Article Courtesy of: Inman News
By: Adam Hergenrother
There comes a time in many real estate professionals’ lives when they begin to weigh whether or not they want to build a team. As the owner of a team currently in 30 states, I, of course, am a big supporter of building a real estate team. But whether you have a team in every state or are just starting to build your first team, there are some fundamental principles that I believe every leader should know and implement.
I have not been perfect with these over the years, which is why I’m sharing them with you now. Learn from the mistakes I’ve made in the past 10 years. The basics are the basics for a reason. They work. Here are 10 team-building basics every leader should know.
1. Know your model, and stick to it
My real estate business has always been rooted in the concept of personal growth through business and building other leaders.
About five years ago, we got away from this model and started focusing on quantity over quality. It worked for a while — until it didn’t. Moving away from a model we knew worked started to erode our culture and our profits.
So we stopped and went back to the basics — building real estate teams by building other leaders. It’s much easier to build a business based on what you genuinely believe in rather than chasing the latest idea you think you can make work. Find what model works for you, one that aligns with your vision and your culture, and stick to that.
2. Attract, don’t recruit
There’s a time and a place for recruiting, for sure. It’s an essential part of building a real estate team. However, there is a fine line between casting your vision and selling your vision.
Ideally, you want agents to come to you. You do this by building your brand, providing an insane amount of free value to your fellow agents and leaders, and making an impact on someone else’s life. The key here is to do that clearly and consistently over time.
When you create a compelling vision and culture, you will attract agents to your company. And those are the agents with whom you’ll want to get into business.
3. Talk net income, not splits
As you engage in conversations with real estate professionals and decide who might be the right fit for your team, focus on net income, not splits.
A big part of consulting with agents is talking about their income goals, which is fantastic. Focus on that!
If you start talking about splits from the first conversation, you’ll be talking about it forever. If an agent is earning the income they want, does it matter what split they are getting? I think not.
Splits can change over time, but the value your team brings (and with it the potential income opportunities for agents) should only increase. Those are the conversations I recommend you lead with when building a team.
4. 51% culture — it’s about the ‘who’
When you’re building a real estate team, it really is all about the “who.” Several years ago, we would add 20 agents, and 20 would leave within the same month — retention rate: zero. Yes, there is a high attrition rate in real estate, but I wanted to build something different, something that lasted. Something that our real estate agents could build thriving lives and careers around.
It took a shift in our thinking and a commitment to building an organization focused on culture first to get us where we are today. It might have taken us several years to get there, but it worked. The first thing we had to do was let go of the outcome.
What we were doing — focusing on adding as many agents as possible, regardless of how many left — didn’t work for us. The top line number looked great, but it wasn’t telling the whole story of our business. Our shift to focusing on retention led us to track our retention rate weekly and sharing it with our agents across the organization.
Now, our retention rate averages around 95 percent. We are very clear when recruiting and hiring real estate agents or looking to partner with a new team that we are looking at those individuals against our scale of 51 percent culture and 49 percent profit. The right cultural fit is always going to tip the scale against profit.
Sure, perhaps a high-producing agent could bring a significant amount of production and profit to the team. But if they do not fit into our culture and could potentially be an emotional and cultural drain on the team, then it’s a non-starter.
Profit is essential, and culture is 1 percent more critical when it comes down to our team’s integrity and vitality.
5. Make your agents’ lives easier with an administrative and operational foundation
Agents generally join a team because they want to fast-track their success by letting someone else take the financial risk of building an organization and allowing someone else to deal with building a viable and scalable administrative and operational foundation.
As the team leader, you better deliver. As you are building out your operational systems and models, constantly ask yourself, “Will this make my agents’ lives easier?” If the answer is no, move on!
You want to create systems around marketing, lead generation, listing management, transaction coordination, client relationship management, and technology that our agents can easily plug into and start succeeding. By creating a better experience for your agents and clients, you will build a sustainable team.
6. Time on task produces results
As we built our team, a significant focus was always on productivity. We are a culture of productive agents. What does that mean? We create administrative and operational systems that make our agents’ lives easier so they can spend time on what they do best — prospecting for clients, building relationships with clients, and serving our clients during the home buying, selling, and investing process.
The only way to do that effectively is time on task (and again, making it as easy for agents to succeed as possible). We call our system 15-3-1: 15 minutes of script practice, followed by three hours of lead generation and one appointment set per day. And if they don’t set an appointment, keep prospecting. Time on task (with a system in place) is a team-building basic.
As you are building your team, it’s essential to ask for feedback from your agents and clients regularly. What’s working? What isn’t? Is there a more effective process you could implement to support your agents? Would your clients like more, less or different communication?
Client surveys and check-in calls can give you a lot of information here.
So can the five daily accountability questions with your agents and employees. These systems can be very effective if used regularly. Yet, it’s just as important to be “listening” between the lines.
What isn’t being said? Has one of your top agents missed sending in their questions four days in a row? Is your preferred lender sending less business your way than in previous months? Are your clients spending more time on Instagram than Facebook (where you keep posting updates)?
As a leader, it’s essential to keep your head up and your eyes, ears and heart open. You need to be looking months (even years) ahead, gathering data from industry experts, books, podcasts, clients, agents and colleagues to be making the best decisions for your team’s growth and success. Make it a habit to be listening to your team, your clients and reputable sources so that you stay one step ahead.
8. Share a roadmap for success
Don’t keep your team-building plans a secret! Your vision and the roadmap you lay out for how agents can continue to grow will attract the right agents for your team and organization.
Talented agents already on your team will want to know how they grow and succeed within your world. We have created a roadmap for our staff members, individual contributor agents and agent leaders.
No matter what path they choose to take, there is a path forward for them. When building a team, you have to think long-term. This isn’t just a team — this is a company. Your people are your greatest asset. Show them the path forward, and then see who steps up to the challenge.
9. Cast the vision for future growth
A clear vision is essential for building a team. If you are not clear on the vision for your company — start there.
Take the time to write this out, and start communicating it to everyone you come into contact with. You will inevitably begin to get clear on your vision and be able to articulate it to various stakeholders.
Like the roadmap for each agent’s or team member’s career growth, you will want to share the overall vision for the organization over and over and over again. The vision for your company is everything. It’s what attracts agents to your team. It’s what makes clients choose your company over a competitor.
It’s what retains staff and agents over time. It’s what helps third-party vendors decide to partner with you year after year. It’s what will ultimately help your company grow, scale and succeed.
10. Find joy in the success of others
Without great administrative and operational staff, and talented real estate agents around you, you will not successfully build a team. A considerable part of this is learning to remove your need for individual recognition and success.
In its place, you need to cultivate a true understanding and desire to lead others, and find the ultimate joy in their success, rather than your own gain. The beauty of this is that the more you lean into helping others succeed as you build your team, you will see more success and fulfillment than you ever did before on your own.
That’s what drives me to build company after company. The joy of others succeeding is pretty incredible, and it’s something I hope you all experience as you get down to business and build your teams.
No one said building a business was easy. But if you tap into these 10 team-building basics, you’ll be on your way toward sustainable and scalable growth in no time.
Adam Hergenrother is the founder and CEO of Adam Hergenrother Companies, the author of The Founder & The Force Multiplier, and the host of the podcast, Business Meets Spirituality