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Eerie silence

I ventured into London last week for only the second time since March. There was an eerie silence in the heart of the City of London.  Working from home has sapped the lifeblood out of the financial district. My gut feeling is that we are witnessing a once in a lifetime step change in the way we work. I also think that it’s as futile for office investors to see this is a temporary blip as it was for retail property investors to believe that online shopping would have only a minimal effect on our high streets and shopping centres.

For those whose careers have been built on building offices in the City, it’s only natural to have self-belief in their products. Like me, you’ll have read the interviews which put forward the line that 1. We are social creatures 2. Teams can’t work well when separated 3. Young people need to learn by listening 4. Sandwich bars deserve our support. ….so it’s only a matter of time before the problem goes away and we return to the way things were.

I liken this self-belief to that shown by shopping centre owners who confidently told consumers that there’s no substitute for being able to try on a dress or shoes in store. Meanwhile the percentage of online sales has grown year on year. Retailers saw that the future was multi-channel long before shopping centre owners. For shopping centre owners, being invested in just one channel has proven a scary place to be.

Blended working

Flexible (or blended) working is the workplace equivalent of multi-channel retailing. It recognizes that one solution doesn’t fit all and that each business needs to think through what’s the best blend of workplace solutions for its customers, suppliers and employees. For some businesses that answer could still be the 9 – 5 traditional office but for the majority it will be a blend of office/hotel/cafe/business centre and home working.

Technology is enabling the change in workstyle with high-speed broadband and low-cost software tools like Zoom and Teams making it possible to work from anywhere. Covid-19 has added another reason not to commute to the heart of our cities, but the underlying trend towards flexible working is not new.

If we accept that office real estate’s biggest competitor is now the ability to work from anywhere, then the question for owners is “what can we do to compete?”. At RealService we’re excited by the opportunity to work with our clients to better understand the desired workstyle of employees. We are already seeing a move away for the formulaic and to the creation of a new and exciting range of products and services which give companies and their employees the workstyle they want.

For those financially and emotionally invested in the old model, this will require a transformational change in thinking.

So how ready is your business to change its thinking?

Real estate has a fundamental health problem but how ready are we to face up to this?

We can learn a lot from the Stages of Change model used by the medical professions.

https://rcni.com/hosted-content/rcn/first-steps/stages-of-change-model

The Stages of Change model describes the different stages we go through when we want to change something in our lives. This readily translates into the world of business

  1. Pre-contemplation: This is where we’re not thinking seriously about making a change or we don’t really see it as a problem.
  1. Contemplation: We’re now beginning to think about our business models and we’re beginning to see that maybe there is a problem that’s affecting our long-term business health.
  1. Preparation/determination: By now, we’ve realised that something needs to change, and we’re ready to make changes – but maybe we don’t know exactly how, so we look for help.
  1. Action: We now know what we want to change, we’ve researched how we can change it, and we’ve got a plan to put into action.
  1. Maintenance: We’ve got to a position where we can sustain our new approach
  1. Relapse: we may revert to our old ways when the market begins to strengthen or it just gets too difficult

Where is your business at today?

The starting point for real estate business leaders is to ask where are we today in terms of our readiness for change? It’s time to be honest. Do we have the energy and resolve to change? Do we have the clarity of customer insight and vision to take action?

In this new series of blogs, we’ll look at ten strategies to accelerate your business through the change model.

 

Howard Morgan is Founder & MD RealService, customer experience consultancy

 

www.real-service.co.uk

 

To discuss any of these themes contact Howard at howard.morgan@real-service.co.uk

Never has the business relationship between landlord and tenant been under greater pressure than now.

The Covid-19 crisis has hit the already reeling retail sector, the demand for office space has disappeared overnight and viewing a residential property is a risk to health.

When the going gets tough, you might expect landlords to revert to stereotype – taking advantage of legally binding commitments made in better times.

RealService clients see the world differently – they see the crisis as chance to enhance relationships and demonstrate a genuine humanity.

We’ve been working for the past 21 years to help our clients to create truly customer focused property businesses. We’re proud that our clients pay more than lip-service to treating tenants as customers. We’ve helped them to measure customer loyalty and to understand what best practice looks like.

