JF2504: 3 Tips to Build a Powerhouse CREI Team | Best of Best Ever
In this episode of “Best of Best Ever,” we dive into the three stages of creating a successful team. Danny Coleman talks about his four-step hiring process for attracting the highest-quality candidates. Shawn Casemore tells us his secret for developing your current team by balancing the focus on business and people. Lastly, Rich Fettke discusses the importance of building and managing a strong team, as well as tips for creating connections and organization in a remote team.
- Has a passion for small business growth and development
- Based in Columbia, TN
- Say hi to him at www.dannycoleman.me/podcast
- Episode #1688
- CEO of Casemore and Co Inc
- Based in Ontario, Canada
- Say hi to him at www.casemoreandco.com
- Episode #992
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Theo Hicks: Hello, Best Ever listeners. Welcome to the best real estate investing advice ever show. I’m Theo Hicks and today we’re going to be featuring three clips that focus on how to build your commercial real estate team. The first clip comes from episode #1688 with Danny Coleman. He makes it a full-time job to help small businesses grow and develop their teams. Here’s what he had to say.
Joe Fairless: Joe Fairless: Where do you find the quality people?
Danny Coleman: You can get them, you can certainly find quality virtual assistants. UpWork is a huge place to go; it used to be oDesk. And you can find them on Craigslist. I got into the position I’m talking about, the COO position, via a Craigslist ad. So it really comes down to your process. Let’s just think about this for a second – if you’ve got 100 people who apply, how do you figure out who are the 1-3 people in that 100 that are good? So it’s not a matter of where do you go to find them, it’s just you’ve gotta make sure you’re casting your net wide enough.
Then the problem is “Oh, I’ve been casting my net so wide…”, so it’s a 40-hour/week job to screen these people, and interview and hire these people. So you’ve gotta have a good process, and that’s when it comes back to the hiring process we can talk about. A good process will work through all the masses of people that exist out there and who are trying to apply for your job. That’s essentially how you do it – you have to cast a wide net, but you’ve gotta have a process that keeps it from taking up all your time.
Joe Fairless: And what is that process?
Danny Coleman: Every business that I work with, we kind of tweak it a little bit. It starts with your job ad – how are you even putting your job ad together? It sounds so basic and technical, but it’s really important. When you’re writing a job ad, what you’re doing is you’re asking someone else to come contribute to your vision; you’re saying “Hey, I want you to come in and be a part of this thing that I’m building.”
The way that I have people write job ads (or I’ll write them for them) is you wanna tell a story. Why your business. Describe what your business is, the four values of your business, what are the people in your business like, and then you wanna lead them on – “Does this sound like a good place? Is it interesting to you? Well, keep reading. Here’s what we need help with.” Get really clear on your position.
I always have people write up a position agreement, or I’m gonna help them write a position agreement. A position agreement is a mutual contract between you and the person who’s filling the position. More basically, it’s a job description. But then once you bring them on board, it’s kind of when it becomes this living, breathing document between you and them.
But to stay on point with the process – you start out with just your job description. You say “Here’s the reason that this position exists. Here’s the things that you’re gonna be responsible of doing on a daily/weekly/monthly basis. Sound like you? Sound like something you’re interested in? Cool, keep reading”, and then you describe them as a person.
I think this is what’s missing from a lot of job descriptions – you kind of just say “Hey, here’s our company, here’s what we need. If you wanna do this, apply here.” But you wanna describe them as a person, because the people who get really excited – and people who are hiring managers know what I’m talking about; or if you’ve done interviews – about working for you and the people you want on your team, they’re reading that description of themselves essentially on your job ad, and they’re like giddy. They can’t wait to apply for it. “Wow, this is what I’ve been looking for!”
And just to give you a real-life example, this is how I got into that position, for the real estate business in Nashville. [unintelligible [00:03:45].20] that changed my life… And it was because of how well-written the job ad was; it wasn’t perfect, but it got me excited. In fact, one of the things that they had in the job ad was “Must enjoy organizing chaos”, which is [unintelligible [00:03:58].12] I have a podcast named “Organizing Chaos.” So I read the recruiter’s job description describing me, and I was like “Oh my gosh, I can’t wait to do this.” So really that’s the big part. I’m kind of going into details on the hiring process, but it really is where it all starts. Putting that job ad together is the first step towards finding the right people… And again, you’ve gotta cast a wide net, but that process needs to sift through all of the people that are gonna apply; you’re gonna have the resume shotgunners, you don’t want them… You want the people who get excited.
Then I have really specific instructions on how to apply. “Your subject line must look like this, and you must include a cover letter”, and these other things… But yeah, I can get into as much detail as you’d like on that.
