5 Reasons Managers Need A Solid Business Plan
January 5, 2014 As part of our continuing series of articles about planning for a successful 2014 I gave a call to, the creator of CreateAPlan. We were talking about some of the critical issues involved in developing a solid business plan and I asked him about planning as a part of good mentoring. He told me his top 5 reasons and I have taken the liberty of passing them along to you. If you are a manager or a veteran agent and are responsible for mentoring others, don’t forget the key role their business plans plan plays in their success.
With the right business plan, an understanding of how simple it is to operate and some helpful guidance, agents will not only reach their commission goals but also relax and be more creative. One way of achieving that goal is to implement the five key components that should be included in a solid business plan when managing or mentoring an agent.
#1 Set Realistic Goals – Unrealistic goals can quickly discourage a new agent or a seasoned veteran. Working with agents to ensure their goals are realistic will set the tone for the first year of production. As a comparison tool use the numbers from business plans of successful agents that have been in the business 3-5 years. He had just recently spent some time discussing business planning with a new agent. Within a few minutes he could hear the frustration she was experiencing in not meeting her goals. After a short review and a hard reality check she made her own conclusion that her six-figure first year salary was too high. Having realistic goals is critical to setting a pattern for long-term growth.
#2 Define Activities – It doesn’t matter how long you have been in real estate, defining what you need to accomplish in very specific terms allows you to better monitor your weekly activities. Seasoned professionals know what activities they need to do to keep their pipeline full, however most agreed that they knew what to do, but just plain forgot. These items include the calls to sphere and past clients, personal visits etc. Having a list reviewed weekly with a mentor keeps even seasoned professionals sharp.
Newer agents need this more from a psychological aspect since much of their work will not reap immediate rewards. Keeping agents focused on the fact that they are meeting their goal of work activities will keep them motivated until the prospecting and generated leads turn into transactions.
#3 Identify Issues – Managers, comparing all the agents in your office with an online business plan will allow you to quickly see if someone is outside the norm and maybe wasting time or money. Conversely, you can also identify marketing strategies that are working and help others employ them.
#4 Add Accountability – Being able to view agent activities allows managers to supervise those agents that need extra incentives. Additionally you can identify and examine problems earlier for those that are consistently falling short of their activity goals. Finally, all those in the sales profession need praise when they do well and sometimes strong correction when they’re not. Viewing agent activities through a business plan gives you, the manager or mentor that ability.
#5 Have Meaningful Reviews – Instead of the annual or bi-annual pat on the back and discussion of what did or didn’t work with no real statistical measurements, a well designed business plan reveals those items automatically. Part of being a manager and mentor is assisting agents in making the decisions they need to become more productive. The use of a business plan as a comparison tool allows you to identify critical components such as:
• Overhead or marketing expense changes
• Changes in closed transactions
• Changes in earnings
• Discrepancies in sources of business
Working with your agents or those you are mentoring to add your experiences and guidance to their career goals is why they give you a percentage of their business. From a recruiting and retention point-of-view this is paramount to keeping the best and quickly identifying those who should be encouraged to explore other career alternatives.