The coming weeks will test their resolve and whether their “customer first” mission statements are more than hogwash. We’ve been working with them to develop their empathy skills, to learn how to ask open questions and to listen to the practical and emotional needs of their customers. Some have already shown that they are listening https://tfl.gov.uk/info-for/media/press-releases/2020/march/tfl-takes-steps-to-support-tenants

At RealService, we’ve always advised clients that when the going gets tough, the most important thing you can do is stick close to your customers. They will tell you what they need, you just have to deliver it. For the property industry post Coronavirus, this is going to mean radical change. We’re ready to help our clients gather even more intelligence about their customers.

The message to our clients is simple…. we are here for you and ready to give any practical support that you need. For example, helping you to keep in touch with your customers, to communicate important messages, or just to see how they are doing. If your resources are stretched, we are able to help.

We’re also bringing customer experience professionals in real estate together through our Experience Makers network – why not join our discussion group and share ideas and get inspiration at https://join.slack.com/t/exmnetwork/shared_invite/zt-cog6pzdt-XQZNLjZXHS1YVSsud9E6HQ

The RealService team are working from home and easily accessible via email, telephone and video conferencing.

Whatever the coming months bring, we remain relentlessly focused on providing our clients with excellent professional service and support they have come to expect of us, and we thank them for their continued loyalty.

We all recognise that feedback is key to our business. As investors or developers, we want to understand what drives our customers; as landlords and property managers we need to know what keeps our tenants happy.

The problem is that as occupiers or consumers we can feel we are being harassed for information, asked to fill surveys, click buttons or give ratings after practically every interaction, no matter how small.

‘How Did We Do?’, we’re asked as we go through border control.

‘Would You Recommend Us?’, we’re asked after a visit to the GP.

‘Rate Our Facilities’, we’re asked after a trip to the loo.

The UKAA’s September breakfast roundtable, hosted by JLL, had the theme ‘Residents’ Feedback: Lifeblood or Unwanted Gift’ and was facilitated by customer experience consultancy RealService.

As a company, RealService is very much in the feedback business, conducting independent qualitative and quantitative reviews to help inform and guide the customer experience strategy of major clients from all sectors of the property industry.

And so, the presentation from founder and managing director Howard Morgan revolved around the notion that those who want customer feedback should really have to earn it.

He said that it should be an easy process, completed at the convenience of the customer and requested only after a relationship has been cultivated through meaningful contact.

Basically, the customer giving feedback should be treated in the same way as the customer buying, or renting, your product.

“Business makes such wonderful claims about service but doesn’t always think about whether their methods for gathering feedback measure up to those claims,” said Morgan.

“I recently went on a cruise and almost as soon as I disembarked was asked by email about my experience,” he said.

The mail said the feedback would take about 10 minutes to complete but filling in the initial questions – how did I rate my cruise overall – led to a 32-page survey. The person who designed it was clearly not thinking about the customer.

Asking for feedback on washroom facilities, he added was “the height of madness”.

“Why would you have to ask how clean the toilets are? I am your customer, not your cleaning supervisor.

“Outsourcing feedback is too easy. We have to learn how to gather feedback in an independent, ethical way, without making it onerous for the customer.”

For those attending, volume of feedback was important, to weed out customers with extreme views, be they good or bad. Other points offered or raised included:

  • Asking for feedback got a better response than simply waiting for it – generally it’s unhappy customers who give it unasked
  • It’s hard to integrate feedback systems; for example, word of mouth with digital or electronic
  • Uber’s 360-degree feedback is stressful – should the supplier really be scoring the customer?
  • Verification is important; how do we tell if anonymous feedback is from a true purchaser?
  • In the residential renting world might it be wise to include ‘responding to requests for feedback’ in the leasing process?
  • The Build To Rent Sector is way ahead of other property sectors because of the realisation that ‘these people could be your customers for years to come’

Hannah Marsh, co-founder of digital feedback company HomeViews, said property was learning from the hospitality industry.

“Hotels wanted feedback but kept getting it from outlier customers – those with extreme views, which were usually negative,” she said.

Now they ask everybody because if you ask all your residents you get the people who might be happy with your service but wouldn’t write a review unprompted.

Sam Winnard, JLL’s Director – Residential Agency, gave an overview of their feedback methodology which included monthly email and telephone calls and residents’ forums. Google Reviews and Net Promoter Scores were used for benchmarking so JLL can compare itself with competitors and with scores from outside the industry.

“Our customers have all interacted with the likes of Amazon or First Direct and they expect the same level of service across the board,” he said.

