May 28, 2003 -- In Use What You've Got and Other Business Lessons I Learned From My Mom, Barbara Corcoran, founder of the highly successful real estate company The Corcoran Group, tells readers how her mother's unconventional life lessons influenced her life and career. Following is an excerpt.
Chapter 8: If You Want to Be in Two Places at Once, Borrow a Reel-to-Reel
Sixth Month. The Corcoran Group.
The "empty desk" ad produced more people to start, train, and motivate than I had time to start, train, and motivate.
Each morning, I hit the phones at 8:30 sharp to finish setting up my sales appointments for the day. I was ready by 9:45, when my eager new hurdle-jumpers showed up for their sales training.
We spent the first twenty minutes reviewing our customer cards and dividing them into three piles, based on how urgently each customer needed a place to live. The "hot-to-trot" customers formed the "A" pile, the "I'll-buy-it-when-I-find it's were the "B"s, and the "C" rating was reserved for the annoying "I'll-shop-till-I-drop" group. I had each salesperson tear up their "C" customers and toss them in the trash.
For the next forty-five minutes, we called each of our new property listings, asking questions like "When are you moving? Why? When do you need to close?" Then we would rate each seller from least to most motivated and divide them into three piles, labeling them "not negotiable," "will take something less," and "gotta-get-outta-here-fast!"
I worked with my bright-eyed crew until 11:00 A.M., took a minute to tell them how much I appreciated them, and darted out for my showings of the day. Around 6:30, I rushed back to the office to return phone calls and set up my sales appointments for the next morning. Then, as it was the days before cell phones and e-mails, I read through the numerous notes left for me in my "in" box and jotted my responses to the salespeople.
Around 8:00, I locked the door and walked the eleven blocks home to my one-bedroom floor-through on East Sixty-ninth Street. I climbed the stairs to the second floor, turned the double deadbolt lock, took a consoling breath, and opened the door into the only place I had ever lived by myself in my life. I was thankful to be too busy and too exhausted to be lonely.
I knew I couldn't keep up the routine much longer. I knew I needed another me.
Bedtime. The Girls' Room.
"Eddie!" Mom hollered to Dad. "Eddie, they're ready!"
As the household population grew, Mom ran out of time. In order to give herself the needed minutes each night to prepare for the mornings, Mom was (thankfully) forced to give up her position as one of our two rooms' nightly lullaby singers. She had Dad record his favorite songs on a brown reel-to-reel tape deck that Uncle Alan had borrowed from his job at Bell Telephone. Then she set up Dad to alternate nights between the girls' room and the boys' room, singing songs to lull us to sleep. The room that wasn't getting a live performance could instead listen to Dad's Greatest Hits. In so doing, Mom succeeded in putting Dad in two places at once and creating a stand-in for her.
Tonight, Dad was live in the girls' room. He sauntered in with his old wood guitar and sat down on the edge of Ellen's bed. I watched as he carefully removed his pick from between the E, G, and A strings and strummed a single sweet C chord. Denise was the first to blurt out a request: "Sing us the one about 'Heart of my heart,' Dad!"
"And 'Valla-Valla-Vee Was in the Army,'" Ellen quickly added, as she set upright in her bed.
"And what about you, Barbara Ann?" Dad asked. "What will it be tonight?"
I always waited, so I could hear Dad say my name. "My usual," I answered, "'Give My Regards to Hoboken.'"
Dad began to sing in his Perry Como voice. I scrunched the covers up tight against my chin, stretched my toes as far as I could, and fought my heavy eyelids until I heard the very last words of my favorite song.
Give my regard to Hoboken, Down where the breezes blow. In all kinds of weather, You'll find us together, In H-O-B-O-K-E-N, E-N In H-O-B-O-K-E-N!
While Dad crooned in the girls' room and his voice reel-to-reeled in the boys' room, Mom made the next day's lunches in the kitchen.
