Apr. 10, 2012 - Learning from Amazon

Mar. 24, 2012 - Leadership Thoughts: Crafting the Job Description

“I’m surprised”, wrote someone in response to my last blog, “At an organization that doesn’t have written job descriptions for its elected leaders.”

I’m surprised, too—not only and the lack of any job descriptions, but also at the dearth of helpful and meaningful ones. One exception I discovered with the Wilmington, NC Association’s position description for association president, which reads like a pledge which might be signed by someone taking office. Most descriptions are pretty vague, however: “chairs all meetings of the Board” is the usual fallback phrase which relegates the prez to a position of gavel-wielder and offers little practical direction to the office holder.

Picture yourself in the unenviable spotlight of a nominating committee, the tank of piranhas looking for a victim to serve up to the membership as meal…er, president. “Please,” committee members ask, “help us out here by agreeing to join the leadership team. You’ll be giving back to the profession that has done so much for you.”

What are the questions you will stammer out to them? You’ll want to know ‘what’s involved’. Translate that into ‘how much time will the job take’, and ‘do I have the resources to do a credible job’? Nobody wants the honor if they are doomed to fail, so the job of the Leadership Development/Nominating Committee (and CEO) is to create an environment where candidates can be confident and understand what’s necessary to be a success.

The first step is a clear job description. As you draft it, think of writing a hiring description in the working world, and include the following:

1.  Give a brief job description
2.  List the specific responsibilities of the job. If, for example, the president represents the association at state or national meetings, now’s the time to say so. If the president chairs the monthly luncheon meetings, add that duty to your list. Don’t be afraid to tell people what’s expected of them: if someone can’t speak in front of an audience and meet the expectations of the members, address the issue before he or she agrees to the position—not afterwards when that shortcoming has become a public disaster.
   
3.  Skills. What skill set is expected of the office? Will the successful candidate be expected to present a professional public image? Will he or she be expected to manage an efficiently run, productive meeting? Moderate contentious general membership meetings? Write a monthly blog for the association website? Be able to read and respond via email?
   
4.  Be clear about the time commitment. Ask the present office holder to estimate the amount of time he or she spends on fulfilling the position. Include meeting attendance, conference calls, work that needs to be done, and travel. List the time either by weekly or monthly hours.
   
5.  Define the measures of success. These will, of course, change on a regular basis, but if there are expectations that the new office holder must fulfill, say so. If the president will spearhead the new strategic plan, or the treasurer will achieve spending cuts amounting to 10% of the budget, now’s the time to define these duties.
   
6. Benefits. What are the benefits to the candidate? The association will fund the cost of travel and meeting attendance? Spokesperson training is available to leadership? Leadership training will be provided in the form of education, meetings, and personal coaching? Tangible and intangible benefits might be included in this discussion.
   
7. Write the description and ask the Board of Directors to endorse it. Then, make sure potential candidates have it and are clear about it before they throw their hats in the ring.

Having job descriptions written and communicated in advance of an election process will greatly strengthen an organization. Candidates understand what the position entails, and whether they are a good fit for the opening. In addition, your association can anticipate potential problems—how often have we heard an executive officer say, “What can we do with a board member who never comes to meetings/comes unprepared to meetings”? How much easier it is to answer the question in advance by saying “Officers and Directors are permitted two absences per year before they will be asked to resign” and “Members of the Board are expected to review distributed materials in advance of the meeting.”

If candidates are discouraged from participation because the requirements are too stringent, the organization might offer some capacity-building programs for those who need them. Often, such training is available in the community itself and organizations can partner to build a strong leadership core. And if candidates are refusing to serve because of the time commitment, perhaps some strategic thinking needs to occur. For instance, one association I know went from four-hour board meetings held twice a month to one hour meetings held once a month. The tipping factor was the imposition of more efficient meeting management and better trained participants.

In short, the organization can only be as strong as its leaders. And the leaders can be much stronger and more focused on their leadership duties if the organization has clearly stated expectations and values that are widely distributed and understood by all.

Mar. 19, 2012 - Leadership Development: The Shooting at Fish Technique

 A long time ago I was president of an organization that prided itself on diversity and on membership participation in all decisions.  That sounds like a laudable goal: however, ‘diversity” and ‘agreement’ do not work well together even in the best of times.  In this particular case my job as president was to steer the group to a decision about a new facility.  At the end of my leadership term we were housed in a different building, but I was totally exhausted.  I had no more energy to give.

Mar. 7, 2012 - Seven Snowy Lessons in Association Management

Picture this:  by Friday at 5 PM the snow is falling—huge, wet, sodden glops of it.  It’s the kind of snow that happens in the spring when the weather is warming up, the ground has thawed, and folks see snowdrops budding at the corners of their yards.  Then the temperature begins to drop and the sky responds with a half-frozen thunderstorm which quickly ices roads, clings to tree limbs, and coats power lines with thick, glistening coats of frozen white. 

It might have been easy driving when people started home from work, but by the time they reached home they knew Northern Michigan was in for a long weekend.

By 10 PM the lights went off and the TV was silent. Early bedtime at my house, a night interrupted by the crack of tree limbs breaking under the weight of the snow and ice.

By morning, the house was cold and there was no coffee.  The bagels were icy and the butter hard.  The driveway was buried under a foot and a half of heavy, wet snow.   Lucy the Wheaten Terrier didn’t get far from the house—she couldn’t even make the 25 yards to her favorite tree trunk. 

It was a long weekend: the driveway wasn’t cleared for two days and the electricity wasn’t restored until a day after that.  Time to do a lot of thinking, eat a lot of peanut butter, and quickly learn to sacrifice style for practicality.  But the association manager in me never is quiet.

Well, I thought, before my cell phone dies, I’d better call the power company in case they don’t know I have no electricity.  Using my handy dandy cell phone browser I went to the electric company website and found—ta da! The ‘Outage Emergency Line’ information is buried deep in pages of text about how responsive Cherryland Electric is in the case of an emergency. There’s the number!  Down at the bottom of page 2!

Lesson 1: Prioritize your website design around what the user will want and need, and not about what you want to tell them.  (Sorta reminded me of the websites I’ve visited that give all kinds of information about the organization’s Code of Ethics without telling the reader how to find a remedy for an immediate problem.)

Anyway, I found the number and called.  Of course the line was busy.  What good is one phone number to service 35,000 irate customers? 

Lesson 2: Maintain adequate resources to provide effective services.

So I thought, “Well, this is the age of social media.  I’ll visit the company Facebook page and  Twitter sites.”  Found those, despite a rapidly dying battery, only to read the messages from the 35,000 customers: “Please update your outage reports”, and “When can we expect heat, our house is very cold?”, and “My mother is on oxygen, please help.”

 Lesson 3: Social Media means communication in real time.  The new technologies are worthless if used incorrectly. If you host a social media application, keep it current.

Then my cell phone said, “No signal.”  No heat, no lights, no phone, no internet, no driveway.

In the bottom of the storage closet I found a battery-operated radio and it still worked.  But where the heck could I find news about the storm?  Interestingly enough, nowhere.  News, I found, is relegated to a only few minutes, and no station had the capacity to provide in-depth local information.  I did find that there were several community shelters available if I needed them—and if I could get out of my driveway and/or phone for snowmobile rescue. 

Lesson 4: Plan for a disaster, because one will someday happen.  Have a central information point.  Make sure that everyone knows where to go for information when it’s needed, especially in an emergency.  Technology makes it possible to provide prompt information services…so make sure you incorporate communication programs into your regular operations.

 And Lesson 5: Make sure your support services are what the consumer/member really needs.  Shelters don’t do much good if I can’t get down my driveway (just as education and other opportunities in a trade association need to be relevant to the member’s business success).

My rescue procedures began after two days of isolation: at 5 AM Sunday morning I realized that I could see lights shining on my frozen front lawn.  “Either the electricity is back on, or the moon is very bright,” I thought.

Not so!  These were the headlamps of the snowplow stuck in my driveway as he tried to remove two days of heavy accumulation.  Too little, too late, and foolishly applied in the early morning dark.  He was joined by another snowplow and, some hours later by a front-end loader.  Soon, they were all stuck in my driveway and I was still a prisoner.

 Lesson 6: Apply solutions quickly, using adequate resources to get the job done.  (I know, I know: this is especially difficult in an organization run by a committee.  It’s always more comfortable for volunteers to have another meeting, a survey, or a vote and further study. “Everybody needs to be on the same page” Is the common excuse for inaction.)

And of course, the faulty execution of a solution leads to the inevitable:

 Lesson 7: Maintain reserves.  Emergency measures will always be more costly than anticipated. Take the case of my snowplow guy: his initial timing mistake lead to three vehicles embedded in my front lawn, increased expenses for him, and—I’m assuming—a similarly inflated invoice to me.  Whether or not I protest his extra charges isn’t the point: somebody has to bear unexpected costs.  It’s just good business to be prepared.

Well, this weather disaster all over now—the ice is melting; the lavender and yellow snowdrops have re-emerged; and my driveway is passable, even if it’s a soggy, rutted, muddy mess. I’ve stocked up again on batteries and peanut butter, because what we know in Northern Michigan is this: weather emergencies can yet happen.