The Net Promoter Score is a good way of finding out if your customers are passionate about your product and benchmarking their experience inside and outside the property industry, agreed Morgan.

“However, if you are going to be rated a nine or a 10 – the scores which suggest a customer will stay loyal and actively recommend you – there needs to be an emotional connection,” he said.

“After getting your scores, there are two challenges.

“The obvious one is to identify your detractors and proactively manage any issues they have.

“The second is to convert any sevens or eights – those who are passive – into nines or tens and to do that, you need qualitative information around what would make the difference.”

It must also be desirable to have that feedback collected and verified independently.

Wrapping up, UKAA CEO Dave Butler said: “Customers are essential to the success of our business, but we have a long way to go before we put people before buildings.”

If you’d like to know more about how RealService could help you to design a customer feedback programme, or measure and benchmark customer satisfaction, please contact Howard Morgan at howard.morgan@real-service.co.uk 

STAKEHOLDER engagement is becoming a key area for GRESB assessment and the ability to deal with stakeholders – clients, customers, occupiers, tenants (call them what you will) – has become a key skill for anyone in a client-facing role.

Investment managers – for whom customer has previously meant investor – are coming around to the view that the definition is now much broader than that.

However, there is a widening skills gap which has become especially yawning in the office sector where the disruptors have had a field day shortening leases, providing excellent customer experience and pretty much doing away with the service charge.

This prompted the British Council for Offices to commission customer experience consultancy RealService to carry out a major piece of research.

The BCO was interested in how the office sector, and primarily its property managers, was dealing with the new emphasis on customer experience and how businesses were going to retrain, retain and recruit staff who were suited to this new world order.

And while the full report is an excellent read (The Customer Experience Revolution Closing the Skills Gap) and can be download for free via www.bco.org.uk, one of the areas thrown up by our research was how diversity – or the lack of it – was impacting on the recruitment and retention of the sort of staff best placed to thrive in a customer-first, space-as-a-service industry.

All the companies we interviewed had policies around equality and expressed that they were doing their bit to help change the image of the property industry from ‘male, pale and stale’ into one which better reflected the industry’s customers.

It was a similar story in terms of inclusion. Behind the rainbow-themed Twitter logos and lots of posts on mental health awareness, especially during Pride/Mental Health Awareness month (or similar), there is clearly some good work going on.

However, we found two ongoing issues.

  • First, the production line for those going into the property industry still (in the UK anyway) usually begins with a “relevant” university degree (as emphasised by the Royal Institution of Chartered Surveyors)
  • Second, even as the universities do their best to attract a wider range of undergraduates, once that production line reaches the leading property companies even the most diverse of candidates becomes moulded into the old-fashioned, traditional system

As the report found:

The road to diversity is not yet well trodden; those with great customer service skills are not being attracted into the property industry, which still predominantly recruits from traditional universities offering ‘relevant’ degrees. Property management is not perceived as attractive an option as investment or asset management.

There are alternative routes into the property industry which might attract more women or black, Asian or ethnic minority candidates and there are many examples of best practice.

However, while major companies run apprenticeship schemes (there’s a government levy on larger businesses), they are not major areas for recruitment. Indeed, there is no guarantee an apprentice who completes their qualification while working at a property company will be offered a job there.

“There is a welcome drive to increase the diversity of students coming into the UK property industry,” we say in the report.

“Property Needs You and, especially, Pathways to Property, with its emphasis on state-school recruitment, are doing their best. RICS, too, is endeavouring to widen its base and overcome what it calls the ‘unconscious bias of middle management’.

“The need for increased diversity at entry level, in recruitment and career development underpins any attempts to close the skills gap.”

We concluded the conundrum around this skills gap, and by extension the lack of diversity, needs a radical solution.

So, property managers of the future must be alchemists, with a combination of base skills – customer service, technology, business and marketing to name a few – which can be turned into CX gold. While some technical knowledge is still required, property management no longer revolves around bricks and mortar. In fact, the term ‘property manager’ is obsolete.

Alchemists will not come into the property industry via traditional routes. They will have a wide range of degrees and come from a wide variety of backgrounds. They will be capable of disrupting the disruptors. Currently, they are being plundered from the hospitality sector and are providing the sort of customer experience which keeps occupiers happy and the rent coming in.

And that will be music to the ears of investment managers.