Real estate operations should be implemented like this!

The concept of "big operation" is not new in the real estate circle, but I personally always believe that operation management is just a different management method adopted according to the stage of the company and its own resources, and there is no distinction between big and small. I also hope that our real estate operators, while "brush" their presence, can be down-to-earth, do their job well, and truly help and empower the development of the company. The above are also what I remind myself all the time (please forgive me if it is offensive).

How to implement operations into practice is a topic of concern to many friends. I think there is no trick to achieve a step-by-step and effective implementation. We still need to start from planning control, cargo value management, profit management, cash flow management and overall decision-making. Below I will only select some of the more important points in each aspect to explain:

Program Management

Planning management is the most basic methodology of operations management.

When talking about project management, the first thing that comes to mind is the first few months of construction and the standard construction period.

But since we are talking about implementation, system setting must come first, and the establishment of a planning management system should be considered from four aspects.

1. Quantity and Grading

Quantity: This refers to the number of nodes in the panoramic plan. 60-80 is more appropriate. Some companies have hundreds or even thousands of them, and require regions to fill in and report to the group, and even require them to go on the information system. Some friends may say, I just made a template of 1,000 nodes and let them fill it in. The specific management is up to the region itself, but have you ever thought about the problems caused by this operation?

1. It takes a whole day to completely arrange these hundreds of nodes, and that’s only if everyone is present.

2. After it is arranged, because the nodes are too dense, it will be exhausted in the afternoon after it is arranged in the morning. After it is exhausted, it needs to be re-shot, because if too many lights are on during informationization, they need to be cancelled and explained.

3. All the lines are basically working together to arrange nodes and adjust points. In a week with only 7 short days, you may spend 1-2 days on this.

I thought it was refined management and that all the templates were complete and the system seemed flawless, but I overlooked one point: this thing is first of all for ease of use and only secondarily for appearance.

The result is: group management is too deep, regional management is too deep, and the staff on the front line are not fighting, but striving for the beauty of your templates.

Grading: Grading refers to three directions. The first is the classification of groups and regions, the second is the classification of node importance, and the third direction refers to node coverage.

The first direction is which nodes the group manages and which nodes the region manages. The general principle is that the group manages milestones and the first level, and the region manages the second level. The group manages 20-30% and the region manages 70-80%.

The second direction is the distinction of importance. In addition to distinguishing milestones, first-level and second-level literal descriptions, importance must be further reflected. Because the importance of nodes cannot be fully reflected by simply counting the completion rate according to the number, each node can be assigned a score based on its importance. For example, important nodes such as plan approval and opening are set to 10 points, and the next most important nodes such as construction regulations and commencement are set to 3 points. The completion rate is the total actual score divided by the standard total score.

The third direction is to look at the coverage level of each stage. For example, we usually only pay attention to the nodes before the first opening. The nodes in this stage are relatively dense. After the opening, we often don’t pay so much attention to it, and there are fewer nodes.

This is also why the opening is good but the delivery is poor, the opening is bright and sunny but the delivery makes people sweat. There is a lack of tracking and control after topping out, and delivery is even delayed.

When we set up nodes, we should pay attention to the coverage of the nodes at each stage.

2. Completion of statistical standards

Since we mentioned earlier that points are set according to importance, we can use the points to calculate the plan completion rate. This is how it can be done.

Try to mobilize others to help you with management and strengthen the participation of each line. Planning management is not the responsibility of one department of the operations line.

For example:

The exhibition area review score determines the final score of the exhibition area development node;

The occurrence of invalid costs determines the final score of the construction drawing completion node;

Delivery satisfaction determines the final score of the delivery node;

Summary: We must achieve both speed and quality.

3. Incentives and Assessment

In the planning part, the two most commonly used and easiest to implement are node awards and completion rate ranking rewards and penalties. These two items can make the project pay full attention to the nodes.

Another way of punishment is to deduct performance due to node delays. The implementation of this method has a prerequisite, that is, you pay your employees relatively high wages. So which method to use, whether it is mild or radical, depends on the company's culture.

Summary: Upper limit + assessment, or lower limit + incentive, consider your choice.

