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The game doesn’t matter until you keep score

(BROKERAGE) How you collect feedback can determine whether your service actually improves or not. #science

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Every significant endeavor utilizes measurements and scorekeeping to record activities and progress. The most trivial of human pursuits often involves record keeping and statistical analysis.

While the sales and production side of real estate services are measured in-depth, the service side of the business enjoys less measurement, scorekeeping, and analysis than one might find associated with the performance of a neighborhood Little League team.

What does this truly say then about the importance many brokers, owners or managers place on service delivery, customer satisfaction, consistency and service performance?

It’s true that a few organizations do attempt to measure service performance by means of a customer satisfaction survey. Most of these programs are produced and administered internally. The surveys are sent under the company banner and the company tabulates the results.

First, when a customer is asked directly by the professional or the company for performance/satisfaction feedback, that feedback is always more positive than what is obtained by an independent, third-party asking the same questions.

This is known as the halo effect. Consumers are more diplomatic in their response to the person or company that provided the service.

Second, internal service/satisfaction assessment programs typically develop standards and objectives to validate the belief that good service is already being delivered. Thus this positively biased feedback data suits the objectives of the internal program just fine.

It’s just that measurement of those areas of service performance that sellers and buyers feel are important is not taking place.

For those more serious about customer service satisfaction and service performance assessment, there is recognition that the halo effect lessens the value of the data for internal use, and that keeping score of one’s own results has less credibility externally.

Instead, they seek the objectivity and credibility that third party validation of service assessment can provide.

Ironically, even without expert resources and objectivity the attention that measurement brings to the organization will effect positive results and performance improvement. This phenomenon is known as the Hawthorne effect.

The effect was first noticed in the Hawthorne plant of Western Electric. Production increased not as a consequence of actual changes in working conditions introduced by the plant’s management, but because management demonstrated interest in such improvements.

Unfortunately, this phase of initial improvement is not sustainable. Sustaining improvement requires more than measurement and leadership interest. Action steps that result in the actual improvement of the situation must follow collection of data.

Measuring service results and satisfaction in the real estate organization is an important first step. It will certainly gain the attention of the organization and send a serious signal.

Sustaining organizational interest and performance improvement requires more.

It requires systematic and timely feedback, objectivity, systems and service delivery processes, coaching and recognition/awards. But it really all does start by keeping score.

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Kevin is a Co-Founder, President & COO of Quality Service Certification, Inc. (QSC) and earned an MBA from The University of California – Irvine. With over 20 years of Real Estate experience, his primary focus is on consumer research, developing better service management systems, and sharing the importance of consumer-centric service standards, transparency and accountability to create measurable and meaningful differentiation and long term advantage for those professionals that put customer needs first.

Real Estate Brokerage

Iowa police hope new website helps solve Realtor Ashley Okland’s murder

(REAL ESTATE) A tragic end to a young Realtor’s life brought Realtor Safety to the forefront for so many practitioners. While still an unsolved case, police hope a new website will generate interest, tips, and hopefully the missing puzzle pieces.

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Eight years ago this week, Iowa Realtor, Ashley Okland was brutally gunned down in a model townhome while she worked. She was only 27 years old. Open houses in the city were immediately shut down, as it was thought it could be a serial killer targeting agents in the field. That theory has since been put to bed.

But the case continues to plague the officers that have spent nearly a decade investigating, and despite hundreds of leads and interviews, it remains an open case.

Local police say they are still getting tips trickling in, but “It’s like a puzzle that you’re trying to put together and you’re wanting to find those last few pieces to complete it,” West Des Moines Police Department’s (WDMPD) Lt. Anthony Giampolo, told KCCI.

In hopes of finding those final pieces, WDMPD has set up a website called Answers For Ashley where people can submit relevant tips anonymously online.

The site appears to be a work in progress, as only the “submit a tip” feature works, but the wish is that offering an additional outlet for tips could solve this murder.

Okland’s murder inspired the industry to revisit (and establish) safety plans, and several Realtor safety apps were born. Her situation was one that was so relatable, it generated a lot of conversation and idea sharing, making a long-lasting impact on the real estate industry.

