Step One on the New Organizational Journey Is the Talent Search

One of the most encouraging aspects of today's real estate industry environment is that after years of denial regarding change and transition, there is now a universal agreement regarding the fact that virtually every aspect of the residential real estate industry is set to transition in some way over the next 18 to 24 months. Having crossed this bridge of consciousness, the industry can now get about the task of determining what manner of internal and external relationships will be necessary and appropriate for success in this new environment moving forward.

While some debate continues with respect to when these new elements will have to be in place, it is likely that many of these decisions will be determined by when the new industry infrastructure is completed. Across the industry, dozens of new technical and management structures are being created by franchises, brokerages, portals, associations, MLSs and even agent groups. Project Upstream, the Broker Public Portal Project, Flanker, and Property Management are just a few of these new functionalities.

With respect to the prioritization process, the leading players seem to be examining a wide range of options. Within the franchise sector, the paramount issues seem to be setting the nature of the franchisor/franchisee relationship moving forward, deciding what role the franchise should play relative to lead generation and processing, and what value to assign to that forever elusive issue of the brand value proposition.

Within the brokerage sector, key issue status appears to have been awarded to re-visioning profitability, re-engineering the brokerage agent relationship and moving to introduce new tools such as standards, accountability and best practices.

A close examination of the current dynamic within the agent sector discloses that significant energy is being invested in an effort to avoid the efforts of both franchises and brokerages to reestablish effective command and control capabilities. That bumper sticker emblazoned with "I don't need no stinking boss" appears to be ready to present its ugly face in yet another chapter of the industry's history.

With all of these trends, forces, and dynamics occurring within such a limited operational time, decisions relative to prioritization are likely to be especially difficult. The purpose of these comments are to support a recommendation that recruiting the appropriate talent to manage and inspire the new business model ought to be job one. A strong argument can be made to support the proposition that the single most important word in the industry vocabulary is going to be T-A-L-E-N-T.

The talent-centered drumbeat is not unique to the real estate industry. This theme is currently constant and compelling across every industry in the North American economy. Success in today's business world has become all about surviving digital disruption (it is now being carried out at epidemic levels within the real estate space), adopting responsive business models, and finding new talent that is relevant to the mission, appropriate to the challenge and up to the new standards. Whether the center of attention is Madison Avenue, the securities exchange, the automotive giants, the commodities market or Silicon Valley, the buzz is the same. New talent and competencies are an absolute.

The talent discussion is collecting around several key areas of focus. The first has to do with understanding the fact that even medium level changes in the business operations and corporate culture can cause unexplainable losses of balance, equilibrium and profitability. Underestimating the ramifications of these changes has become a major source of distress.

Another delicate subject arises when companies assume that those long-standing senior employees are capable of rising to the new situation. The current wisdom is quite the opposite. Not only are old style veterans demonstrating that they can't (more likely, won't) rise to the occasion, but, more to the point, recent research has disclosed that they are often quick to become ringleaders and decedents willing to sabotage change. It is not a matter of loyalty to existing members of the team, but rather a new reality that the old dogs generally can't learn new tricks--especially if they are in a totally different culture and language

Understanding what new skill sets and competencies will be required to engage the new business model is turning out to be the challenge. Companies often assume that the key-recruiting element will be an extensive knowledge of the real estate space. Early evidence suggests that this may turn out to be a myth. Many companies are discovering that it is easier to cross-train a subject matter expert with "out of industry" experience than it is to teach a real estate veteran new competencies and skill sets. This concept becomes much clearer when one understands that the real estate business that will emerge from these changes will have more to do with where it's going than where it has been. In other words, 30 years of experience in how it has always been done may not be as valuable as 30 days of training someone who is bringing in the new skill sets.

These changes will also bring a host of new relationships, many of which are antithetical to those that have been in existence for a number of years. Classic among these are relationships involving sales personnel. A recent edition of Ad Age featured a story about how new professional sales relationships are rendering traditional interaction ineffective. A return of Death of a Salesman, if you will. Individuals entering into new relationships convinced that old techniques will work are likely to be the source of extensive review when the obvious dysfunctions appear.

Both employers and would-be employees are learning to deal with changing expectations relative to the role of employment in a satisfying life. Trial-based employment is becoming a popular option that allows the truth and reality of the proposed employment relationship to fully disclose themselves while there is still time to reverse the decision. Compensation is also evolving to meet the new environment. The new talent may be less interested in salary and more interested in career. Not taking the first thing that comes along and not rolling the dice to see if it is going to work out. It can no longer be assumed that both sides will do what they have to do to make things work. Let's try it for six months and see if everyone is committed to doing what has to be done. It isn't any longer about that super person who can do it all on their own--because they can't.

American businesses are developing whole new approaches to performance review and enhancement. The real estate industry is now moving to make agent coaching mandatory. Within a short period of time, it will be adding executives and managers to those who will benefit from coaching. The world is discovering that reviewing what one did last week is not nearly as important as impacting what they are going to do next week.

In conclusion, of all the changes that are currently being developed by the industry, it is likely to turn out that the single defining challenge will be all matters regarding talent. Regardless of what big projects firms are working on, they should start by asking,How will this new aspect impact our operations and culture? Who is going to manage it and what competencies and skill sets are they going to have to bring to the table on day one? Recruiting the right talent has become job one.

To view the original article, visit the RECON Intelligence Services blog.