4. Optimization and improvement

The operation of any system must go through the closed loop of formulation-execution-feedback-optimization and correction-re-execution. However, most companies only do formulation and execution, while feedback and optimization are a bit perfunctory or made on a whim.

Let’s introduce them one by one from different aspects:

Formulation: Don't worry about this for now. It's better to have it first and then better. When you want to make a system or a system, take it from the benchmark real estate companies, remove the complex aspects, and implement it first. For example, the most basic planning management is what I mentioned earlier, there is a panoramic plan, a standard construction period, assigning points, statistics on completion, and rewards and punishments.

Execution: There are usually three things to do at the execution level

The first thing is to investigate the development speed of the cities to be entered according to the company's strategy.

The second thing: After the company acquires the land, it will report its plan and compare the development speed of the city where it is located. The first project can refer to the top 5, and the second project can start benchmarking against the top 3.

The third thing: Analyze the following data for each region or city company: which nodes are often delayed (frequency), which nodes have the longest delay time (time dimension), which nodes are often advanced (frequency), and which nodes have the longest advance time (time dimension).

This step can further analyze whether it is an external reason or an internal reason of the company. If it is an external reason, we should summarize the experience and strive to improve the next project. For internal reasons, we should specifically analyze whether it is a problem with the management of a certain line, the company system, or product management. This is a further extension to improve the system construction or basic skills of the entire company.

Feedback and optimization: With all the summaries and analyses mentioned above, feedback needs to be given to management for special discussions. Feedback is bottom-up, and reform is top-down. We must listen to the voices of the front line, and after listening, we must provide feedback. This is critical.

After completing the above steps, a virtuous cycle will be formed, making the system come alive.

Cargo value management

Cargo value management is an upgrade of operational management, which is a process from point to surface.

Planning is the understanding of the point, and value of goods is the interpretation of the opposite side.

The ultimate goal of planning management is to ensure fast delivery. After delivery, it is the balance management between supply and sales.

Cargo value management is a very broad topic, and I will talk about three points here.

1. Maximizing the value of goods

How to maximize the value of goods? Do you often ask designers to provide several solutions, compare them, and choose the largest version? But what does the operation do here?

Compare the indicator of land-to-quality ratio with competitors and past projects in this city to find out the gaps. Here I would like to point out a point that few people do, that is, you should go to the market to visit the property after you get the land or before you get the land. This is completely different from what you see on the website. In other words, we usually have a field survey team, but only the marketing department participates in the market research. In fact, in the future, if we need a measurement or a more accurate positioning, we also need a field survey team, led by marketing and with participation from design, cost, operation, engineering, etc.

In addition, the key point is that after the value of the goods is maximized, the relationship between the composition of the value of the goods, storage rooms, parking spaces, residences, etc. is not necessarily the best. The value of the goods that can be sold quickly is the maximized value of the goods.

2. Group Cargo Value Structure

Regarding the composition of the group's total residential value (regional total value), I personally feel that, especially at this point in time, we should pay special attention to the composition of the area segments.

Because in an uncertain environment, when we consider the product itself, we must also consider its liquidity and monetization capabilities. Once the market turns, small apartments are relatively easy to monetize, and even if they are discounted, houses with high total prices are still very expensive after a discount.

III. Caliber and Informatization

In fact, whether it is a planning management system or cargo value management, the best state is to keep the online and offline calibers consistent. The main expression here is that we use informatization for higher work efficiency and decision-making efficiency. So before installing the system, we must check with the software company to find out the differences between the standardized version of the informatization company and the version we currently use offline, and how much cost and time will be incurred if secondary development is involved.

The caliber issue is a common problem in the process of informatization construction and is also the most easily overlooked problem. Informatization will bring us tremendous management empowerment. Informatization can maximize the solution to internal friction and duplication of work. Informatization will also cause changes in the personnel structure. At the same time, informatization is also a process of continuous investment.

4. Value of cooperation projects

In the management process, it is found that each company has a different caliber. With the increasing number of cooperative projects, contradictions in this aspect become more and more prominent, resulting in the inability to update information in real time and multiple entry of data.

