Property Management is unique in so many ways!
As a national trainer and consultant working in many companies right across Australia, we see many successful departments that are doing so well in property management.
Unfortunately, though, we know there are a lot more property management departments out there not so successful! Just like success leaves a trail and can never occur by accident, it is also the same for the unsuccessful property management department. There are very clear reasons leaving evidence as to why it is unsuccessful!
The Principle that rules business (and everything else)
I am a total believer in the ‘sowing and reaping’ or ‘cause and effect’ principle being that whatever you do there is also a consequence, a reaction from an action, whether good or bad. Unsuccessful property management businesses are the result of something else that is sown, an effect with a definite cause.
Bad performance, ‘constantly in crisis’, and poorly run property management departments are consequences primarily caused by actions, and more specifically caused by a leader’s actions!
Let’s have a look at the causes we see as the primary problems for property management departments in general if we are to assume most problems and primarily leadership-driven!
The top ten common mistakes we see principals make-
1. Not focussing on the department- this is by far the biggest mistake we see! No business can survive or thrive when the key business driver is focussed solely on something else like the sales department! The very laws of business are all founded in a driver or leader purposely taking a business forward and no business can succeed without being driven to succeed!
It is interesting to note that Robert Bevan from bestpractice.com.au did a survey on how much time the average real estate principal spends in their property management department per month- the shocking answer was an average of just 60 seconds!
2. Not caring for their people- when a principal doesn’t understand property management, doesn’t know its unique challenges, and is not aware of what the average property manager goes through on a daily or weekly basis, it is easy to be dismissive when issues and problems arise!
I remember a former principal I used to be employed with within the 1990s saying to me ‘Darren, there is no such thing as burnout!’ This statement simply said to me they just didn’t care or understand the difficulties of the role and really this statement demotivated me to want to continue working with that company, and in fact, left shortly after!
Not showing genuine care or concern for the day-to-day welfare of your staff simply results in resentment, and drives away your good performers!
3. No resourcing- when a principal focuses all their energy on something else, the business then performs poorly, becoming unprofitable. When this occurs the principal is reluctant to resource the department properly with up-to-date computers, quality training resources, incentives, and the like- all of which help take the performance of the department to its potential. Basically, what gets focussed on gets nourished and resourced!
Extreme Case! Just a few weeks ago I heard of a department that insists their salaried property managers pay for their own stationery and also the ink for their printers! Little wonder this company is always advertising for new staff as they have a huge turnover rate with property managers resigning! This wouldn’t be a great place to work at all!
4. No reporting- I believe the average principal (the ones that spend just 60 seconds on their department per month) simply just wants to know their total end-of-month fee income and their net property growth.
They do however neglect all of the other information which is vital to growing a department like the average weekly rent, average management fee, and average income per month per property as well as many other key areas of reporting. These areas should be monitored and strategies in place to increase their values.
Other reporting is also crucial like monitoring staff performance with key performance indicators, customer surveys conducted and even business development strategies. And like any other business, reporting takes time and focus to collect and monitor!
5. No training- because the general department is simply in ‘existence’ mode, training is of little to no priority. We know of principals that are aware of training coming available in their real estate group that will better skill their property managers, who simply don’t say a word to their staff and so they miss out on the very training they will make them more effective, simply because the principal did not want to spend any funds on training!
Be sure to read the next five common mistakes we see principals making in Part Two.
All the best!