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Home Insider Blogs Eric Wu's Blog Can the lean startup apply to property management?
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May 13
2009

Can the lean startup apply to property management?

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Posted by: Eric Wu on May 13, 2009 01:00

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Lots of momentum in the valley around Eric Reis' Lean Startup. Though I find his advice particularly valuable to startups, I think there are other applications to the general principles. If you haven't seen it, here is his presentation from the Web 2.0 Conference.
Eric Ries Lean Startup Presentation For Web 2.0 Expo

 

In our industry, the traditional methodology of developing and implementing a new idea or service seems to stifle creativity. At a typical property management group, the risk-profile is perceived to be very high. Further compounding the problem, traditional mediums are viewed as efficient "enough". 

Though, if all companies, large and small, viewed themselves as a lean startup, experimentation, progress, and eventual value-add to the renter and company might be achieved at greater speeds.
 
Two current hot topics are mobile and social media. A common hypothesis is that renters want both (Shadow belief #1). However, traditionally for the a property management group to research, understand, and implement either takes loads of time, resources, and a high degree of dedication. Consider a few of the lessons from a lean startup.
 
1) Deploy new software quickly.
 
Instead of software, this would be marketing ideas, pricing changes, new referral programs, etc. With a wide variety of tools to reach consumers, considering trying rapid deployment to a small userbase, measuring impact, and quickly identifying the negative or positive change. You might discover that a particular property can be marketed well on Facebook, and another one just needs traditional print.
 
2) Split test the small, measure the large. 

I'm not recommending you spend hours a day tracking and measuring leads, but putting some simple processes in place will help you identify which leads are converting from which sources. Though the general goal is to drive the most leads possible, maybe it should be to drive the most qualified leads possible.

3) Reduce total time through the loop.

The general idea is the getting through the feedback loop as quickly as possible. The faster you are at identifying what renters want or how to interact with renters, the more branding and lead generations opportunities you will have.

I think a lean startup is about testing a variety of hypotheses, using feedback and data to identify consumers' needs, and being able to quickly change strategy and iterate again. This may be a bit of a stretch for property management groups and I know I am oversimplifying things, but I think some lessons can be learned and applied. What do you think?


Comments (3)Add Comment
68
written by Eric Brown, May 14, 2009
Hey Eric
You are right on target here with your advice, unfortunately, for whatever reasons, our beloved industry will not move quickly. I am pretty convinced that they could move much quicker than they do, but they don't, which creates a lot of opportunity for those that can and will!
322
written by Eric Wu, May 14, 2009
@ericbrown, I have noticed that there are more companies moving quicker after identifying an opportunity or problem. I think the key is to experiment and measure (in an attempt to be ahead of the problem), and I think Urbane is doing that very well.
1249
written by Jared Parsons, June 04, 2009
The generation gap is closing quickly between our industry's stakeholders. Only recently have we seen personnel in the PMC hierarchy filled with tech savvy decision makers. Our industry has historically bandaged its operational problems with man-hours. The next step for our industry is to adopt software systems that fully address their operational problems. That goes for revenue management, marketing, leasing & rents, accounting, purchasing, etc.
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