At present, the usual solution on the real estate side is to clarify how to cooperate with each other before signing a cooperation agreement. At the same time, internal staff are also set up in the cooperation project to enter data simultaneously. However, this also causes great internal friction and involves the privacy of customer data. Often, the cooperation in this area is not very good.

In fact, we actually hope that information software companies can provide us with a solution in this regard, that is, how to ensure the interoperability of cooperative project data without obtaining the other party's information.

5. Supply Management and Sales

When it comes to this, we can think of terms such as flexible operation and inventory-to-sales ratio, and immediately want to ask, what kind of ratio is healthy?

What I want to say here is that you can look at the inventory-to-sales ratio from a group level, or from a regional, city, and project level, but don't pursue a specific ratio, because this value, which is dominated by more than a dozen factors, is actually meaningless to set and argue about.

So what can we do?

1) Dynamically follow up the customer accumulation situation at each stage, mainly the situation of temporary exhibition points, the opening of demonstration areas, and the first opening. If the popularity continues, organize special discussions to re-evaluate the market and the rhythm of subsequent supply. This is the intersection with marketing and engineering.

2) In fact, fast turnover has been talked about a lot now. That is to say, the market is good, and everyone is passionate about rapid development and talks about it a lot. But if the market is not good, rapid development will be hindered. That is to say, when customer accumulation and sales are not ideal, what can the supply-side management do?

—On the supply side, adjust the subsequent start-up rhythm and construction rhythm. It is actually difficult to slow down the start-up speed, but the speed can be adjusted through assessment, that is, slowing down the assessment. Because the assessment orientation has changed, the speed of the project will also be slowed down appropriately.

- On the inventory side, we will conduct an inventory of the entire group's retained inventory, and formulate different sales measures for different projects, different business formats, and different apartment types, such as price reduction to speed up payment collection, national marketing, etc. On the one hand, we will speed up sales and ensure payment collection, and on the other hand, we will provide experience and basis for subsequent projects, reduce the proportion of this business format and this apartment type in the future, and return to the market's "urgent need" products.

—On the marketing side, do the big picture, push for repricing, and increase marketing expenses.

Profit Management

Profit management involves the choice of direction, speed or quality.

We often hear about profit-based projects, flow-based projects, and balanced projects. I think these are summaries and classifications made during the review, and are not suitable to be placed at the front end as a basis for making land acquisition and positioning decisions. Putting them at the front end is a false proposition in itself.

Which project is not about making money? Which project doesn’t require flow rate? Which project doesn’t need to be balanced?

In the current environment, I think it is enough to maintain one idea, that is, if the flow rate is good, make money by the way. If you can't make money, then make money by building a brand and scale. This is also a way of expressing "profit". Profit is not just the number on the books.

So I think the operation management of profits should focus on three stages.

Cash flow management

Cash flow management must be both streamlined and precise.

Cash flow management and optimization also involve many aspects, and here we mainly analyze the operations of on-site management.

Pull-through mechanism:

Guarantee mechanism:

Cash flow management includes current specific projects and future layout to optimize cash flow. Both are very important and should not be limited to the present.

Global business decision-making mechanism

The global decision-making mechanism must be based on facts and be timely.

Basis: Decision-making is the process by which business managers select an action plan and implement it based on sufficient market information in order to achieve a certain development goal of the enterprise.

Time-limited: The selection of action plans and the implementation process are subject to time constraints, and decisions need to be made in a timely manner.

Organizational decision or individual decision

The decision-making mechanism includes static decision-making system and dynamic decision-making system.

Static meetings include various types of meetings, such as the program review meeting after land acquisition, the kick-off meeting, the opening pricing meeting, and other fixed meeting decision-making mechanisms.

Dynamic means that a decision-making mechanism must be triggered because something happens.

What we lack is a dynamic decision-making mechanism. This is not the key to success, but everyone pays more attention to the static and fixed decision-making method. On the contrary, the relatively complete dynamic trigger decision-making mechanism makes us more efficient, more scientific in management, and has a higher success rate. This is also the reason why differentiated management determines that some companies will get ahead.

Author: Mi Xiaoxia

Source: Mi Xiaoxia