Leadership Styles Contributing to the Success or Failure of a Real Estate Agent

Introduction

It is widely known that leadership can have a profound impact on a company's success or failure. The style and behavior of an organization's leaders is usually reflected in employees' attitudes, as well as their performance. Leadership may have a particularly influential role in determining the success or failure of real estate salespeople, as these professionals must have the power to influence consumers into making a particular purchase decision. Unfortunately, little is known about the particular impact of varying leadership styles on real estate success. Therefore, the purpose of this proposal is to present a research project intended to explore the specific role of leadership in determining the success or failure of a real estate agent. 

Background

The real estate business is a particularly tumultuous one, with the market fluctuating daily (Apgar, 2009). As such, real estate salespeople must be particularly opportunistic and skilled at influencing the purchasing decisions of their clients (Apgar, 2009).  Furthermore, the legal complications associated with many aspects of real estate warrant effective management skills and organizational control (Falkenbach, Lindholm, & Schleich, 2010). The lack of effective influencing power or management can result in significant economic loss, as well as potential legal issues stemming from limited organizational or financial control (Falkenbach, Lindholm, & Schleich, 2010). Therefore, it seems apparent that leadership is a critical determinant of success or failure in the real estate business. Interestingly, the concept of leadership has not been studied extensively in the field of real estate. Although similar fields (e.g., sales management) have studied the impact of varying leadership styles on organizational success, research specifically exploring the role of these styles in the real estate market is somewhat scarce. This is somewhat surprising, as these aforementioned fields have benefitted greatly from the information gained from leadership research. For example, Schwepker and Good (2010) found that leadership in the sales management field can impact everything from employees' moral judgments to a company's financial performance. Additionally, Jaramillo, Grisafee, Chonko and Roberts (2009) found that the leadership styles of managers in fields such as insurance sales and healthcare were highly accurate in predicting consumer purchasing behavior. Therefore, it is clear that leadership warrants further attention in real estate research. 

Research Questions

The proposed research project intends to address the question, "How do leadership styles contribute to the success or failure of a real estate agent?" Specifically, this project intends to explore how various leadership styles contribute to factors such as consumer purchasing behaviors, employees' moral judgments, organizational efficiency, and any additional factors that influence success or failure as a real estate professional. Additionally, this study intends to discover how real estate agents can best improve their leadership skills to increase their chances of professional success. Through addressing these specific research questions, it is hoped that real estate researchers and professionals can have more concrete evidence as to how to best meet client purchasing needs. 

Review of Literature

Although there is a paucity of leadership research in the field of real estate, a number of recent studies have begun to emerge in scholarly journals that pertain to this topic. For example, in a review of the components of successful real estate practice, DeConnick and Brock (2011) found that the ability to influence others was among the most critical components of financial success. According to these authors, real estate professionals who possess effective leadership skills are substantially more likely to achieve their financial goals, as well as enjoy longer careers in the real estate business, than those who did not (DeConnick & Brock, 2011). Additionally, Hsuing (2011) found that real estate professionals who possessed an authentic, relationship-oriented style, were much more likely to experience success than those who were less authentic and more task-oriented. Fiedler's contingency model of leadership, which describes leaders as being either primarily relationship- or task-oriented, has also been used to capture the leadership needs of the real estate business (Daft, 2008). According to Daft (2008), leaders in sales professions such as real estate must possess both a high relationship- and high task-orientation in order to achieve maximum success. Favoring just one style is likely to result in significant oversights in other areas of business (Daft, 2008). For example, a real estate professional who is highly personable, but lacks organizational skills, may find him or herself in legal troubles due to insufficient operational control (Daft, 2008).

Two additional leadership styles that have garnered attention in the real estate profession are transformational leadership and servant leadership (Lee, 2012). Transformational leadership is a style that characterizes individuals who are successful at motivating, influencing, and guiding others through a variety of conventional and non-conventional strategies (Lee, 2012). Leaders who possess this style are generally very outgoing and personable and are skilled at transforming the behavior of others in positive ways (Lee, 2012). According to Lee (2012) transformational leaders are generally more resilient and opportunistic in terms of their management strategies. Due to the inconsistent nature of the real estate market, resilience and the ability to identify new business opportunities represent critical skills for success (Lee, 2012). 

