The class was Business and Technology and the year was 1994. The professor was rather arrogant, but behind his disinterested persona was a pretty smart person from whom I learned a great deal.
One of the assignments was to read a book called the Modular Corporation. Its lessons have always stuck with me.
Building a ‘Modular’ business dramatically reduces the risk to the owner …
While there were many lessons in the book, my favorite was how building a business made up of parts that can be added and subtracted on-demand drastically reduced the risk.
- Don’t hire a person when you can contract for one.
- Don’t build a division when you can purchase capacity from those who have already built one.
- And don’t hire someone full time until you are sure you need his/her services full time.
In effect, a ‘modular’ company leases capacity or purchases it ‘on-demand’ until it proves more beneficial to invest in the development of a team or system that does the same thing.
A Business or a Job?
As agents, we like to think of ourselves as business owners, but most of us are not. Steve Jobs didn’t man the Genius Bar at the Apple Store in the same way that Ray Kroc never asked ‘if you want fries’ with your Happy Meal. So, when I hear agents who write contracts, show houses, take pictures, run the termite report to the attorney, and do everything else that is required to get a deal done, call themselves a business, I question what exactly they mean.
Steve Jobs never worked the Genius Bar …
Why? Because if you are your own chief, cook, and bottle washer, you don’t own business, you own a job.
Building a business means building an organization, and building an organization feels risky to us because we are used to doing everything ourselves. But, as the spring market reminds us each year, there are only 24 hours in a day and 7 days in a week, and our greatest limitation is the time in which we can get things done. To truly transform your job into a business, you have to be willing to trust others to do all the things you’re used to doing yourself.
The MREA Still Resonates
Gary Keller’s legendary publication, The Millionaire Real Estate Agent (MREA), remains the most prolific treatise on team building in real estate sales. The book lays out a clear progression from ‘lone wolf’ agent to CEO of a dynamic organization. It discusses not only the roles of each individual on a high-functioning team, but the order in which each hire is made.
When we opened One South in 2008, I had never read the MREA and was largely unaware of Keller Williams as an organization. Keller was still in expansion mode and had not fully arrived in Richmond, so their lessons and teachings were not well known in our marketplace. But, somewhat ironically, we followed the MREA model almost verbatim. I guess it just seemed logical to us at the time. Our first hire was a transaction-focused administrator to help the agents manage their transactions. And, almost immediately thereafter, we hired someone to create property brochures, send e-blasts, and help run our marketing efforts.
A ‘Risk-Free’ Team
Without even realizing it, we had created a ready made ‘MREA Level 3 Team’ for everyone in our office to use to their benefit.
One South agents receive the benefit of ‘team’ without having to bear the salary, training, and management risk …
Marketing, admin, and transactional support are delivered ‘on-demand’, and the agent is not responsible for salaries, training, or employee management.
What would an agent have to spend in order to replicate the services provided as a part of One South? We estimate the cost would be close to $100,000 to house, manage, train, and pay two full time employees in order to create the same level of services that we provide as a part of our standard contract with our agents.
At the end of the day, the model we have employed has allowed our agents to be a team without having to pay for one — the ultimate in a Modular Corporation.