The day Esther Kaplan arrived for her interview at the old Corcoran-Simone, she wore a two-piece knit dress that was mostly cream and green, with small touches of cranberry. She was a small, elegant woman in her mid-forties and carried a beige handbag with a Bakelite handle and clasp. An executive secretary to a real estate attorney, Esther wanted to make a change in her career.
The first thing Esther did was present her card, which she carefully removed from her purse. I caught a quick glimpse inside. Esther's handbag was a small miracle of organization, a miniature file cabinet disguised as a fashion accessory. She unzipped one of the two interior pockets, extracted the card, handed it to me, zipped the pocket, and snapped the clasp. Before the interview was over, I knew I'd feel safe with my wallet in Esther's purse.
That's what I remembered as I realized I desperately needed someone to help me run the business. And after working side by side with her for the past two years, I knew I could trust Esther with any amount of responsibility, if she would only agree to take it on. So one night I asked her if she could stay an hour late.
"Esther," I began, "I really appreciate your taking the time out of your busy day to meet with me, and I must say that I'm constantly amazed at what a phenomenal salesperson you are. I remember you made your first sale your very first month at Corcoran-Simone, and I think you've made a sale every month since. I frankly don't know how you do it. Esther, you are truly an amazing lady."
"Thank you, Barb," Esther quietly replied. "That's very nice to hear."
"Esther, I'm wondering if you would consider taking on more of a leadership role here at the company," I continued.
Esther raised a suspicious brow. "What leadership role would that be?"
"Why, the most important position there is, vice president of The Corcoran Group," I heralded.
"And what would the vice president of The Corcoran Group do?" she inquired.
"Basically, you would be an extension of me," I explained. "When I'm out showing apartments, you would act with my full authority. And when you were out showing apartments, I would act in your stead. I guess you could say we'd be one, and together we would build the business."
"Well, Barb, I don't know what to say," she answered, obviously flattered and surprised. "Ill have to give this some serious consideration." She hesitated, clutching her purse closer to her chest. "May I ask what the position would pay?"
I hadn't really thought about this minor point, but suddenly I remembered Wimpy from the Popeye cartoons Mom let us watch on Saturday mornings.
"I would gladly pay you Tuesday for one hamburger today," I said with a smile.
Esther straightened in her chair, tilted her head and said, "I'm not quite sure I understand."
I laughed. "Esther, I don't have any money to offer you right now, but his is more important than money. I'm offering you a partnership, and I could pay you in stock. In fact, I'll pay you ten percent of our entire stock in three years if you help me build my business today." With that, I took a yellow legal pad from the shelf and drew three wide columns across the top.
The first I labeled "Year." The second, "# of Salespeople." And the last column I labeled "Commissions." I figured my fourteen salespeople would bring in $250,000 this year, so in the first row, I wrote "1978," "14," and "$250,000." Then as Esther watched with interest, I quickly worked down each column, doubling the number of salespeople and commissions on each year as I went.
"Thirty-two million dollars!" I exclaimed when I completed the last row. The number astonished me. I was amazed at how easy it would be to become rich! I looked up at Esther, circled the impressive sum, and gushed, "Well, what do you think?"
Whether she believed me or not, Esther Kaplan bought in, and deferred some of her salary in the first few years in exchange for her partnership interest. The very next day, while Esther was running the office, I was buzzing about town, hustling for our $32 million.
MOM'S LESSON #8: If you want to be in two places at once, borrow a reel-to-reel.
Lessons Learned About Hiring Good Managers
I realized that in trying to be everything to everybody at my fledgling company, I was only fooling myself.
I was going to have to put my confidence and wallet into someone else's hand and it scared me to death. In my heart, I knew no one else could run The Corcoran Group the way I could, so why, I reasoned, would I let someone try and maybe screw things up?
Deciding to share responsibility and control was the toughest move I ever had to make in building my business. But because of the way Esther was, it was also easy as pie. Right away, I saw a tremendous upside in being able to delegate the things I didn't like to do. I also saw that because Esther enjoyed those things, she might even do them better than I did. Good enough, anyway.