 It’s still early in March.

Dec. 29, 2011 - Pessimism and Predictions: Comments on the Commentators

  It’s that time of year: everybody stops and takes note of last year’s trends and next year’s predictions.  I was noticing this morning that the secret of writing end-of-year blogs is to include a number in the title, and predict the worst.  “Ten reasons why the economy will fail in 2012”, and “Seven signs of impending disaster in real estate”—titles like these are almost clichés.

I slog through these blog bytes, thinking about what many of the predictions will mean for real estate associations and MLSs in the coming year.  How can we as organizations survive and be healthy if these predictions come true?

Bill Rovillo, of IMAPP, voiced some particularly challenging thoughts that association and MLS staff and leadership need to consider and place on the strategy section of their organizational agenda. 

In several of his forecasts Rovillo sees significant actions being taken by big brokers.  He predicts that “frustrated with the expenses and politics associated with being a member of NAR, some Brokers will decide go it alone.”  And later he says “Big Brokers will gobble up more RE businesses- creating a “who needs syndication?” atmosphere when they have 30+% of the market share of listings.”

Now I’m not going to be too surprised if this prediction comes true.  Over 30 years ago, at the very first meeting of the Board of Directors after I took my job as the Association Exec for a Realtor association, the largest broker in town said, “Lower those MLS fees or we’re outta here.”  Of course we didn’t, and neither did he, but the threat was pretty much an annual event that had us quaking in our boots each year at dues renewal time. Our organizations have tried a lot of tactics to appease big brokers: representations on decision-making bodies, inclusion in planning activities, and so on.  But brokers remain committed first to their company financial success, as well they should, and intolerant of ‘leveling the playing field’ for smaller brokers.

Now, of course, things have changed for MLS positioning: there are viable alternatives on the horizon.  If MLSs won’t provide public information, the public will go to 3^rd party sites (can you say “Zillow” and “Yahoo”?) which are information-filled and user-welcoming.  And if Realtors know that the public is going to those sites in advance of showing up on a broker’s doorstep, guess where the salespeople will go to be armed with the same information.  And when the real estate salespeople find that there is indeed a place where their listings can be seen by consumers FOR FREE and without a labyrinth of MLS rules and penalties---well, the results are inevitable. 

(I know, I know: there’s data integrity, and ethics and all the other pluses of an MLS database, but there’s also a growing disenchantment with those high ideals and the expense and punitive atmosphere associated with them.)

Rovillo also predicts that “Large MLS’s will take more control- of their data, both MLS and Public Record, and create their own revenue stream.”

That’s not too much of a stretch, is it?  Look at MRIS, and Minneapolis—shining examples (among many) of how to develop revenue in adjunctive ways, using the strengths inherent in the MLS system itself.  Let’s face reality: as the real estate practitioner population declines, so does the income that’s based on dues and user fees. In an organization where over half of the users do not make a living income from real estate sales, the opportunity to raise fees is limited.  MLSs (and associations) must look for independent sources of income.  One of those clear sources is data repurpose and repackaging, and another is sales activity to our target market.  Still another is increasing a membership base, and developing new product lines for an expanded audience.

Rovillo identifies two other interesting trends: a free MLS, and association mergers.

The no-cost MLS is not a new idea, either.  Rovillo says “ A Free (or nearly free) MLS system will emerge- the only way to stave off big MLS vendors from monopolizing the business in a down economy.”  Actually, I’d disagree with him there: a free MLS will emerge because there isn’t a lot of money to be made in the legacy business propositions for an MLS.  There are reasons why Google and Microsoft haven’t entered the MLS biz: there’s relatively no money there. The technology is certainly available, but the ROI is not.  However, it won’t be long before somebody will figure out how to generate new money by providing real estate data , money I suspect it won’t come from the nickel and dimes MLSs charge for user and listing fees.  Nor will the new MLS vendor business model include the significant expenses of marketing, customizing, installing, and supporting systems for a plethora of demanding, impatient, and technically challenged users.  Think about it.

Finally, this merger thing.  It’s really taken up a significant amount of association resources.  Thinking back again to my initial year on the job as an AE, one of the first regional Realtor meetings I ever attended was a highly contentious confrontation in which a gathering of small boards almost resorted to fisticuffs to defend association boundaries which no longer conformed to market areas. Today those boards are still having that same meeting.

Only now associations can’t afford to maintain their independence and reinvent governance every 30 or so miles.  And again, there are alternatives: association boundaries need no longer be defined by how far a horse and buggy can travel in a day.  I’m not a big fan of mergers because I think well-developed market areas are important to a healthy cooperative business, but I am a supporter of concentrating on the priorities that matter. As another real estate commentator, Rob Hahn, observed in his 2012 predictions: “The vast majority of companies, brokers, agents, Associations, MLS, tech vendors, and others will spend an inordinate amount of time and energy rearranging deck chairs on the Titanic. There will be much effort spent focusing on ancillary issues. . .while the entire infrastructure of contemporary real estate crumbles around them."

Optimist that I am, I think there are things real estate organizations can do to build capacity and respond to adversity.  Among them:

A.    Schedule time on each meeting of the board of directors of the organization to have frank discussions on emerging trends.  Awareness, priorities, strategies—these are the watchwords of any effective group of decision makers.

B.    Downplay the restrictive, punitive features of the organization/MLS and encourage member service and support.  Make user satisfaction a priority.

C.    Involve buyers and sellers and members of the business community in your organization.  Develop the idea that the organization is a place where people come together to conduct business successfully.  Information can’t be contained by building walls around it any longer.

D.    Look for new business products and income sources.  Constantly work to minimize dependence on user fees and dues and diversify your income stream.

E.    Streamline your operations.  Eliminate burdensome governance such as elaborate geographical representation or non-productive committees. Reduce the percentage of your expenses spent on non-essential meetings or travel.  Develop effective leaders instead.

And most of all, think like a business start-up.  Because that’s what our organizations are: the real estate world is being re-invented around us, and every day presents new and inventive opportunities to support our members and their customers.

Dec. 19, 2011 - From Policy Hysteria to Best Practice:Recognizing AE Influence

Last week, Inman News released its annual list of 100 of the Most Influential Real Estate Leaders of 2011.  This is a pretty prestigious list in the industry, as befits a significant real estate voice and commentary.

I think AEs should fully recognize and celebrate the names of our peers in Realtor association management who are on the list*:

• Mark Allen, CEO, Minneapolis Association of Realtors,  and 10k Marketing
• Bob Bemis, CEO, ARMLS and MLS Domains Association
• Russ Bergeron, CEO, MRED, Ltd.
• Art Carter, CEO, CRMLS, Inc.
• Dave Charron, CEO and President, MRIS
• Merri Jo Cowen, CEO, MFRMLS and Chairperson of CMLS
• Bob Hale, President and CEO, HAR
• Rebecca Jensen, CEO and chair, UtahRealEstate.com MLS

That these names are included is important to all AEs: it means that the larger industry recognizes the importance of the work we do as association MLSs and the contributions those associations make to the industry.  I know I can look at each one of these people and respect their individual contributions to the success of our members.  They are, in the eyes of the world, some of the practitioners of Best Practices of real estate trade association management. As commentator Bill Fowler recently observed in his blog article “MLS in 2012”, “Creating something vital to REALTORS in MLS technology requires leadership in our organizations.” 

Inman has recognized many of these leaders.

However, without detracting one bit from the applause due these individuals, I’d also like to kick the Inman group in their collective kneecaps.  Why?  Because the MLS isn’t the only area of successful performance by association execs: there are other areas of management leadership and influence besides MLS and its derivative products, the only criteria seems to Inman recognize.  Other programs are equally influential in the world of organized real estate: let’s salute the AEs involved in the RAMCO development work and the successful implementation of some of the great Game Changer programs.  Let’s look at a collection of stunning association professional education innovations, international real estate outreach programs, cooperative infrastructure efforts between associations to produce better services and efficiency, and some outstandingly innovative state association programs—all influential real estate accomplishments in 2011.

Perhaps Realtor AEs need to do a better job of recognizing our own innovators and leaders.  How about an annual collection of best practices? An AE Innovator recognition program?  Another Game Changer program?

And for the benefit of all, let’s make our judgments not only on the program or product, but also highlight answers to the following questions as key learning opportunities for all association managers:

• ·         How did you foster overall management focus on results?
• ·         How did you create a governance structure to move your organization forward?
• ·         What techniques did you use to back your programs with strong, accountable, transparent financial management?
• ·         How did you motivate and structure available human resources?
• ·         What communications program and technology did you employ?
• ·         How did you manage resource development and fundraising to support the project?

Congratulations to the Inman honorees.  You’ve moved beyond IDX policy hysteria to develop practical programs for real estate professionals.  My hope for real estate in 2012 is that AEs continue to recognize skillful leadership and expand our opportunities learn from each other.

*Note, I didn’t include the NAR or ISC staff—they are also well represented on the Inman list.

