On Business Darwinism

Hi, Can I List Your Home for Sale?

Hi, Can I List Your Home for Sale?

First of all, let me give a shout-out to Hey Amaretto, aka, Diane Guercio, whose blog I just read for the first time.  She’s got an amazing voice for the web: personable, yet relevant, with useful information mixed in with humor and an overall fun voice.  Really, check her out for one example of how realtor blogging should sound.  (She is also now blogrolled here.)  Here’s a taste:

So, okay, I can’t see how they would have signed an Exclusive Buyer’s Agency contract, let alone a MA Mandatory Agency Disclosure form. And handing out my lockbox codes to buyers doesn’t exactly constitute representation. Just thinking about the things that could happen made me really upset. Suppose the buyers had slipped on the ice, or had fallen down the cellar stairs, or SAID they had fallen down the cellar stairs? I am just getting over the headache that had started after I was handed this little nugget of information.

See what I mean?  Useful info, but with a really nice, personable, human-sounding voice.

Her latest post — which I found out via Twitter (which is, in and of itself, some sort of testament to social media) — is also interesting: Business Darwinism, Success, and Laundry.  Her point appears to be that to survive in a Darwinist environment, one needs to become a “Shortcut” — a superior specimen par excellence that becomes the ‘automatic choice’ for any given task.  And to become a “Shortcut”, one needs plenty of elbow grease:

And that is the point, in summary- by working harder and better than others, you become indispensable. Not much of a surprise that I scored well on the online test, given the rigorous training sessions I had been through with the little cherubs. I guess you want to be the best you can be, in business, in your personal relationships, in life. That’s how you create job security, and really, it’s the only way to go, regardless of the rewards. (Emphasis added.)

Now, here’s the thing: I have a passing interest in the application of Darwinist theories to other subject areas.  Indeed, it’s fascinating what happens when you apply evolution to something like computer programming.  There’s a whole institute, called the Santa Fe Institute, that focuses on things like chaos theory and evolution as applied to areas like economics, physics, chemistry, and so forth.

[By no means do I know more than the tiniest of the tiny bit about any of this stuff.  So it is quite likely that I'm going to sound like an idjit in the next few paragraphs, since a little knowledge is a dangerous thing.  Caveat lector. -- ED: And this would be different from your other posts how?]

Evolution and Effort

But at the heart of evolutionary theory is the notion of competition.  Evolution is not, as popular usage of the phrase has come to mean, a peaceful, gradual change from one state to another.  It is a violent conflict, with winners and losers, and the losers in evolutionary struggle almost always die.

Im Evolving, Dammit!

I'm Evolving, Dammit!

The interesting thing to note, from a theory standpoint, is that the winners and losers are not differentiated by a level of effort.  In other words, there is no suggestion (and no evidence) that species which go extinct did not work at survival.  The dodo bird quite likely worked hard at finding food, reproducing, and so on given its environment.  It just couldn’t adapt fast enough, or adjust quickly enough, when its environment changed dramatically with the arrival of humans — and more importantly, their livestock:

However, when humans first arrived on Mauritius, they also brought with them other animals that had not existed on the island before, including dogs, pigs, cats, rats, and Crab-eating Macaques, which plundered the dodo nests, while humans destroyed the forests where the birds made their homes;[20] currently, the impact these animals – especially the pigs and macaques – had on the dodo population is considered to have been more severe than that of hunting.

Applied to business, then, the lesson frankly is not to work harder but to adapt to changing conditions faster.

If you’re a buggy whip manufacturer, no amount of hard work, no amount of superhuman effort, no amount of being the go-to guy when it comes to horse buggy whips is going to save you from extinction when automobiles replace the horse-drawn carriage.  That is an environmental change, driven by technology: your only choices are to adapt or perish.

Which makes Diane’s observations correct, but only in part.  Working harder and better than others to become indispensable is the key to survival, but only if the hard work and better work is suited to the environment in which they are happening.

Being a mom, frankly, is the wrong analogy here, because no matter how lazy you are, no matter how neglectful you are of your kids, you are still indispensable to them.  Conversely, Diane might be the best mom in the entire world; she could be the “Shortcut”, the go-to mom, for all things momlike.  That does no good for my kids who don’t have Diane as her mom; they’ll have to settle for their own mom (who, incidentally, is pretty kickass too).

Evolution in Real Estate

Which brings us back to real estate, evolution, competition, and Darwinism.  The situation we face today is not simply a “market downturn” — although there is no doubt that the market downturn is part of the environment.  The situation, frankly, is that the environment itself has changed irrevocably, as disruptive technology tends to make happen.

Brokercentric? Agentcentric? Consumercentric?

Brokercentric? Agentcentric? Consumercentric?

I just don’t see how it pays to work your tail off doing the outdated things that worked prior to the Internet era.  You might become the go-to gal when it comes to making property flyers, but when 80% of consumers are finding homes online, does that hard work matter much?