Joe Fairless: Yeah, that would be good. I imagine — one of the things you’ve mentioned is “Have something specific in the subject, as well as have a cover letter”. Those are the ways you filter people out, right?
Danny Coleman: Yeah. And it started honestly out as something I did for technical reasons… Because I was casting a wide net, but I didn’t wanna deal with all these e-mails in my inbox, so I set up a filter… And it needed to work with that filter. I’m sure you’re probably familiar with Podio. I would use Podio to manage the applications. So e-mails would come in from Craigslist, Indeed, or wherever else I placed a job ad – they would come in, and then they would use that filter to send that e-mail on to Podio, where I would then manage the applications in there.
But then I also had a qualifier – can you follow simple directions, such as your name, colon, position. A lot of people don’t do that. There’s also lots of apps out there that work with Craigslist, that help people shotgun their resume, and it doesn’t take those types of things into consideration… Just like go to apply with the job title, or something like that. So that’s the next part of the process.
Then the next thing I do is I shortlist those candidates. So I already have two pre-screens that essentially run through a really specific job ad, and then a specific way of applying. Then I do a video recording. I’ll send out a video of myself where I pretty much just say a few things about the position we’re looking for. I’ll pretty much just read the job ad, but I obviously give it some flavor and context, and I let them see me. Then I send that video out to everybody who I’ve shortlisted, and I request a video back from them.
We used to have a problem… For a while we would kind of hit and miss on whether or not people would be responding with their video, because a lot of people don’t wanna do that. But I’ve found out that it balanced the relationship a little bit by me sending the video first to all those people I shortlisted, and basically it gets them excited again. If they like the position, they’re gonna be excited to respond. So that’s another screen right there, because you’re gonna have maybe a 25% response rate with people doing videos back… And it also tests their ability to do something simple like upload a video to YouTube, make it unlisted and send it to you.
Joe Fairless: What do you ask them to do in the video?
Danny Coleman: I have them tell me what about the job ad stuck out to them and what interested them, and then why do they think their natural talents and/or their experience would be relevant to this position. And I really just use the idea of who they are as people. Before we have to sit down and schedule interviews, it gives me an idea of what their character is like, how are they coming across; what is it that excited them about the job ad. I wanna hear them say it, rather than formulate an e-mail response where they can write and rewrite it a million times. Of course, they can upload the video many times too, but they’re less likely to do that than they would with an e-mail.
So getting just those two questions answered is really all that I ask for. And again, it helps me with this whole process of being able to cast a wide net, but then use all these various filters to filter it down to make the best use of my time.
Joe Fairless: For people who do the video, the 25%, but you’re not a fan of the video – do you reply to them, or do you just not reply?
Danny Coleman: I do let them know that I’m moving forward to another candidate. Of course, typically at that stage they might have asked me a question, like “Hey…” — I’ll always let people know I got it, because you always wanna be respectful of the fact they’ve sent a stranger a video.
Joe Fairless: Yeah…
Danny Coleman: So I always respond. I have an auto-response that says “Hey, we’ve got your video. Thanks so much. We’ll be in touch within the next timeframe.” And I always try to let people know. But the people who send back a video, I try to let them know what the deadline is for when I’m trying to hire for this position; it’s respectful of their time… Because if they’ve given me this much respect at this point too – replied to the video, followed the instructions, sent me a video back – I wanna let them know 1) that I got it, and 2) what kind of timeframe they can expect. Because they might be looking for a job sooner, or they might need to move on with another application, or something. So I try to be respectful in that by letting them know.
But ultimately, when I’m done interviewing someone, or by the point I get to the point where I’m scheduling in-person interviews, I let everybody else know we’re moving forward with other candidates right now, so thanks so much for your interest, or whatever.
Joe Fairless: And then what’s the next step in your process?
Danny Coleman: The next step is an in-person interview… And I’ll give this out, honestly, to anyone who’s interested in it – I have an interview template that I use. I’ve built it over time, there’s a lot of research behind it, there’s more experience behind it… I’ve got an interview template that — my interviews run about an hour long. That’s why this process has to shake people down to the point where maybe I’ve got five or six people who sent back videos, who I’m like “I wanna schedule an in-person interview with these people.” Without fail, out of those five or six I’m only gonna get three people who are going to take the time to schedule an interview with me… But the truth is that probably any one of those people that I’m going to schedule an interview with, because of all the filters I’ve had set up beforehand, by the time we get to that point probably any one of those three people would actually work… And then the interview is just to see who I think it would work with the best; who has got the chemistry if they’re interacting with me where we’re gonna get along the best and we’re gonna be able to communicate and understand one another.