Dec. 10, 2011 - Making Lemonade: Building capacity in changing times

Well, this is interesting: the ever-optimistic NAR economist Lawrence Yun recently observed that 2012 won't see a robust recovery in the housing market. In fact, Yun says that as rents climb in the multi-family housing market and as the stigma of renting is disappearing, it will be the commercial real estate sector which will see the greatest increase in activity.

And noted economic commentator Barry Ritholtz states that the slow motion crash in housing will continue for another 5-10 years and predicts that the US are only in the 5th inning of a 9 inning game in which values may continue to drop. Additionally he says that"following a debt crisis, consumers spend a decade or more deleveraging, and tend to downgrade purchases that involve taking on more credit - like a mortgage."

What does this predicted trend indicate for real estate association managers? It's an uncomplicated answer: it simply means that our more aggressive members will go where the money is. And in turn, that means the association needs to provide those members with adequate support services to get them there.

Even the smallest real estate associations need to sit up and take note: if we are to remain relevant as trade organizations, we must understand that our membership no longer consists of 90% used home salespersons. In order to make a living in the real estate market, members need to respond to consumer trends-and according to the observations of Yun and Ritholtz, the markets are trending toward commercial real estate. That's where the action will be.

So how must real estate associations react? Most Realtors won't become full-fledged commercial specialists flashing their CCIM designations-a majority of US real estate market areas simply won't support many exclusively commercial specialists. What members will want to do is gain the skills and the tools to support an increase in their commercial activities, particularly in the rental property market for multi-family housing. And fortunately, there are some pretty robust existing programs that associations can use to build capacity to support these emerging member needs. Here are some suggestions for the association executive:

1. Encourage members to participate in a commercial overlay board. Many existing support services are already in place in these organizations-- you don't have to reinvent them and spend down your association resources. Becoming a secondary member in a commercial overlay board is a good answer for many Realtors who don't want to exclusively specialize but do want additional education and marketing networks.

2. Form a commercial marketing group in your own board. It could begin as an informal 'haves and wants' meeting over coffee and doughnuts. If the need is there, it will grow on its own-with the association acting the incubator.

3. Examine NAR's Commercial Services Accreditation program for local associations. While your association may not wish to pursue the actual accreditation (which may seem unnecessarily elaborate for your immediate purposes), this program does offer some very useful ideas on how to develop association support capacity in the commercial services area. Think about

a. A dedicated commercial page on your association website. It might feature member's commercial listings, statistics, and useful information about topics of interest-even some data from the local economic development organizations.

b. A website link to NAR's commercial home page, its commercial advocacy page, and the commercial education page. And don't forget NAR's commercial blog, "The Source.", as well as the Commercial Research department--members need easy access to this information.

4. Ask your commercial marketing group what kind of education programs its members need and develop an education series using local or regional experts-commercial developers, economic development corporation representatives, taxing authorities, and others. Again, remember that your target member market is probably not interested in becoming specialists in commercial real estate-but they do want information which will help them expand some specific skills in new areas. (There's a difference.)

a. Offering a regular (monthly?) commercial education program followed by an informal marketing session is one of the best ways to develop member awareness in the commercial area, assuming your association doesn't have the audience for anything more elaborate.

b. This activity might be one which could be shared with neighboring associations as well. Commercial real estate practitioners aren't always productively confined to geographical boundaries-a commercial program will possibly be more successful if your board can partner with other associations in this effort.

The take-away point here is that the changing real estate market is influencing member needs-and our associations must respond, even if only in a modest way. Most Realtors don't want the Commercial Member Golf Outing, or even a commercial ethics process or trade show (as the NAR Commercial Services certification application suggests). Reinventing the association model with the word "Commercial" attached to it is not what most of our members need or even care about-nor is that something that probably two-thirds of local Realtor associations have the resources to provide.

What members do want is practical, efficient access to the skills sets and useful information which the changing real estate marketplace is demanding. It's our job as AEs to start with what the member needs, and set about providing those tools.

(PS: How do you fund this stuff? Try charging the members to showcase their commercial listings on the association website, soliciting underwriting from developers of rental income properties, advertising sales, commercial affiliate member programs, to name a few ideas.…The opportunities are endless.)

Nov. 4, 2011 - Creating Communities: the Future of the Real Estate Association

Associations have a primary purpose: to create a community. In a real estate association, the primary purpose is to create a business community centered on the business of property ownership and transfers. It’s really that simple.

Let’s examine that word ‘community’. In many Realtor associations, the community is really quite limited: it consists of brokers and salespeople involved in the transfer of pre-existing homes. Oh, I know: lip service is often given to other groups—commercial specialists, appraisers, property managers, and a small number of affiliated business interests—but by and large the emphasis is on license-holding real estate practitioners. (Of course it goes without saying that the community is further limited by geographical restrictions, in many cases.)

Realtor associations build most of their programs and services around that limitation: licensed salesperson or broker, located in an assigned geography.

Frankly, there’s a problem here: in reality the real estate community is much more extensive and the desire to be a part of that business community much more far-reaching than the current operating definition would have us believe.   In addition, our existing membership is becoming specialized in other areas besides used-home sales: members are finding business in the rental and rehab market and personal investments for themselves and their clients. They are becoming more conversant in online marketing techniques, technology tools, foreign transactions, and finance.

The real estate community is also expanding well beyond the current limits of license holders, with a second tier of bankers, mortgage companies, and title companies. As members expand their interests and activities, they are partnering with an array of business interests never before included in real estate circles—marketing specialists, technology experts, website designers, foreclosure experts, and economic and development analysts.  

It’s easy to say “Not MY members—they just want to make sales. And, the  Realtors I know don’t read, anyway.” That’s a familiar litany, of course. And of course, in many cases it’s true: statistics show that well over half of current members don’t make a living at real estate. They are dilettantes, retirees, and folks who also have a ‘real job’ and just want to make a little extra income on the side.

The caution here is in thinking that these are the sum total of members, that this is the real estate community our association must serve. If we as trade associations fall into that trap, we are contributing to the erosion of our industry as surely as if we ourselves were the lions coming over the hill (“We have seen the enemy, and they are…).

Certainly this class of member is real and currently accounts for over half of our association dues income. “Ah,” you say, “doesn’t that make the non-productive majority our association’s target market? They are a majority of the association members. If it weren’t for them we wouldn’t exist. So let’s continue producing remedial level education programs, keep our dues and costs low, and direct our collective energies and resources at servicing these members.

I think there’s another answer: if the members in your community by and large don’t make a sustainable income from real estate activity, enlarge the community. Think about it: if your association is to become ‘The Voice for Real Estate’, for whom would they speak? Professionally, your organization would speak for all your industry partners—builders, remodelers, community planners, environmentalists, financial partners, attorneys, estate planners, and property owners. These are some of the areas of the real estate business community who share an interest in the business climate relating to real property.

There are many opportunities to enlarge a reasonably small and circumscribed audience and build a powerful community voice. These doors don’t necessarily depend on an MLS presence, either—they open onto a larger world of business interests, shared knowledge, and valuable networks and coalitions. It’s here that the real estate organization will find its future direction, I believe. There’s not a lot of reason to waste much more effort in locking the barn door after the MLS horse has gone elsewhere, but there is much to be gained by thinking about the kind of community that can be built through a real estate organization which is inclusive rather than exclusive, and which involves using technology tools and other resources to transcend the current limited organizational structure.

It also means assuming that the target market for a real estate association is based on skilled practitioners with skill and commitment to the many facets of the real estate business.

Oct. 19, 2011 - MLS Questions? Who has the answers?

     Sometimes I feel like I'm standing in an empty room and all I hear is the echo of my own voice. This is one of those days.

     Two MLS-related news stories are bouncing around the internet this morning-one is about the NAR IDX policy proposed changes, and the other is about FSBOs.

     (Well, let's face it; they're pretty much about the same thing…)

     In a nutshell, the NAR IDX issue is this: "The big news, as many have already heard, is that the Franchise IDX policy will be repealed in its entirety. The overall thrust of the proposal appears to be one aimed at restoring the status quo ante." The quotation is taken from this morning's blog post by one of my regularly-read industry voices, The Notorious Rob. Rob proceeds to examine what this proposed policy change will mean, and then asks the question, "just what percentage of the Directors of NAR, who will be voting on this proposal on Monday in Anaheim, understand the issue? How many will have studied the issue? How many will have thought about it at all?.... Could someone explain to me how hundreds of NAR Directors are not in violation of their fiduciary duty as a director of nonprofit organization?"

     The other topic has to do with what's happening in the world that exists outside of the pre-meeting hysteria of an NAR convention. In this case I'm referring to Zillow's recent announcement that it has added 45,000 'for sale by owner' listings to its database of existing FSBO web and mobile real estate shopping , allowing independent home sellers to distribute their listings free of charge. Zillow obtains these listings through individual home sellers as well as listing feeds from ForSaleByOwner.com™, HomesByOwner.com®, owners.com® and Postlets® . The latter is a Zillow company, by the way, which allows home sellers, real estate agents and landlords to generate one listing and dispense it to Zillow's more than 24 million monthly unique web and mobile users, as well as 13 other sites including Yahoo!® Real Estate and craigslist®.

