1. Marketing Problem and Solution Matthew Neitzel August 30, 2011

2. Introduction to the Businesses Four different businesses – Program HR 3648 – Trudocs – RealPrompt Real Estate – RealPrompt Realty

3. Balanced Scorecard Evaluation What is a balanced scorecard evaluation? Consists of four perspectives – The financial perspective – The customer perspective – The internal business perspective – The learning and growth perspective Owners keep most of this secret from everyone

4. The Financial Perspective Critical success factors: – Revenue growth through new client sales – Productivity improvement through implementation of solid training platform – Asset Utilization through electronic services

5. The Customer Perspective Critical success factors: – Quality of services through recruiting knowledgeable short sale processors – Reducing processing time through proper training and one-on-one contact with client – Creating value for the client through several training modules and access to short sale software

6. The Internal Business Perspective Critical success factors: – Productivity through quality, knowledgeable, and trainable short sale processors – Research into new technologies to help improve efficiency. – Gathering and delivering quality leads for the clients in order to increase short sale processing

7. The Learning and Growth Perspective Critical success factors: – The employees through quality training – The information systems through having a high priority in researching new technologies – Product innovation through research into new technologies for the clients

8. Controlling Costs Costs include: rent, internet/phone, web servers, marketing servers & applications, processing applications, training portals, fax lines, phone server, fixed & variable payrolls, and database application/maintenance Costs of quality – Prevention costs – Appraisal costs – Internal failure costs – External failure costs

9. Prevention Costs Phone server Training portal Database application/maintenance Short sale processing application

10. Appraisal Costs Phone system Database application/maintenance Short sale processing application

11. External Failure Costs Payroll Database application/maintenance Short sale processing application

12. Environmental Costs Originally had few environmental costs – Printers – Ink cartridges – Paper Paperless process – Saves on wasted paper, ink cartridges, and printer maintenance – Saves processing time

13. Profitability Only two ways to be profitable – Selling distressed homeowner leads 125 of homeowners 30, 60, 90, or 120, days behind on mortgage Clients market to homeowners to do a short sale – Processing short sales One percent referral fee 30 to 35 percent commission to processor

14. Customer Response Time Critical to the success of the company Two avenues to measure efficiency – Time it takes to send leads Send information to lead harvesting company Receive leads Send leads to clients – Tracking time spent on phone More time on phone = quicker the files are processed More time on phone = higher commission checks

15. Marketing The company has only one form of marketing – Buys email lists of real estate professionals – Sends email blasts – Potential clients come to a webinar/watch presentation – Client signs up for leads and/or processing Used since the company first started

16. Problem with One Form of Marketing Greatly affecting – The organization Quick profits made it the only way to market Bills go unpaid Good services are switched for poor services – Extreme employee turnover rate Without experience, owners treat employees poorly When sales decrease employees are laid-off or quit – Clients Clients must get to know new processors constantly Clients must learn new applications

17. Potential Solutions to the Problem Three potential solutions for one method of marketing – Partner with national brokerages Increase short sale business for all companies – Working at or with seminars Advertise at seminars, purchase a booth, host a seminar – Run different types of media advertisements Realtor magazines, real estate websites, direct mail to real estate professional, radio advertisements

18. Payoff Table Least expensive – Partnering with broker Medium expensive – Advertising at bi-monthly seminars Most expensive – Advertising through media State of Nature – low increase to high increase in new clients PRPES Decision Alternatives per year State of Nature ($ in thousands) Decision AlternativeLow # of new clientsHigh # of new clients Partnering71124 Seminars29206 Advertising-53248

19. Expected Value of Decisions Other Methods of Marketing Expected Value Partnering0.4(71)+0.6(124)=102.93 Seminars0.4(29)+0.6(206)=135.25 Advertising0.4(-53)+0.6(248)=127.77 Other Methods of Marketing EVPI EVwPI0.4(71)+0.6(248)=177.45 EVwoPI0.4(29)+0.6(206)=135.25 EVPI177.45-127.77=42.20

20. Decision Tree

21. Conclusion Should pursue other methods of marketing Could increase profits Two other change recommendations – Create a solid business strategy – Focus on employee retention

22. References ASQ. (2010). Basic concepts: Cost of quality (COQ). Retrieved from http://asq.org/learn-about-quality/cost-of- quality/overview/overview.html. Dorkin, J. (2011). The foreclosure process: Understanding how foreclosures work. Retrieved from http://www.biggerpockets.com/foreclosure- process.html. Jackson, S., Sawyers, R., Sweeney, D., & Anderson, D. (2008). Managerial accounting and statistics (custom). Mason, OH: Cengage Learning. John. (2011). What is a short sale? Retrieved from http://shortsaleshelp.org/what-is-a-short-sale/. Lindamood, K. (2011). HR 3648 mortgage forgiveness debt relief act. Retrieved from http://www.ehow.com/facts_4827401_mortgage- forgiveness-debt-relief-act.html.