Okland is not the first or last Realtor to be murdered – beloved Jacksonville Realtor, Derrick Hartley was gunned down in a road rage incident this month, leaving behind five children. Asheville Realtor, Tina Kessinger was savagely stabbed to death with a screwdriver and tossed into a dumpster. And we’ve lost others – an El Paso Realtor recently died in an ATV accident, a Kentucky Realtor died in a hit and run auto accident, and a Florida Realtor died in a freak accident, falling from a boat. An unnamed Chicago Realtor was recently attacked with a stun gun in what would have been a sexual assault had she not gotten away to call police. The list is far longer, but these recent incidents have scarred the industry.

Okland’s case has always been on the industry’s mind is because it is thought to have happened in conjunction with her career, while she was at work. Potentially similarly to another high-profile case, Beverly Carter’s 2014 murder.

Realtors are often in a vulnerable position, spending time alone in the field, and while Okland’s murder very well could have had nothing to do with her profession and being alone in a model, it is worth considering how your team is educated on the topic of Realtor safety.

The National Association of Realtors offers ample Realtor safety resources and recently launched an alert system, akin to Amber Alerts (read about the Realtor Safety Network and know how to file an incident report).

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Real Estate Brokerage

Google’s secret formula for the perfect team (that you should emulate)

(BROKERAGE NEWS) Google is famous for building high quality teams that change how technology works, so let’s talk about what they do well so you can emulate them.

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Google is infamous for having highly functional work teams, and for being a great company to work for. What accounts for the success of Google’s teams?

It’s relatively easy to discern the effectiveness of an individual employee. It’s a bit more challenging to figure out how to study what makes a group thrive or fail – but Google has done it.

A few years back, they released the results of an internal two-year study of their own teams.

Google conducted 200 interviews, and analyzed 180 of its teams using a list of 250 attributes in order to see what characteristics are most important in making teams successful.

The results show that the attributes of individuals on the team are less important than how they work together. The single most important factor in determining a group’s success turned out to be something called “psychological safety.”

In teams with a high degree of psychological safety, members are unafraid to take risks, and are unembarrassed to ask questions and make mistakes.

In other words, people can be vulnerable with one another without fearing negative reactions.

Said Google, “Individuals on teams with higher psychological safety are less likely to leave Google, they’re more likely to harness the power of diverse ideas from their teammates, they bring in more revenue, and they’re rated as effective twice as often by executives.”

Other factors that made a big difference were dependability (team members can rely on one another), structure and clarity (the goals, roles, and plans of the group are clear), meaning (the goals are important to the individuals on the team), and impact (the team members believe that what they are doing is important).

Factors like how much the team members have in common and their experience and education levels were much less important than one might think.

In a nutshell, great teams aren’t as much about great people as they are about great teamwork.

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Real Estate Brokerage

NAR seeks dismissal of flawed anti-trust lawsuit (Moehrl v. NAR, et. al)

(REAL ESTATE NEWS) The fallout from the widespread, flawed anti-trust lawsuit against the real estate industry, is beginning, and NAR says they intend to fight back.

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At the annual Association Executive Institute (AEI) event, there was an underlying vibration of curiosity leading up to the legal update over lunch. While a handful of people were cheerfully humming along to a Beatles song being played in the massive ballroom, the majority were whispering about the class action lawsuit recently lobbed at the industry like an irrationally thrown surprise molotov cocktail.

Filed by Minnesota home seller, Christopher Moehrl, the suit claims there is a “conspiracy” to price fix broker compensation in the 2.5-3% range, naming the National Association of Realtors (NAR), Realogy, HomeServices of America, RE/MAX, and Keller Williams (with more to be named, inevitably). The complaint intimates that by requiring brokers to offer buyer broker compensation when listing a property on the MLS, fees are “fixed” and inflated, violating anti-trust laws. In short, they believe buyer’s agents shouldn’t be paid because buyers can find their home online now.

NAR has been sued before. All major brokers have been sued for similar “conspiracies,” and agents know the drill. The industry has been sued before. It’s one of the most litigious lines of work in America. And everyone in the industry agrees the claims are outlandish and untrue. And frankly, worthy of an exaggerated eyeroll.

So why the palpable angst?

