Pruning Your Property Management Business
Dr. Henry Cloud’s book Necessary Endings has a section about the importance of pruning that I believe contains a great formula for getting your property management business where it needs to be by eliminating what isn’t working. He says: “Successful people and successful leaders all have one thing in common: They get in touch with reality. If you are looking for the formula that can get you motivated and fearless, here it is: you must finally see reality for what it is—in other words, that what is not working is not going to magically begin working. If something isn’t working, you must admit that what you are doing to get it to work is hopeless.” –p. 74. He continues: “If you comb the leadership literature, one theme that runs throughout everyone’s descriptions of the best leaders. The great ones have either a natural ability, or an acquired one, as Collins says, to ‘confront the brutal facts.’ This is especially true when it comes to seeing a necessary ending. Drucker scholar Jeffrey Krames puts it this way: ‘Some managers are able to let go of the past better than others. Those that have the greatest difficulty abandoning things are often those unable to face reality.” –pp. 74-75. Many property managers continue doing some things longer than they should. The ability to stop doing what isn’t working and prune it out of your business and your life is a critical skill and this book tackles how you can best go about doing this.
- The analogy of pruning a rosebush helps to understand the classifications of what must be pruned. As you are likely aware, rosebushes cannot reach their full potential without a systematic process of pruning. Gardeners intentionally and purposefully cut off branches and buds that fall into one of three categories. These are:
1) Healthy buds or branches that are not the best ones,
2) Sick branches that are not going to get well, and
3) Dead branches that are taking up space needed for the healthy ones to thrive.
Cutting off something that is living to strengthen the overall bush seems counterintuitive. Yet, gardeners cut healthy buds off to free up resources so the plant can redirect them to buds with greatest potential to become mature roses. The reality is that a rose bush can never reach its true potential if it isn’t for the process of pruning. In the case of the sick branches that are not going to get well, a gardener monitors, fertilizes and nurtures branches to make them healthy if possible. However, at some point, a gardener recognizes that more water, more fertilizer, or more care is not going to help and so he removes the sick branches for the good of the rose bush and the garden.Are you willing to make the hard decisions of pruning in your property management business? Are you cutting out areas that no longer produce profit for you? Are you cutting out things that take up your time that prevent you from working on more productive and profitable areas of your business?
These are all important questions to carefully consider. Dr. Henry Cloud asks:
“Are you only achieving average results in relation to where you or your business or team is supposed to be? In other words, given your abilities, resources, opportunities, etc. are you reaching your full potential, or are you drifting toward a middle that is lower than where you should be if you were getting the most from who you are and what you have? When pruning is not happening, average or worse will happen? –Necessary Endings, p. 19.
Jack Welch, who grew GE from $26 billion in revenues to $140 billion when he was CEO and from $14 billion in market value to over $410 billion, as constantly cutting back businesses that weren’t meeting the following four standards. This allowed GE to become the most valuable company in the world at the time. Obviously you should have your own standards, but the question of “What are we pruning towards?” is a great question you should think about more often at your business. Welch’s standards were:
1) If a GE business could not be number one or number two in its market, it would be cut.
2) Any business that was struggling (sick) would be ‘fixed, closed, or sold.’
3) Every year, GE would fire the bottom 10 percent of the work force.
4) Welch would get rid of the layers of bureaucracy in the company that slowed down communication, productivity and ideas.” –Necessary Endings, pp. 24-25.
You may think these are pretty harsh, especially number 3 where he would cut the bottom ten percent of his work force every year. Yet, that decision of pruning and cutting back what wasn’t helping him get the business to where it needed to be is what helped it accomplish so much more.
Cloud gives one caution in the book about this area of pruning. He says:
“Sometimes people equate the concept of pruning with cutting expenses or ‘reducing head count.’ They say things like, ‘You’re right. We have got some fat around here and need to cut some costs.’ But cutting costs is not what pruning is about, and when someone says that, they are thinking more like a manager than a leader….The kind of pruning I’m talking about has to
do with focus, mission, purpose, structure, and strategic execution. A mere expense cut might have enabled GE to keep all of the two hundred or so businesses it got rid of, if it has just followed a mantra to cut all expenses by 10 percent. As a result, the ‘average roses’ would then become even less than average, and we would not still be talking about GE’s accomplishments. So what we are talking about here is not just ‘cutting fat,’ as the phrase goes. We are talking about defining what the bush is going to look like and pruning everything that is keeping it from realizing that vision—be it good, bad, or dead.” – Dr. Henry Cloud, Necessary Endings, p. 29-30.
Are you clear about what you are working towards? Do you know with certainty what you want your business to look like in 1 year, 2 years, or 3 years? If not, you’ll never be able to prune it to become what it could be, since you aren’t sure what to cut out or eliminate. I would highly recommend that you read this important book and look carefully at the things or areas of your business that you need to prune or eliminate. You can get this book here.
Property Management Inc. has sifted through all of the options of how to run a successful property management business. If you would like to learn how you can prune your property management business into a robust, growing, thriving, and profitable entity, contact us at firstname.lastname@example.org or schedule some time on our calendar. We look forward to hearing from you!