How to You-Proof Your Property Management Business
How To You-Proof Your Property Management Business
5 Quick & Easy Steps To Getting Your Business To Run Without You
It’s easy for property management owners to hyper-focus on problem-solving and operational efficiencies. Ours is a tough business. Lots of fires to put out.
There are many ways a PM owner can increase the value of the business. One super-critical component is making the company “you-proof.” Can the place run okay without you there? Can you pass the ‘3-week vacation” test?
One of the ways we help to prepare a business for sale is to shift the owner’s gears a bit. Instead of focusing on sales, operations, leads and problems, set aside time to get the shop working without you. A lot easier said than done, right.
How about making your primary goal over the next 3 months in making the company more owner-independent? A business not dependent on its owner is the ultimate asset to own. It is infinitely more valuable to buyers knowing the show can go on without you.
It allows you complete control over your time so that you can choose the projects you get involved in and the vacations you take. When it comes to company value, a business independent of its owner is worth a lot more than an owner-dependent one.
Here are 5 ways to set up your business so that it can succeed without you.
- Develop Easy-to-Read SOP’s
Standard operating procedures (SOP’s) come in all shapes. Some PM companies have employee manuals. Others take the time to write, illustrate and bind a group of tasks and functions spread over multiple departments. We’ve found the best examples are the SOP’s that are most visual. Screenshots make a huge difference. Links to helpful websites can add a ton. Write the procedures in an informal, instructional tone that guides a new person through tasks which may be new to them. Emphasize way to decrease or eliminate repetitive tasks. Lay out ground rules for how to solve problems. You’ll be amazed how many pages you’ll need to walk through some steps and properly explain things. But once you’ve got it down, you can use it for onboarding and training purposes for years to follow.
- Give Them A Stake In The Outcome
Jack Stack, the author of The Great Game of Business and A Stake In The Outcome, wrote his books about creating an ownership culture inside your company. It can start with something as simple as letting employees know how the business is doing. Let them know specifically, with numbers. Let them know about bad months as well as good months. Don’t let ego get in the way of transparency. Your staff needs to know when things are going well and what they’re doing right. They also must understand where improvement lies. With numbers.
- Get Them To Walk In Your Shoes
If you’re not quite comfortable opening up the books to your employees, consider a simple management technique where you respond to every question your staff brings you with the same answer, “If you owned the company, what would you do?” By forcing your employees to walk in your shoes, you get them thinking about their question as you would. It builds the habit of starting to think like an owner. Another successful owner I know uses the phrase “don’t bring me a problem unless you’ve got the solution to go with it.” Pretty soon, employees are able to work through issues on their own.
- Automate. Automate. Automate
The joy of automation is independence. It takes time to integrate new systems and turn them into coherent and consistent procedures. If you’re not comfortable seeking out software solutions or finding vendors, go to Fiverr.com and search for experts who can walk you through things. There is an amazing number of talented folks out there who are willing and able to improve your company for a very small fee. You don’t need to be involved in every collection dispute, maintenance request and lease rate discussion. If you are, fire yourself as the company problem-solver and find automated solutions wherever possible.
- Rate Your Operation
Be brutally honest with yourself. Look over your online reviews. Review recent complaints. Do an honest assessment, on a 1-10 scale, of where your PM business is humming and where it’s struggling. All shops have weaknesses. You may be a 9 or 10 in leasing and tenant retention but only a 3 or 4 in maintenance speed. Find a diplomatic way to share your impressions with your staff, without creating animosity. Commit to making improvements and then repeat the process every quarter.
You-proofing your management business has enormous benefits. It will allow you to create a company and give you back some of your life. Your business will be free to scale up because it is no longer dependent on you, its bottleneck. Best of all, it will be worth a lot more to a buyer whenever you are ready to sell.