I was intrigued to read an article in the New York Times the other day about how law firms are beginning to offshore some of their clerical processes to India in order to drive down costs. They are doing this largely because their large corporate clients are insisting on cost reductions, not because they are particularly forward thinking. Why pay for a New York based associate to copy edit a document at $250 per hour when it can be done for 1/5th of that rate by a double graduate in India?
Now, large corporate law firms are pretty darn conservative and not organizations that adapt to change easily, so the fact that this is happening is an indication about how much sectors of our economy are likely to change over the next 5 – 10 years. We have all gotten used to hearing about manufacturing jobs being shipped overseas; those of us in the technology space know that the same is happening with jobs in our space, but this is an indication that other sectors, previously thought to be immune from the trend, will be affected.
This got me to thinking about property operations. On the one hand, folks in this sector all provide services that are site dependent, like a hair stylist or plumber – until we figure out teleportation, you are going to have to pay a real live plumber to come and fix your dripping faucet: no way to offshore that service – so it should be largely unaffected by off shoring. On the other hand, some of the property and asset management teams that I work with spend a lot of time on fairly low level clerical activities: copying, faxing, moving information from one silo to another. These activities can (and will be) off shored. Given the relentless downward pressure that owners put on asset and property management fees, this change may be forced on the property operations sector by its customers, as it is in the law profession.
There is a bright spot in all this: property operators that figure out how to streamline clerical processes and focus on providing their clients with higher value services will prosper. Some of this value-add comes through using technology, like Building Engines‘ web based operations platform, to improve customer service, increase data liquidity and reduce operating costs. I have run into a few that have made this a differentiator and who tell me that their clients are beginning to see it as a significant benefit.
“Try again. Fail again. Fail better.’ ~Samuel Beckett
While I don’t think the Irish writer and poet ever owned or managed commercial property, you can certainly apply his quote to what we all do in the course of running our businesses or doing our jobs.
This may be especially true now, given what the industry and economy in general have been through over the past few years. There have been some spectacular failures (Bedford-Stuyvesant anyone?). But, there are also those who have weathered the storm well, such as Normandy Real Estate, and many signs of life are rising from the ashes and companies are trying different approaches to partnerships, financing, filling space, manage operations, etc. In other words, “trying again.” Not all of these attempts will be successful, the “Fail Better” part, but what are the alternatives? This is what we do. We move on, we try again, we fail again, we get better.
Every 4 years the soccer world turns its focus to the world cup. 32 countries and their respective players practice and train for years simply for the chance to compete in this prestigious event. While there are certainly favorites and teams that are expected to win, it seems nonetheless that every year there are upsets and the teams we expect to win don’t always oblige.
For example, in this year’s contest, the French team headed to South Africa with high hopes and was expected to fare well. They had plenty of talent on the roster and many of the players had been there before and had the experience and skills to wager a successful campaign. But as the first round comes to a close, France has been eliminated and will be heading home. So what went wrong?
The team dynamics and overall attitude of the team played a major role in their failure. They didn’t work well together, allowed the egos of the players to get the best of them, and they did not put the team’s interests first. The negative attitude of certain players and members of the staff poisoned the group as a whole and rendered them ineffective. In the end, all the experience and skill in the world couldn’t fix the egos and bad team dynamics.
In business too, building the right team dynamic is extremely critical. Do the members of your staff respect each other and work well together? The most talented or skilled employees are not necessarily a good fit if they bring down team productivity and morale. When evaluating a candidate for a position it is so critical to think about how they will interact and work with other members of your team. Finding that perfect fit is far more important than finding the most talented person and taking this approach when building your company or team will prove to be invaluable and almost certainly translate to success.
Walking on the beach one morning while on vacation last week, I saw a man in the distance digging a hole in the sand. As I got closer, I realized that this man, a maintenance worker for the property at this spot, was digging holes in which to bury the seaweed that he had previously raked into neat little piles. There was a lot of beach and many piles.
I’m not quite sure whether this would qualify as a reactive or preventative maintenance task, but I do know that it couldn’t possibly be a very fulfilling task…pun intended.
We all have “filling hole” types of tasks that occupy parts of our day and most managers are guilty of creating and assigning them to their employees. – You know, creating the reports no one ever looks at, the manual processes that might be automated and of course, the many meetings without purpose or clear objectives.
The insidious thing about of these types of tasks is that although they generally begin with the best intentions, they tend to gradually accumulate and lose value until like a tick, they have embedded themselves and worked to suck the joy out of our jobs and those of our employees. Additionally, our most precious resource, time, becomes the host for these low value parasitic chores. It’s important to recognize these types of tasks and do what we can to clean them out of our daily lives and those of our employees.
As for the resort and the poor soul filling holes with seaweed in the hot sun; assuming a seaweed-free beach is a valuable aesthetic and important to their guests, what could they possibly do? – Here are just a few ideas:
- Provide better tools – there must be some kind of power tool that could make this job easier.
- Share the task and cost of an automated pick-up system with their neighbor resorts.
- If they are really limited to the rake and shovel method, at least make sure the chore is spread among several people.
