How is Property Management Like an Airplane?

No, it’s not the set up to a cheesy joke.

Although, yes, at first, it may seem like these two entities have nothing in common. One flies; one doesn’t. One rents a seat for a few hours; the other has leases lasting months, a year, or more. One serves little individual bags of peanuts or pretzels; the other probably has candy in a little bowl on a desk.

However, the method of maintaining a healthy, well-run airplane does share an interesting correlation to the method of maintaining a healthy, well-run property management company. Nowhere is this more true than when trying to solve problems.

Wald’s Reinforcement Strategy

The best example of this took place during World War II. B-29 bombers were being shot down far too much for America’s liking, and the military decided to reinforce the planes. This reinforcement needed to be selective, however, as with every additional armor plate, the plane’s performance decreased. Plates could only be applied to the most susceptible, vulnerable areas of the plane.

The post-mission bombers examined on base were riddled with holes over the wings and tails, and so the military’s advisors, quite reasonably, recommended reinforcing these areas. Enter Abraham Wald, a brilliant mathematician and statistician.

Wald proposed that, instead of reinforcing the areas that experienced damage, that the military instead apply plates to the undamaged areas of the post-mission bombers. Basically, this was the fuselage and engine area. Wald’s reasoning behind this was that the planes with the wing and tail damaged returned in spite of this damage, whereas bombers with damage to the fuselage crashed, never to return to base at all.

Survivorship and Selection Bias

The post-mission B-29 bombers that the military was examining were survivors, and so, the data set that the advisors were using was incomplete. When we only see the most noticeable or obvious outcomes, not all of the them, we can draw false conclusions, and thus this logical error can encourage us to make poor business decisions.

Another example of this kind of bias shows up every time there’s a winning lottery ticket. Everybody sees and envies the rare winners, but little if any attention is paid to those who routinely lose money. If someone were to only see the winners, and never see the multitudes of losers, then the chance of winning the lottery seems much higher than what it actually is.

Preventing Bias in Property Management

Eliminating bias entirely may be impossible, but it is possible to understand and prevent the effect that bias has on how you see your property management business. Instead of focusing on the obvious—the damaged bombers with holes in their wings—try to see what isn’t there right in front of you.

For example, if you often focus only on the number of residents that are moving out, perhaps look closely at the residents who stay. What keeps them there? Is it price, amenities, environment? And then look to enhance or reinforce those reasons for your residents. Armor the fuselage, so to speak.

The same goes for dead leads (what converts a lead into a resident?) or for maintenance issues (what doesn’t break?) that you come across. Delve into the tools, including report options, available through Residential Management or Commercial Management to find such issues.

The key here is to look at what you don’t typically see. You may uncover an amazing solution.

And finally, in case you were hoping for a cheesy joke, here’s this: So how else is property management like an airplane?

Snakes could bring the whole thing down.