Strategic Planning & Finance Process C.A.R. SPF Committee January 2007

Overview- C.A.R.’s Organizational Structure SPF’s Role in Organization SPF Composition Planning/Budgeting Process & Timeline

C.A.R. Organizational Structure

C.A.R. Organization Chart C.A.R R.E.B.S REBT Inc,RE FormsNetSARECREBT,LLC 65% 70% CREPACIMPACCREIEC CREPAC Federal Education Foundation Housing Affordability Fund Scholarship Foundation

Mission Statement The purpose of the California Association of REALTORS® is to serve its membership in developing and promoting programs and services that will enhance the members’ freedom and ability to conduct their individual businesses successfully with integrity and competency, and through collective action, to promote the preservation of real property rights.

Vision Statement The REALTOR® organization will be the pre-eminent source of essential business services and the association of choice for real estate professionals committed to excellence.

SPF Composition And Role

SPF Committee Structure 18 Members –3 groups of 6 appointed to staggered 3-year terms Chaired by C.A.R. Treasurer (2 year position) Two Vice-Chairs Officers Candidates for Officer Positions

SPF Role in Organization Primary Budget Advisory Arm to BOD Meshes Long-Range Strategic Planning with Budget Concerns –Identifies Critical Issues that are relevant to near-term and long-term future with: R.E. industry and practitioners C.A.R. and its membership, and Organized real estate in general Special Budget Allocations

Examples of Current Issues Collision between REALTOR® and non- REALTOR® interests in Internet space. MLS issues Member understanding of today’s more informed and demanding consumer Budget impact of peaking market and membership on C.A.R. & local AORs

SPF Process

SOURCE: California Association of REALTORS® SPF Timeline

Brainstorming Reading, Discussion & Analysis Current Trends New Paradigms New Thinking

Brainstorming: Review Mega-Issues Mega Issue 1: Decreasing reliance on personal service relationships among consumers coupled with skepticism and questioning of the REALTOR® value proposition. Mega Issue 2: Loss of control of the MLS and other related data to non-practitioners Mega Issue 3: Increasing impact on REALTOR® profitability by external and internal forces.

Brainstorming: Review Mega-Issues Mega Issue 4: Increasing adverse impact of housing affordability and availability on homeownership and real estate investment. Mega Issue 5: Increasing need to proactively identify and support candidates and causes at the local level to enhance REALTOR® influence at all levels of government. Mega Issue 6: Increasing need to meet the challenges of the growing diversity of the membership and general public.

Environmental Scan Information Gathering Economy and Market Membership Survey and Forecast Consumers –Buyer/Seller Trends, Technology, Demographics Industry –Brokerage & Technology

Staff Prepares Environmental Scan Econ & Housing Market Outlook Membership Projections Industry Outlook Speakers: Brokers, agents, outside experts Hot Issues Planning Assumptions

California Housing Market Forecast SOURCE: California Association of REALTORS®

Membership Forecast

Dues Revenue As Share of CAR & Subsidiaries Total Revenue

Recommendations for Program Objectives Program Budgets Objectives will be assigned to C.A.R. Programs/Depts. to be further developed by C.A.R. staff Environmental Scan

C.A.R. Program Groups Communications/Marketing Financial Management Governmental Affairs Legal Member Information Operations

C.A.R. Program Development Multiple programs/departments in each group VPs/Managers prepare program objectives and budgets Programs presented to SPF staff for review Zero-based budgeting Specific budget for coming year, with outlines for 3-year direction

Budget Review & Approval Process SPF Committee Summer Budget Meeting –Review and Recommend Executive Committee Special Budget Meeting –Review and Recommend Board of Directors Session –Approval of Budget for Coming Year

SPF Process Informed, Fact-Based Decision Process NOT Opinion-Based Decision Process

Strategic Planning: Beyond Budgeting

Nexus Between Strategic Planning & Budgeting Committees Bring Ideas & Proposals to SPF, or SPF Identifies Key Issue Examples: Budget issues when membership stops growing REALTOR® image in media Relay WINforms in Dues SPF Program & Budget Recommendations Vote by BOD

Ideas into Action Combined Function Forces Concepts & Ideas –To address budgeting realities –To conform to timelines –To determine feasibility and possible returns on investment