Market View: The Leadership Challenge, 2012 and Beyond
- Dec 15, 2011
When the path is not clear, the job of a leader grows tougher. It is relatively easier to lead in good times, when revenue streams are robust and the problem is finding the human and financial capital to capture a growing share of the avail- able business at a profitable margin. In a volatile market, the leader must forecast the likely direction of the cycle and be flexible enough to move with the ebb and flow of the marketplace. This creates its own set of challenges, as companies move from growth to contraction and back to growth again.
Today, the challenge is compounded by the fact that we have been in a recession for at least three years—with little sign of relief. Never has it been so difficult to maintain a presence in the market and to prepare to act when an opportunity appears.
I believe a leader has three key responsibilities in the current environment: vision, ethics and execution.
Vision: In these difficult times, you can become discouraged and lose your way. The mission of a company can become blurred, creating confusion among the team members. A leader must articulate a clear, concise and constant vision. More important, the vision must be presented in such a manner as to be owned by every member of the team. Peter Drucker’s assertion that “the only definition of a leader is someone who has followers” is truer today than ever. Every person working for a company must understand and believe in the company mission and the leader’s vision.
Ethics: A leader’s responsibility to company stakeholders cannot take precedence over obligations to the client. Most real estate transactions use a majority of other peoples’ money. The primary responsibility to protect that capital is paramount over all other considerations. Deals cannot be done simply to earn a fee. Transactions must have the needs of the owners/investors as the motivating factor.
Execution: Today’s leaders must also keep the team together, working as a cohesive unit prepared to tackle the first opportunity they encounter. A leader cannot change the economy that exists and cannot lower the standards of client satisfaction. Therefore, the leader must have their team prepared to act when opportunity arises. The decision-making process must be clear, the roles of each team member defined and understood, the metrics used to evaluate decisions studied and then applied constantly.
One person cannot implement the vision of a company. The leader must communicate, make people aware of the vision and create an atmosphere of energy around the organization. A leader must define the future—not be stuck in past traditions. Finally, a leader will succeed when everyone in the organization understands the company’s mission, the vision of its leaders, their definition of success and the steps necessary to achieve it.
The risks inherent in leadership are magnified by today’s social and regulatory environment. Leadership styles must be updated to take into consideration the diverse and sometimes conflicting demands of an ever-widening constituency. The critical role of today’s leader is to shape the image and future of an organization so it harmoniously meets the needs of regulators and society, as well as those of clients and stakeholders.
Richard A. Hanson, CRE, is CEO of the Real Estate Research Corp. and a former chair of The Counselors of Real Estate professional association (2008).