     We're not talking peanuts here--Yahoo Real Estate is a formidable challenger to realtor.com. But what really set me back was the association manager who, upon hearing of the Zillow announcement, shrugged and said (somewhat disdainfully), "I don't keep track of Zillow."

 

Associations of REALTORS® and their multiple listing services must enable MLS participants to display aggregated MLS listing information by electronic means. Electronic display subject to this policy includes display on participants' public websites, displays controlled by participants on other websites, display on social media sites used by participants, RSS subscription, and applications for mobile devices. All electronic display of IDX information conducted pursuant to this policy must comply with state law and regulations, and MLS rules. Any display of IDX information must be controlled by the participant, including the ability to comply with this policy and applicable MLS rules.

     And I bet you're thinking: "Now how am I gonna enforce THIS on a budget that has been shrinking as members are dropping away?"

     Well, don't worry about real estate buyers and sellers: they may be looking elsewhere. As Zillow CEO Spencer Rascoff says, "Our integrated approach to marketing all types of real estate listings, creates the most comprehensive and data-rich shopping experience for web and mobile."

     Oh, and don't worry about the MLS subscribers either. They want to be where the consumer goes. That's where the money is.

Oct. 15, 2011 - CMLS Conference Conversation

As you may be aware, I serve on the Board of Directors for the MLS Domains association—because it’s a cause I believe in (well, ok, I have several causes…and I’m not very quiet about my enthusiasms). But as an association exec I was always frustrated by the ‘MLS thing’: the public appreciated an MLS but couldn’t define the term, and our members were equally confused—and thought every collection of housing information was ‘the MLS’. Whatever an MLS was, everybody knew they wanted one, including all the folks who weren’t an MLS but appropriated our name—like ‘FSBO MLS’ or ‘luxury home MLS’.

The 2012 opportunity to introduce new top level domains into the world wide web seem to me to be an ideal method to define the term ‘MLS’  and to control who can use it. If the MLS Domains Association is  granted the exclusive use of .mls by its members only, we will have come a long way to stabilizing the use of the term and protecting our organizations’ investment in being the source of the most accurate and timely data available in the US housing market.

Dot MLS (as I fondly call it) is an idea whose time has come—but not necessarily because the organized real estate is ready for it. The urgency was introduced by outside events: the international internet naming association has set January 2012 as the date that applications for new top level domains (TLDs) will be considered, “Big corporations, nonprofits, and governments are expected to scramble to claim the new TLDs,” says the Washington Business Journal. 

The MLS Domains Association will be standing at the head of the line, application and check in hand. 

But getting there is a bit of a battle. The biggest problem is that top level domains aren’t on everybody’s radar screen—and by the time the opportunity becomes  clear, it may be too late to be considered by the great domain naming authority in the sky (ICANN). The second TLD round may not be available for several years—opportunity lost!

The point of this long introduction is to set the stage for my comments on the recent Council of MLS conference held in Tucson. The conference itself was outstanding in its speakers, its format, and its opportunity to meet vendors and have meaningful hallway (and lobby bar) discussions. To my delight, the issue of ‘MLS branding’ was center stage during many sessions and informal conversations..

“What’s ‘branding’ mean?” my friend JoAnn asked me. “I’m an MLS financial person—I don’t know these things.” 

The clearest answer is in this quotation: “…understand that branding is not about getting your target market to choose you over the competition, but it is about getting your prospects to see you as the only one that provides a solution to their problem.” To that point, it was clear at the conference that in a world where real estate information is everywhere, the MLS brand is increasingly important as a way to tell our audience (members and the public) that our information source is timely, accurate, and as trustworthy as they’ll find anywhere.

If the CMLS agenda is any indication, the topic of branding is under consideration of MLS leaders across the country. They are asking, “How will we help the public understand that housing information from the MLS is the most reliable source? How can we motivate our members (who are the collectors of the data) to do the best job possible in conveying accurate data to the MLS in a timely manner? How can we repackage our data products so that they are valuable to the real estate community and their clients and customers?”

These questions formed much of the substance of the conversations at CMLS—and the work of the MLS Domains Association was often cited as one of the obvious solutions. 

To explore this topic further, CMLS is hosting a half day session on branding on November 9 at the NAR Annual Conference in Anaheim. MLS CEOs and decision-makers should make every effort to attend this important education event.

You can be sure the efforts of MLS Domains Association will be on the agenda.

Sep. 23, 2011 - Last in the Series: The Interim AE Job Description

 

I recently attended a meeting of several association execs and MLS CEOs where we spent a couple of days brainstorming and fantasizing about our jobs, our roles in organized real estate, and the state of the industry in general. At the end of the session, we asked each other the question “What will you take back with you to the Real World? How has this two day discussion influenced you professionally?”

I had to think about that for quite a while. What I know about my position as a retired AE/current consultant is that I don’t have the power to make the Big Changes in the real estate industry. I am never going to make the Forbes list, or even the Inman list.  What I can share is some practical knowledge and a perspective that comes from the outside looking in on the association’s daily management activities. What I can do is drop a few breadcrumbs here and there and hope that they will be helpful to you on your path to your goals.

During these most recent think tank meetings, one of the participants turned to me and asked, “So Judith, what’s behind these last couple of blogs you’ve written? Why are you thinking about interim association managers?” 

Good question. In part, it’s because I was recently asked if I would consider being an interim AE for three months and I had to answer the question, “If I were to do this, how would I go about it?” The other part is that my church just engaged an interim minister, and I began to understand the value of a well-defined breathing space for an organization which is undergoing some significant transitions.

What this latter process also taught me is that ‘interim’ doesn’t mean ‘placeholder’. It suggests using the transition period to regroup, get healthy, heal wounds, find direction, and move forward. An interim minister in our church setting is a specialist at being ‘interim’. He or she is not expected to fill the permanent position—the interim is a trained  expert in the techniques of transition and the job description is clear.

With that in mind, I wrote a hypothetical job description for a transitional AE. The following is just meant to be a template—feel free to use it and/or modify it to suit your needs.

INTERIM ASSOCIATION EXECUTIVE

SAMPLE POSITION DESCRIPTION

Serves as interim general manager/chief operating officer of the association on a temporary basis. The interim AE is responsible for all aspects of the association including its activities and the relationships between the organization and its members, employees, community, government and other tiers of the Realtor organization. Sustains and administers the association’s policies as defined by its bylaws, policies and direction of the board of directors. Directs the work of all department managers; monitors the budget; oversees the quality of the association’s products and services and ensures maximum member satisfaction unless otherwise directed by the board of directors. Secures and protects the organization’s assets, including facilities and equipment.

Implements general policies established by the organizations Board of Directors, and directs the implementation and execution of those policies. Plans, develops and approves specific operational policies, programs, procedures and methods in concert with the general policies of the NAR and/or the association’s local board of directors. Coordinates the development of the association’s operational plan, and prepares a 90-day transitional action plan in concert with the board of directors prior to the hiring of a permanent AE. Develops and administers a sound organizational plan and initiates operational improvements and structures a plan for their implementation. Monitors policies relating to personnel actions and training and professional development programs. Conducts a human resources audit.  Ensures that the association’s current policy handbook covers all necessary topics such as sexual harassment, conflict of interest, and whistleblower policies. Maintains an active and informed relationship with the State and National Realtor organization, and oversees the implementation of appropriate mandated policies and activities. Attends conferences and professional education sessions as approved by the Board of Directors of the Association.

Coordinates development of operating and capital budgets according to the organizations calendar, and monitors monthly and other appropriate financial statements.   Takes corrective action as required. Upon arrival, the interim AE evaluates all budgets to ensure that they are supported by appropriate details, and conducts an audit of existing organizational resources such as buildings, equipment, and financial reserves.

Coordinates and serves as ex-officio member of the board of directors and of association committees.

·         Provides advice and recommendations to the president and appropriate committees about materials, supplies, equipment and services not provided in approved plans and/or budgets

·         Ensures that the organization is operated in accordance with applicable local, state, and federal laws

·         Oversees care and maintenance of all the organizations physical assets and facilities

·         Coordinates marketing and membership relations programs to promote the associations services and programs to present and potential members

·         Develops a membership marketing program for members and affiliates

·         Ensures the highest standards are met in enforcing professionalism within the organization

·         Monitors compliance with state and national Realtor organization policies

·         Analyzes financial statements, manages cash flow and establishes controls to safeguard funds, if needed.

·         Reviews income and costs relative to goals and takes corrective action as necessary.

·         Attends meetings of the organization’s Board of Directors and Executive Committee

·         Participates in other activities judged appropriate and approved by the board of directors to enhance the prestige of the organization

·         Broadens the scope of the association by fulfilling its public obligations

·         Serves as liaison between the staff and the board, as appropriate

·         Implements policies concerning employee-employer relations

·         Develops and maintains a basic management philosophy to guide association personnel toward optimal operating results, employee morale, and member satisfaction.

