The 7 Wastes in Real Estate Businesses, with Stephen Wilkinson
Special guest, Stephen Wilkinson, from Rapid Lean Coach joins the show to discuss the 7 Wastes in Real Estate Businesses. Below is his take on the subject where he significantly expands on the subject.
7 Deadly Wastes in Real Estate Businesses – By Stephen Wilkinson, Rapid Lean Coach
When I say “waste,” I’m referring to Toyota’s “7 Deadly Wastes.” Even real estate businesses have examples of the “7 Deadly Wastes.” Eliminating waste from your business could be just what you need to refine your business strategy, improve customer service, and improve profitability. You may be surprised just how obvious and common these wastes are in a real estate business.
So, to start, what is “Waste?” We explain it this way. Waste is any resources we use like money, time, space, or equipment that doesn’t add value in the eyes of the customer. The customer could be someone who buys our services or our products. We only add value when we directly convert raw materials or leads into products or sales. Everything else is Waste. Shockingly, as much as 70% of the time spent by employees could be considered waste. They may be busy doing something, but it’s not adding value. Let’s briefly mention just a couple of examples of each of these wastes.
These are delays in the flow of our work or processes.
1. Waiting Examples:
- Waiting for the next listing – go out and get the next one yourself!
- Waiting for phone calls to be returned from vendors, buyers, tenants, landlords, suppliers, and management. How can you speed that up? Perhaps always ask for specific dates or times to complete actions.
- We wait for managers to make decisions.
- We wait for staff or inspectors to complete tasks or arrive and appointments.
This is moving documents or equipment from place to place unnecessarily.
- Excessive movement of documents.
- Use of couriers when electronic messaging will do.
- Office layout (location of photocopiers, faxes, and printers).
3. INAPPROPRIATE PROCESSING
This is doing more than what is required to complete a task.
Inappropriate Processing Examples:
- Wrong machine for the job (e.g. photocopier).
- Accountant doing data entry versus bookkeeper.
- Matching skills to task (e.g. listing, selling, and administering contracts).
- Manual processes for something that can be automated.
4. UNNECESSARY INVENTORY
Inventory is a real estate business may be listings or properties under management and time spent on each of these may be unnecessary.
Unnecessary Inventory Examples:
- Too much office supplies on hand than will be used this month.
- Taking in more leads than you have staff to process.
- Settlement days.
- Unnecessary office equipment.
- Unnecessary information retained in the office.
5. UNNECESSARY MOTION
This is where staff have to search for documents, equipment, colleagues, or travel that doesn’t have value.
Unnecessary Motion Examples:
- Traveling to meet vendors, buyers, tenants, and landlords.
- Inefficient office layout may cause excess walking around things like printers or copiers.
- Travel to and from properties or looking around for people or documents.
Defects are any time a process has to be repeated or an error was made. We should ask why these errors happen.
- Errors in advertisements or marketing material.
- Errors in computer input or contracts.
- Missing deadlines – ask why was it missed?
- Miscommunicated information (including phone messages).
- Human errors – septic or well inspector didn’t show up on time because of a scheduling error.
Overproduction exists when we make or produce more than what is needed, just in case.
- Generating a long list of weak or unqualified leads.
- Advertising that does not suit the target market.
- Too many open houses where prospects don’t show up.
To finish up, consider these 3 steps:
- Understand what the 7 Wastes are.
- Learn the Lean tools to identify them in your business
- Learn the Lean tools so you can eliminate the 7 Wastes.
For help in improving your organization, you can email me, Steve Wilkinson at: RapidLeanCoach@gmail.com.
For More Information
To learn more about Stephen Wilkinson, Rapid Lean, and the services he provides, visit: www.RapidLeanCoach.com.