Tools, Systems, and Processes

I realized the other day how much I really don’t like working on houses.

Sounds odd coming from someone with a real estate business, doesn’t it?

But I’m not alone. Most of the people that know in this business are the same – they really don’t like doing the work themselves. And for good reason. It’s dirty, sometimes difficult, and always takes time away from other things. Especially family.

But as I was crawling around on the floor removing the old carpet tack strips from the beautiful hardwood floors of my newest rental (at least the Tigers were POUNDING the Yankees) because my college helper had to go back to school, I was thinking about something else. I was thinking back to the time where I thought that I HAD to do everything myself, and that I was “saving money” doing it that way.

So much so, that it took me six months to take my first rental from purchase to rented. SIX MONTHS of evenings and weekends, not to mention nearly an entire Christmas vacation (my wife is a saint). But BOY did I save money doing some of the work myself. Sure, I probably let at least $800 per month in rent times 4 months = $3200 slip through my fingers, but damn it I sure saved money on the rehab.

I got a little smarter with the second one, but I still did too much. So after hobbling around Home Depot for two hours on crutches with my broken leg in a cast buying materials I FINALLY vowed never again!

The challenge then became HOW. How would I extricate myself from any direct involvement in the process but still make sure that everything gets done. How would it all come together, and most importantly, how could I let go?

The answer was much simpler than I ever could have imagined. All it took was establishing and implementing a number of tools, systems and processes, and then getting out of the way.

Tools are items that make work easier to accomplish. In this case they include checklists, contracts, and technology, such as a digital camera and MS Project.

A system is a group of related components that work together to complete a specific project. Like lenders, contractors, inspectors, home depot, and me.

And finally, a process is simply a predetermined sequence of events that leads to a predetermined end. This was the key to everything.

In short, when you put all three together you get something like an outsourced business model, where you have specialists doing ALL of the work that specialists SHOULD be doing.

I tested this methodology first with a small rehab. It worked well but it had a few kinks. I addressed those areas of weakness and then tested it again with a major rehab. It worked flawlessly. Does it cost more to do it this way? You bet. But what did I gain?

How about more time.

Just look at the difference. My first paint and carpet “rehab” took six months, but after implementing this model I put in a total of 12 hours on a $40k top-to-bottom renovation. And then there’s this newest rental, which will be rehabbed and rented within 21 days from the day I bought it.

The beauty of all this is that you let go of the work, but still maintain control.

That’s the power of putting tools, systems, and processes in place.

And that leaves time for you to do the high-value things that you should be doing. Like marketing. Like sales. Like getting more business. Like spending more time with your kids, and spending time on worthwhile volunteer activities.

Instead of crawling around pulling out tack strips.

Try it. It could change your business.

 

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