·         Prepares reports and other supporting material for committee and board use.

·         Negotiates and recommends Board approval for contracts

·         Establishes and approves workloads, work methods, and performance standards

·         Gives direction to and works closely with vendors, outside contractors, firms and individuals providing service to the association.

·         Directs the association’s communications programs

·         Performs other duties as directed by the president and the board.

·         Assists in the search for a permanent AE

Sep. 16, 2011 - Part Two: The Interim AE--A Case Study

"I'm sorry," Al said. "I really am. But my wife has this great offer for a three-year work assignment in Paris, and I'd like to go, too. It's an offer she can't pass up, and I want to be with her.   I hate leaving the association high and dry, but...."

The leadership looked at each other, bewildered. There was no transition plan, needless to say: a transition roadmap was something that the board had on its 'to do' list, but had remained fairly low as a priority while other concerns attracted resources and energy. Now what would they do? Al planned to leave them in just a few weeks, and time was running short.

To make matters worse, the association was in the middle of a strategic planning activity. It has become clear to leadership that the industry profile was rapidly changing: the real estate brokerages had become leaner and more dependent on technology, the sources of income from MLS operations had diminished due to a regionalization program, and the focus of the organization was becoming more directed to providing support services for consumers as well as members. All of these trends were requiring a restructuring of the association's resources and direction. It was a time of significant change.

Al could not be leaving at a worse time. How would the association replace his knowledge and leadership? And how could the leadership find someone of a senior executive level to guide them through finalizing and implementing the strategies to accommodate the dramatic changes that were taking place in the real estate industry?

The National Association of Realtors provided the association with an answer: the Human Resources department suggested hiring an interim Association Executive to manage operations until a permanent hire could be put in place. "We've experienced the retirement of several successful CEOs," NAR told the association president. "Why not consider hiring a professional to lead you through this transition?"

NAR presented the board with several resumes, and the association was able to secure the temporary services of a seasoned AE with 25 years of Realtor association management experience. The interim AE came to the association with a clear understanding of the temporary nature of the appointment and of the work which the association needed: to continue operations of current programs and services, to guide the organization through the remainder of the strategic planning process, to organize and train staff to better serve the new directions the association was taking, and to assist in revamping the internal organizational structure to increase its capacity to meet new challenges. And the over-riding mission of the interim AE: to guide the group through a successful search process resulting in a permanent hire for the top management position.

What did the association gain from this solution to suddenly losing its Association Executive?

1. The association bought time in which to make a considered decision in hiring the right person. It did not expend volunteer resources in trying a do-it-yourself solution, and it did not spend unnecessary time and political capital in hiring the wrong person in haste.

2. The association brought the right skill set to the job at hand, which was to manage the transition period and prepare the way for the permanent AE.

3. The new permanent AE was positioned for success. The association had defined its goals, written a clear job description for the new CEO, implemented a fair and thorough search process, discussed with staff the need to meet the requirements of new goals, and instilled confidence in the members.

4. The association benefited from the advice of an objective and experienced short term manager.

5. The association (and the interim manager) were able to focus on key priorities. Because there was a clear 'end date' to the relationship, and an established set of benchmarks, the association did not get bogged down in side issues and unimportant disruptions. It was a very productive transition time for all concerned.

Granted, this article is billed as a case study--your organization may not fit this exact description. But there are many situations when an interim AE may be an excellent solution:

• When a long term, well-loved AE is leaving the association, and distance is needed (There's an adage for that: “I don't want to follow Bud. I want to be the person who follows the person who follows Bud");
• When there is significant political disruption accompanying the departure of an executive;
• When immediate leadership is needed, and it is clear that the hiring process will take a long time;
• When the association is evolving and the long-term needs are unclear, as are the extent of the organizational resources needed to meet those needs.

In recent years the Realtor organization has experienced the loss of many seasoned AEs, often baby-boomers who have reached retirement age. The Realtor organization can use these people as resources in many ways: as consultants, as mentors, and as interim association executives who can share their knowledge, leadership and experience at times when local and state organizations most need these qualities.

(If your organization needs help in developing a transition plan for planned and unplanned replacements of your chief staff executive, I can help. Contact Judith@judithlindenau.com. If you need further information on an interim AE program, contact NAR's Human Resource Department for more information. Fee-based consulting services are also available from NAR: contact Donna Garcia, Director Human Resource Services, at dgarcia@realtors.org, or at 312-329-8311. )

Sep. 14, 2011 - Making the Case for an Interim Association Executive

 

Judith Lindenau, CAE, RCE

I have a friend, now retired, who served as AE of a Michigan Realtor association for over 40 years. He was well loved by the members, and for most of the association members, his name was synonymous with all that was good about their profession—ethics, MLS, education programs, collegiality. The members had never known anything but a smoothly running association, a well-oiled machine.

So when it came time for my friend to retire, the Board of Directors simply buried their heads deep in the sand pile of denial. Two times he tried—and finally, five years after his first announced retirement date, he suffered a major health crisis and was no longer able to work.

The association was in a panic.   The leaders had no transition strategy for either a planned or unplanned departure of their CEO. There seemed to be no available staff replacement, and no obvious candidate for the job from neighboring associations. 

The Board of Directors responded with short term questions: How quickly can we fill this position? Who do we already know in this field? Can we post the current job description? Can we fill the opening internally with someone who already knows everything? 

In so doing, the association missed a golden opportunity: the exit of a senior staff person can be a strategic directioning point, an opportunity to look forward to future needs without having to consider the presence, capacity and limitations of the departing AE.  A departure (for whatever reason) can and should be a time to consider the association direction, its future needs, and its business model. It’s a time to ask the question, “How can we best complete our mission in the years to come?”

Recently, a church in my town parted ways with its senior minister. The national headquarters insisted that the congregation accept an interim minister for the following reasons: the members needed to break ties with the past and reflect on their future direction while, at the same time, being assured that daily operations were being carried out. “We’ll provide you with a skilled and trained leader“, the congregation was told. “This plan will give you some breathing room. Moving too quickly to fill a vacancy can result in the candidate who most resembles the departing leader or, perhaps, one who is his or her polar opposite.”

A professionally trained interim executive makes good sense when a transition plan is needed. Unfortunately, it’s common for associations to appoint past elected leaders to the task, or perhaps retired CEOs of businesses. Neither have a clear understanding of the balance that must exist between a Realtor AE and association leadership, nor do they understand the unique infrastructure of the Realtor organization. The learning curve is steep for many such candidates, and the association’s forward progress can be quite slow during the transition.

By the same token, hiring an existing staff member as an interim director also has pitfalls:

·         The staff member may be overworked in his or her current position, and unable to fill both responsibilities;

·         An increase in compensation should accompany the increase responsibility;

·         Is the replacement a candidate to permanently fill the position, and if so how will that influence the search?

·         What will happen to the interim person once a candidate is found for the permanent position? Will the interim return to the previous responsibilities at reduced compensation? What will be the effect on other staff?

In the long run, contracting with a professionally trained and experienced interim executive can be smart succession planning: the association staff can be kept engaged, membership involved,  and the board appropriately informed and motivated during the search for a permanent CEO. 

Ultimately, an interim Association Executive can provide the board of directors with the opportunity to determine how best to move into a successful future for their Realtor Association.

(Ed Note: I recently met with a former Realtor association AE, who reminisced about a job change which she made some years ago. The change was a disaster, both for her and her former employer which hired a replacement in haste, spending far too much money and time on an unsatisfactory candidate. It’s important for associations to have not only a transition plan, but also to understand that the process of hiring a new staff executive will require time, thought and—yes—some cash in reserve. This series of blog articles will address the problem of hiring a new AE or CEO from several different angles. My thanks to Donna Garcia at NAR for her help and inspiration.)

Sep. 4, 2011 - The Answer Site: a Social Media Tool for Successful Real Estate Communities

“Not another social media column,” you grumble. “I am Facebooked and GooglePlused and Tweeted to boredom and back. And I haven’t got any new satisfied customers to show for it. Social media is hype—all Stetson and no horse.”

“Now just a minute,” I reply. “Social media is not about Tweeting your breakfast cereal preference. And it’s not about finding new buyers for your product or dropping breadcrumbs of information in front of your members. Social media is about creating a community—a group which shares interests, beliefs, or knowledge.  It’s about bringing people together, enabling them to bond through shared interests and information. It’s not about YOU, Bucko, it’s about the community you create or join.”

In real estate, the community is about buyers, sellers, and property owners. As real estate association managers, we often think our community is our members—but that target market definition is expanding and shifting as we speak: as our members become more and more aware that the consumer’s interests will direct their business structure, so must associations realize that  public demands will shape the future of the association.

In a recent blog from the WAV group, the author observes that traditional MLSs are focused on communication with their members. However, “More aggressive MLSs are putting themselves in the center of the conversation about real estate issues by communicating to consumers. They do this with public facing websites, publishing market trends, issuing press releases to local media outlets and hosting real estate related events. In this regard, the MLS is an advocate and connector between consumers and the professional real estate family.”

