What Derails Implementation Of Business Plans In Real EstateOctober 22, 2015
Today’s real estate industry is awash in new strategies. Franchises, brokerages, Multiple Listing Services and professional associations are all using “strategic’ as their new magic word. Some of these strategies represent bold and innovative steps into a new and exciting future. Others unfortunately are just updates and recasts of what their sponsoring organization has always done in the past.
Fortunately more and more of these organizations are opting to seek outside expertise with their strategic plan document. The key differentiating factor here is the difference between acquiring assistance (an amateur commodity) and acquiring expertise, the commodity that is really needed. Not so fortunately, many brokerage executives are electing to align their future potentials with individuals who have little or no experience with the concepts of strategy or are already aligned with a larger philosophical entity (e.g. a franchise) to which them have already pledged their allegiance.
Many of these plan documents suffer from substance abuse. This is what occurs when the individual selected by the organization or company to facilitate their planning experience (rather than process), casually asks everyone in the organization what they think should happen, then gathers the leaders and executives together for a more intimate view, and then moves the organizational pieces forward in incremental steps so that, when executed, the organization will look exactly like it has always looked, just a year or two older. In other words, Substance Abuse in planning is what happens when the plan document reflects where the company or organization has been rather than where it wants to go. Substance Abuse is what happens when a strategic plan becomes a task list rather than an expression of strategic intent.
But interestingly enough as great a hardship as identifying an appropriate planning professional, creating an effective planning process and giving birth to an innovative business plan has become the ultimate challenge accomplishing a successful implementation process.
What are the most common oversights that brokerages and other entities make when attempting to implement their business plan? There are seven deadly crises that will terminate an effective business planning process:
- The first implementation crisis comes when the plan document itself is a task list rather than a statement of strategic intent. Task lists by their very nature do not encourage collaboration nor require synergy within the organizational team. In fact quite the opposite. Tasks lists end up being personal performances between two or three individuals on a team with little or no thought being given to the efforts or objectives of others in the process. Strategic intent driven business plans require collaboration between a wide range of implementers, leaders, executives and staff.
- The second implementation crisis comes when the company or organization hasn’t prioritized the implementation function. If the governing board doesn’t care enough about the plan to sponsor it, the decision regarding its success has already been made. When an un-prioritized business plan arrives at a CEO’s desk with no credentials, priorities or credible sponsorship the real message is received and it is immediately placed at the bottom of the pile.
- The third implementation crisis comes when the company or organization hasn’t funded the implementation function or coordinated it with the annual budget. When this occurs the same response happens. The plan goes to the bottom of the pile.
- The fourth implementation crisis occurs when the planning process hasn’t included sufficient time for the implementation process to mature to completion. The reason many companies and organizations are not successful with their implementation processes is that an implementation dream without funding, sponsorship or sufficient time, will always be DOA. This scenario often pleases the senior team players because all the boxes are checked, the organization can brag that it is progressive, yet nothing will change.
- The fifth implementation crisis occurs when those involved at one level of implementation or another equate implementation with absolute obedience to the specifics of the plan. The fact is that the business plan sets a direction not a course. In today’s fast moving real estate industry, firms and organizations must have and exercise the freedom to execute tactics that may not appear to be consistent with those set forth in the plan. The plan brings a strategic intent and direction to the table. What is actually being served may well vary depending upon a wide range of factors and circumstances.
- The sixth implementation crisis occurs when those in charge of the process fail to capture the difference between the act of communicating the organization’s strategic intent throughout the company, and the challenge of effectively implanting an understanding of the strategic intent in the minds of a company’s important executive and staff players. Implementation must be more than merely pushing the firm in a new direction. It must effectively capture the minds, imaginations and innovative spirits of all involved. Anything else is just a rote memory exercise with only the ability to evoke short-term change.
- The seventh implementation crisis occurs when a new Chief Elected Officer, Chief Executive Officer, or officer in charge of planning comes into power with no requirement or commitment to the Company’s strategic intent as reflected in the plan. This is a very common and highly damaging planning mistake. It immediately severs the commitments of all who have been involved in the planning and/or implementation process. Those who didn’t like the strategic intent adopted by the organization can now align with the new personality. Those who have worked hard to make implementation happen are now at risk from both an emotional and a career perspective.
The seven implementation crises discussed above occur with a level of frequency that makes them almost inevitable but not avoidable. That being the case why aren’t strategic business plans being replaced with less toxic options. The fact is that the procedures which give rise to the best practices in strategic intent driven business planning are still among the most effective available to the average brokerage or organization. They still generate far more positive than negative results.
In its best iteration business plan implementation is all about marching an army towards a predetermined objective while, at the same time, taking advantage of opportunities that appear along the way to feed the troops and make the journey either less exhausting or more rewarding. The optimum success of implementation comes when everyone involved in the process understands, and at least appreciates, if not respects, the objectives and is driven to share in their success. We can do this.
Author Credit: Jeremy Conaway