But that interview – as I said, it’s an hour long; a couple of the things that I ask people about is their future plans. I wanna know that a candidate that I’m talking to has been considering their future, at least 6 or 12 months in the future. Are they reading books? You know they read books, period; I don’t care — I like it to be personal development or business books, but if they’re reading fiction, that’s fine too. I think people who read books – it’s a telltale sign of someone who is just a little bit more than basic. That’s another favorite.
I always ask the classic question, “What’s a weakness? What’s something you could stand to improve on?” Because for me if you’re not self-aware enough to know something that you need to work on, then you’re not self-aware enough to be on my team… So I think that’s important, too.
I’m trying to think of some other things… I always like to ask people to say one word to describe what motivates them. Then I also ask “In one word describe what discourages you, or tears you down.” It helps me to get an idea of how this person uses words. Everyone has a different association with different words, different words mean different things to people. That’s why communication is hard. It gets them to stop and think in an interview, and that’s with a lot of my questions – they’re designed to get people to pause and give me thoughtful answers… Because as I’m doing the interview, I’m always engaging in Socratic questions; if you don’t know what that is – it’s basically asking a clarifying question after each question. It’s not every question; sometimes people give you good answers that I don’t need to ask for clarification on, but most of the time I’ll be like “Go further into that” or “Why would you use that word?” or “Give me an example of that”, or something like that… And you get them to get a layer deeper. That’s how you filter out people who might just be blowing smoke, or BS-ing you, or whatever. That’s what my interviews are really designed to do – how do I get down to the real person, how do I get down to the genuine human being that I’m gonna be interacting with on a daily basis.
One thing I forgot to mention is that I open it up by actually mentioning a few things about myself. I like to have a conversation, not an interrogation. If you go in there and you’re just like “Oh, well let me just immediately start asking you questions” – no, I like to say “Hey, my name is Danny Coleman and I live in Columbia, TN. I really like to be a part of my community. I’ve been working for this business for x years. I like to ride motorcycles, and I’m a Star Wars fan.” It lowers defenses, because defenses are there because they think that they have to present this perfect version of themselves.
Joe Fairless: Right.
Danny Coleman: That’s not the version of the person you’re gonna be working with on a daily basis. You’re gonna see people in terrible situations, which reminds me of one other favorite question of mine from the interview… Asking them about what frustrates them the most, and then following up with “How do you cope?” That’s another good one that I’ve really used. Because again, you’re not just asking questions that they pass or fail here; you’re asking questions that inform you if you hire them, you understand more about them and how to interact with them, sooner rather than later.
Theo Hicks: So Danny’s clip focuses on creating the right hiring process to ensure that you are finding the highest quality people.
Theo Hicks: This next clip comes from episode #992 with Shawn Casemore. Shawn Casemore runs a consulting company where he works with massive corporations and companies and helps them improve their operations. Listen to what he had to say about building a strong team
Shawn Casemore: Step one – when you think about any contract at your business, and by contract I don’t specifically mean a general contract, but any way that you pay an hourly or by job basis, you have to realize those folks have their businesses and have their own priorities, and therefore you need to somehow make your business their priority. I’ll say that again, you have to make your business their priority.
Now, the logical ways that we’ve seen this done, even if you watch some of the shows on TV, is that the investor goes out and they beat up on the contractor, they yell and scream and rant and rave and threaten to pull business… That looks good for TV and that’s why that’s on TV, but in reality that’s not the way it works.
So you have to figure “How can I make things in my business just as important as their business?” You can do that obviously through leverage – the amount of business you give them – but more importantly you wanna make them feel like they’re a part of something. For example, when you’re going out to take a look at a property, you bring your contractor – we’re talking like a general contractor – with you. Do you involve them in the decision-making? Do you actually give them the chance to take a look at situations and provide potential solutions, and when they do, do you thank them for it and you take some of their advice?
I see it in myself, I’ve been involved in real estate now for probably only about 5-6 years as kind of a side venture, something I enjoy, and really to build that team when I’m kind of a solo investor, it becomes trying to ensure that other people who support me, although they’re not an employee, they feel like this is also their business. That comes back to building a relationship, which includes things like trust, honesty… And you’ll find that a lot of contractors will be very receptive to that, because everybody else treats them like crap, so they’re happy to work with those who actually treat them like a human being, respect their ideas and viewpoints, and treat them as if they’re part of your business.
Joe Fairless: I love that. Involving them… One thing that I do with my team – I’m not a fix and flipper, but I have teams for my company, and I always make sure that I mention it’s not MY podcast, it’s OUR podcast. I have that mentality because it truly is ours; it’s the team, it’s not just me, and I think that has a psychological benefit as well. What do you think?
