Production vs Development

I was recently discussing my frustration around our product development with a friend of mine. The problem centered around how we handle always wanting to build more than we have capacity to possibly get done. Tony asked me a simple question that changed the way we develop Homequest. It also directly applies to building our brokerage and to us as individual agents.

Do you know the difference between production and development? my answer was I think so…um yeh…um no whats that. I felt a little stupid because I have been in direct charge of Homequest Development for years and this sounds like a simple question. It is a simple question and the answer is simple and the implications are huge.

production is where there are no unknowns. for example we sell custom headers for our agent IDX sites. they are $500-1,200, we have a set process for meeting with the client, evaluating their needs, generating mock up, We know how much time and resources they take and block out capacity each week for header production. This program runs on auto pilot we don’t have to think about it,  just sell and produce. It is clearly in production. It got that way because we designed it from the start to be in “Production” the internal structure was put in place, we tested our assumptions with a pilot, made some adjustments and now it is reliable.

Development is where there are unknowns. for example we are in the process now of developing a virtual tour integrated into our IDX and Looking glass. We also are in the last stages of development of “orange dots” they are about to enter the Pilot phase where we measure the effectiveness and make small adjustments. You can’t sell things that are in development this includes services as well as products. They are inherently unreliable, take more effort than you think, and it is very difficult to meet the clients expectations.

The key is to really understand your business as it relates to production vs. development. Production is where all the money is generated and development is where innovation occurs and future production components are generated. A balance must be found where new revenue is consistently generated from production and development continues to move the company forward.

This obviously applies to a development company like Homequest but it also directly applies to an agents real estate practice. Can you identify the activities and programs that you can classify as production. Those programs that run on auto pilot and consistently generate revenue? are you spending most of your time coming up with new programs that you are going to implement? I see lots of agents planning and devising new programs but not understanding how to package, test, adjust, and move a program into production.

Our team has esablished an internet marketing program that is now fully established into production mode. We have two new programs that are in development that wil be piloted this years and may or may not reach full production depending on how well they work. The key is that the new pilots will not interfere with the current production that generates our revenue.

Work hard to get programs into production quickly then opperate, and make small adjustments. Only then work on larger innovations and new programs.


One Response to “Production vs Development”

  1. Simple steps to Real Estate Success | Garron Sellikens blog on February 22nd, 2010 6:46 pm

    [...] Is is as simple as that. Don’t mistake simple for easy though. Any process that is truly in production mode is simple but that does not mean getting there was [...]

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