As a self-storage owner or investor, you’re facing a number of obstacles: a battered economy, a weak real estate market, increased delinquencies, decreased occupancy, reduced net operating income, and more competition than ever before. Most of this is cyclical, and strength will be regained. In some areas, recovery has already begun.
In the meantime, there’s still a need to set a positive and inviting tone with our customers and facility managers. One of the challenges in dealing with lackluster economic conditions is keeping managers motivated without letting complacency take over. Creating motivation starts with hiring the right manager and setting the right goals, along with having positive leadership and rewarding employees when they go above and beyond the scope of their position.
Hiring a Go-Getter
The easiest type of manager to inspire is one who is motivated intrinsically. Intrinsic motivation is simply that which comes from within a person rather than any outside reward, such as a bonus. Typically, this type of manager is motivated by the satisfaction of completing a job well, rather than a bonus on the amount of units rented or inventory sales.
An intrinsically motivated storage manager will take “ownership” of his facility. For example, you may have a manager who consistently creates and implements new marketing ideas without direct solicitation, keeps the grounds around the facility in impeccable condition, makes the rental office a calm and inviting place for customers, decorates the office for the holidays, always has a bright and positive attitude, and gives the facility a personal touch.
The drive to succeed is not typically something that’s trainable. A person usually has this motivation or doesn’t. During interviews, look for those who have this quality. Often, they will provide letters of recommendation along with references. These should be used to gauge not only the qualifications of a potential candidates, but to find out what kind of manager a person will be overall. Look for people who have been in a position in which intrinsic motivation is expected, such as a former business owner, military personnel or an apartment manager.
Define the Manager’s Goals
One of the easiest ways to motivate a facility manager is to provide goals that are clear, concise and realistic. Nothing will de-motivate a manager faster than looking at a set of goals, whether financial- or customer-oriented, and knowing he has no possible way to attain them. This doesn’t mean you should lower operating standards or allow a manager to talk you out of a goal that’s attainable but difficult; it means you should keep your perspective in the present economy.
Each manager should be given a list of goals and an operating budget, which should be reviewed regularly. Work with your managers as a team and discuss the goals of the facility. Allow them collaborate with you on next year’s budget. Here are some questions you should consider when outlining goals:
- How much occupancy or NOI increase do you expect in 2010?
- What’s your goal for inventory sales?
- What kind of closing percentage for customer leads are you expecting?
- What percentage do you expect to decrease expenses?
- Is your payroll going to increase or decrease?
- How much will your marketing budget increase or decrease?
Allowing managers to participate in goals will give them a sense of responsibility toward attaining them. This works especially well if your bonus structure is tied to these goals on which you have both agreed.
Praise and Reward
The depressed economy not only affects our facilities in terms of income, delinquencies, NOI and other metrics, but also manager performance. Facility managers are very much like bartenders in that they hear customers’ problems, from domestic disputes to foreclosures and layoffs. Mix these issues along with under performing properties, and it can psychologically overwhelm a person quickly.
As an owner or operations manager, your job is to keep morale and motivation high. Even with tight budgets, you should be taking care of managers who do a great job and treat them well. During one of your visits, take your manager to lunch and point out the areas in which he has excelled. Or cover the facility one day and give him a paid day off. Present your manager with a gift card to a local restaurant or store.
Different types of motivation work for different people. Small acknowledgements, monetary or not, will go a long way in keeping your managers spirits high during these difficult times.
Facing the Challenges Ahead
As we move into 2010, motivating managers will continue to be a challenge. If you’re hiring a new manager this year, look for one who is intrinsically motivated will get things done. Work with managers on realistic goals for the coming year, and allow them to be a part of the budgeting process. Lastly, provide the moral support and leadership skills needed to keep your manager’s upbeat, their spirits high and on track for a strong finish this year.
Motivate your managers correctly, and you might be surprised with the long-term success of your facility.
Matthew Van Horn is the vice president of Cutting Edge Self-Storage Management, a full-service management company specializing in self-storage management, feasibility studies, consulting and joint ventures. For more information, call 866.970.EDGE; visit www.cuttingedgeselfstorage.com. Follow the company on Twitter at Cuttingedgemgt.