Shawn Casemore: Absolutely, it does. It really comes back to — I think in business sometimes we end up running over those who support us, and maybe inadvertently, because we’re so busy, we’re so fixated on the next deal, the next opportunity, cash flow… Those things absorb, I’m sure, much of the time of your listeners. But the problem is in doing that, many of us, because we’re so focused on those things (they call it stress), we can come off as jerks, and then that inadvertently can be then thrust upon those who support us. And notice, we’re talking about a contractor here, but if you had employees on your team, the same thing can happen; you’re focused on cash flow, you’re focused on sales, you’re focused on the next deal, but that stress then when you turn to answer some questions of your employee or your contractor comes out that you’re a little bit of a jerk… And then what do they think of you? They think you’re a jerk, so are they gonna stand behind you, are they gonna be there when you really need them? The answer is no, and you’re probably gonna wonder “Hey, why is that? I’ve given them a solid job and I’m paying them for years, I’ve been trying to include them as a team…” So it becomes very difficult for the entrepreneur or the investor in this case to have a couple different mindsets going on. Number one – the business mindset, which is “the next deal, cash flow, profitability”, but also the separate mindset that is “Hey, in order to be successful, I can’t do this alone. I need people, be it employees or contractors or otherwise”, and people are receptive to other people. People are receptive of being treated fairly, being treated honestly. In fact, I can actually warm people up a little bit if I start to maybe go that extra mile or if I drop off a coffee. When I’m [unintelligible [00:18:51].17] I always try to grab some coffee for the guys.
Here’s a funny situation… I had a contractor and his team working last summer on this property that I had, and it was a really hot summer day, which believe it or not, despite the snow [unintelligible [00:19:02].10] I’m coming in, I’m rushing in, I’ve got a few minutes to stop by and see how it’s going and move on to the next thing, and I think “You know what? If it were me, here it is Friday at [3:30]; I’m hoping they’re gonna stay and finish the job”, so I stop and grab some beer. I brought it back and I said, “Hey guys, I hope this is okay.” I can tell you the contractor that lead that job became my friend immediately. Instead of bringing stuff to my house after hours, dropping off stuff… “Here, I forgot to give you this. Here’s a deal on that…” Suddenly, he’s my best friend, and all I did was take a moment to step out of my agenda, my schedule, and start to think about them as people and realize “Well, what would I want if I were them? It’s a hot Friday afternoon, I’d want some beer”, right? It’s that mindset.
Entrepreneurs and investors need to focus on two mindsets: the business mindset and mode, but there’s also the people mindset and mode, which oft times is very similar to how you would deal with your customers. We’re suggesting you deal with contractors, employees with a similar tone and ideas that you would with your customers.
Joe Fairless: I imagine that the principles that you teach and work with your clients on through your consulting firm are similar principles that we as real estate investors can employ, so what framework do you use with your clients, when you’re working with them to get the most out of their team?
Shawn Casemore: Typically, what I would do is — every team is different, every organization is different. For example, I was just speaking with a client this morning; we are working with kind of a subset of a small group of people in the organization. We identified some very minor changes to something, and this morning we sent that out to the broader team before it went live and said, “Hey, give us your feedback. What do you think?” and interestingly enough, out of about 15-20 additional people this went to, two were just hands-down “This is crap, this is not gonna work.”
Joe Fairless: Fire them. Nah, I’m kidding… [laughter]
Shawn Casemore: Well yeah, but [unintelligible [00:20:59].14] they’re senior people, they’ve been around for a while. So the fun thing was leading up to this, everybody in the subgroup I was working with said “Oh, there’s gonna be some barriers, there’s gonna be some problems”, and I said “What will they be?” “Oh, can’t tell you.” Well, it became very clear what they are – some senior people that realistically are just at a point in their career where they don’t wanna change.
Now, the one mindset is, as you suggested, Joe, fire them, get rid of them; they’re not gonna accept change, I don’t have time for this. But on the flipside you’ve gotta realize they’ve got – how many decades of experience here? This may be a matter of “I can invest a little more time with them to convince them”, but also on the flipside, “What am I maybe missing here?” So rather than let my desire say “Hey, screw them, let’s just move forward with this. This isn’t necessary”, I’ve gotta invest a little bit of extra time.
When you go back to “What’s the framework?”, step one is understanding that everybody on a team is an individual; they’ve got their own life experiences, which includes their personal experiences, their own work experience, their own ideas, and everybody wants to share those ideas and experiences. Some people will speak up and slap you upside the head with it, and the next person might not say “Boo!”, but everybody does have that information. So if you wanna create a stronger team and a better business, you need to really understand that everybody’s an individual, and deal with them on an individual basis to get the most out of them, to get these ideas that help them feel like they’re part of something. When you create an environment where that happens, powerful things begin to happen, people begin to feel happy at work, which we all know means they’re actually more productive, they start to share ideas more frequently, which as an entrepreneur we can’t think of everything.
