Biz 2.0: Super Real Estate Companies

by Mike Farmer

Real Estate Broker

Author website

When I first started in real estate my goal was to own a big operation after getting my broker’s license. A quintuple bypass changed my plans and I now operate a boutique operation, small, profitable and simple. I spend my extra time doing things I enjoy like golfing, reading and writing.

But I haven’t stopped thinking about big. It’s my belief that most large RE companies don’t fully exploit the advantages of being big, with access to resources largely going to waste in offices run from defensive modes with key players protecting turf rather than striving for excellence and market domination. Internal competition has been a weakness of big RE companies, along with the lack of talented employees with broader skills than RE skills. There’s a time and place to compete and there’s a time and place to bring talented individuals together to co-operate.

All companies and all offices differ, but from what I’ve seen much is missing. Big doesn’t have to mean slow, stubborn and infected with in-fighting and politics. I admit, I have idealistic binges that sometimes border on drunkenly naive, but I also know what people working together can accomplish — I’ve witnessed it through personal involvement and I’ve read the stories of companies who’ve achieved excellence through new ways of thinking, co-operation and a dedication to talented people given free reign to think, act and innovate. I also have no knowledge of the sophistication involved with large franchises, but I know that even independent offices with 50 to 100 agents can develop 2.0 systems that drastically improve their ability to compete.

It starts at the top with leadership. I should say enlightened leadership. Fearless and open-minded leaders are rare; hell, most everything I’m about to describe is rare — that’s what makes it special, and that’s why great companies achieve the largest market share in their line of endeavor. Good leaders are an amalgam of psychologist, priest, coach, cheerleader, protaganist, antagonist (questioning his/her own leadership), hero(ine), visionary and sage. That’s asking a lot, but good leadership demands a lot. From Alexander the Great to JFK to Lee Ioccoca, the styles are different and the scope greater or less, but the key elements of leadership are many and must be present. Not only must they be present they must be maintained through daily openness and ongoing learning — no one rests on their laurels anymore, at least not more that a couple of smug seconds.

A leader surrounds himself (herself, and this is the last time I will include both genders; we can assume I mean both or either) with talented people and has a hand in all hirings to avoid As hiring Bs and Bs hiring Cs and Cs hiring Ds so that all along the line people are hiring mediocre talent to protect their positions and wind up with mediocrity throughout. Everyone in the organization must buy into selection of the best. There is so much nepotism and poor hiring in most RE companies I’m familiar with that it sickens me — and the hirees are all RE-centric , when they should have broader skills that lend to good management. A good manager of technolgy doesn’t need to necessarily have extensive knowledge in RE sales, nor does a manager of people in general — I’ll get to this later, but businesses have an internal working order that is extraneous to the particular line of work, which can be taught sufficiently later. 

A company should be totally wired and integrated with enterprise (intranet) 2.0.; the committment to online marketing, social/biz networks, blogs, mashups, website expertise, digital photo management, etc, should be beyond question, a prerequisite for being a part of the company — it needs to preached, taught and lived. Along with being wired there should be a never-ending daily search to learn how to take the best practices of offline, traditional marketing and sales, and connect it to enterprise 2.0 (biz 2.0, if you want to get jazzy). It’s safe to say the time has arrived, it’s no longer theory, and now is the only time to do it. Redfin has done an amazing job leading the way; now RE companies need to quit bitching and start catching up — not their discount business model, necessarily, but their tech model.

Being a tech newbie/doofus myself, I realize how much there is to learn and the only way to learn is jump in the middle and experiment, which leads to the next point, micro-modeling.

I believe companies should have sophisticated, productive meetings. Experimenting with this new wave of doing business is critical to understanding the most profitable routes to take. Creating virtual situations and looking for consquences and advantages is a great way to test models without sinking a lot of time and money into dead ends. I know all about dead ends on the internet; I go down them all the time. Group testing could be easily and effectively done in a big organization (I’ll need to develop a smaller version, micro-micro).

I know it’s impossible for most companies to afford managers for different departments, but cross-training can help that. Research is another important aspect and plays into micro-modeling as a way to gather, manage, analyze and test the mountain of information that’s available. By getting several key players involved in different areas of concern integrated with one another this creates an understanding across and between departments. Co-ordinating all the efforts will allow information to be more useful — financial, research, marketing, technology, sales, it all seems bureaucratic and boxed but cross-training and co-operative efforts can blend the functions into a single purpose. The players should always be looking for connections to improve performance and efficiency. Regardless of what any experts say, we all just got on a steep learning curve; old dogs and new alike are going to be learning new tricks.

There is much weary, scepticism and cynicism surrounding bottom-up companies, as well there should be — my theory is that it’s been implemented poorly and naively (or cynically misleading). The truth is that a company needs leadership, but a committment to the on-the-ground salesforce is critical to retention and productivity. With intranet 2.0, voices across the system should be heard and information used for steady improvement and innvoation. With all the communication tools, any part of the company should be able to access rich information about listings, trends, local changes, clients, closings, vendors, etc. with a click or two. The information being fed from the field should be a steady stream. Training should include the skills necessary for agents to learn the importance of information, how to quickly gather it and input it so that it’s meaningful and useful. The infrastructure for this should user-friendly so that agens aren’t burdened with a clumsy, complex system they won’t use. But, companies should also be contracting with more skilled agents.

The Biz 2.0 tools will allow communication and comarederie throughout the company and create the highest level of co-operaton possible if leadership believes and everyone is on board. Then perhaps companies who hire anyone breathing will be more selective and realize that quality is way more powerful than quantity in this line of work. I venture to guess that a local company who implements these changes could dominate the market their in in no time at all. The environment would be attractive for connected, productive agents and too difficult for those who aren’t serious about RE. It would be very difficult to form a company like this, but it is possible. Can you imagine what 50-100 agents and high-skilled managers with enlightened leadership could accomplish if they were wired and working together toward a common goal?

I can’t, not fully.