Much like spring cleaning, periodically review your own regular, recurring tasks and those you have created for your employees. Figure out a way to improve the way you do the ones that you still consider valuable and discard the ones that offer no real value or have you just filling the holes in your work day.
I recently read this article by Ian Knauer posted on the The Atlantic’s web site, about the writer’s bee keeping hobby. Notwithstanding the fact that the hobby nearly killed the author when he was young – he went into anaphylactic shock when stung multiple times – he is deeply devoted to his bees.
And why wouldn’t he be? Honey bees are amazing creatures and their industriousness is legendary. It was not hard to find lists on the web of the things that make honey bees incredible:
- The honeybee is not born knowing how to make honey; younger bees are taught by the more experienced ones.
- A honeybee visits between 50 and 100 flowers during one collection flight from the hive.
- In order to produce 1 pound of honey, 2 million flowers must be visited.
- A hive of bees must fly 55,000 miles to produce a pound of honey.
- One bee colony can produce 60 to 100 pounds of honey per year.
- An average worker bee makes only about 1/12 teaspoon of honey in its lifetime.
- It would take approximately 1 ounce of honey to fuel a bee’s flight around the world.
In a small way, honey bees are a great metaphor for what we do in the building service and asset management space and how we achieve success. We work steadily, executing tasks over and over and improving processes slowly (with 2 million visits to flowers to produce 1 pound of honey, you can be sure that honey bees become good at what they do). We work as a team ( a hive needs a lot of bees working together to flourish). A tremendous amount of work goes into making buildings run in a manner that looks effortless to our customers- when you and I take a spoonful of honey we rarely think of the effort involved in producing it.
The writer of the Atlantic article went out to the country in the middle of winter to visit his hives. When he arrived, the hives were covered in snow and it was cold. Other than the entrances to hives being clear of snow, there was little evidence of life. Then, he noted, ”I bent over and placed my ear on the side of their home. It felt cold. I closed my eyes and listened. From inside there was a calm, steady hum. It sounded something like, ‘We’re alright, we can take care of ourselves, we’ll see you in the spring.”
In his GlobeSt.com blog today, Anthony LoPinto suggests that based on the hiring activity he sees, while real estate hiring has improved a bit overall, it is still a very difficult job market for new graduates entering the business. It appears as though hiring managers are opting to hire the over-qualified for entry-level positions to leverage their talent for a year or two and take their chances on a likely departure. – I am not so sure that is such a sound strategy.
I think the net results of this approach are the following: First, You have hired someone for an important role who has a foot out the door before they have even started. Second, if this is a wide-spread occurrence, there is a chance that the future talent pool will be degraded for years to come because many young, talented people will have been turned away and taken different career paths.
The landscape has shifted significantly for real estate and property management firms on number of fronts, and hiring is certainly one of them. The BOMA Kingsley report of 2008 focused on the “human capital crisis” in the commercial real estate industry. While it may appear that the recent economic circumstances have created a situation where a firm has their pick of talented and experienced people to fill available positions, consideration must be given to given to where the generation of future leaders will come from and a strategy put in place for re-stocking the talent pool.
We have talked a lot about the need to perform and be better. After all, do any of us really aspire to do the same thing day after day; performing our jobs in rote fashion without conscious thought? If so, we are destined to deliver the same results. And there is one thing for certain, acceptance of the status quo signals the beginning of the inexorable death march for any organization.
So, we commit to do better. But how do we know what “better” is…and how to get there? It’s one thing to say “cut this by 10%” or, increase this by 12%.” But you need a plan and a process to achieve those results. Benchmarking is one of the best ways to get there and can transform and organization.
Benchmarking is a word we are all familiar with and thrown around often by consultants including those who specialize entire in benchmarking. The definitions vary and can be quite specific depending on your industry. But simply stated, benchmarking is just comparing something you are doing now to something you consider, or know, to be a standard… a better result.
In the property operations and management market we serve, there are many processes and results that can easily be benchmarked. It takes effort and commitment, but the effort more than work it. Not only will you improve the specific process you are benchmarking, but you will send a signal to your team and organization, that we are here to get better at everything we do.
Over the next few weeks, we’ll look at some specific property operations processes and discuss how you might use benchmarking to improve them.
What does Account Management mean and what do Account Managers do? The role of the Account Manager in many organizations is neither clearly understood nor properly executed. He/ she is often someone who does not seem to clearly fit into a prescribed department. The Sales Team provides a clear cut function – to sell goods and services for the organization they represent. The Customer Support Team provides another clear cut function – support the customers who use those goods and services. So, who is this Account Manager who seems to have a foot in both departments?
A good Account Manager should act as the liaison between a company and its clients, and it’s their responsibility to see that those clients are maximizing the value of the products and services provided. That beings said, there is also a sales component to the Account Manager’s job as well. It’s the Account Manager’s role to not only maintain and retain the customer but also to up-sell additional products and services to those same clients.
