Now the Internet challenge has expanded to a new front. This time the opportunity is being laid down along the lines of service provision. Once again the real estate industry must square its jaw and prepare to evolve yet another aspect of its traditional business model.
In March of this year several major corporations, including Microsoft, Oracle and IBM joined to create an ambitious non-profit Silicon Valley entity known as the Service Research & Innovation (SRI) Initiative. The creation of this unit signals a new trend in American business trends as major corporations begin to shift their attentions from products to services. It is understood that this new organization’s priorities will be in the area of Internet based service delivery.
“We need a professional organization to help promote service science,” said James C. Spohrer, director of service research at the IBM Almaden Research Center in San Jose, Calif. “It is one of the seed crystals around which the new discipline will form.”
IBM and Oracle are founding corporate members of the Service Research and Innovation Initiative. Other company members of the organization’s advisory board include Accenture, Cisco, Computer Sciences, EMC, Hewlett-Packard, Microsoft and Xerox.
Researchers from several universities are also members, including some from the University of California, Los Angeles; the Wharton School at the University of Pennsylvania; and Arizona State University. The European Commission and a German research organization, the Fraunhofer Institute, are also members of the advisory committee.
The new initiative is backed by two professional societies, the Technology Professional Services Association and the Service and Support Professionals Association. The executive director of the new organization, Thomas W. Pridham, is the senior vice president for advanced programs of the service and support professionals group.
The real estate industry is not the only business sector facing the challenge of delivering better services in an Internet environment. Some of the most significant corporations in the American economy are working to meet the standards set by Internet based service models that seek to set new service standards for an increasingly demanding consumer.
The idea of innovation in the service sector flies in the face of innovation, as most perceive it. The unveiling of Apple’s new I-Phone in June fit the classic concept to a T. Here was this exciting new product that incorporates dozens of amazing features into a sexy package design. Complete with glitzy marketing the whole package was so successful that it sold more than 700,000 units in the first 24 hours and redefined the cell phone space. It was classic innovation at its best.
But while the real estate industry has been fighting for Internet supremacy another reality has spread across the American economy. Slowly but steadily more and more industries are discovering that service, once a throw away or consolation prize, has become a more and more critical and integral part of their overall product and profit. With continuing competition from Asia and automation many experts suggest that the greatest battle of this war may be fought on the service front. It is time for the real estate industry to take a careful look at its service practices and decide whether or not they can stand up to the demands and expectations of today’s real estate consumer.
Properly managed the service front may be where the real estate industry finally wins the war and establishes its long-term dominance in the real estate space.
At first blush many in the industry will breathe a sigh of relief for it is a well known fact that most if not all agents and brokers believe themselves to be the ultimate service providers. Indeed some are. But a more realistic appraisal of the industry’s current service posture would include the fact that most real estate service packages are created and delivered by real estate service providers with little or no consumer input, participation, rating or response. More to the point some experts who have access to credible surveying processes suggest that the consumer may not be that happy with the industry’s service package, especially the ones delivered in up markets.
These thoughts aside however the reality of the upcoming struggle for service superiority is that the industry will have to incorporate features that were never ever considered by traditional practitioners. Property and agent rating, consumer comparisons and new information about target properties are but a few of the new service dimensions.
An even more sobering thought is the fact that most, if not all, of the industry’s Internet based competitors are already working to develop service programs that wow the consumers. Zillow, Google, eBay and Yahoo have already made progress in the service arena. This early focus has provided them with strategic and tactical lead in this important area.
So what has to happen to ensure a real estate industry victory in the service arena? The first step must occur at the top of the management and command structure.
Executives must recognize that;
(1) Creative service will not be a product of experience, time in the saddle or market domination,
(2) Creative service will not be accomplished on an agent by agent basis,
(3) Creative service programs must be a companywide commitment that can be measured, benchmarked and monitored and
(4) Creative service must include a valid and viable consumer input in its design, execution and rating. In short, creative service must be a product of the brokerage’s creative processes division.
Anything else will just be an exercise.
The current market offers the perfect opportunity to invest time and energy in a creative process directed to re-inventing the brokerage service procedures and policy. What will great service look like in your firm in 2009?