So it really starts as simply as understanding that everybody is an individual, has their own ideas and viewpoints. Some of them might not be valid, because they don’t have all the background that I do or others do, but a lot of people just wanna be heard. If you can listen to them and start to capitalize on some of those ideas, you’ll build a very, very strong team.
Joe Fairless: How do you treat everyone as an individual and hear their ideas, while still scaling a company?
Shawn Casemore: Here’s how we’ve handled it in the past – we put in layers of management. So your team starts to grow and you say “Well, I need a general manager to manage this team” or “I need a supervisor for this group.” And that’s okay, but the problem is when we hire those people, we usually pick the best person. You’ve heard that old saying, you get the top sales person and you make them manager of the sales department, now you’ve got two problems – number one, you’ve lost your best sales person, and number two, that person may not be a good people person.
If you’re gonna put these layers in, you wanna pick leaders who are people-first, who are good with people… Because I can train any skill, I don’t care what it is. It might take me time, but I can train a skill, I can develop somebody’s skills. I can’t make everybody good with people. So when we’re adding these layers, that’s what you wanna consider, that’s step one.
But on the flipside, let’s say you’re not gonna have layers. You’re still small enough that you can scale for a while before you put leaders into place… You need to calendarize some time where you’re only dealing with your people, whether it be contractors or otherwise. This isn’t a stop by a property and just “Hey, how’s it going? What’s new?” If you’re gonna do it that way, schedule time to spend time with people. Make a point and realize it that as a business owner, as an entrepreneur, the people that are in this business are as important if not more so than me, because they’re making it happen. I may be putting the deals together and shaking hands, but they deliver… So I really have to invest some time.
I tell leaders all the time: “Stick it in your calendar every Friday to spend the afternoon or the morning going around and just talking to people.” You might not hit everybody every Friday, but make a point of doing that, and what you’ll find is you’re able to better understand everybody as an individual, therefore when you’re positioning things, ideas, viewpoints, asking questions, you can position it from a perspective that they personally appreciate.
Joe Fairless: Let’s say we have a remote business… A lot of real estate investors have remote team members. Let’s say we follow your advice on scheduling time with our remote team members; we just jumped on the call, they say “Hi”, we say “Hey, how’s it going?”, we do the initial pleasantries… How do I approach that call? What questions do I ask?
Shawn Casemore: Well, step one, don’t have a call. If you look at the technology we’re using today, Joe, Zoom, Skype – there’s all these tools out here today that allow for face-to-face interaction. So preference number one – and you can use mobile for it – I have a face-to-face interaction. Because think about any call you’re ever on; if somebody calls you, what are you typically doing?
Joe Fairless: I’m picking my nose right now while you’re talking.
Shawn Casemore: You write notes, you’re answering e-mails, you’re trying to type quietly so nobody hears… So if you get them face-to-face, you’ve got their attention, even if it’s for a short span, and you get a better feel for where their head’s at; are they really interested in this or not? It goes back to the old saying, body language is the most powerful communication tool we have, and yet in today’s highly technologically driven world we’re missing that piece and we’re wondering, “Why do I have to send 32 e-mails to get the point across?” Well, why didn’t you go see them? That would have saved you a lot of time.
So if you’ve got a remote team – and I have the same in my business today – I schedule time (if they have Skype, or Zoom, or something) where we get face-to-face. Maybe it’s only once a month, maybe it’s once a week, depending on how important that person is to the business and how frequently you can interact. And I can change that. If we start at once a month and that’s not enough, I pull it up to once every two weeks, and I set this [unintelligible [00:26:16].04] with the individual that “Look, I think it’s important that we stay connected. I prefer face-to-face, because it allows for both of us just to have a more meaningful conversation” and if they push back and say “I don’t want that, because I’d rather be at home in my PJ’s right now”, tell them “Just put a better shirt on and let’s go face-to-face. Give me the chance to give it a try first.” Face-to-face is key with those remote people to ensuring that you’re having a valuable dialogue.
Joe Fairless: Okay, alright. We’re seeing them electronically, via Skype or something, or we’re in person. Now what questions do we ask? How do we structure that conversation?
Shawn Casemore: It depends on their role. You start with pleasantries; that might sound so simple and stupid, right? You say “Hey, how’s it going? What’s new?” but the change that I would suggest a lot of entrepreneurs make when they ask that question is to actually pause and wait for an answer… Rather than just “Hey, how are things? Great! Anyways, here’s what I need from you…” – that’s typically how that conversation goes.
