Would you want the company that built your marketing website to handle your accounting?
It might sound ridiculous, but it's not far from the current view of software vendors held by many in the apartment industry. Accounting software providers provide marketing websites, payment processing, email marketing and more. Online advertising sites (ILSs) provide blog content, social media tools and online reputation monitoring. The list goes on.
We expect our vendors to provide solutions to help us grow our apartment businesses.
Yet I think we ask too much of industry software vendors. And ultimately, it's our own apartment businesses that suffer because of it.
I once had a client tell me they couldn't consider best-of-breed solutions to manage their digital marketing. Staff turnover was high, so adding more tools to the training regimen would cost too much. Rather than going with the best email marketing tool available, they went with the inferior solution offered by their property management software. Why? Because they had convinced themselves that the one-stop shop was the way to go. (They've since changed their stance, and they now have an award-winning marketing team regularly looking for tools to help them do their jobs better.)
The notion of the one-stop solution is exactly the issue that keeps people from seeking better options. We've put too much on our onsite people, and we've trained ourselves that, when staff turnover is high, it's too hard to train people on multiple software systems. The one-stop solution is a "better fit" and there really isn't another option.
Building a Successful Platform
Now take a look at Saleforce.com. Or Apple's iOS. Or WordPress. Or MailChimp.
All have built incredibly successful businesses by not trying to do it all.
Instead, they've each focused on building a robust, flexible platform as the base for their core function (CRM, mobile computing, website management, and email marketing, respectively). But instead of bolting on anything that resembles a potential customer solution, all of these platforms have opened themselves up to other developers -- companies that are often much, much better at a given area of expertise. Instead of building everything in-house, they have vast resources available to their customers through apps, extensions, plug-ins and APIs. Want to get more out of your iPhone? Download an app. Need your website to do something specific? Add a plugin.
It's time for an approach like this to take hold in multifamily. We don't need one-stop solutions. We need software vendors perfecting their craft in specific areas, then openly sharing their data (your data, really) with complementary systems to provide you with effective tools to run your business.
Openness Will Take Time
This "open platform" approach won't happen overnight. (Property Solutions is taking the first steps toward a "platform as a service" with Entrata, which could be a good sign that we're heading in the right direction.)
Although it's a proven model in other industries, the open platform has yet to take hold in multifamily. Vendors are just starting to open their data (again, your data), and many of owners and property managers are just starting to look outside the industry for appropriate tools and solutions.
Even just recently, I saw the following comment in a LinkedIn discussion:
"I think the problem is as follows: Though there are many very strong providers providing comprehensive solutions, the market is so vast that users aren't aware of all the options available to them. The users; businesses have changed, too, so that when a small-scale solution might have worked when the company or property was smaller, there is a real need for a one-stop solution at a later stage of development. Platform as a Service (PaaS?) is a great concept, one of which I had not heard before."
Of course, none of us could possibly know about all the options available to us. If we're honest with ourselves, we also know that no vendor can truly provide comprehensive solutions. We need to start asking better questions, looking for the software tools and solution providers that will truly help us take our businesses to the next level -- some cater specifically to the apartment industry, others may not. I wouldn't expect the accounting team to handle my marketing, and I'm not sure you should, either.
The idea of open software systems is long overdue in multifamily. It's happening for small business and many other industries (check out The Small Business Web as an example). Kudos to PSI for taking the first steps toward an open future. Who's next?