If you have an opportunity, read Thinking, Fast and Slow, by Nobel Prize winner Daniel Kahneman. As Slate’s Daniel Engber wrote in an October 2011 review of the eminently readable and down-to-earth compendium of Kahneman’s career highlight reel, “A new characterization of how we misjudge the world—and a new catchphrase that we might use to describe it—appears in almost every chapter of the book.”
The reason we’d urge reading Kahneman’s book about how and why our brains tend to play games with all kinds of judgments and decisions—a volume that would be of help to leaders, senior managers, and middle managers in the multifamily community—is this: Thanks to a confluence of economic, financial, and fundamental household forces that at some time during the past 36 months or so have turned tide, the multifamily community has moved out of a shell of defensiveness into a mode of assertiveness. It’s exciting to see demand swell where only a short time before it was a trickle, and the challenge now is to supercharge that demand and price your community offerings, as Riverstone Residential Group central division president Stephanie Brock says, “disproportionately against the operational upside we provide.”
This boils down to recognition of a seldom-acknowledged reality among businesses that regard themselves as serving consumers: At the household level, more and more consumers—of all ages—behave as small entrepreneurial businesses. As such, people simply won’t accept “less than” when it comes to connectedness, self-service, and efficacy in managing a portfolio of everyday, every-month, and every-year issues and activities. They expect the boundaries between making a living and living to be blurred by real-time, high-speed, full-bore bells and whistles.
Property managers must begin to regard each community resident as a business node for whom there’s an investment and a margin of profit on that investment. Technology serves multiple roles here, both as an investment that elevates the perceived value offered to your residents and as the enabler of scalability, consistency, velocity, and measurability across each pool of resources in your enterprise.
What Kahneman’s writings do so well is illustrate the deficiencies in our judgments, the ways our ability to weigh options, look at trends, and choose among tactical pathways becomes swayed by biases, mental shortcuts called heuristics, illusions, fallacies, and effects.
So, even when it comes to the still-provocative notion of implementing a revenue management strategy, we’re prone to react and respond based on reflexes, leaning toward comfort zones—aka, the devil we know—rather than bring counterintuitive analysis to bear on the ¬decision-making process.
Dashboards of all kinds are hot. They allow us to see into all the nooks, crannies, corners, and far-away edges of our operations, pouring out data, metrics, trends, forecasts, and decision sets. For property managers, at either the site level or from an enterprise headquarters perch, dashboards are a way to navigate away from turbulence toward smooth flying.
What these dashboards lack, however, is that particular mechanism that enables us—in your case, as community makers who invest capital into building profitable for-rent neighborhoods, and, in ours, as a linchpin to critical decision-supporting intelligence about what’s coming next—to kick out of our confirmation biases. What we see is all there is.
This is why Multifamily Executive needs to be part of your dashboard. We’re that trusted haranguer who’ll call you out when we think you’re headed for trouble. We all need somebody like that, because our own brains, and even our technology, won’t tell us when we’re fooling ourselves.