So we’ve got in our mind going into this, “Hey, I’m spending 10-15 minutes, maybe 20, just trying to find out what’s going on in this person’s life”, so if they focus heavily on business, I’m gonna go there with them, but I’ll ask them how are things going personally. If they focus heavily on the personal side of things, I’m gonna go “Great! How are things going in your job? What’s going on right now?”
So it’s just that time to have a dialogue, and there doesn’t have to be a fixed agenda. The point is if you’re an effective leader and you’re dealing with people just like you would with a customer, you’re gonna change your approach. Think about this again from a customer standpoint – if you’ve got a customer that’s pounding his or her fist on the table, demanding answers, do you sit back and crack a smile and light up a cigar? Probably not, right? You’ll get them the answers quickly. Same if you have an employee that’s direct like that, I’m gonna respond directly. Or if I’ve got somebody who’s more thought-provoking and they wanna sit back and analyze things, I’m gonna mimic the same, because that’s how I break through that barrier of the fact that “Hey, I’m human just like you. Yeah, I’m your boss, but I appreciate you, I care about your ideas and viewpoints” and that starts to open up people to providing new ideas, being more creative and more supportive to my business.
Theo Hicks: So Shawn’s clip focuses more on how to get more out of your existing team and keeping that team happy. The third and final clip comes from episode 2203, with Rich Fettke. Here’s what he had to say about building a strong team.
Rich Fettke: Back then, when we were going remote, I read a book from the founders of Basecamp, called Remote. So it’s all about how to run a remote company, how to do that and all the benefits of that, and I was just blown away; that really nailed it for me. I was like, “Okay, we’re going 100% remote and this is how we’re going to do it.” So that’s a great resource, is the book Remote. It’s Jason– Jason Fried, I think his name is.
So that was really helpful, but what’s worked really well for us – one, it’s culture first. So we got really, really clear on what our core values are, and we didn’t just come up with that ourselves. We got our whole team on board, we talked it out, we argued about it, we discussed it, we brainstormed it, and we came up with our core values that are so important to us around– I won’t go over all of them, but accountability was a big one. Connection is another big one. We help connect people, we have a connected team, like family. Another one is obviously integrity, I think that’s an important one for any core values. And transparency is a huge one, it’s a core value of ours, of being transparent; being open, speaking up when anyone is not feeling good about something or has a concern or a challenge.
So I would say a huge one is make sure that you are aligned as a company and as a team around those core values and hire to those core values. We just hired a new syndication manager. In the three different interviews we had with him, what came up every interview was I would focus on one core value and say, “So one of our core values is accountability. Tell me about a time when you were held accountable and why that was important and how you had to really pull through? And also, how would you hold someone accountable if they were supposed to do a certain job or accomplish a certain goal, and they didn’t? How would you handle that?” So it really let me see behind the scenes of how he is a leader and a manager. So hiring and firing to core values.
We’ve had people that we found were out of integrity and they broke that integrity, and so that’s a no brainer, and that’s an instant, “Sorry, you’re gone. You broke one of our core values of integrity.” But it could be other things. Breaking the core value of connection, and just being a jerk. You get three strikes. If you’re a jerk three times, then you’re gone. So that’s a big one.
Another one would be having a very clear organizational chart or accountability chart. Knowing who reports to who and how they do that and have everyone have that same chart so everyone knows what their roles are, what their responsibilities are and who to go to when you need something, and who’s the expert in each area. So I think that’s another big one, too.
And I would say on that org chart, don’t just create an org chart for your business today, also create an org chart for your business five years from today. So get all those boxes out. You can look up how to do an accountability chart or an organizational chart online. It’s pretty simple. But you have – who sits in which seat? What do they do? What are their roles? Sometimes maybe you’re a three or four-person company, you might build out your whole organizational chart in five years and have all these positions rather than faces. And then you can maybe, right now, your face goes in all those and you and your partners, your employees. But over time, my goal has been to take myself out of those boxes and put someone in who’s even more talented than I am, so I can oversee the whole thing.
Theo Hicks: Rich’s advice is very timely, but also timeless, because he focuses on how to build and manage a team remotely.
Rich Fettke: So the other thing we do for culture is we do a quarterly state of the company address. Kathy and I do it together. At the end of the quarter, we’re just like, “Hey, everyone, here’s how we did. These were the big goals that we accomplished this last quarter. Here’s how we did financially. Here’s the profit-sharing”, everyone on our team shares in the profits of the company; so the better the company does that better our whole team does. So we share that in the state of the company.