I know this is obvious to most of the folks who are reading this (after all, this is a blog….)  But the challenge the industry faces as a whole is one of evolutionary adaptation.  Given fundamental changes in the environment, does it make sense to keep doing what one has been doing? At the same time, change for change’s sake isn’t necessarily going to lead to success either.  Just because ‘social media’ is the in-thing today doesn’t mean that it makes sense for you or your company to do.  On the other hand, maybe it does.

All depends on your assessment of the environment, and what efforts will lead to success in your environment.  Once you have some idea, then and only then will all that hard work and better work pay off.

A Modest Suggestion

So allow me to make one modest suggestion for the various real estate companies.  I know the trendy thing to do right now is to hire various positions like “Director of Social Media” and “Chief Blogger” and such.  Those things, in and of themselves, are just fine.

But you really need to have a “Chief Evolutionary Officer” whose job is to continually look at the environment and assess whether the strategies you have in place are the right ones right now.  (And yes, that should be the CEO in most cases.  The acronym is fully intentional.)  We are undergoing significant environmental disruption; now is the time to pay very close attention to the environment to ensure that all that hard work is actually accomplishing something.

-rsh

  • http://www.realcentralva.com/ Jim Duncan

    Rob – If you haven’t already, I highly recommend you read Guns, Germs and Steel.

    I feel that many of the larger brokerages are continuing to operate under the belief that their respective sizes and scales entitle them to success. This perceived entitlement puts them in the position of the Boiled Frog , and provides opportunity to those who are more nimble, innovative and open to change (frequently smaller brokerages with less overhead but less cash).

    The competition is going to get more intense, but in the end the profession and consumer will benefit; the two keys are the willingness and ability to listen and then to adapt and implement new things.

    Writing the best ad copy in three sentences or less was a highly marketable skill pre-internet (and it’s frustrating that most MLS’ tend to still have this limitation – presenting opportunity to the competitors).

  • http://www.realcentralva.com Jim Duncan

    Rob – If you haven’t already, I highly recommend you read Guns, Germs and Steel.

    I feel that many of the larger brokerages are continuing to operate under the belief that their respective sizes and scales entitle them to success. This perceived entitlement puts them in the position of the Boiled Frog , and provides opportunity to those who are more nimble, innovative and open to change (frequently smaller brokerages with less overhead but less cash).

    The competition is going to get more intense, but in the end the profession and consumer will benefit; the two keys are the willingness and ability to listen and then to adapt and implement new things.

    Writing the best ad copy in three sentences or less was a highly marketable skill pre-internet (and it’s frustrating that most MLS’ tend to still have this limitation – presenting opportunity to the competitors).

  • http://robhahn.wordpress.com/ -Rob

    Hey Jim!

    Love the boiled frog analogy. :)

    I liked Guns, Germs & Steel, although it really should have been named, “Importance of Wheat on Civilizations” or some such. :) His next book Collapsewas an atrocious piece of crap, though.

    If you’re interested, I think Complexity is a great book about some of these topics.

    -rsh

  • http://robhahn.wordpress.com -Rob

    Hey Jim!

    Love the boiled frog analogy. :)

    I liked Guns, Germs & Steel, although it really should have been named, “Importance of Wheat on Civilizations” or some such. :) His next book Collapsewas an atrocious piece of crap, though.

    If you’re interested, I think Complexity is a great book about some of these topics.

    -rsh

  • http://www.LoudounScene.com/ Danilo Bogdanovic

    It seems as though many of the big brokerage firms and big brokers seem themselves as “moms” and don’t realize that there are competitors rising around them and leading the evolution.

    And the evolution taking place in real estate right now is quite violent as you wrote in your post. It may not be physically violent or even publicly violent, but it is very violent on many behind-the-scene levels nevertheless.

    This post is an excellent segway (or vice versa) into “Barber Poles and Real Estate” by Marc Davison – http://www.1000wattblog.com/2009/01/barber-poles-and-real-estate.html. Being a mom or an “American Icon” does not guarantee you future success. In fact, it breeds ego, complacency…and eventually death.

    New real estate brokerage and business models such as “White Label” brokerage are already here. The fact that big brokers have taken such notice and tried to squash them and put them out of business is the “violent” part of evolution in real estate.

  • http://www.LoudounScene.com Danilo Bogdanovic

    It seems as though many of the big brokerage firms and big brokers seem themselves as “moms” and don’t realize that there are competitors rising around them and leading the evolution.

    And the evolution taking place in real estate right now is quite violent as you wrote in your post. It may not be physically violent or even publicly violent, but it is very violent on many behind-the-scene levels nevertheless.

    This post is an excellent segway (or vice versa) into “Barber Poles and Real Estate” by Marc Davison – http://www.1000wattblog.com/2009/01/barber-poles-and-real-estate.html. Being a mom or an “American Icon” does not guarantee you future success. In fact, it breeds ego, complacency…and eventually death.

    New real estate brokerage and business models such as “White Label” brokerage are already here. The fact that big brokers have taken such notice and tried to squash them and put them out of business is the “violent” part of evolution in real estate.

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