I know, I know—there are still the foot-draggers who mutter imprecations about the MLS that competes with the broker business—but those are the folks who don’t know a whole lot about current consumer interests (“give me efficient, anonymous access to all the information I need in one place”) and search engine optimization (“eighty percent of house hunters begin their search on Google or a similar search engine, so you need to get mentioned ‘above the fold’, i.e. in the first eight responses”). These are, of course, results which a large group such as an association or an MLS organization can produce better than a single company can.

Cooperation, after all, extends to areas far greater than individual property sales. And a cooperative community is what a trade association is all about.

As the WAV group blog points out, there are many ways to cooperate in building a consumer community which is supportive of the real estate business, and which is knowledgeable and informed about property and property transactions. The creation of such a community does, of course, benefit everyone—brokers and salespeople, buyers, sellers, and the real estate business periphery as well.

The bottom line for associations and MLSs: adopt building such a community as one of your goals. Be direct and proactive about it—ask yourself, “WWCW” (“What would consumers want?”). 

One thing we know without much additional research is that consumers want trustworthy, complete  information. In my many years as a real estate association executive, I came to dread The Cocktail Party. Invariably I would be cornered by some member of the public with a real estate question (“What’s a good price for waterfront property?”) or a horror story (“MY agent never told me about that perfect house on Sycamore Street and somebody else bought it before I had a chance!”). I had a great deal of sympathy for my doctor friends, who admitted that they studiously avoided those same parties because someone always needed an on-the-spot diagnosis, or wanted to show them a surgery scar. 

My question to Associations and MLS organizations is, why not create a consumer conversation site as a part of your web presence? These sites have become increasingly popular in recent years: perhaps the most well-known popular one is the Yahoo! Answers site, which encourages community questions and encourages a game-like atmosphere of building points for answers. 

There are more specific real estate answer sites you can look at as examples: take a moment to browse the AllExperts site or RealEstateABC.com.

Most real estate answer sites would most likely be simpler than these examples: such a website  could be limited to real estate-related questions, particularly as they involved the local or regional marketing area. It could be set up with a bank of ‘experts’ providing answers and resources—and including zoning administrators and others, as well as invitees for specific issues. Of course you might want to build some controls into the answer providers: avoiding liability, wrong answers, and blatant sales solicitations are pitfalls to avoid. 

As far as the technology is concerned, a Q & A site that is narrowly focused will probably have a manageable amount of traffic, and can have a simple format: give the public a place to post questions, and give your organization a column to answer them. If you want more elaborate interface, explore the online answer site providers like AnswerBase or QHub. The Q&A Script program will look a lot like the Yahoo! Answers format, if that better suits your site, or you can explore the possibility of the Wordpress Plugin for a blog: for an $89 investment you might turn a blog into a wealth of information (and generate a little cash and a few more visitors) in the process, or there’s a geographically specific Wordpress Real Estate plugin which incorporates real estate answers for your specific zip code area.

·         Your organization becomes an authority on the subject.

·         Generally Q and A sites have good public relations value

·         Q and A sites index quickly on search engines

·         Traffic can be instant, even less than a minute if it's a fresh question.

·         You are creating a stronger, more positive and helpful real estate community

It’s time to move our thinking to creating more dialogue with the public—with using our MLS and association websites to move beyond our members as a target market. In so doing, we can indeed create a better environment in which our members can flourish.

Aug. 15, 2011 - The ABCs of TLDs: Domain Name Basics for Realtors

It was just a few short years ago that we were all struggling to understand the complexities of internet addresses: Realtor.com? Realtor.org? What’s the diff? And what’s with this ‘http colon backslash backslash’ stuff? It’ll never catch on….

Well, it appears you now have a few new alphabet clusters to learn, and they will become as important to your professional success as those internet addresses you struggled to learn not so many months ago. They’re called Top Level Domains—TLDs.

The TLDs are what you know as ‘.com’, ‘.org’, and ‘.gov’, as well as others.  TLDs are the two or three letters that follow the last dot in an internet address: Dale@realtor.org is an example, with ‘.org’ being the TLD in the address. These TLDs are a part of the world wide Domain Name System (DNS) which helps users to find their way around the Internet. Every computer on the Internet has a unique address - just like a telephone number - which is a rather complicated string of numbers. It is called its "IP address" (IP stands for "Internet Protocol"). IP Addresses are hard to remember. The DNS makes using the Internet easier by allowing a familiar string of letters (the "domain name") to be used instead of the arcane IP address. 

There are two basic types of TLDs: the gTLD (which stands for generic top level domain—like .com) and the ccTLD (awarded to a country, a country code TLD like .us). What you need to know is that every domain name around the world ends with a top-level domain, and that each total address is unique. 

And it goes without saying that every address of every domain is registered, just as is every house address or vehicle license plate. That’s a complicated process, of course, and you really don’t need to know how it works—just that it does!

That’s the terminology. Here’s how things are changing, and will change—dramatically—in the next year or two. 

The organization that handles the registration and assignment of the top level domains is called the Internet Corporation for Assigned Names and Numbers, or ICANN. There were 8 TLDs when ICANN was started in 1998, and only 13 more have been added since then. This year, after months of discussion, ICANN announced that it had approved a new program, an initiative that will enable the introduction of new gTLDs into the domain name space.

Why? ICANN says, “One of ICANN's key commitments is to promote competition in the domain name market while ensuring Internet security and stability. New generic Top-Level Domains (gTLDs) help achieve that commitment. Soon entrepreneurs, businesses, governments and communities around the world will be able to apply to operate a Top-Level Domain of their own choosing.”

And what will that mean for the real estate business community? Again, let’s look to ICANN for the answer: “The increase in number of gTLDs into the root is not expected to affect the way the Internet operates, but it will, for example, potentially change the way people find information on the Internet or how businesses plan and structure their online presence. “

Our group*, the MLS Domains Association, recognized a great opportunity here in the US, an opportunity to create name recognition and consumer confidence for real estate professionals. “If we can organize,” reasoned some major MLSs, “we can apply for a domain of our own, one that can be used only by recognized multiple listing services. The public, and other MLSs, will recognize the .MLS top level domain and the consistently high quality of information it represents.”

Is this a simple goal to achieve? Of course not. ICANN’s fees alone will discourage all but the most stable applicants: The application evaluation fee is estimated at US$185,000.   Then, under the agreement, there are at least two additional fees: (a) a fixed fee of US$6,250 per calendar quarter; (b) and a possible added transaction fee.

The MLS Domains Association firmly believes, however, that the benefits of acquiring the .MLS top level domain, and limiting its use only to multiple listing services, will be of great service to the real estate industry. ICANN has declared that “The applicant is responsible for setting the business model and policy for how they will use their gTLD, so long as the registry is in compliance with the terms of the registry agreement.”

 If our application is successful, the association members will be able to benefit from brand name recognition, as well as manage the continued use of the term “MLS” on the internet.

*the author serves on the association board of directors

Answer to the Puzzle:

Aug. 10, 2011 - It's Complicated: MLS Questions

The celebrated (read “Notorious”) blogger Rob Hahn proposed a solution to the problems facing the Multiple Listing Service. In his most recent column, Rob said, “The MLS should cease collecting payment from the agent/member; it should, instead, collect payment directly from the broker, and only from the broker.”   No more nickel-and-diming the sales associates and whoever else may have access to the MLS, no more collecting a thousand checks from subscribers when a single check from each broker/owner/Participant will do. 

What this means, says Rob, is a more clearly delineated target market for the MLS: “the real issue will become whether the MLS’s own innovations deliver value to the broker, who pays the bills.” After all, the listings belong to the broker, as does the real estate company. Let the brokers decide what products to adopt  and fund because the brokers know what makes sense to develop cooperatively and which should be left to individual brokerages to invest in: this way there will be no generalized ‘leveling the playing field’.

Hahn concludes, “I think this relatively simple change would go a long way towards restoring order while lowering conflicts in the real estate industry. Frankly, I don’t see a huge amount of downside. And it would be relatively easy to implement: some changes to billing practices are what’s required.”

A modest proposal indeed! Certainly not as complicated as boiling up a tasty Jonathan Swift stew instead of a constant diet of bland and mealy potatoes, eh Rob?

The question in my mind is, would that simple change in the billing structure really portend massive reforms? I once worked for an MLS that was not only quite small, but also slow to jump on the bandwagon of fads: hence it always billed the brokers for their use of MLS services based on the number of users in each individual brokerage. The Bake Sale Board of Realtors never quite caught on to the trick of billing each subscriber individually. “Too expensive and time consuming,” the business manager sniffed. 

The BS Board even put it the issue to the brokers. One large broker thought it a grand idea, but when asked if he would pay a little extra to support salesperson billing, he wasn’t too receptive. Another large broker resented the MLS ‘coming between’ him and his sales staff. “And I don’t want competition for their money,” he said. “Salespeople pay me, and I pay the MLS.”

Oooookay. Changing to billing the individuals was not a good plan, the BS MLS decided. But as I re-read Rob’s article, I thought, “That was then, this is now. Wonder if MLSs today think Notorious Rob has a solution?” So I asked them.