Once I'd decided Esther was the one to help me run things, I still had to convince her that it was a good idea. Why should she upset her own profitable apple cart for what might turn out to be pie in the sky?
So I shared my naïve dream with Esther, a big payday some Tuesday down the road for hamburgers today and every day for a while. When she didn't quite know what to make of that, I found a way of putting it in her own no-nonsense, very organized terms, laid out neatly in boxes, dollars, and cents. Then Esther could at least see that she liked where I was heading.
I made sure that Esther could maintain some of her sales income while helping me build our company. The arrangement enabled her to still meet her financial needs until "Tuesday" arrived. I didn't ask her to run the office full-time until the company's growth made it possible to make up the shortfall from her lost commissions.
We hit $32 million in commissions in fourteen years instead of the projected seven, and 500 salespeople made it happen rather than the 1,792 I'd projected. So, my projection was a bit off, but I knew we would have accomplished it much later if I hadn't taken a leap of faith in hiring, and then promoting, Esther Kaplan.
Who and How to Hire
I've hired a lot of people since Esther Kaplan became the first vice president of The Corcoran Group, and I've learned a few things about how to pick 'em. The first thing to recognize is that while your goal may be to duplicate yourself, reel-to-reel, there's really no one quite like you. You've got to accept an imperfect copy.
What stops great leaders from hiring other people to lead is often their conviction that no one else can do the job as well as they can. And they're right to think that. But, sooner or later, if they're going to build a bigger business, they've still got to hire somebody to help them run things.
Here are my dozen tips for hiring great leaders:
1. A job done 80 percent as well as you could do it is a job done well enough.Forget about perfection; it doesn't exist.
2. The speed of the team is the speed of the boss.The boss sets the pace that everyone follows. If you don't lead by example, watch out.
3. Leaders come in two flavors, expanders and containers.The best leadership teams have a mix of both. Expanders, like me, are naturally inclined to make more and more of something. Containers, like Esther, are naturally inclined to keep everything in order. One without the other always runs into trouble, because after a great idea is birthed, it needs to be nursed.
4. Always choose attitude over experience. Always. People with the right attitude are a pleasure to work with. They are willing to learn, eager to try, and excited to discover something new. If someone likes to do things their way or no way, don't hire them. Bad attitude is bad news.
5. Always choose a woman over a man. (Almost always, anyway.) Women have more to prove than men, and they'll work much harder proving it. They work differently from men, their style is more collaborative, and they know how to read between the lines. Women are pragmatic, much more likely than men to tell the truth, and they're definitely more fun to work with. Besides, choosing a woman puts you on the cutting edge, since women are taking over anyway.
6. Make sure they fit in. A good organization is like a box of crayons. You need different colors of the spectrum, but all the crayons should fit in the box.
7. Make jobs for people, don't squeeze people into jobs. Everyone has something they do best, and a manager's job is to find it and wrap a position around it. Esther Kaplan's purse indicated that she had the organizational flair to run a tight ship. Most of the positions in my company were created around the specific people who hold them. Some examples:
Our Welcome Lady. The beautiful young woman I found sitting behind the counter at my neighborhood florist had a smile I'd walk the extra four blocks to see. She was an anomaly, a smiling New Yorker! I hired her as a walkin', talkin' smile for our business. She warmly welcomes out-of-towners to our city and quickly introduces them to the right salespeople. Ours.
Our Swing Manager. One of our talented salespeople spent half her time between appointments helping and coaching her colleagues, yet refused my offer to become a full-time sales manager. She said she had no interest in being tied down to "the twenty-four-hour-a-day, seven-days-a-week" routine of running an office. (And she was right, our sales managers never really had a peaceful day off.) We crated a new position of "swing manager" around her. She got the flexibility she wanted, and the new position guaranteed our sales managers days off and carefree vacations.