Servant leadership, on the other hand, is a style that has transformed traditional power structures within business (Jaramillo et al., 2009). Perhaps the antithesis to transformational leadership, servant leadership suggests that the primary role of the leader is to serve the needs of subordinates and clients so that they can perform their jobs effectively or make the best consumer decisions (Piccolo, Greenbaum, den Hartog, & Folger, 2010). Instead of viewing leadership as a dynamic and motivational process, servant leadership theory contends that leaders play a more passive role, simply facilitating decision-making of others (Piccolo et al., 2010). In a service-oriented profession such as real estate, it seems apparent that servant leadership may also be a useful theory in which to guide professionals.

Based on the recent influx of leadership studies, it is apparent that the real estate field is beginning to observe the merits of this concept and its value on performance. However, a number of questions still remain unanswered. First, there is no general consensus as to what constituted the most optimal styles of leadership in this particular field. Furthermore, there is a lack of data describing the specific effects different leadership styles have on real estate success or failure. As the study is leadership in real estate is still relatively novel, future research is warranted. 

Purpose

Based on the lack of research described above, the purpose of this study is to explore the most effective leadership styles for determining success or failure in the real estate business. through addressing this question, it is hoped that future real estate professionals can make more evidence-based decisions about their personal leadership styles. Additionally, the information gained from this study is intended to direct future empirical research regarding leadership in real estate. 

Research Method

To explore the role of leadership styles in determining success or failure in the real estate business, this study intends to utilize a qualitative, semi-structured interview format. This method was selected due to the relative novelty of the research topic and the general lack of empirical data describing the efficacy of various leadership styles. According to Sorensen, Mattson and Sundbo (2010), qualitative research is useful in such circumstances, as it is effective in gathering large amounts of information from expert subjects, which can be used to construct theory and instruments needed to obtain more objective data in subsequent studies. 

Adopting this method, a sample of licensed real estate agents will be selected for a 15-minute, semi-structured interview regarding leadership styles in their profession. Interview questions will seek to gather as much information about the role of various leadership styles in determining their professional success as possible. A semi-structured interview format will be utilized because it provides structure and consistency to the interview process, but also allows for the natural conversational flow needed to gain a maximum amount of data. Once the interviews are complete, all transcriptions will be coded based on the existence of similar themes. Finally, these themes will be organized according to their frequency and conceptual consistency. This information will be used to propose a theory of organizational leadership within real estate.  

References

Apgar, M. (2009). What every leader should know about real estate. Harvard Business Review, November, 1-9.

DeConinck, J. B., & Brock, B. A. (2011). The influence of real estate manager's supervisory behavior on the role clarity and job satisfaction of real estate salespeople. Journal of Applied Business Research, 9(3), 119-128.

Falkenbach, H. Lindholm, A.-L. & Schleich, H. (2010). Environmental sustainability: drivers for the real estate investor. Journal of Real Estate Literature, 18(2), 201-223.

Hsiung, H.-H. (2011). Authentic leadership and employee voice behavior: a multi-level psychological process. Journal of Business Ethics, 107(3), 349-361.

Jaramillo, F., Grisaffe, D. B., & Chonko, L. B., Roberts, J. A. (2009). Examining the impact of servant leadership on sales performance. Journal of Personal Selling and Sales Management, 29(3), 257-276.

Piccolo, R. F., Greenbaum, R., den Hartog, D. N., & Folger, R. (2010). The relationship between ethical leadership and core job characteristics. Journal of Organizational Behavior, 31(2- 3), 259-278.

Schwepker, C. H. & Good, D. J. (2010). Transformational leadership and its impact on sales force moral judgment. Journal of Personal Selling and Sales Management, 30(4), 299-318.

Sorensen, F., Mattson, J., & Sundbo, J. (2010). Experimental methods in innovation research. Research Policy, 39(3), 313-322.