Property management was once simple. You had a small business, a loyal client following, a couple of great staff and everything just worked. Over time businesses started getting bigger, landlords became savvier, and the team was wanting to develop their careers. Now don’t get me wrong, I embrace this as do most business owners, however with more moving parts, comes more logistics, and working out how to develop these in synergy with each other, to leverage efficiency within the business can be a bit tricky. What I wanted to explore today was how to align your internal procedures to promote your business goals.
There are not many businesses that I go into that don’t have a set of policy and procedures or a business plan of some description. One concern that many business owners raise is, they are struggling to achieve business goals because they have no way of integrating it into the day-to-day of the business. Many have tried varying proactive approaches such as making it an agenda item in every meeting, putting goals on a whiteboard or posting goals on the office walls. I endorse this behavior to create awareness within the team. However, a business will always struggle with the execution of the business plan if they don’t invest in a more integrated approach to achieving business goals.
The key to integrating the two is to align the procedures guide with the business plan. If the procedure guide doesn’t support the business plan, you may find that one is opposing the other, causing friction against executing the business plan. Let’s look at a simple example. Part of the business plan may be to increase the average management fee by a quarter of one percent over the next twelve months. There would be other metrics to support this goal, for example, an increase in 100 new properties net to the business, at a rise of 1% on existing management fees. The company would need to create a procedure or set of processes to support this goal.
One would need to do some groundwork like, change the management fee in the marketing to reflect the increase, then it would be time to review the current procedures. The first one may be to show value to prospective new clients without reducing the fee offer. This would require a stringent listing kit that promotes the new business process to support this and training to the new business team to handle fee objection. The second one might be to amend the growth team bonus structure to promote this, by reducing the commission earned if the new business team member reduces the base fee for the client. There would be more processes to support this initiative, and I won’t go into them all, but I’m sure you understand where I’m going with this.
Review the annual business plan and consider what processes are currently in place, or what new process needs to be put in place, to ensure the business can successfully achieve the business goals in an integrated way without having to drive adoption into the team in a separate, unrelated initiative.