How To Lead A (Real Estate) Business In A Time Of Crisis
In 2020, leadership really mattered. Economically and medically, leadership really mattered. At the national level, where we lacked it, at the New York state level, where we (mostly) had it, at the New York City level, where we (mostly) lacked it, leadership really mattered. And as in politics, so in business. Those companies in which everyone pulled together have had a much better shot at pulling through the pandemic. It’s not easy to keep a company afloat during difficult times. Having been a CEO for 30 years and navigated through 9/11, the 2008/2009 recession, and now the first wave of the COVID-19 pandemic, here’s what I have learned about crisis leadership in real estate:
- Make tough decisions, and make them fast. Strategy only matters if the company survives. With property showings in New York shut down for three months, and few buyers wanting to commit based on virtual viewings alone, brokerages completely lost their revenue source for an entire quarter. So survival depended on quick and strong action emanating down from the top. The CEO had to make the staff furlough decisions, the downsizing in footprint, the marketing workarounds as soon as the seriousness of the problem came into focus.
- Deploy technology, and remember its limitations. Real estate agents, deprived of the ability to go out, could only show property virtually. In a high-value market like ours, few people were willing to commit without an actual tour of the property, but good technology did enable agents to keep their buyers engaged and help them to narrow their set of options to the most appropriate choices. We must provide our agents with the most useful technologies while carefully screening to make sure we don’t waste their time with new products that don’t actually help them sell more. In my experience, only about 10% of these new tools actually improve either the agent or the client experience.
- Encourage debate. Even the best leader only knows what he knows. If you have assembled a good team with a diverse set of skills, listen to them. And listen to your agents as well; as entrepreneurs, they often excel at both outside the box thinking and creative solutions. Once a good idea emerges, hear everyone on the team out about the pros and cons and then make a decision. Once you make a decision, stick with it.
- Create consensus. The whole team must carry the same message, which should both address the circumstances and be on brand. Different people react differently to a crisis. A good leader will take the necessary steps to make certain that the whole team fully understands the message and the reasons behind the decisions being made. “Because I said so” usually doesn’t seem like a compelling reason to children; it’s even less so for adults. The worst thing for a leadership team to do in a crisis is to send a mixed message.
- Think three steps ahead, but focus on now. It’s always important for a leader to have a sense of what they will do next depending on how the crisis unfolds. At the same time, imagining doomsday scenarios debilitates even the strongest among us. Dealing with what’s in front of you requires projecting forward, but it doesn’t require stressing about issues in the future which you can’t control. Deal with it when it happens.
- Communicate clearly throughout the organization. Important decisions that affect everyone should always be communicated person-to-person. In today’s world, that often means Zoom. However you do it, your constituents need to see you looking at them when they receive difficult news. Email is both too impersonal and too easy to forward outside the organization.
- Be kind. Remember how many people depend on you. Your staff is counting on you to save their jobs. Your agents need to be reassured that they will once again be able to sell homes and make a living. Your demeanor and words will either convey your interest in them or won’t. The former, the proof that you care when the going gets rough, builds loyalty. And hopefully reflects your core belief and not just strategy.
In a week we enter 2021, and then perhaps another lockdown. As a city and an industry, we’re more knowledgeable and less frightened than we were ten months ago when this all began. But we still need to keep evolving. As leaders, we keep learning what our agents and employees most need from us. In times of crisis, companies stand or fall on their leaders’ ability to deliver good solutions.