Editor’s Note: This is the first in a series of three Opinion articles on topics of central importance to leaders of real estate enterprises large and small. See the other two, "Recasting Your Real Estate Strategy" and "Opinion: Restructuring Your Real Estate Information."
Vitality is the hallmark of entrepreneurial organizations. The real estate industry, especially in America, has been built through entrepreneurship. Entrepreneurs, by nature and practice, are energetic, resilient, can-do individuals. But the current recession, with its inevitable downsizing and mergers, sapped the drive that propels entrepreneurs to succeed.
After several years of regressing, many real estate organizations are tired. If yours is one of these, your main challenge is to revitalize your team. Your stimulus should spur everyone toward the recovery. Without action, competitors may pass you by.
Conventional management theory starts with strategy and follows with structure. In times of stress, however, real estate is different. Structure, and its corollary, organization, should come first when market conditions have deflated expectations and impaired the economics that drive them. Here are five initiatives to recharge and refocus your team.
Clear the clutter. The recovery is a prime time to simplify your organization and its processes. During booms, entrepreneurs can succumb to bureaucracy. In the recession, most did not want to be consumed by the effort and expense of internal reengineering. Now, you can stimulate your organization through delayering, sharing, teamwork, and transparency. You do not need management gurus for such commonsense actions. But you must have the will to lead because transformations are inherently threatening to some and disruptive for many. If you see the need but cannot face the hassle, or if your objectivity is clouded, empower a trusted colleague or adviser and stand aside until the restructuring is done.
Coach, care, champion, correct. Coaches leverage their teams by caring about them as people, championing their achievements, and helping them grow professionally. The leader/coach knows about individuals’ lives outside work and the hardships they may have endured. Your time and attention strengthen their connections with the organization. Feedback, supported by data, improves their understanding of what they contribute, how others see them, what works, and what does not. As teams face market uncertainty, clear direction can revive their confidence. The counterpart of caring is fairness. With reduced cash flows, you may be tempted to delay or trim payouts that affect colleagues’ livelihoods. Try to avoid this; but if you must do so, ensure that your plan is open, equitable, and designed to restore the trust that may have eroded under recessionary pressures. In turn, people reward fairness with renewed energy, creativity, and commitment.
Infuse the we of partnership. Partnership goes beyond teamwork. Partners share the risks of each other’s actions as well as the rewards. These reinforce values of reciprocity and commitment. It is we, not I, or them and us. High-performing organizations instill partnership qualities in every employee and install metrics to reinforce them. Perversely, nonrecourse financing and limited liability structures can insulate individuals from the consequences of poor decisions. Examine how each facet of your current design enhances or diminishes the partnership spirit—who is “in” and who is “out” of decisions, who shares in equity rewards and risks, how nonequity stakeholders are engaged, and how mistakes are rectified and their costs allocated.
Capture the four I’s. Ideas, in--sights, inspiration, innovation—the “four I’s”—do not just happen. They must be zealously pursued. Procter & Gamble and 3M master these qualities by tapping their customers. Google’s new CEO holds open forums at which employees pitch ideas. Apple’s founder transformed multiple industries with sleek, high-tech innovations for everyday consumers. Real estate legends James Rouse and Trammell Crow exhorted their teams to seek improvements in every phase of development and operations—Rouse through his visionary humanity, Crow by his infectious enthusiasm. Through such accomplishments, leaders ensure a fifth I—impact.
Promote flexibility in schedules and locations. Few leadership levers are more potent in boosting morale than flextime and flexible workplaces. Nearly all organizations can decouple some of their work from fixed locations. Entire functions—sales, service, asset management—can be performed anywhere, anytime. This enables you to offer employees choices in where and when they work. Allowances for home office equipment and broadband also help. Managers often resist these initiatives, but experience shows that individuals’ job satisfaction and productivity grow when their work/life balance improves.
These actions are not costly, but they will take time and effort. Whether you lead a small team or a major multinational, address them quickly but systematically. They can help ensure your success in revitalizing your organization as it emerges from an era of substantial stress. Revitalization may be your toughest challenge, highest calling, and greatest legacy.