The response was a fairly resounding yawn. One industry analyst wrote, “I did read this (article) earlier, but I didn’t have a lot of interest in commenting on something that the industry talked about quite thoroughly 15 years ago or more.” An MLS manager said, “I wrote an essay on this topic back in 2004…nothing has changed.”  A former colleague reminded me: “I’m sure you can remember when many more MLSs were billing brokers rather than agents – we’ve been there, and we’ve done that and I don’t remember it making MLS more complicated when it changed. And brokers putting increasingly more responsibility on the agent for costs has been a trend that has only increased – a trend entirely initiated by brokers.”

Another voice, again an industry observer rather than practitioner or staff person, says the Hahn’s answer is too simple--that asking, “Wouldn’t it be nice if we could simplify the problem of who the customer is? But that question isn’t very useful. Note also that this wouldn’t change anything for many participants – one or two person shops. It would only screw up the cash flow for the largest brokers.”

One of the main reasons for the weakness of the broker-as-customer solution was stated this way:”The ‘Don't Level the Playing Field’ problem requires a process for its solution, not a project. In other words, you need to keep solving the problem over and over again, because it arises from a natural tension between individual brokers and the collective organization working on their behalf. (It's a little like "How much should government do?" The answer depends on the time and place and other factors.)“  

Restated, this quotation means that it’s difficult to craft a static solution against the decision-making dynamic of competitors trying to cooperate in the best interests of all. The answer has to be re-invented each time a problem arises.

Bob, an MLS CEO agrees that the problem isn’t easy: “Fiduciary responsibility of an MLS is not as easy an issue to grapple with as it is in a traditional business.  An MLS has many masters, all of whom must be served, sometimes to varying degrees at different times. 

(1)                          Most are owned by associations, some of which expect a dividend payment (in a wholly owned subsidiary situation) or at least financial support (in a committee situation) from the MLS so they don’t have to raise dues; 

(2)                          Brokers are the business owners that rely on the MLS to maintain a modicum of arm’s length control in an environment of cooperation between competitors; 

(3)                          Agents on the street are the consumer of the lion’s share of the services the MLS provides; and

(4)                          Consumers are the beneficiaries of those services since ultimately they are the ones writing the checks (either to buy the house or to pay the commission). “

Bob’s final observation is one that all MLS administrators fully understand:” It’s the brokers who have the capacity to take their ball and bat and go home if they don’t like how the game is going.  Because if they don’t like the practices of the MLS and no longer see a benefit but instead a liability, they will find another way to stay in business.”

“Ok,” my friend Matt challenges. “What do you think, Lindenau?” (No fair, Matt. Writers are allowed to hide behind the quotes of others….. )

Well, I’ll summarize my thoughts. Here they are:

1.       It doesn’t make any difference who pays the bills, Rob. MLSs will never act as an efficient technology-based business service as long as the decision-makers (i.e., the board of directors) are neither business oriented (as opposed to being guided primarily by the profit and loss statements of their individual companies) nor technology proficient. User groups and technology-based business decision-makers are not the same thing.

2.       There are only so many resources in any one organization’s bucket. We’ve spent most of our resources chasing after diversionary issues like this one. Real Estate is an industry in peril. Get used to it and address what we can of the real problems we’re all facing. Examine the dead elephant in the room—the corpse is getting smellier and smellier.

3.       The current MLS dependency on single vendor relationships is one of our biggest weaknesses. Our vendors need to stay in business, sometimes at the expense of innovations which members require and technology makes possible. Data collection and information extraction, interpretation, and presentation are different things. It’s best if MLSs are not tied to a one solution provider for all of these functions.

4.       As MLSs, some of our most pervasive problems come from the NAR organization itself. The issues of who should be members of the real estate business community is tied to licensing structures and job descriptions which are outdated at best, and NAR’s insistence on antiquated geographical boundaries for servicing members’ professional needs has consumed an inordinate amount of our collective resources.

I wish there were easy answers. I wish we could just change the billing system and solve all the issues. The pure fact of the matter is, most of these problems are very solvable—but maybe it will take an organization which can invent the answers without cumbersome politics and governance.

 Hey! Maybe we could just appoint a bipartisan committee, and lay the responsibility in its collective lap….

Aug. 1, 2011 - Board of Directors Checklist Tool for Realtor Associations

I hate to remind you, but it's August 1 and time for the annual Realtor association identity crisis we celebrate: the election and installation of new directors and officers. And if that weren't enough, most Realtor associations are also billing dues, setting budgets, and orienting and training new leaders.  Members themselves may be getting a little testy as they take stock of the successes (and lack thereof) of the summer selling season.  In my area of the country, at least, it won't be all that long before the real estate inventory will be covered with snow....

In the midst of the mayhem, it's time for reflection and planning. In an earlier blog I mentioned the need for an annual calendar.  Here's another tool which may help AEs focus on strengthening their associations and ready them for the challenges of the coming year.

Checklist to Evaluate a Realtor® Association Board of Directors*

This checklist has been adapted from the Greater Twin Cities United Way.

Jul. 30, 2011 - A Game-changing Opportunity for MLS Survival

A July 29 article in E-Commerce Times addressed some issues that have been on a lot of minds since the MLS Domains Association announced its intention of seeking a top level domain (.MLS) which will be used only by certified MLS organizations (imitators and MLS wannabes need not apply!)

The question being asked by MLSs is, “Will new domain names really work? Everybody knows .com, .gov, and .org—the existing top level domains. The consumer will never understand this stuff.” And the unspoken conclusion is, “So let’s not join this movement right now. Let’s wait and see.”

The E-Commerce Times begs to differ with that attitude. . “The gTLDs (new top level domains) are not just about trademark filing and battle posturing or cybersquatting. They are about the potential to create unusual global intellectual properties offering multiple opportunities for rapid image expansion and -- most importantly -- the achievement of market domination via name identity.”

That’s pretty heady global thinking from experts on this topic. The Times goes on to say that the ICANN’s new domain name program is about “massive customer acquisition and the creation of intricate layers of customer access.”

Translate the rhetoric of this article into layman’s terms: “Yes, internet users will respond to ICANN’s far-reaching relabeling of information and products. And if you participate, you’ll find seismic new ways to reach your audience and draw them into your world.”

However, the Times article cautions, not everyone will successfully navigate the complicated process that goes with obtaining a TLD. To begin with, there’s the money. The application fee per name starts at US$185,000, and each new name can cost up to $500,000 to integrate. The Times observes: “This investment is no more than the price of large single-highway signage over a 10-year lease. However, it permits thousands of such luminous cyberstructures over high-density information highways.”

Done correctly, the article says, a TLD offers the fastest way to create hypervisibility and global presence, and a game-changing opportunity to depart from traditional marketing and branding. 

In the US, the MLS Domains Association is working hard to spearhead the TLD effort in the world of real estate sales. Association chairman Bob Bemis says, “We know that consumers recognize the term “MLS” as a source of accurate and reliable information. We want to capitalize on our name recognition and protect it from the many imitators who use the reputation of ‘MLS’ to draw traffic to websites that are neither owned by nor operated by MLSs. Only recognized MLSs will be able to use the top level domain administered by the MLS Domains Association.”

The MLS Domains Association is a non-profit corporation founded by some of the largest MLSs in the US. Over the past two years the members have been actively soliciting new members and building start-up funds. The Association has formed bylaws and operating policies, commissioned legal infrastructure work, and studied the massive ICANN policies. “We’re confident in the work we’ve done,” said Bemis. “We’re finalizing our contracts with our funding partners now, and we’ll be ready to make our application in early 2012, when ICANN opens up the process.”

In my last two blog entries, I've mentioned the importance of having an MLS which can act decisively and knowledgeably, if in fact the MLS organization is to survive and serve our members and their customers.  One of the AEs who contributed insight to my last blog specifically mentioned this opportunity of supporting the MLS top level domain program.  You'll find a list of organizations which have joined the MLS Domains association as well as the domain names they've already reserved.  Visit the association website: if your MLS isn't there, now is the time to act!

Jul. 28, 2011 - Another voice heard from...

I have this friend, a Realtor Association exec, with whom I share an important personal habit: we both get up very early in the morning. So early today when I staggered over to my desk, clutching my iPad to my chest and gripping my coffee, there was an email waiting--no surprise.  My AM pen pal had already been at it, thinking about my blog post from last night.

He had written the following:

When an MLS does innovate—such as the launch of a public website—some large brokers become very angry because in their words “Once again, you are leveling the playing field.” Since no brokerage has all of the listing data—nor will they ever---the MLS provides the vehicle for brokerage collaboration but the large brokers do not want MLS providing a way to make the smaller-than-them brokerage look large to the consumer. They assume incorrectly that consumers do not already understand that fact.

Another area to which the large brokers are currently blind is their inability to understand that collaboration with consumers is the new normal. Listing information is ubiquitous. Brokers should be improving the consumers experience with the listing information while driving them to experts who understand what it all means and where to get the best information.

