Is it possible? Could your firm lose more than 90 percent of its market value in ten years?  Could it actually increase by a factor of nine or more?

No firm plans to lose the majority of its market value but many do . . . why?  In many cases it is companies that are run by smart people who make a few bad decisions.

For example, it wasn’t too long ago that BlackBerry was considered the coolest technology company in the world. In fact, people were so addicted to their BlackBerries that they were called “Crackberries.”

In 2007, BlackBerry and Apple were both roughly $70 billion market value businesses. Then Apple launched the iPhone. Today, Apple’s value has ballooned to more than $617 billion, while BlackBerry has decreased almost 95 percent to $3.7 billion.

What happened?

When the iPhone first came out, “Blackberry co-CEO Jim Balsillie said, ‘It’s OK—we’ll be fine.’”[1]

“Other [Blackberry] executives outlined why the iPhone wasn’t a threat. ‘It wasn’t secure. It had rapid battery drain and a lousy [digital] keyboard.’”[2]

The company’s C-suite didn’t give much additional thought to Apple’s iPhone for months.

But…the iPhone sold more than one million units in three months.  How? It was more than just a beautiful device with the first viable multi-touch screen interface.

The key to much of Apple’s success Apple’s critical innovations were more strategic decisions rather than technical innovations.

In our practice, we advise leaders in multifamily firms, share best practices and outsource their back office.  We have performed operational assessments and facilitated executive retreats.

Nearly all of our clients want to “grow” and we have found that a consistent pattern emerges for successful growth companies.  Most frameworks present a set of levers that companies can pull: portfolio repositioning, market transformation, geographic expansion, segment domination. However, one important piece of the puzzle is consistently over-looked or positioned as an afterthought. What is this one last lever for growth that is figuratively staring you in the face, and literally sitting right in front of you (or behind, or beside)?

People

There are four things multifamily organizations can learn from Apple as it relates to people to ensure significant success. These are:

• Create An Open Environment – Harness the wisdom of all your stakeholders
• Get the right people in the right seats on the bus
• Foster an environment of communication and debate
• Keep things simple

Create An Open Environment

Apple’s key decision was its unprecedented open mobile operating system, iOS, which enabled third-party developers to easily create apps for the device — effectively harnessing the wisdom of crowds to create a rich user experience. Apple created a platform.

Unlike BlackBerry, Apple had an army of outside developers who had already built consumer apps for its computers and iPods-and were primed to do the same for the iPhone. By the time BlackBerry launched its first app platform in 2009 — a full two years later — iPhone customers had already downloaded one billion apps.

Throughout history, “open systems” have constantly upended “closed systems” by creating superior efficiency, quality, transparency and access. Free markets outperform rigged models like socialism.

If you want to grow you multifamily firm you need to develop an open system beginning with, as Jim Collins taught, getting the right people on the bus, the wrong people off the bus and the right people in the right seats.

Get the right people in the right seats

You need to build a team of A players.  ‘It’s too easy, as a team grows, to put up with a few B players, and they then attract a few more B players, and soon you will even have some C players,’ recalled Steve Jobs in his autobiography.  ‘The Macintosh experience taught me that A players like to work only with other A players, which means you can’t indulge B players.”[3]

Foster an Environment of Communication and Debate

From reading Walter Isaacson's 2011 biography of Steve Jobs, we learn that a key, though not well known, driver of innovation at Apple was a weekly executive meeting that involved all of the operational heads of Apple. Despite his reputation as an autocratic leader, Jobs was a fan of open discussion and debate, and encouraged it among his key managers.  Jobs maintained that open discussion and debate were how the best ideas were forged.

“The key venue for freewheeling discourse was the Monday morning executive team gathering, which started at 9 and went for three or four hours. The focus was always on the future: What should each product do next? What new things should be developed? Jobs used the meeting to enforce a sense of shared mission at Apple. This served to centralize control, which made the company seem as tightly integrated as a good Apple product, and prevented the struggles between divisions that plagued decentralized companies. Jobs also used the meetings to enforce focus.”[4]

Keep Things Simple

What set Apple apart from other technology companies and ultimately helped make it the most valuable company in the world was simplicity.  Not merely the shallow simplicity that comes from an uncluttered look and feel and surface of a product, but the deep simplicity that comes from knowing the essence of every product. “It takes a lot of hard work,” Jobs said, “to make something simple, to truly understand the underlying challenges and come up with elegant solutions.” As the headline of Apple’s first marketing brochure proclaimed in 1977, “Simplicity is the ultimate sophistication.”

Get Started

To reach your 2017 or your ten-year goals, remember what Ken Blanchard said 40 years ago, “All of us are smarter than any one of us.”  To succeed in a significant way, we need the right team members in the right environment aligned to a few simple objectives.

Ascent brings experience to help our clients keep things simple and stay focused.

Units Magazine published a story about the rising trend in outsourced accounting for multifamily property owners and management firms. The article noted important trends experts are seeing in outsourced accounting, including:

• Owners are realizing that the capital and time saved by outsourcing the tactical functions in accounting can be spent on more strategic initiatives
• Better utilization of technology, better reporting, better analysis
• Flexibility and avoiding excess payroll
• Financial savings from 30 to 60 percent

In the last six months our firm, Ascent Multifamily Accounting, has started working with clients from Los Angeles, Philadelphia, Dallas, Houston and Colorado.   As the Units Magazine article said, outsourcing is a trend that is going to quadruple in the next few years.

If you would like our white paper entitled “Is Outsourcing Right for You?” please click here for the free download.

If you would like to speak to one of our consultants on how to improve your operations by better utilizing your people, click here to get in touch with us.

Have a great 2017 and may you reach all your goals!

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[1] Wall Street Journal, May 22, 2015, “The Inside Story of How the iPhone Crippled BlackBerry.”

[2] Ibid

[3] Isaacson, Walter. Steve Jobs (biography), Simon & Schuster, 2011.

[4] Ibid.

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