Many real estate investors can grow their companies to a point, but then no matter how hard they grind, the desired success doesn’t follow. What’s keeping these companies from achieving their full potential?
If this scenario sounds familiar, what your company is likely missing is an established process. The best way to give your team the structure needed to reach the next level of growth is to document your processes using process maps.
So, what is process mapping?
Process mapping is the documentation of what you do to deliver value and to keep your business running. Properly developed, your process maps are a visual representation of what the company does on a regular basis. They allow you to take a bird’s-eye view and make the changes necessary for the health of the organization. Maps pave the way for consistent procedures and open the doors to competent projections. Process maps are the foundation for efficiency in your business.
What Processes Should Be Documented?
The first order of business is to determine the company’s core processes. To do that, review the SIPOC, or customer’s journey. Once you’ve identified and documented your core processes, you will discover subprocesses that stem from your core processes. Next, you can document internal processes, such as onboarding new team members.
How Do You Begin?
To begin process mapping, fight the urge to learn and implement all the shapes and tools available in your chosen software. Keep it simple; use only around four standard shapes the first time around: terminators, process boxes, decision diamonds, and subprocess boxes. Implementing processes can be complicated enough. There’s no need to add to that by using additional shapes that require a college course (only half joking) to learn.
The flow of your process maps should be linear from left to right; you are not creating a mind map that explodes over the page. As you move across the screen, organize your processes in swim lanes that clearly define what role or position is responsible for each step.
As you develop the process map, document the rule (what happens around 75% of the time) and not the exception. Your maps should give team members the ability to handle the rule, leaving the managers and leaders in the company to handle the exceptions. When nothing is documented, everything is an exception. This is why your team feels like overwhelmed firefighters.
What Metrics Do You Track?
Once your processes are documented and your team is trained on your procedures, you need to institute the proper metrics to hold the team accountable. Only after the team has a clear path of what to do and has been trained properly can you fairly and accurately measure their progress and keep them on track. Without the accountability that proper metrics impose, the processes and procedures you built will not be followed and the effort will be wasted.
Fortunately, you no longer have to guess at the best metrics to track. Your KPIs should come directly from your process maps. When built correctly, your process maps will end with a Key Performance Indicator. The purpose of the process is to achieve that goal. Each Key Performance Indicator tells you whether that process succeeded or failed; if it’s the latter, then the process needs to be reworked. In most real estate models, Key Performance Indicators should be measured on a weekly basis, and these KPIs should show up in your weekly stoplight report.
Your Key Process Indicators are also found in your process maps. Process Indicators allow us to find and measure the inefficiencies within the process. Everywhere your process maps are split by a decision, you’ve identified a potential Key Process Indicator. These KPIs should be measured on a daily basis and are the early warning lights that a process may be broken. Your team should know their daily goals and briefly review them each day to maintain focus.
Once you’ve documented your processes and held the team accountable to them, you can use the metrics you’ve established to keep your team dialed in to what matters most. No more fighting fires, no more pulling your hair out wondering where your time and money went. You have the ability to run an efficient, profitable business that you can control and adjust in real time.
As you gather and review the data from your KPIs, you can use that information to make projections with confidence. When your lead conversion percentage is no longer a gut feeling, but hard data tracked over months and sorted by marketing stream and employee, discovering how many leads you need becomes much simpler. Knowing the number of appointments needed to obtain a contract, as well as the appointment capacity of each sales rep, gives you a realistic idea of how many deals to expect with that crew, as well as how many additional reps you need to hire to reach this quarter’s goal. It all starts with process.
Gary Harper is the CEO of Sharper Business Solutions. He spent 13 years as an executive in a Fortune 500 company where he handled the process of evaluating companies’ operation expenses and helped the company reach new levels of efficiencies. He began investing in real estate in 2004 and has used his expertise in business systems and process management to develop a program that helps real estate investors position themselves to scale their business to new levels.
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