I know every person has his own opinion on this topic. Business Owners are quick to point out that their way of doing things is Best Practice, but what does that even mean?
According to Wikipedia, "a best practice is a method or technique that has been generally accepted as superior to any alternatives because it produces results that are superior to those achieved by other means or because it has become a standard way of doing things."
So, let's unpack some aspects of Best Practice for Rentals based on some of the methods or techniques that are either widely used in the industry or growing to soon become the new Best Practices of tomorrow. I am not suggesting that this is a comprehensive list, but rather a common thread that we are seeing in the industry from a technology solution provider perspective.
Non Negotiables - The Basics
There are many things that you need before you can call yourself a Rental Agency, but the following is really the foundation that is non negotiable from a Best Practice perspective:
Accreditation - you need to be registered with the EAAB as a Rental Agency and comply with the all the requirements to receive a Fidility Fund Certificate that will authorize you to work with Trust Money.
Trust Account - all money received and disbursed must flow through a Trust Account and every sent in or out must be accounted for in terms of the EAAB audit requirements.
Access to Credit Information - tenants are approved or rejected largely based on their credit history. Having access to a reliable source of Credit Information such as those provided by TPN, ITC, Trans-union and the likes are therefor a key component in the value chain.
A compliant Lease - I think it is fair to say that Tenants should not be allowed to move into a Rental Property without a signed Lease Agreement. Most agencies are therefor well positioned to process applications quickly and effectively. Those that really shine can produce a comprehensive Lease Agreement for signature with the click of a button.
Means to Communicate - there are many parties involved in the Rental Value chain and it is extremely important to have the technology available to communicate effectively with Landlords, Tenants, Contractors, Body Corporates etc.
Rental Management Solution - keeping tabs on all aspects of the Rental Value chain requires lots of discipline, accurate information and a good Rental Management solution. If your organization is still dependent on Excel, then you are definitely not in line with Best Practice. In the past the focus has mainly been on the accounting side of Rentals, but the new Best Practice that is growing fast, includes aspects such as formal Renewal Management, Default Management and Maintenance Management.
Traditionally leadership in this industry was responsible to source and secure new business (in many instances this required some good golfing skills) and then a largely hands-off approach with regards to the operations. This is however changing. Principals are getting more involved in pro-actively managing their agencies and motivating their staff.
Best Practice Leadership require Business Owners to understand what is good for their business and to make choices that will move the business forward for the benefit of all the stakeholders. This is however not where it ends. Business Owners also need to get involved to motivate their staff to follow suit and then to follow up to ensure that decisions are implemented across the organization.
We very often see business owners taking a decision to implement technology, just to cancel a few months and few thousand rand later. There is really no point in deciding to implement a technology solution and then abdicating the responsibility to motivate and support your staff during the implementation process, only to find out that they failed miserably a few months later because they did not even know why they had to do this in the first place. In many instances Business Owners did not make any effort to get buy-in or involve their staff during the technology acquisition process.
So, yes, Leadership or rather lack of true Leadership is an issue in the Rental Industry, but there is a new generation of leaders that are more hands-on and I can assure you, hands-on leadership will be Best Practice in the near future.
Knowledge Capital - Training and Continuous Learning
Most agencies realize that they have to invest in training their staff, but the methods used and focus areas are some times very outdated and not in line with the Best Practices of tomorrow.
Online vs traditional class room approach - The idea of online training and self study is only beginning to take-off in the Rental Industry and I expect this to become Best Practice in the next few years. This is one area where you can become a front runner and lead the pack. Old school training methods tend to be very inefficient affairs providing little more than a welcome break from the office with knowledge transfer being very low due to the information overload associated with trying to cram everything into a few hours. The new online methods provide a much more pragmatic and effective approach for knowledge take-on. It also caters for the fact that we do not all learn at the same pace.
Compliance - The Rental Industry is highly regulated and if you want to be a Best Practice company, you need to know your stuff with regards to the basics of the Rental Housing Act, EAAB Audit Requirements, Tribunals, etc. to name just a few. Front runner agencies empower their staff through regular seminars to be on top of their game.
Financial Literacy - Since agencies are working with other people's money, they need to have a good grasp of financial accounting. Unfortunately many agencies fall short on this issue and the concept of managing a Landlord Account on behalf of the Landlord is foreign to them. Best Practice agencies employ people who have the correct background and grasp of basic financial accounting principles.
It is finally here. Using Cloud Based solutions are fast becoming the new norm and Best Practice. This technology solves many problems, but the most notable are the following:
The industry have realised that one of its major problems is the chaos when some-one resigns, becomes ill or even just go on leave. Most agencies realise that the clever way to solve this problem is to deploy systems that will enhance transparency in terms of what people are busy with and provide easy access to the information that they used. A good example here would be the concept employed by RedRabbit to ensure that all information related to a Maintenance Job is easily accessible from the Ticket folder including all Job Cards, Emails, SMS Messages, Documents, Audit Trail of Process steps followed to date, etc. If your organisation is still largely paper based or if you are still reliant on a clipboard and a camera for inspections, you will soon fall behind and it is time to seriously re-evaluate your business practices.
Data Security - The days of the file that got lost is finally over. If your organisation still have this problem or use this excuse, please note that you are definitely not in line with Best Practice. Yes, it is now Best Practice to use SAAS technology that will ensure that all your information is safely stored in the Cloud Environment from where you should be able to recover it at all times. Hosting Service providers such as Amazon provide high reliability cloud based platforms with point in time recovery that makes all of this possible. So, if you still use technology that is locally installed on servers or PCs, it is time to rethink your technology choices.
Accessibility - Another advantage of using Cloud Based technology is the fact that you can access information and work from anywhere as long as you have an internet connection. This is fast becoming a new norm with many administrators doing their best work after hours from home. I really hope they are getting paid for all the after hours work they are putting in.
With the above in mind, you have the opportunity to become a Best Practice front runner who continuously experiments with new Methods and Techniques in order to find superior ways of doing things that will eventually become the Best Practice of tomorrow when the rest of the pack catches up.