I go to a physician’s assistant for check-ups. We were talking about real estate websites and I was explaining why some had great looking tools but bad data. He laughed and said too many patients were showing up with “medical” advice garnered from a website and a list of prescription medicines that must be prescribed to cure them. He was spending more time with patients explaining what the site they visited was--a  university where they were doing research—and why the drugs could not be prescribed—because the drugs were not approved for the use in treating a particular disease—the university had permission to conduct trials but doctors could not prescribe!

My AM penpal's letter was written in confidence, but I asked him if I could share it anonymously because I think it makes some important points that we all need to think about:

1. The consumer public is well educated--sometimes much more so than we imagine.  They understand and value accurate and complete information, and when they don't receive that information, they will go find it in some other way.

2. Witholding information, or making it difficult for a consumer to find and access, is not the answer.  Consumers want complete listing inventories, valuations, and sales histories. They want to know about the quality of service they will be receiving for the dollars they are paying to the Realtor.  Consumers expect to be answered when they ask: they've been trained by websites like Amazon.com and Ebay to expect compete information, and to share their experiences with others.

Often, Realtors shoot themselves in  the foot by thinking that they can change consumer behavior or ignore the need for convenience and completeness. "Let's not have a cooperative public website," they say.  "Let's not even mention that there are quality issues and/or differences among our salespeople." "We don't want to level the playing field," they say.  Have they not shopped at one of Amazon's 'partners' or clicked on a 'Buy it used' feature of the bookstore?  There's a reason why consumers begin their shopping experience at Amazon--because they go for the transaction satisfaction, not the product itself.

3. But having researched and discovered the information, consumers still need an experienced guide to help interpret and analyze what they've found, particularly as the product gets more expensive or the purchase process more complex. 

Let's face it: there are things which we can do more successfully in cooperation, than we can do alone.  One of them is to create a satisfactory transaction environment for real estate buyers and sellers.  As my morning correstpondent says, "Collaboration is the new normal."  When MLSs recognize that it's collaboration, and not competition, that creates a comfortable environment for buyers and sellers, and that its the consuming public which will judge our success, we will be able to move forward with confidence.

Jul. 27, 2011 - Let There Be Lions

Kim Prior created a bit of a buzz last week in the MLS world. Kim, who is the Director of MLS Market Operations at Onboard Informatics and has had a ten year career in real estate sales, posted a blog titled “MLSs Taking Control of Destiny—a Plea, an Observation, a Call to Arms.” The post was reprinted and commented on at some length: let’s examine why.

Prior’s premise is that change is happening on the outside of the MLS world much faster than it’s happening on the inside, and ‘we’ (I presume that word encompasses MLS managers, leaders, and vendors) are facing a crisis: the end is in sight. 

The main reason for Prior’s statement: “We are reticent (and at times nearly obstinate) to lead survival-level change.” Ultimately, Prior says, “We avoid game-changing decisions…leaving our destiny in the hands of outsiders.”

In her mind, there are four strategies in developing a solution and regaining control of the future of the MLS: (1) regaining full control of our product (including distribution, terms, usage and price), (2) appropriate dissemination of external power and appropriate control of outside relationships, (3) eliminating the middle man from our relationships with our consumers, and (4) enabling opportunities, innovations, and job growth.

Doom is ahead if we don’t grapple with these issues, she tells us. And she ends with a call to action: “We can tip the scale of change, but the time is now.”

OK, I am curious about Prior’s post. People who have been listening to me for the last 15 years know I’ve been predicting the imminent demise of the MLS; my not-so-secret nickname is “Chicken Little.”  The sky is falling:! My early whispers became shouts, and still the sky didn’t fall—the storm moved on through, and the lions were still snarling on the other side of the hill.

Well, I thought, Kim Prior must know something I don’t know. I think I’ll ask some people I really, really respect about their response to this post. What’s your reaction to Kim’s observation and call to arms? I emailed.

Marilyn Wilson posted her own call to action on the WAV Group Blog : “Enough Analysis Paralysis! Time for MLSs and Associations to make it happen!” The problem, Marilyn says, is that the real estate industry is focused on the needs of agents and not consumers. “Any company that worries more about its own margin and sales commissions more than the long term satisfaction of its customers is writing its own death sentence. “ And that attitude of protectiveness means that third party vendors offer more information to consumers than the real estate industry does. The industry hasn’t, Wilson claims, evolved property search methods in 20 years, for example.

And then she hits on MY personal hot button: “The governance structure of MLSs and Associations makes it even more difficult to get things done quickly and decisively. “ Governing boards made up of brokers and agents hunkered down in a survival mode are simply too risk-adverse to think broadly and act creatively. 

I asked a prominent MLS administrator what she thought about this lack of leadership and she agreed with Marilyn. She wrote, “As a side note, I have (and still am) been on the road this week speaking to brokers about their data, about syndication, about other issues --  many are shocked, more are exactly as Kim said – reticent – not overly concerned, just hoping for that one (BIG) lead…… “   And a recently retired AE of a large Realtor and MLS operation says, “We won’t be able to deliver what the consumer wants until we transform…(ourselves)…into true, well-educated, fee-based, professional advisors. The ‘bar’ that should be above our heads is instead firmly lashed around our knees and nobody seems willing to make the first move to raise it—not the Realtors, not the big brokers, not the state licensing agencies.”

My wise friend Bob, who manages a giant-sized MLS in the Southwest, chimes in, including even more culprits in his analysis: “I don’t know of an MLS executive anywhere who is willing to put his/her job on the line defending a course of action that may be right but that will get him/her fired,” he writes. MLS executives do exactly what the title implies – they execute. “

Bob comments further on the governance issue: “(MLS Executives) executives execute on the wishes of their association owners that hopefully reflect and are based on the business interests of their broker participants. That’s the difference between a ‘corporate success’ which for a business usually is measured by return on investor’s equity and the non-profit world…. Failure in a corporate environment usually is followed by a change in management. Failure in the MLS business puts thousands of brokers and their agents out of business.”

In the end, Bob concludes, “the measure of success according to the brokers is, ‘Did it make the phone ring?’ Even if the decision of where and how to distribute listing data is a bad one, it will seldom be seen as such if the (broker’s) phone is ringing.”

When I ask one of the NAR staff to comment on Kim Prior’s article, she grumbled, “Not much substance, and (Prior) criticizes more than she advises.”

So what to do? How does the MLS sector respond to Prior’s call to action? Here are some suggestions, culled from those who responded to Kim Prior’s article:

1.       Jim (a seasoned Realtor exec and consultant) says: Get over the turf wars and politics. This is a world of collaboration and listing syndication. If your MLS is unwilling to share data and support initiatives like RPR and other collaboration efforts, someone else will build a nationwide—or even global—property database. That’s what the consumer wants.

2.       David, the CEO of a megaMLS, observes that Prior’s ‘call to arms’ “is about listing syndication and compliance. Kim is right. We need to understand where the content is going and make sure the recipients play by the rules….This is simply about ensuring that the brokers’ content goes where it is supposed to go. If someone profits from it, then the broker wants to know and if appropriate, be reimbursed.”

3.       The retired Realtor CEO I mentioned earlier says that maybe the problem is a little more far-reaching and encourages MLSs to take leadership and decision-making to a more professional and business-like level. To me that suggests not only ‘raising the bar’ on our own members, but perhaps expanding the MLS  decision-making body to include non-members who bring needed skills to the table—people who understand technology, investments, education.   Develop a leadership pool of skills, not just a glorified users group.

4.       This CEO also observes that “One small step the industry COULD take right now would be to wholeheartedly embrace the .mls domain idea. “At least,” he says, “That might hold the wolves at bay for a little while.” 

5.       Choose your business partners wisely. Bob says, Sometimes MLSs need ‘middle men’ because “Most MLSs don’t have the resources (money or staff) to determine what the consumer wants, or to deliver on that challenge effectively. All facilitators (middle men) should not be lumped into the same category and condemned because of their position or their profit motives.” But, he cautions, it’s important to carefully select your partners, because ‘a poor selection can damage your reputation for years to come.”

6.       Finally, as Marilyn Wilson so eloquently writes, base your  MLS organizational decisions on the demands of the people who purchase homes, not the people who sell homes. “Until we address the needs of consumers in real-time (getting over our own insecurities), the industry will continue to be dominated by outside parties who will ultimately take it over.” Marilyn reminds us that third parties already offer more in depth information to consumers than most brokers and MLSs do, and these same third parties offer consumers information about agent performance and property valuation, and they extend user-friendly and innovative property search tools. “It’s the people that give us checks for real estate who need to be at the center of every decision,” she concludes.

When I work with clients on strategic plan development, I teach them how to use a ‘strategy screen’. Not all decisions can be anticipated and incorporated in to a long-range plan, I tell them--you need a tool to use in order to evaluate your leadership actions and judge them in light of your organizational mission.

How about if our mission, as MLSs, were to give our members the tools which would enable them to best serve their customers, the consumers who pay money for real estate? If every tool we offered, every service we provided, were carefully evaluated in light of its contribution to the success of that mission of satisfying consumer needs, would MLSs increase in value and usefulness?