to earning more.

Second, like all revolutions in the past the last people to get on board are those in charge. Employers, business owners, and team leaders have often, unfairly, been characterised as unwilling to invest in the education of those within their organisation. Statistics available from bestpractice.com.au would suggest this might not be true for some businesses. It seems that Australian real estate agencies with lower turnovers spend less (as a percentage) on staff development and training than larger, more successful offices with higher turnovers. Is there a clue here? Do more successful offices spend more on training and educating their staff because they can? Or did they learn their lesson about learning early on and sacrifice an increased amount of their turnover on training, which then produced their growth and success? The answer is probably obvious but the lesson is not always heeded.

Learning → Change → Quality Deming led the charge on quality improvements in the manufacturing industry during the 50’s and 60’s. His lessons changed the way many industries around the world created products for a buying public who were only just beginning to realise their power as consumers in a modern economy. Today, these same lessons on quality apply equally to real estate agencies and agents who “manufacture” a service for property buyers, sellers, tenants, and landlords.

Quality service in real estate can be measured in the time it takes us to respond to a tenant or a buyer’s email, our ability to return calls, our willingness to offer additional assistance during the application phase of a letting, our attention to detail when recording the condition of a property during a routine inspection or the management of a bond claim after an outgoing inspection plus a range of other activities that make up our service. How conscious are you of ensuring every part of your service reflects a dedication to quality?

Quality service has lots of by-products but two in particular. First, consumers of your service, be they buyers, sellers, tenants or landlords, will recognise your service as being “better” – better than your competitors, better than they expected, better than their past experiences. Consumers who experience your service will then tell others, who will also want your service. Better quality equals more clients – sounds simple, but quality service leads to business growth for both you and your company.

Second, quality service leads to a reduction in costs. The better your service the more positive word-of-mouth advertising is generated which leads to lower costs in traditional areas of business and personal marketing.

If it’s that easy, why doesn’t every agent do this? Have a look around. Every local marketplace contains agents and agencies that do not appear to be interested in quality service. They do not see any value in learning better ways to serve their clients. They must not be interested in changing to meet the evolving needs of the consuming public. How long will they last? As Deming said, “Learning is not compulsory, neither is survival!”

Are you ready for success? Success in real estate in the second decade of the 21st century will depend on you, how much you learn and how much of what you learn can help add value to your client transactions.

So what can you learn today, for yourself, for your team, for your clients? If you are an employee ask yourself, “What course can I commence?” If you are an employer, ask yourself what course or what trainer you can you introduce to your team? Just like Deming, you’ll discover an increase in learning will result in more income and a more satisfying career.

Michael O’Sullivan is the managing director of Prudential Real Estate which operates four offices in Sydney’s south-west. Michael has been a guest speaker at both the Annual Australasian Best Practice Conference and at AREC. In 2010, Michael became the proud recipient of the Australasian Real Estate Agency Best Practice Award and this year will complete his Masters Degree in Business Administration.

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