Charles Tarbey, Chairman of Century 21 Australasia, shares some of his own experiences in real estate; focusing on the value that systems and procedures can have in enhancing the overall functioning of any business.
As real estate professionals, there are numerous operational variables that we must manage in order to ensure that our businesses run efficiently and effectively. This is the case regardless of whether you own a single real estate office, or oversee a network of hundreds.
The real estate industry itself remains as competitive as ever, and in a market that is experiencing some obvious challenges, we are all on the lookout for ways to maximise productivity and gain an advantage over competitors.
One pivotal way in which you can separate your office from other agencies is through integrating strong and clearly defined systems and procedures into your business’ operating framework.
Studies have demonstrated repeatedly that the implementation of structured systems and procedures can help to significantly increase productivity, transparency and accountability, and also reduce error rates, even amongst highly trained professionals.
Gain from Mistakes
Every year since opening my first real estate office over 35 years ago, I have kept a diary to continuously record what hasn’t worked within my business. For me, particularly early on in my career, it was also important to have regular meetings with my team to discuss mistakes and implement procedures to prevent them from being repeated; in most instances people say ‘I won’t let that happen again’ and then three months later the problem returns because they didn’t put a system in place to prevent it from happening again.
Based on the solutions derived from such meetings, systems and procedures were gradually implemented to streamline the functioning of my business. Proving to be successful, these systems and procedures ultimately became operational manuals and in 1985 were encoded into a software program (called e-Sales), which is now a web-based platform for every office in the Century 21 network across Australia – a new version has, in fact, recently launched.
I emphasise that e-Sales is not a system taken off a shelf or from a book – it is the data encapsulation of systems and procedures that have resulted over time from mistakes corrected within our organisation. This platform gives franchisees a strategic template, based on years of experience and know-how, to run a successful business – allowing principals and their teams to focus on listing and selling real estate, because this is the only time an agent is actually generating revenue.
This lesson is an important one for leaders of any organisation, regardless of industry. Ultimately, if you can recognise, learn from and correct your mistakes, and systemise solutions accordingly, you can put your business in the best possible position to consistently achieve success.
In today’s marketplace, information is effectively currency. Thus, if you can find efficient ways to collect and distribute information, your capacity to consistently generate profit increases substantially. This is particularly the case in real estate agencies, where effective data management can mean the difference between automatically being on the shopping list for buyers and sellers or having to go out every day and try and promote yourself and your services.
Whenever I have the opportunity to speak with a Century 21 practitioner, I always discuss the ‘Four C’s’ – that is: Creating activity, Capturing data, Cleansing data and Converting data. By having an understanding of this process, any real estate professional can enhance their own data systems and ensure that their information is set on a path to success.
For the majority of real estate agents, creating activity is the easy part. In many cases an interesting ad or enticing window display will get at least some buyers interested. However, it’s how agents subsequently go about capturing and cleansing data that makes the major difference.
It is therefore important that if you are a principal that you put in place systems to encourage and make it simple for agents to capture the data of potential clients – this includes taking a full name, phone number and valid email address – anything that allows you to make future contact.
Data cleansing through modifying or removing incomplete entries from databases remains an equally important variable in the conversion process; because at the end of the day data is only helpful when accurate – ‘GIGO’ is how it has been described: Garbage in, garbage out!
Making sure that agents maintain regular contact with your database will help to ensure that information is kept up-to-date and relevant.
When all is said and done, real estate is about listing and selling – face-to-face, eyeball-to-eyeball. But the truth remains that agents need to get better at collecting information about the people who drive the market forward – vendors and purchasers. If principals take some time out to really try and improve the performance of their offices in this particular respect, our industry as a whole will likely be much better for it.
Don’t Overlook the ‘Little’ Things
It is often said that ‘a machine can only work when all of its cogs move in unison.’ This notion is usually expressed in relation to teamwork; however, it is also relevant to the way in which a business’ success is contingent upon all of its processes functioning effectively.
As a principal it can be easy to concentrate on the areas of a business that relate directly to the generation of profit – for us, this usually means the aspects that directly impact on listing and selling property.
Nevertheless, you should always keep an eye on less obvious operational aspects that have or may need structured implementation. Ask yourself the following questions: Are your agents doing regular market research to keep up-to-date with market trends? Do you have processes in place to ensure that client queries are responded to within reasonable time periods? Is your team on the look-out for new technologies that could increase insight and efficiency?
Even examine something as simple as structured induction processes, which I know some businesses take for granted. The reality is that effective induction is usually the first foundational step in communicating an organisation’s expectations, procedures and policies to new employees. In effect, these processes function to convey information that will guide employees, from the outset, in a direction consistent with effective performance – and they decrease a business’ likelihood of incurring low employee morale, high staff turnover and re-recruitment costs, as well.
Today we operate in a market that has an impetus for efficiency as never before. We want more listings, more buyers, and ultimately better commissions. The truth is that all of these are feasible prospects; however, they are difficult to achieve unless your staff are working productively and consistently in line with your business’ needs and goals.
You can put yourself in the best possible position to ensure efficiency and effectiveness by developing and implementing systems and procedures across your business framework. This will not only empower and guide your staff towards success but also reduce your time spent micro-managing, enabling everybody to concentrate on the core fundamentals of listing, selling and managing property.