Are You Building an Idiot Proof Real Estate Business & Why It Matters!

By
Real Estate Broker Owner with Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate

Well over a decade ago, I read Michael Gerbers' famous book, 'The E-Myth.'  I am the daughter of two entrepreneurs and an entrepreneur myself.  I have lived through the 'technician syndrome' that Gerber described in which vast amounts of energy are siphoned from the entrepreneur who must run their business on a daily basis and subsequently becomes a slave to the work rather than the inspiration driving the company.

French FriesSo, when the idea of making a business 'Idiot Proof' was introduced during a professional real estate seminar, I was eager to embrace the method.  The process involved systematizing a business by breaking each action/segment into small, clearly defined steps.  The BENEFITS: a precisely written manual which ensured that anyone could replicate the same results every single time with the aim of creating a consistent consumer experience.

To illustrate the point, the presenter used the example of the methods that fast food companies have perfected through their training systems to ensure that your burger is pretty much the same anywhere you get it.  If you've ever worked in a fast food joint, you know that every single item that impacts the business is detailed in the manuals. 

The system is fully automated with cookware that tells you when the fries are done and guides you through the process of making every menu item.  Most workers are hired to do one little segment of the work and not much else.  Even the cash registers are coded with pictures to make sure that the right order is processed and the correct change returned.  The RESULT: workers who know a few details very well, but may be largely ignorant when it comes to understanding how the operation works. 

The problem with this type of system is that it thrives primarily within a stable environment.  An environment in which the delivery truck can be expected to arrive at the scheduled time carrying the necessary supplies.  The system requires tremendous amounts of coordination and performs with supreme efficiency when that order is present.  However if there is inadequate staffing or the supply chain breaks down, the system becomes vulnerable.  Ultimately the problem with this type of system is that LIFE IS UNSTABLE. 

In the real estate industry, we have created our own versions of Idiot Proof systems.  In a sense our Forms and transaction management systems have allowed many of us to facilitate millions of real estate transactions with efficiency and speed.  These systems have also made it possible for anyone off the street to enter our profession with a mere 40 hours of training and then sit down with a client to list a Million dollar home. The agent simply needs to know how to fill in the blanks.  

However, just like the fast food industry, the real estate system of transaction management may be inherently vulnerable precisely because it requires certain 'anticipated conditions' to operate efficiently.  When the stability of those conditions is threatened or upset entirely, as we are currently witnessing in the mortgage crisis, the entire house of cards is in peril, not unlike the perilous times in which we currently live.

Row of housesPerilous times require creative, innovative individuals who possess the critical thinking skills to make intelligent assessments and respond to unforeseen and unexpected circumstances. 

Idiot Proof Mechanisms are guaranteed to fail in perilous times, because the conditions necessary to support them are wobbling or have crumbled entirely. The hidden gift of perilous times is that we are given a fresh opportunity to re-evaluate the true effectiveness of systems we have used without questioning.

So, I'm in the process of dis-assembly.  Although we still use and appreciate our board supplied real estate forms, our agents are being challenged to not rely on forms to do the critical thinking.  Agents are required to think through solutions and to be ready to explain WHY they think the options they are suggesting merit consideration.  The days of using systems without thinking about what you're doing are numbered  OVER, because fewer real estate transactions are falling into easily defined categories!

Today's real estate transaction involves, amongst a host of other critical skill sets,  having the negotiation skills and patience to see a Short Sale through to the end.  Being a competent agent means having the ability to utilize the Internet to create important professional networks and prospect for future business.  Today's agent needs to understand what is happening in the financial world and be informed about the developments in ancillary services like the inspection and title industry.  In my opinion, the days of 'cookie cutter' real estate are over...if they ever truly existed in the first place. 

Copyright 2008  Audu Real Estate  All Rights Reserved

Picture of french fries courtesy of wEnDalicious photo-stream on flickr

 

 

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Comments 76 New Comment

Ambassador
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Jason Sardi
Your Agent for Life
Auto & Home & Life Insurance throughout North Carolina

Lola - So you aren't a big fan of the "Real Estate for Dummies" syndrome;)  This may be one of the best posts I've read from you, which is a hefty accolade in of itself.  This is what I truly love here, the learning.  I'm nowhere near astutely familiar with Mr. Gerber.  Adaptation and the ability to think on or off your feet seems key.  While I'm guessing there is a place for a streamlined and assembly line approach to this gig, I doubt that it will work right now.  There are too many variables, makes me want to re-visit that critical thinking course from years ago.  It always applies.

December 02, 2008 11:26 PM
Rainer
32,772
Brian French
Estate Settlement LLC

Finally a deep thinker apprears.  I could use your membership is our Financial Services Reform Group.

December 03, 2008 06:08 AM
Rainmaker
59,836
Tami Vroma
Realtor, Grand Rapids MI Real Estate
West Michigan Real Estate Specialist-Five Star Real Estate

Great post Lola - written systems are what keeps me organized and I am learning with short sales, meticulously written notes also!

December 04, 2008 06:53 AM
Ambassador
2,030,439
Todd Clark
Broker - Beaverton, Oregon Real Estate Expert - (503) 524-9494
Keller Williams Realty

First of all congratulations on your two year anniversary in the rain and now back to your post. I wish I could make it idiot proof, but everytime I do, I find a better idiot. I love the e-myth, but still working on implementing it in to my life even though I really know I should if I want to live past 50!

Once again thank you and have a successful 2009 and I be watching your posts and enjoying as usual.

December 07, 2008 01:20 PM
Rainmaker
372,820
Lola Audu
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate

Wow, Todd, thanks for the reminder!  Two years has passed so quickly!  I'm so glad that Active Rain became a part of my life and has helped me to learn so many new things.

December 09, 2008 05:45 PM
Rainmaker
372,820

Lola Audu

Audu Real Estate~Grand Rapids, MI ~Welcome Home!
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Grand Rapids, Michigan real estate information including houses for sale, rent and home buyer/seller tips. Also includes wisdom and insights from Lola Audu, CRS Associate Broker.

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