Where is your business in the cycle of change?

LeadingRE’s ground-breaking study offers insights to help you navigate an evolving market

The Business Cycle of Change is inevitable in all industries. Companies navigate the five cycles – Disruption, Acceleration, Maturation, Saturation, and Commoditization – at different rates, impacted by internal factors, like leadership alignment, and external factors, like the economy.

We see corporations going through the cycle – companies like IBM and Apple, Blockbuster and Netflix, Yahoo! and Google are some of the most notable examples. The ones that successfully manage decline, stabilize their core and innovate during this process come out on top.

These days, change is a hot topic in real estate. From new technologies to evolving consumer expectations to different business models, the collective industry is mindful of shifts at play in our business. But while change is ever-present, companies navigate the cycle in different ways.

To help its member brokerages understand where they land in the cycle and evaluate how ready they are to embrace disruption, Leading Real Estate Companies of the Word® (LeadingRE) engaged McKee Wallwork + Company, a marketing advisory firm, to conduct a ground-breaking study.

Using proprietary research techniques, McKee Wallwork surveyed LeadingRE members to gauge where real estate industry leaders stood in comparison to economy-wide metrics. Overall results were presented at LeadingRE’s recent Broker Forums, and participating companies received custom reports showing company-specific results.

According to LeadingRE President/CEO Paul Boomsma, “Our organization has always been about leadership. This study empowers our member leaders with individualized insights they can use to ensure internal team alignment and be attuned to unique opportunities and threats, as they transition their firms to embrace the future, based on their position within the cycle.”

LeadingRE’s overall results reflect a more even representation across each phase in the cycle than those of the economy-wide study. It also identified key concerns among participants and examined the dynamics that correlate to business health.

“When we evaluate the factors that are destructive to companies – loss of alignment, loss of focus, loss of nerve and inconsistency – LeadingRE members demonstrate a healthier than average profile, probably due to their market strength and strong leadership,” said Steve McKee, co-founder of McKee Wallwork and author of the LeadingRE study. “The responses are balanced by some shared concerns among the brokers, most commonly relating to profitability and agent recruiting, retention and success.”

Business cycle of change

McKee notes that each phase brings with it challenges and opportunities, offering the following strategies.

Acceleration – If your company is in rapid growth mode:

  • Beware of growing too fast; speed can kill.
  • Recognize that you’re figuring out your brand as you go; adjust as needed.
  • Watch for competitive intrusion.
  • Monitor and address inefficiencies.
  • Remember that momentum beats perfection.

Maturation – Once your company hits its stride:

  • Don’t try to do it all at once; pace yourself.
  • Make hay while the sun shines; it won’t shine forever.
  • Invest in systems and processes, but don’t lose your culture.
  • Build brand equity while you can afford it.
  • Share the rewards with your team.
  • Watch for loss of focus.
  • Begin thinking about succession.

Saturation – When your company has significant market share:

  • Watch your margins.
  • Recognize you can cut your way to survival, but not success.
  • Focus on the denominator of the price/value equation.
  • Beware of becoming internally preoccupied.
  • Watch for loss of nerve; R&D, training, and marketing remain important.
  • Keep your team aligned.
  • Don’t let succession plans get derailed.
  • Begin thinking about business model evolution.

Commoditization – If your products or services are seen as simple commodities among consumers:

  • Honestly confront your situation.
  • Take care of the home fires (at home).
  • Pay attention to your flock (at work).
  • Beware opportunism or knee-jerk reactions.
  • Culture and market relevance may derail your succession plan.
  • Watch for dangerous internal discord.
  • Turn your attention back to the marketplace.
  • Actively pursue a new business model.

Disruption – If you are changing the ways things have always been done:

  • Keep your focus on customer needs; don’t be wedded to a particular business model.
  • Balance bold thinking with practical planning.
  • Be realistic when taking risks.

Throughout the Business Cycle, McKee advises companies to leverage the value of their brands. “Your brand—the sum and substance of what your customers and prospects think and feel about your company—is an asset unlike any other. You might even say that your business doesn’t have a brand, your brand has a business. Business models come and go; navigate the Business Cycle well and your brand can thrive indefinitely.”


To learn more about McKee Wallwork + Company, visit mckeewallwork.com. To learn more about LeadingRE, visit LeadingRE.com.