Technology products and systems showcased at this year's Realcomm conference in Chicago affect how commercial real estate professionals develop, lease, manage, buy, and sell property. Of all the industry segments, brokerage in particular benefits from these technological advances. The following 10 trends emerging from the conference illustrate technology's growing influence in the brokerage arena.
1. Leaders Must Adapt to Change The most significant trend is the struggle by brokerage leaders to adapt to new, technology-based business models. To effectively transform their organizations, brokerage leaders must recognize and adopt these new concepts, or they may find themselves struggling with client communication, business efficiency, and ultimately, their profitability.
2. Automation Improves Efficiency Another theme was the shift toward streamlined processes: Business efficiency trumps technological advances in today's marketplace. Even with the newest and fastest products, a company isn't efficient if it fails to improve processes and create a better business environment. Various brokerage operations — from marketing to commission management — are being rethought, reorganized, and automated. For example, Sperry Van Ness has streamlined its marketing system with technology: Brokers enter listing information into a Web-based form and the system automatically creates a postcard, flier, summary report, CD-ROM presentation, and Web listing. In a matter of minutes, this automated system does full-scale property marketing.
3. Integrated Systems Are the Future Integrated business applications that consolidate separate automated systems further improve business efficiency. These separate programs effectively may carry out specific business processes, but if they are not integrated, data must be re-entered into each system. This time-consuming, expensive process stymies meaningful data analysis. Brokerage's future lies in interconnected applications that integrate contacts, properties, transactions, commission management, and human resources, among other critical business functions.
4. Brokers Are More Mobile Traditionally, brokers personally gathered, organized, analyzed, reformatted, and distributed transaction information, but traveling to a specific place to retrieve documents now is considered a sign of disorganization and inefficiency. With high-speed communications, enhanced high-performance mobile products, and real-time information systems, today's brokers can work from anywhere, at anytime, as long as they have laptops and cellular phones. In addition, new all-in-one, or converged, devices offer users more flexibility, power, and speed.
5. CRM Software Allows Data Sharing For many commercial brokers, sharing information is a foreign concept; traditionally, proprietary information provided the competitive advantage for securing transactions. However, the idea of teaming with other professionals who have similar market expertise is eroding that mindset. Such teamwork involves sharing contacts and contact information, and one of the most powerful tools allowing brokers to do this is customer relationship management software. This software provides a centralized repository of contacts in which all team members share one contact record and subsequent relationship activity.
6. CIEs Facilitate Deals Along with distributing contact information among team members, the idea of sharing listing and market information also is taking hold. Although national services have made data available online for several years now, comprehensive property databases that act as local, regional, and national exchanges only recently have become popular. Most major markets have implemented successful exchange platforms and are providing local professionals with a good basis of information to use in transactions. A number of secondary markets also are implementing exchanges, and, during the next few years, commercial information exchanges likely are to become the cornerstone of most transactions in the brokerage industry.
7. Web Portals Enhance Client Communication Good client communication is critical to successful business relationships, and for years the brokerage industry relied on the telephone and, more recently, e-mail to stay in touch. However, use of Web portals, or virtual project sites, as communication vehicles has increased. Time-pressed brokerage professionals have realized the value of storing team information, project documents, and schedules on the Internet for all parties to access 24/7. Some companies even are augmenting these sites with newer technologies including automated forms, chat rooms, and video conferencing.
8. Technology Is Supplanting Staff To remain competitive and profitable, brokerage companies must continuously evaluate the number of staff members necessary to carry out the workload. Since technology makes tasks such as researching easier, more brokerage teams are shrinking in numbers. Many organizations are downsizing support staff: For example, in one division of a Southern California brokerage company, one administrative person supports more than 20 brokerage professionals. Ultimately, organizations that run more efficiently with less people will be more profitable.
9. Positions Are Becoming Obsolete
Not only are brokerage companies doing more work with fewer employees, in some cases they actually are eliminating some very traditional roles, such as the receptionist. A few innovators revealed that this position is unnecessary because enhanced communications systems and interactive lobby technology automates the receptionist's functions. Eliminating redundant positions can lead to higher customer satisfaction, improved customer communications, and lower operating expenses.
10. Offices Are Shrinking In the days when large corner offices symbolized success, many organizations allowed up to 500 square feet of space per employee. But today's brokerage companies are operating on the less-is-more theory: By utilizing fewer square feet, fewer dollars are deducted from the bottom line. In fact, some companies are accomplishing this by encouraging their brokers to telecommute.
The brokerage community's need for a technology-oriented vision is critical, and by using technology to streamline operations, improve mobility, and integrate information systems, real estate companies can start focusing more on their business and less on the processes required to carry it out.