Preparing Your CRE Business to Operate Digitally

Preparing Your CRE Business to Operate Digitally

In this crazy pandemic world, do you feel comfortable that your business is operating efficiently? If not, and most of us don’t, the question we should ask ourselves is: How do we prepare our business to operate at maximum efficiency when another catastrophic event occurs or our economy is shut down again due to a shelter in place order?

If the medical experts are accurate, we could have a second wave and possibly another shelter in place ordered next winter unless a vaccine is developed. Whether it’s next winter or next decade, the question really isn’t if something like this will happen again, but when it will happen?

Our research indicates that most real estate business organizations have not yet invested significant time and resources to streamline their back-office operations. A study by Wells Fargo states moving away from desktop, paper-based processes and outdated systems improves productivity and increases accuracy. Automation initiatives can also make a positive impact on cash flow forecasting and budgeting which is especially important in today’s environment.

Moving forward, companies should create technology roadmaps to guide them through the process into an automated and digital world. All the multifaceted aspects of your business operation that are interrelated, including cloud-based applications, adopting Automated Clearing House (ACH) or electronic payment options for vendors and commissioned agents, accessing a virtual notary and even potentially providing key personnel with high-speed internet at home should be incorporated into the plan. Skipping this step can result in unnecessary tension and risk for the organization, as back-office staff struggle to implement a successful strategy.

Back-office business operations of today’s world will require a different mix of skills than the historically traditional role of the past two decades. A recent study by Inc Magazine stated the most desired skills for future back-office professionals will include: strategic thinkers, adaptable to new and evolving technological advancements and an individual with good collaboration skills. Financial knowledge is still essential — but it’s no longer the only strength that will be required by professionals handling back-office operations.

Automation helps address many of these stubborn issues. With better technology, back-office staff can become more productive, and concentrate their valuable time on assisting ownership with cash flow management and forecasting. So, what are best practices we should all implement to effectively run our business companies digitally during the next catastrophic global event? The most mission-critical functions of your business should be focused on first.   

In the study by Wells Fargo, organizations identified manual processes as the number one operational challenge for their back-office staff. The three most time-consuming and frustrating activities reported by back-office personnel were: managing payments to vendors and employees, forecasting cash flow and accurate budgeting. Today’s cloud-based systems not only automate back office processes, but they also provide a central, easily accessible hub for all your company’s payments and related files.

Many of us are currently grappling with high-impact decisions that will change the way we operate our business businesses in the future. For significant issues that deal with solutions with long term effects on your business, the concept of “scenario thinking” can help improve decision making.

Scenario thinking challenges conventional wisdom, but also relates decisions to company or industry key performance indicators (KPIs), allowing decisions to be monitored over time. To develop best practices for scenario thinking, we suggest reading Peter Schwartz’s great article about it. Mark Warrington-Read, founder and CEO of Warrington Network Consultants, gave us a great quote during our interview for this article.

“Lack of communication causes frustrations,” Warrington-Read said. “Frustrations create uncomfortable situations and conversations. Uncomfortable and unresolved conversations destroy trust in relations”

I doubt anyone can disagree that communication and trust are critical to creating and nurturing a successful business. We are all in uncharted waters as we try to navigate how to survive in this environment and keep our business moving forward.

In what has been called the best commencement speech ever delivered, Denzel Washington continually spoke about “falling forward” and learning from our past experiences when he addressed the graduating class of the University of Pennsylvania in 2011.

Although there are numerous business factors and decisions to future proof your business for similar scenarios, they all start with the health and wellbeing of your team.

What Are Psychological Effects of Working Remotely?

This was a resounding theme in the 2019 State of Remote Work created by the fully-remote social media startup Buffer: 49% of remote workers claimed that their greatest challenge was related to mental health. To be more specific, 22% said they were unable to unplug from work, 19% suffer from loneliness, and 8% struggle with motivation. If you’re not proactive about communicating, your team will start to feel disconnected from the rest of the world and may potentially feel trapped in a bubble of isolation.

