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AAR Gets an “A” for “TM” Partnership

In today’s stressed and transitioning real estate marketplace, the definition of innovation, achievement and partnership seem to be in a constant state of change. It is rare that one organization can be credited with scoring all three designations, especially in its own backyard marketplace.

This story is not about the latest Harry Potter classic or the newest Walt Disney super cinema, although in an era marked by a remarkable lack of forward thinking, it might qualify for fantasy status. This is the story of what has happened over the past few years between the Arizona Association of REALTORS®, their “best in class” statewide transaction management program, and more than 500 of Arizona’s most progressive brokerage firms.

The program, launched early in 2008, hasn’t always been this successful. Industry historians recognized that by 2008, the industry was feeling overwhelmed by the combined impact of the sub-prime crisis, the recession, the mortgage disaster and the overall market collapse that was sweeping the nation.

At the time, many “experts” announced that it was the perfect time not to launch a new service program, especially for a brokerage community that was living with the “crashing” end of the longest boom market in industry history, and that by and large had no idea the amazing impact that transaction management (TM) would ultimately have on their businesses,” said industry technology pioneer and AAR Senior VP of Information Services, Ron LaMee.

“This program was born of a sobering reality and daunting decision,” said LaMee. “As I look back on it today, I realize that there was a great deal of courage involved in getting to the right answer. The responsible players on the leadership, brokerage and staff sides were not exactly the swashbuckling types. But we felt in our hearts that something had to be done. We understood that a new chapter in the industry’s history had begun. We knew that moving forward the end of the boom also meant the end of how business was done. It was clear even then that technology, not personalities, would be the differentiating factor moving forward.

“I do not ever recall in my career having undertaken as much research, study and brain storming as this project entailed,” added LaMee. “It was clear that we would need help and additional expertise and we found it. We listened carefully to those experts. We studied previous efforts and found they had failed because:

  • Adopting ‘wholesale’ pricing models had passed along too much of the costs to brokerages.
  • Sponsoring associations had taken a ‘hands-free’ approach to implementation.
  • Brokerages that had allowed agents to opt out of TM found that TM quickly became an ignored orphan within the brokerage operation.

AAR also scored well with its technology partner, PropertyInfo Corp (PIC), by using PIC’s hearty and dependable SureClose® TM system. Branded AAR TM for the Arizona program, it has proven to have long legs, to be dependable and to be a relatively easily acquired skill sets for both agents and brokerage administrative staff

In the 2011 marketplace, TM players such as eEdge and Pulse have focused their energies on creating high performance, high productivity and high profit brokerage programs. But during those early days of innovation in 2008, what AAR needed and got from first generation player, Sure Close, was a high quality workhorse capable of being stable and forgiving, a system for the long-term backed up by experience with millions of transactions across the national marketplace.

“While PIC has been there every inch of the way,” says LaMee, “great credit must also be given to the strength of our organization at both the leadership and staff levels. We have been fortunate to have tremendous support from our elected leadership. Even when the things got tough they were there for us all the way.”

Recognizing the importance of long-term local support, AAR has made a major staff commitment to this program. Today, a measurable percentage of LaMee’s time, that of Nick Catanesi, AAR’s Director of Business Services, and an implementation staff of four, are engaged in making the program a growing reality for the Arizona marketplace.

At the present time, AAR has signed up more than 500 firms and the adoption rate continues to increase. Currently, new firms are signing up at the rate of three to five per week.

“Despite our current high level of success, we have not forgotten how we got here,” said LaMee.“In the beginning we agonized over adoption rates and were committed to making sure that AAR was directly involved in each implementation. I remember my ‘kick-off’ talk to the team on the first day they were hired.”

“Nobody’s done this before, so we start from scratch. We do it our way, which is the way that fits our brokers and agents. We’ll never know when we’ve perfected it, because we’ll never stop trying new things.”

Today in the Arizona marketplace, that attitude and spirit continue. In preparing for this article, 13 brokers from large, medium and small brokerages were interviewed. The level of enthusiasm for the program was amazing. Sure, there were some negative comments, most of which came from individuals who still long for the return of the MLS book. But even more amazing was the level of support both brokers and agents expressed towards their association and the fact that its innovative and creative thinking was positively impacting their ability to compete in today’s remarkably new real estate marketplace.

In 2011, Transaction Management is now a proven commodity whose impact is reaching far past “paperless” and into the world of competitive management. Over the next year, thousands of firms from Arizona and across the country will grow to understand why TM will become their most important tool. Our industry has already is in the midst of its most significant operational transition since the computerization of the MLS. Among the many lessons we have learned are the following five stages of TM acquisition:

  • Stage One: The brokerage accepts the fact that an automated TM system could possibly have some benefit so long as it didn’t unduly upset the agent panel, add to the agent workload and as long as it was reasonably compatible with the firm’s existing technologies.
  • Stage Two: The brokerage uses the TM system as an alternative “paperless” document storage system.
  • Stage Three: The brokerage begins to use the TM system to effect entry-level risk management techniques incorporating basic standards of practice for both internal and external service provider functions.
  • Stage Four: The brokerage recognizes the importance of using the TM system to meet the expectations and demands of the contemporary consumer and it becomes the foundation of its consumer experience and standards of practice program.
  • Stage Five: Finally, there is the grand discovery. If everything above works flawlessly, the brokerage discovers it can use its TM systems to improve overall management, productivity and profitability.

The industry owes a debt of gratitude to Ron, Nick, PIC, and the Leaders of the Arizona Association of REALTORS®. Thanks for demonstrating once again that REALTOR® associations can be part of their member’s business solutions. We have a long way to go over the next few years to meet consumer expectations and the challenge of new competitors, but the widespread adoption of TM programs means that we will ultimately get there.

We can do this.

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