Tradition versus reality
For the past several years, the rise in the boutique brokerage has rapidly increased, putting traditional big name brokers at a disadvantage. In some states (like here in Texas), all it takes to be a broker is two years being licensed, as well as a few extra tests and dollars. Given modern technology, brokerages are no longer reliant exclusively upon expensive television and print campaigns, so operation costs are lower making it more realistic for a typical agent to open up shop. Reliance on the big broker has also seemingly declined as the web has given rise to a certain brand of “groupthink” if you will that leans toward individuality and disruption.
Mix all of these ingredients together and whether it’s good for the industry (or agents for that matter) or not, it is the new reality- the flexible, fast moving, adaptable boutique brokerages.
How big brokers are reacting
I would argue that despite rapid fire growth of boutique brokerages setting up shop across the nation, many big brokers are doing quite will with recruiting and retention. The agent-centric brokerages, despite their size, most closely match the mentality of the modern boutiques, and they offer agents a sense of security that boutique brokerages haven’t mastered yet.
The stale brokerages of the past are losing agents left and right because they can’t wrap their mind around how to motivate agents to produce and stay loyal. It’s not about offering kumbaya retreats or sexy offices, and it isn’t unique to the real estate industry. The human mind takes very little to produce high quality work and loyalty to an employer, and it’s not money or plush high rise offices.
Take ten minutes to watch the incredibly well produced video to see what I mean:
Can old school brokerages survive this storm?
Traditional brokerages that insist on motivating agents with camaraderie like saying the pledge of allegiance at dressy events or rewarding agents with silver pins, desk trophies and gift certificates will not survive. Traditional brokerages and boutique brokerages that insist on innovating by using the power of their agents’ minds will thrive. Those who value their agents and allow them autonomy, mastery and purpose (as the video above outlines) will not only thrive but will dominate.
There are new brokerages that consider themselves progressive and when you ask them what makes them innovative or how they motivate their agents, and the answers are almost canned and sound exactly like the early days of the big brokers, “better splits,” “better education,” “better profit sharing,” “better technology” and the like are what boutique brokers claim their advantages are, but none of these things empower their agents by giving them (let’s say it all together now) mastery, autonomy or purpose.
Mastery, autonomy and purpose
Which brokerages opt for brainstorming sessions with the entire staff from the receptionist to the broker? Can you name a brokerage that behaves more like an open source society and less like a dog and pony show or a black tie banquet? Is there a brokerage that gives true ownership of the brand to the agents?
At this point, most people have already skimmed this article and will comment something about why they’re loyal to their broker and will miss the point completely (and I’ll act oh so surprised as I comment in return noting that “with all due respect, I think the article should be read in full as the point was missed”). And, at this point, most brokers are not reading, they’re simply formulating their response in comments that will read much like their website’s about page. They’ll say that they’re progressive or superior in every way and that their way of doing things is already motivational and their agents are loyal. I know thousands of agents across the nation and I guarantee you that no agent feels empowered with autonomy, mastery or purpose unless they do it themselves for themselves, but I postulate that the brokerage that finds the balance between these three (as outlined in the video) will be the dominant brokerage for decades to come, despite the model, split or technology preference.