Our Marketing Coach. There's always a day when a great salesperson decides he or she "doesn't want to be in sales anymore." So, when one of our best salespeople and self-promoters made that declaration, I handed him a paintbrush and told him to paint a picture of his dream job. The picture he painted was one of teaching other people how best to market themselves to get more business. He's now our in-house guru on self-promotion and a singular attraction in luring good salespeople from other firms.
8. Make sure people see their gift. It's the manager's job to find the gift and underline it. Just like my mother identified the gifts in her children, a good manager helps people see their potential and reminds them of it regularly.
9. Tell them to make mistakes. Make it part of their job. Failing and growing are the same thing, and a good manager communicates that belief. I've found that sharing my own failures is the surefire way to put failure in the positive light it deserves. It's no good if people are afraid to fail, or afraid to tell you they've failed. That atmosphere leads to a lot of skeletons stashed in closets. It's not fun when they start spilling out — and they always do.
10. Throw them the ball and cut the string. Make sure people understand that they don't need to report each day's progress. But make sure they also understand that you expect to hear from them whenever they get stalled. I've found that the more confidence you express in people, the harder and more creatively they will work to solve a problem. When you tell someone, "You're a bright woman, you'll figure it out," the last thing in the world she wants is to come back and say, "I can't do it."
11. Never step in front of those you hire. The boss's place is in the background, getting behind people and lending them support. Once you promote someone to a position of authority, the worst thing you could do is make a decision for her, or let her subordinates go around her to get to you. All too often a boss will let longtime subordinates make an "end run" around the new manager, completely undermining that person's chance to lead effectively.
12. Become a grandparent to your young leaders, not a nervous parent. Thank them, bless them, pray for them, and spoil them. But don't day-to-day control them. Instead, give them an emotional massage every day, just like the back rubs Nana gave us at bedtime, as she whispered sweetness into our ears.
Six Ways to Motivate
1. Identify someone's hot button, the thing that motivates them. Just asking, "What would make your job a dream come true?" will yield amazingly attainable answers. Individual hot buttons can run the gamut from financial stability to status, authority, creative expression, or just a comfortable desk chair. But everyone has at least one motivational hot button.
Esther was interested in respect and financial security. The position of first vice president gave her the respect she needed. Each time I sought her counsel on important decisions, her pride was enhanced. She was in charge of the company's money and that made her feel financially secure.
Zero in on someone's hot button, and wrap that person's position around it. By understanding their personal goals, they're able to achieve their professional happiness.
2. Let them name their own price. Negotiating a price for your own labor is an unnerving experience for everyone. Even the most confident people will second-guess themselves after agreeing on their compensation. When deciding upon the right compensation for a position, ask the person to structure their own compensation package, and then pay them a little bit more. I've always found that people name a lower price than I would have given if I had suggested their compensation. Also, paying people just a little bit more than they've asked for is the best shortcut I know to long-term love and loyalty.
3. No matter how much a raise is appreciated, it's soon taken for granted.Raises soon become old news. An unexpected bonus, on the other hand, leaves a sweet, satisfying aftertaste long after the money is spent. In fact, a well-placed bonus conditions the receiver to make extra efforts to say thanks and motivates them to work even harder for the next one.
4. Little kindnesses are the sure road to loyalty. Nothing is more corporate or less effective than public displays of the boss's appreciation. Grandstanding only serves the guy on the grandstand, and everybody knows it. Instead, express your appreciation one-on-one and let the recipient share your compliment with everyone else.
5. First, last, and always, share your dream. Show people why and how their role is essential to your dream. By sharing your dream, you speak to people's souls and allow them to be part of it.
6. Remember that gold shines. After you've molded a great new leader, your competitors will try to poach her. So be darn sure you've already made your leader loyal.
Excerpted from Use What You've Got and Other Business Lessons I Learned From My Mom by Barbara Corcoran, copyright © 2003. All rights reserved. No part of this book may be used or reproduced without written permission from Portfolio Publishing.