So does that mean that my Account Manager is someone I shouldn’t trust? Is it someone who does not have MY best interests at heart? If they are a good Account Manager, the answer is no – they should be someone you trust and they should have your best interests at heart. A good Account Manager will be most successful if they think of themselves as an extension of the client – a representative of the client within the organization. It is their job to live in the client’s shoes and understand where they’re coming from. If they are successful in doing that, they will be able to more accurately represent the needs and requirements of the client within the organization and work effectively to help the client achieve those goals. By achieving those goals, they will help to maintain client satisfaction.
In today’s economy, there is great value in applying effort and resources toward retaining clients and ensuring their happiness. A happy client will not only continue to pay you, but they will help you to continue to develop your product. They will provide valuable insight into the market and help you build feedback into new configurations and solutions. A good account manager should feed off that invaluable stream of information and use it to help develop products and services that can be sold to other clients with similar organizational structures and needs. The up selling part of the Account Manager’s job is not about “sticking it to the client” for additional revenue…it’s about providing complimentary products and services that make the entire package an end all, comprehensive solution. If your Account Manager is good…their goal will be to help you to achieve that success. Yes, sometimes there will be additional costs associated with reaching that milestone, but a good Account Manager is not focused on the revenue…they are focused on the comprehensive solution. If the Account Manager keeps that their focus, additional revenue for the company will come on its own and will simply be gravy on top.
In summary, an effective Account Manager should be someone you consider your friend. They should be a trusted resource for advice and guidance. They should be detail oriented, organized, and communicate well. They should accurately represent your needs within the company and they should follow through on their promises. They should own up to mistakes and make things right when they are wrong. The bottom line is that if an Account Manager is doing their job properly, they should be your strongest ally within the company, your friend, and they should be focused on your success.
I wish I could take credit for that phrase, but I can’t. It belongs to Building Engines’ client, Hank Ashforth, Chairman of Ashforth Pacific.
Hank made that statement last week while delivering a presentation to our guests at an Executive Briefing Dinner we sponsored in Washington, DC. His topic, and subsequent discussion, focused on Ashforth Pacific’s experience implementing an energy reduction program and other “Green” initiatives over a 10 year period.
The most important factor to consider and manage in any major operating shift, Hank so clearly explained to the group, is the company’s culture and getting buy-in from the people who have to implement and live with the decisions you make. In their case, Ashforth had a particularly difficult time obtaining cooperation from some of the more experienced people on the engineering team. These were people who were used to doing things a certain way and didn’t necessarily want to change. According to Hank, although it was a long and painful process that included making difficult choices to let some people go, the end result was worth the effort.
Ashforth Pacific has made significant reductions in its energy costs over a 10 year period and worked cooperatively with its tenants and community to implement leading edge green programs that benefit all involved parties. The company has also achieved LEED EB Silver Certification for one of their properties. Their early commitment to the process and the results they have created have positioned them as leaders in the markets they serve.
It was a hard journey, but isn’t that true of most objectives of value? The real lesson Hank left me with was not to underestimate the need to factor in and manage your own corporate culture: personalities and operating practices need careful consideration when you embark on any major new initiatives and have the power to de-rail the best laid plans if not considered carefully.
For more reading on making a cultural change in your organization, I recommend reading “Beyond Lean” (http://www.beyondlean.com/corporate-culture.html) and Peter Bregman in the Harvard Business Review (http://blogs.harvardbusiness.org/bregman/2009/06/the-best-way-to-change-a-corpo.html)
If you would like to request a copy of Hank Ashforth’s presentation, please contact Sarah Fisher at sfisher@buildingengines.com, or 781.290.5300.
Most of us have made a New Year’s Resolution at some point in our lives. These resolutions typically focus on personal issues such as eating healthier, getting more exercise, or quitting smoking. They are typically goals that we would like to achieve, but we often fail to put a plan in place that allows us to achieve them. Like everything else in life, it is important to not only set realistic goals but to also lay the groundwork to set oneself up for success. Some key components to a successful New Year’s Resolution plan:
- Be Realistic
- Think Critically
- Outline a Plan
- Talk About it with Others
- Continue to Try When at First You Don’t Succeed
I got to thinking about the concept of resolutions and started to wonder why more businesses and companies don’t do the same. Again, the same strategy is key for success….don’t set unrealistic goals and plan accordingly. The following are 20 ideas that might make good resolutions for your company:
- Fine Tune and Execute on Your 2010 Business Plan
- Touch Base with your Clients More Regularly
- Think Outside the Box – create innovative marketing strategies
- Get Organized
- Define your Processes and Stick to Them
- Make more with less
- Network with companies that compliment your product
- Build testimonials and case studies for future clients to read
- Attend at least 5 relevant seminars/ webinars in the coming months
- Adjust pricing for your products as the market/ your clients dictate
- Build a new product to add to your current package
- Add a new service to your current list of client service offerings
- Go Green
- Track the time you work better
- Remember that SERVICE is king
- Listen, Listen, Listen
- Be flexible, the status quo is not ok
- Tell the world what you’re doing
- Improve your website traffic and page views (this year, we resolved at Building Engines to improve in this area)
- Never get complacent
Remember, it’s easy to make a knock down list of ideas – but truly successful companies are the ones that build a strategy and plan around those ideas.
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