So in that state of the company, that’s when we brought that up. We’re saying, “We’re implementing a new policy. It’s called the three-strike rule. This is the way it works,” and explain it that way. And then on top of that, I’m just thinking about these quarterly meetings – people love face to face human connection. That’s what we’ve learned as a remote company. So every year, we take our whole company on a three-day retreat. We hook everyone up, we treat them to a resort. The last time, we went down to San Diego at this paradise resort, and we do half day of looking at the year, the past, what worked, what didn’t, what have we learned, how did we grow, we acknowledge people for their role and what they did… We also look at what didn’t work, what did we learn, what were the mess-ups. And then the second day, we look at where are we going. We look at the vision, the ten-year vision, the three-year vision, the one-year vision, the goals for the year. And then we have a lot of fun. So we’ll do stand up paddle boarding, kayaking, we’ve gone on ski trips with the whole company.
So there’s something about that magic, getting the whole team together, all 25 people, that everyone falls in love with each other, and it’s really cool. Zoom is good and you can get the face to face, but face to face and really connecting is an awesome thing. So after this whole COVID stuff is over and we can get together and be face to face and hug, we’re really looking forward to that.
Theo Hicks: Thanks for sharing that. So on a similar note, when your company transitioned from office to remote, I’m wondering if there were people who couldn’t necessarily make that transition. They weren’t very good at working from home. Because the reason I’m asking that is — let’s say, I’ve got a company right now and we’re all working in office, and then Coronavirus hits, everyone’s working from home, and I’ve seen just a massive drop in productivity from people because they don’t work as well at home. I’m wondering how should we approach that? Do we fire them? Do we say, “Well, hopefully, we’ll eventually come back to an office and then everything will be fine”? How do you think people should approach that?
Rich Fettke: Awesome question. That’s a big one. I’m really proud of our team. What we focus on that I always have focused on is creating empowered leaders. So each person’s a leader. Rather than having to micromanage or look over their shoulder and say, “What did you do?” and everything, what we do is we have four directors at Real Wealth. So each one has their own division. There’s one in SFR brokerage, there’s one in syndication department, there’s one in Director of Marketing, Director of Finance and Legal… So each of those directors have their own team. So what they do with their team is they meet one on one with each of their team members, and they come up with their big, most important goals each quarter. First to get together as a team and they say, “What are we going to do this year? What are we going to accomplish this year as a team that fits into the company overall goals?” So the directors get together, we come up with the overall goals for the company. “This is our initiatives, this is what we’re going to do this year.” And then each of those directors takes their part of that to their team and say, “Our department, this is what we’re responsible to make happen this year.” And then they work with each of their people and say, “Okay, so what about you?”
We follow the EOS system, the Entrepreneurial Operating System from the book Traction. We’ve been following that for almost four years now; that’s a great one. So that’s one of my highly recommended books, is the book Traction, and the other books that Gino Whitman’s put out. So we use that same type of process. So each person has what they call rocks, putting the rocks in the jar, and it’s one to five of the most important things to focus on during the quarter. So each person has rocks.
So we don’t micromanage. We don’t look over someone’s shoulder and say, “You’ve got to do this, you’ve got to do this.” We just say, “Here’s your rock.” It’s very clear what they need to accomplish and how they need to accomplish it. And then every week, when we have our meetings, we’re looking at that and people are saying, “My first rock is this. I’m on track,” or “My first rock is this. I’m off track.” If it’s off track, then we drop it down, we make it an issue, we talk about it. What support do you need? What help? So that really helps. So people are responsible for the results, not just working their ass off. It’s getting the result is what matters for them. So everyone has a number.
Theo Hicks: Perfect. I interviewed someone before and we talked about a rock, and I told him he should just get a bunch of boulders, and then literally write whatever the goal is on there and then mail it up their employees’ offices. They get up to their office, there’s a big stone just sitting there that they see every day.
Rich Fettke: Yeah, that’s what it visually feels like. It is like that, these are the big three. I really like the big three. More than that, it starts to get a little bit diffused. So I like people to have one to three main rocks, because then they can really focus on, “Okay, this is what I’m responsible for this quarter. This, this and this”, and all the extra minutia, it’s like, “Don’t put a focus on it, don’t get sucked into email or any of that stuff. You focus on what needs to happen.”
Rich Fettke: I think it’s a blend. We do not do all Zoom meeting. It drives me crazy at times; our whole team crazy. It’s like sometimes you just want to focus on someone’s screen and look at the numbers or what we’re doing or the site or the membership portal, whatever it is. So having everyone’s face up there is not necessary. What we do – we just started initiating this – is we do a monthly call. So like I said, we do a meeting every single week, and the different teams have their own meetings. So there’ll be maybe five to eight people on a meeting. It’s a very structured meeting. It’s very clear. And in that, what we do once a month — so three weeks, we just share screens, we don’t look at each other, and once a month, we have an agreement that, “Hey, we’re going to share our screens.” So whoever wants to get dressed up, they can do that and do their hair or do their makeup or whatever they want to do, they can do that. But then we get to get that human connection, the face to face. But I honestly, not for our company, I don’t think it’s necessary to have every call be a face to face Zoom type meeting.
