If you visit Porsche’s factory in Zuffenhausen, Germany, the first thing you notice is … well … it’s tiny! Like smaller than a satellite parking lot at Ford! And when you learn that they make more than 55,000 cars per year at that factory, it’s easy to ask, “How?”
I am sure there are many reasons for their success, but the concept that resonated with me (and spawned this post) was their absolute mastery of two principles: Just-In-Time (JIT) and Just-In-Sequence (JIS). Something I found fascinating is that the materials used to construct their vehicles often arrive no more than one hour before being installed on the assembly line! One hour! And not only do they arrive “just in time,” but they are loaded/off-loaded in the exact order as the cars in the assembly line (Just in Sequence).
What does this have to do with property management? Here it comes: the Porsche factory has to be extremely efficient and well-organized. And they have to execute their processes to perfection – there’s no room for waste of any kind. If they make an error, there are very few areas where a car can be removed from the line. If a part is wrong or missing, they are stuck!
This got me thinking about why there are such varying degrees of performance from apartment operators who operate similar class properties within the same markets. Some portfolios achieve lease:lead conversion at 5-7%, which is good, but some peers achieve 10-15%. Why?
The answer is rooted in a company’s dedication to delivering an organized and efficient lead-management process that delivers the right type of engagement to the right customer at the right time.
Building the Right Process
When crafting your plan for engaging prospects, consider whether your measures of success are open-ended or closed-ended questions.
When I see portfolios that are good, but not exceptional, I often hear them asking close-ended questions like this when evaluating their performance:
- Did we follow-up with the prospect?
- Was the number of follow-ups in-line with our expectations?
- Did the speed in which we followed up meet our company goal?
Don’t get me wrong – these are all great questions. But compare them with the following open-ended ones:
- What is the ideal content to deliver to this prospect given where they are in their search, days until move-in and desires?
- How did the timeliness of our follow-up align with the prospect’s expectations?
- How did the prospect say they wanted to interact with us? (self-scheduling, self-guided tours, chat, SMS, after hours, etc.)
In the “closed-ended” scenario, the plan is centered on the property management company. In the “open-ended” scenario, the plan is focused on the prospect.
In truth, a prospect-focused engagement process is easier said than done. To achieve performance excellence that rivals your competitors, the operators should follow this framework:
- Trash your current plan. Ignore it. Don’t reference it.
- Take a 100% objective look at renter desires. Forget about your management software, integrations, etc. Start with a clean canvas.
- Map the functionality, automated communication and human contact that achieves #2.
- What can you do? Don’t map your software/partners/existing operation to #3; map #3 to your platform.
- Identify the gaps. What is in #3 that you can’t do?
- Rank every gap in #5 according to the following:
a. How impactful would this be if implemented?
b. How expensive would this be to implement?
c. How hard (technology commitment or change management) is this to implement?
7. Grab a scalpel. You aren’t going to be able to do it all.
8. Get to work!
At this point, you may be saying, “Geez – this sounds hard. Why do this?” When I see a platform that looks at the world in this customer-centric way, they create operating leverage. They reduce ad spend. They have superior NOI through excess demand creation. They reduce vacancy loss.
Bringing this back to Porsche, how would they operate? They would be riveted on figuring out exactly what was needed and when. They would produce no waste, ensuring every ounce of effort has a specific and desired outcome. And that outcome would be measured expertly. Can you make a great vehicle without being Porsche? Sure, but if you could be Porsche … doesn’t that sound better?