Below is the advice from the 2019 survey to avoid depression, procrastination and isolation in a long-term, forced remote working scenario.

• Book all your appointments early in the morning
• Get outside at lunchtime and connect with friends and family
• Fill your calendar with local networking and social events, virtually in today’s environment
• Turn your home office into a space you love
• Adopt or foster a dog and take it for walk or run

Selecting The Right Remote Internal Communication Tool

Our recent experience is that most individuals working remotely are utilizing the lowest range level of internet speed from their providers. Many are having connectivity issues trying to deal with basic files and workflows. One of the first steps an organization might need to consider is supplementing key executives and administrative support team members with home internet benefits, ensuring they can operate efficiently and without significant bottlenecks.

As Mark Warrington-Read alluded to, without effective communication tools you’re dead in the water. Selecting the right communications and remote tools and the right features of the platform chosen is one of the first steps in setting up an effective remote workforce. Some of the more frequently used internal and external communication tools are Slack, Teams, UNITE and remote-connect tools like LogMeIn and Splashtop. Each has various levels of service with additional upgrades and can support even the largest business businesses.

Video Communication Is Critical

Everyone wants normalcy in times of uncertainty. Video communication can go a long way to making your team feel as normal as possible. Our family even had a virtual happy hour over the weekend, and our daily standups typically via Slack are now through Zoom. Some of the best in class video conferencing platforms are UNITE provided Intermedia, Zoom, WebX provided by Cisco, GoToMeeting, Skype and Google Hangouts.

Financial Workflows and Processes

How are the current workflows and processes for critical functions of your business currently handled? When it comes to accounts payable and payroll, does your company have an alternate payment method to sending checks such as internally created wire transfers, ACH payments for payments to agents and employees, or credit cards for vendor payments and required employee purchases?

Are you currently able to process accounts receivable using remote portable scanners provided by your bank or phone applications allowing deposits? Fraud prevention unfortunately increases during times of crisis; scammers are more likely to strike. Continuing to educate your employees and utilizing the fraud protection services offered by your bank can help prevent potential losses.

Use caution with email communication and be aware that if you receive a request to initiate or change payment instructions, perform callbacks using a public number and not the number in the email, or click links that may be unsafe – they may be scams. Also consider performing daily account reconciliation if you have a significant volume of daily transactions.

Is Your Business Able To Process Brokerage and Vendor Employee Salaries During a Crisis?

Having accessible systems during a time of crisis is, of course, the first step for dealing with situations we find ourselves in today. Having access to your company’s critical information through the cloud or remotely will become standard operating procedure. If your systems are still desktop based you are likely unable to process invoices, commission payments, or vendor bills without someone in your back office being exposed to undue risk to perform these functions.

Once you make the necessary move into the cloud, determining whether to work with an off the shelf software solution for your back-office processes vs building a customized solution is an important question. Dealpath created a worthwhile whitepaper on the subject which provides the pros and cons of both approaches.

File Storage, Sharing and Security – Provided By Your Software Applications

As daunting as it may be to move your business-critical financial information to the cloud, the major platforms such as Google, Microsoft and QuickBooks provide the highest levels of security and redundancy natively within their platforms. Utilizing Google Drive, OneDrive, Dropbox, and QuickBooks Online will typically provide even the largest business adequate protection.

A business local network consultant can also add additional levels of security and administrative access if desired. Here is a link to Solutions Review providing some of the basic seven best practices an organization can follow to secure and allow access. To stay abreast of the technological innovations in the world of commercial real estate trade associations like NAIOP, CCIM and SIOR are great resources. Additionally, CRETech and Duke Long blogs offer intelligent and comprehensive access to all things technology happening in our industry. 

Visit the NAIOP Response: COVID-19 page for critical resources and knowledge to support you now.