Theo Hicks: And then my other question on the tech side is– and again, this may just be a “This wasn’t an issue for us”, but when you did go to remote and you started to add in technologies, did you ever get to the point where you’re like, “I think we’re using too many different softwares. I think we need to bring it down a little bit and focus on the ones that are the most important.” So maybe walk us through that process, and again, for people who are now working remote, maybe they think about buying all these softwares and maybe doing overkill.
Rich Fettke: Yes, we did go through the overkill. I love tech, I’m an early adopter, I’m always looking at what’s next and what’s coming and what useful thing… So in the beginning, the most important thing that we did was Basecamp. So we use Basecamp as our project management software. It’s awesome. There’s teams in there, you can communicate through teams. So it keeps away from having to use Slack or Skype or all these different things – texting and everyone’s getting pinged and all these different things. So we run our whole company on Basecamp. And Kathy and I run our whole investment portfolio on Basecamp. We have each property in Basecamp as well, because each one can be set up as its own project. It can have photos, it can have all the documents, all the closing documents, HUD, whatever it might be, can go in there. So Basecamp’s great.
And then we also use software called Ninety. It’s just ninety.io is the address for it, and that is a software for running this EOS, the Entrepreneurial Operating System. So it’s the structured meetings, you can put to-do’s in there. You actually open it up when you run your meeting, you start the meeting off and what they’re called is an L10 meeting, a level 10 meeting; at the end of the meeting where everyone rates the meeting, and the goal is to have everyone say that was a 10. Usually, it comes in around 8.5, but 10 would be “That was an amazing meeting. It flowed quickly, we solved a lot of issues and everything.” So anyway, we use Ninety to run those meetings, which has a scorecard built into it. So it’s a dashboard. It shows how we’re doing, with leading indicators about where’s the company going, how many sessions of our investment counselors’ done with our members and investors, where are we on a raise till we transact for a syndication… So we look at that. Then it goes into to-do’s from the last week. So each person goes through and say, “I said I was committed to doing this; I did it. I was going to reach out to this person; done. And then I was gonna finish this report; not done.” And then if they’re not done, we can drop it down into this area of called IDS, which is – identify, discuss and solve. So we have 60 minutes there just to identify what issues are happening – issues can be good or bad – and discuss those issues and go back and forth. Take one issue everyone on the team could share, debate it, give ideas, and then we solve it. So what’s the solution here, and usually, that solution comes with a to-do that gets assigned to someone. Someone would be like, “Okay, we have a solution. I’ll take it on. That’ll be my to-do,” and then you wrap up the meeting. So anyway, ninety.io works awesome for that, for anyone who’s running on the EOS system, which I know a lot of your listeners probably are for their companies.
And then let’s see, we were using something called 15Five, which is a really good software as well. When we went with Ninety to run our meetings and everything, we dropped 15Five; even though there’s too many platforms, but 15Five’s really good. It’s each person on the team fills out a report that takes them 15 minutes a week to fill out what they did, what their big wins are, what their challenges were, any numbers or anything, and it takes five minutes for their supervisor to review it. It was created by Yvon Chouinard, who started Patagonia. He wanted to use it to travel and rock climb and surf and all that, so he came up with this method for holding his employees accountable and know what’s going on in his company, where people would actually physically write it down in the day. It takes 15 minutes to write down what their week was like, and then it would take him only five minutes to review it. So they would send it over to him by fax or whatever back in the day. So he could be on a surfing trip or halfway around the world climbing and know what’s going on in his company. So very similar, 15Five is a great one if you’re not using Ninety. So those are great tools. And then we’ve been using GoToMeeting for years and years. So we usually use GoToMeeting which is just like Zoom, but we also use Zoom as well, for the same purpose.
Theo Hicks: The three clips faetured today are definitely related and build off of each other. We started off with Danny Coleman telling us how to hire the right people, but building a strong team is more than just hiring. So in the second clip with Shawn Casemore he told us how to get more out of our existing team. And then lastly, Rich Fettke gave us tips on how to manage a team when they’re not in our office, we’re not seeing them every single day. So how to build and manage a team remotely.
My call-to-action for everyone listening today is to take action on at least one piece of advice that you learned from these clips. That’ll conclude this episode on the three tips to build a powerhouse commercial real estate investing team.
Thank you for tuning in. As always, have a best ever day, and we’ll talk to you tomorrow.
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