No matter what software program is created, business model launched or latest service offered, there is one thing that touches them all: accountability. Their success or failure depends entirely on how much accountability they have and deliver. And the only way to truly succeed is to know how that’s measured in whatever it is you’re doing.
At the core of everything
Right now, the notion of accountability is incomplete. It exists in some corners of the industry but is lacking in others, and when it comes up, there is pushback. It has to be pervasive — everywhere. When there are exceptions to being accountable, nobody is held to a standard. Without a standard, it’s impossible to truly measure success.
- Are agents accountable to brokers for revenue? Not really.
- Are agents accountable to consumers for quality service? Not really.
- Are agents accountable to themselves for running a successful business? Sometimes.
- Are brokers accountable for agent performance? Rarely.
- Are brokers accountable for office production? Yes, but …
- Are brokerages accountable for profits? Yes, but …
- Are lead generators accountable for quality leads? Rarely, if ever.
- And so on, and so forth …
There are so many ways to measure accountability that it’s almost impossible to present them all in a single article. Let’s focus on the ones that really matter and have the greatest potential to truly raise the standard of performance and quality in the industry. Those are ethics, customer service and revenue.
Accountability to ethical standards
Can you imagine an industry in which everyone who is licensed is held accountable to the same standard of ethics? Right now, that doesn’t exist. Realtors have a Code of Ethics. But that excludes anyone with just a license, particularly most commercial agents. Think about it: Having ethical standards in the law means raising the bar for all, not just some.
It seems that while we’re busy looking at how to become accountable to ourselves and consumers, standardizing industry ethics for everyone would be a good place to start. How do we do that? Put more provisions in the civil code across all 50 states. Accountability in ethics via the law means shedding light into the dark corners of the industry and a high standard of care for all.
Revenue accountability for agents and brokers
Right now, the vast majority of brokers do not hold their agents to any kind of quota. They’ll hire nearly anybody, and as long as you pay a desk fee, you can “practice real estate.” Where’s the motivation? There is none. What’s the answer?
- Quotas
- Incentives
- Being OK with firing
Most agents fail in their first year because nobody showed them how to run a business. They’re taught to sell, perhaps even how to do a little marketing, but not how to manage costs or plan revenue. This is in complete contrast to every sales job I’ve ever seen — anywhere. If you don’t sell anything for a year, you get fired. FIRED!
Agents should be held accountable to brokers for revenue goals, and brokers should be accountable to agents for helping build their pipelines — just like every other industry. When brokers focus less on headcount and more on revenue generation, they’ll see an amazing transformation. Accountability for revenue means better agents, stronger brokerages and, potentially, a happier bunch of people.
Customer service accountability
The latest NAR study on buyers shows that 44 percent of consumers rate their satisfaction with agents as “somewhat satisfied” down to “dissatisfied” (only 4 percent). Just for perspective, that study also showed 56 percent of consumers as being “very satisfied” with the buying process. These numbers are frightening.
Take a look at the American Consumer Satisfaction Index across several industries. They’re all 20-30 points higher in overall consumer satisfaction. Why is real estate taking such a beating?
The answer could lie in a number of areas, not the least of which is a lack of training from brokers to agents in customer service methods. I’ve seen good agents deliver stellar customer service — in all honesty, far better than I’ve ever done myself. The talent is there.
As an industry, we need to make agents accountable for delivering a high standard of service. That holds true to brokers, as well. The outcome would, in my humble opinion:
- Increase trust of agents by the public.
- Improve agents’ ability to retain clients long term.
- Transform industry perception.
Can we do it?
Yes, we can bring accountability to the industry by introducing the concept of key performance indicators into the daily function of our firms. Stop thinking about headcount, focus on performance, and make accountability an intrinsic feature of your businesses and industry. When we do, everything will change for the better.
Bryan is the co-founder and managing broker of Catarra Real Estate. In addition to his role at Catarra, he is on the California Association of Realtors board of directors for his fifth year, primarily serving on MLS-related committees.