Because the suit is led by big scary attorneys that are famous for winning billions in class action lawsuits. Look at the final two pages of the suit – this isn’t just some random lawyer on a whim, it’s an overcrowded dais of dynamism.

Not to mention real estate consultant Rob Hahn’s observation that if the lawsuit is somehow successful, “REALTOR Associations evaporate, the MLS likely dies off, and the entire infrastructure of residential real estate in the United States has to be remade.”

Of course a room of over a thousand Association Executives (AEs) would wonder what NAR has to say next. NAR’s response leading up to this luncheon had been to publicly denounce the suit as “baseless,” noting that “The U.S. Courts have routinely found that multiple listing services are pro-competitive and benefit consumers by creating great efficiencies in the home-buying and selling process,” and that “NAR looks forward to obtaining a similar precedent regarding this filing.”

The lunch began with NAR General Counsel and Chief Member Experience Officer, Katie Johnson, updating eager eaters on insurance topics, and afterwards pondered that there was something else she was going to talk about… Oh, what was it? Oh yeah, the lawsuit! Her zinger was awarded with thunderous laughter and applause. The presentation behind her said in bold letters, “We’ve been sued… now what?”

Johnson described home seller Moehrl as a “standard transaction” that is in no way unique. She proclaimed that the industry would prevail. That this isn’t the first time they’ve been sued.

She asked the anxious audience to “step back 100 years,” noting that “it is important to understand and be able to articulate why our system today works.”

A century ago, before associations and licensing laws, it was “very chaotic” and not at all consumer oriented, with little to no consumer protections. A home seller would have a dozen brokers put signs in their yard, and not only did the seller have to give their personal financial information to multiple brokers, but had to also give physical access to all of those brokers. Mass confusion ensued – who actually has all of the details? Who represents the home?

And buyers had to know a broker with a sign in a yard in order to find a home to buy. Johnson called this time as one “shrouded in secrecy and was not transparent – it was not good for consumers.”

Thus, brokers began getting together and exchanging information. The idea was that a broker will list the home, and if another brings a buyer, they’ll be compensated. Agreeing to share inventory was what Johnson called a “wild sea change.” Consumers could give their private information and home access to one trusted broker, and that represented buyers were legitimate.

Buyers could come to one place (the association exchange) for the data, which opened the market to consumers. Many iterations of how the data has been shared include notecards, then books/binders, computers, and ultimately the internet.

“In the end,” said Johnson, “cooperation (sharing your listings and compensation), agreeing to pay the representative of a buyer who is going to ultimately sell your inventory is the basis of the MLS and is what is on attack.”

The class action suit claims that because the seller has to pay the buyer’s agent, commissions are inflated. The truth is that although it is NAR’s rule to require compensation, it could be as little as one cent, and Associations support all compensation models (flat-fee, discount, rebates, traditional 3% per side, and even higher on luxury listings).

And their “conspiracy” claims that buyer’s agents are unnecessary since listings can now be found online (but the suit fails to mention buyer’s agents’ fiduciary responsibility to protect their client and guide them through a convoluted process). And ultimately, they name “co-conspirators” as brokers who have conspired to violate anti-trust laws via their membership to an MLS.

Another flaw in the Moehrl case is that they argue that home buyers can find their home online without representation, ignoring that the converse argument would also therefore hold true – a homeowner can sell their own home without representation (and without paying commissions). The plaintiff saw the value of the MLS and cooperative marketing when buying and selling their home, and used representation rather than opting to list on their own on Zillow or a For Sale By Owner site, which they had every right to do.

And finally, there is a massive conflict of interest with these attorneys – it is essentially legal for attorneys to practice real estate (local laws vary), so why wouldn’t they collectively push against an industry they could theoretically take over with the bang of a lone judge’s gavel?

NAR has filed a motion to extend the time to respond, and will push for a dismissal. Johnson said, “we have really good legal standing,” noting that “anti-trust [laws are] complex, and not often won on a motion to dismiss,” and while they know it’s not often granted, she notes that it may take time, but, “we’re going to defend it and win.”

The session ended with shuffling plates and standard conference noise, but there were more people humming to the Beatles after the session than before. The fight was on, and the AEs appeared to stand taller, newly empowered by Johnson’s battle cry.

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