A tougher marketplace dictates direction from the top
By Desiree French
Following a very long and fruitful period of booming home sales, many brokers have reassessed the type of leadership skills that will help them successfully manage and motivate agents in today's more "normal" marketplace. On their minds the utmost have been ways to maintain-even maximize-profitability and productivity. In light of a market now riddled with fickle buyers, excess inventory, and inexperienced agents, more brokers are implementing a mix of leadership strategies to keep business intact.
Prior to last year, most agents really didn't have to work very hard to be successful. Business landed in their laps. But the investor frenzy that helped to galvanize the market has all but dissipated. Many new agents are clueless about how to solicit business alone.
It will take leadership to get everyone, newcomers and veterans alike, on the right track. According to J'aime Sans Souci, a certified leadership instructor with San Diego-based Buffini & Company, "it's more important than ever for brokers to build systems and become good at using them." The right systems and platforms can help agents become as successful as possible. If agents, particularly new ones, have not yet learned how to use direct mail and Internet marketing and client management programs, they should. In fact, more savvy recruits with technical, business, and management backgrounds may expect it.
Honing people skills is always at the top of any leadership to-do list because companies cannot realistically survive without people. However, this skill alone will not suffice. Communicating a vision to agents, getting their buy-in, and challenging them to work more creatively and efficiently is crucial.
"You have to have a vision of what the company should look like and what its position in the marketplace will look like, and then communicate that to agents," says Mike Schlott, general manager of Randall GMAC Realtors. "The skill set really is the same regardless of the time frame or the market conditions. While brokers in the past faced a different landscape, they still needed a vision and the tools to deliver to agents."
Mark Stark, CEO of Prudential Americana Group in Las Vegas, agrees. Brokers, he believes, need to have the foresight to anticipate change. It's what Stark calls "being ahead of the curve." It involves asking yourself the tough but pertinent questions. For example, if you're in a market where you know investors are a dominant force, what will you do once they depart? What's happening with interest rates? Where will future sales associates and executives hail from? What strategies should you implement, and which ones should you drop?
In his book Leadership is an Art, Max DePree, chairman emeritus of Herman Miller, Inc., the furniture maker consistently ranked in Fortune magazine as one of America's best managed and most admired companies, claims "the first responsibility of a leader is to define reality."
This is Stark's point exactly. "Be honest with yourself," he advises. "Look at where you are in the marketplace and how it affects your business. Make sure you're dealing with correct information and know what's truly going on. Don't be sold on your own press. If you're honest, you can enact change."
The Effects on Profitability
In fact, failure to act or effectively use good leadership strategies will eventually interfere with a broker's ability to be profitable. "There are going to be times when you're going to have to say no," concedes Schlott. "In a challenging market, the leadership of the company must find ways to make each individual productive and the company productive. But you have to say no to things that might drain the resources the company needs to make profits and to exist in the first place."
While this may seem like an understatement, Sans Souci contends about 70% of real estate brokers are not consistently profitable. The main reason is that their systems fall by the wayside. To be consistently profitable they must find systems that work specifically for their business models. "The bottom line is that the numbers don't lie," San Souci explains. "If you have a system that works, it will show in the numbers."
Hoddy Hanna, chairman of Howard Hanna Real Estate, goes a step further. He says the purpose of leadership, from a purely business perspective, is to create a steady flow of business, whether one is in real estate or another line of work. "In good times and bad times," he says, "it's about creating a flow of business and a flow of customers to support profitability."
It is paramount, then, to become more brand conscious and to promote both a brand and services that are unique. "The problem with real estate is that almost all brokerages offer the same services and products. In good times, everyone sort of gets their share of business, but in difficult times the companies whose leaders know how to differentiate their products and services will draw the consumer," says Hanna. "So leadership has to come up with creative ways to ride the market. At Hoddy Hanna Real Estate, we have done that by offering buyers a 100% money back guarantee program if they are dissatisfied with our homes."
By definition, most brokers are trained leaders. But his doesn't necessarily make them good leaders. Brokers can enhance their leadership skills and that of their managers several ways. Observing other brokers by carefully listening and learning from them is a very powerful strategy. CEO groups such as Vistage International, the world's largest CEO membership organization, can be very invaluable. So can industry and business-related seminars, conferences, and classes on systems and leadership strategies. Leadership books and tapes are also helpful. There's literally something for everyone.
Leadership Tips: Enhancing Communication Skills
• Empower managers. Step back and resist the urge to always exert control. Give them the freedom to make decisions and lead in a fashion that may differ from your own.
• Communicate often. Constantly relay your message to the troops, and don't waver; otherwise, no one will buy into your vision.
• Value face time. The visibility of brokers and managers is critical. Company newsletters and Intranet are helpful, but ultimately it's your responsibility to gather agents for motivational and informational meetings.
• Be available. Avoid communicating only to a select few in the company; be open to conversing with everyone in the company.
• Accept criticism. If you cannot take constructive criticism easily without being offended, that's a problem; it can be detrimental to your company's growth and your own.
• Ask questions. To often brokers try to recreate the wheel or take on too many additional responsibilities. Ask agents what they need and expect in the way of systems and training. It could save you both time and money.
Copyright© 2014 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.
Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia's REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com