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Destination: Integration

by Guy Lyman

Multifamily owner-operator Prime Group replaces a "Tower of Babel" with an integrated, streamlined software system.

When Deloitte's Chris Anderson was called in to consult on Prime Group's information systems, little did he know he would end up working there—and managing a complete overhaul of what he describes as a "Tower of Babel."

An owner-operator with over 22,000 units at 43 properties in six states, Prime Group was aware their software system had become unwieldy: a patchwork of applications from various vendors that impaired the speed and quality of information coursing through the company.

"Prime Group was wise enough to see that everything from site-level efficiency to top management decision-making were impacted by having a poorly integrated software system," says Anderson, now senior vice president of corporate administration for Prime Group. "I was called in to look at process improvement, specifically regarding how information systems might help managers in their decision-making—but that turned out to be just the tip of the iceberg."

Communication Breakdown

"Prime Group's software system, like many others, had evolved over time, with new applications being bolted on to the existing ones," explains Anderson. "The trouble with this is that you end up with pieces and parts from many different vendors that just don’t talk to each other very well."

"At the management level, there was immense frustration with the lack of visibility into data, the kind of data that help managers both make decisions and monitor the activity in their areas of responsibility. Reports could take weeks. They were in all sorts of different formats. Sometimes the information in one didn't agree with the information in another. And, data access and user rights were hard to control."

"There were just as many problems at the site level," Anderson continues. "You had multiple user interfaces that didn't look or work the same way. Generating reports was cumbersome and time-consuming. And users were more prone to errors due to the complexity of the system."

At every level, providing technical support for multiple systems was inefficient and costly. "It's only logical that when you're running software from a bunch of vendors, the support issues can be more frequent and complex," Anderson says.

Planning for a Big Change

"I was hired to make recommendations, and my first recommendation was to review the various options for a single, integrated system," says Anderson. "So we called the leading vendors in for a dog-and-pony show." Included in the review were Yardi, RealPage, and MRI. "Criteria we were looking at included the user interface; reliability; accuracy and speed of data reporting; streamlined movement of information from the sites to management; experience; and customer service, including support and training." Following a careful evaluation, RealPage was chosen. "We got a clear sense that they were the leaders in terms of having a very well-integrated solution that best satisfied the criteria we had listed," Anderson recalls.

The Importance of Heroes

To successfully implement a change this dramatic, one of Anderson's chief concerns was that he achieve collaboration and buy-in at all levels of the company, from the sites to top management. His solution was to select a "savvy" property unafraid of change from each core region, to groom as "heroes" for the new software system.

Regional and executive management were brought in for a general education about the benefits of an integrated system. And management teams from each of the "hero" sites were flown to Los Angeles to help determine the most efficient way to train for the rollout. They were encouraged to go online to review training materials, and to put forth questions or concerns that could be addressed before training began.

Meanwhile, Prime Group and RealPage worked together to smoothly import the company's historical data into the new system, in a consistent form.

Actual training of the five initial hero sites was carefully planned to take place shortly before the switch-over. "We didn't want to do it too early—we wanted the training to be fresh, so they would hit the ground running," explains Anderson.

As the conversion approached, training began at the sites, with both RealPage and Prime Group staff on hand to address any problems or questions. The training lasted two days.

Going Live

The careful run-up to conversion at the hero sites paid off. "I have seldom seen an implementation of this type go as well, and I have managed an awful lot of them," says Anderson.

"We were very ambitious in how many applications we rolled out immediately," he continues. "We turned on RealPage's leasing and screening, work orders, on-site property management functions, property accounting, purchasing, billing, lead tracking, and document management right up front. Our goal was to have all the modules up and running within one year."

"This was a very rapid schedule for a big change," Anderson says. "We had our first meeting about the need for an integrated system on June 7, 2007, and here we were rolling out all these modules in early 2008. In retrospect, I might be a little more conservative and phase it out over a bit more time if I were to do it again, and ultimately we did decide to slow things down a bit for the company-wide rollout."

Another thing Anderson says he might change if he were to do it all again is to bring in experts in change management. "We had to fulfill the role as change managers while simultaneously handling the actual conversion of products and processes, and that was a challenge," he explains. "Still, as I said, this was a very smooth implementation." As expected, the hero sites became a highly effective tool for both training and energizing the rest of the portfolio when it came time for their own conversions. "It's one thing for management to push a new system down to the field, and another to have your peers at fellow properties acting as enthusiastic boosters for it." The input from the hero sites was instrumental in designing the training for the broader portfolio. And representatives from these properties were even present at meetings with the rest of the properties as they were briefed on the new system.

"Light Years" Ahead

Anderson describes the company as having come a long way from where they were before the conversion.

"Our key goal was to give people streamlined access to the information they need to effectively run the business, and in this area we've come light years from where we were," he explains.

"Getting at important information is not only easier, but takes a fraction of the time it once did. For the first time, managers can log into a web-based system anywhere, anytime and look at up-to-date data from the sites and regions in clearly understandable and consistent formats, rather than waiting weeks for outdated reports that were often hard to glean useful information from. Financial reporting has gone from 21 days to eight days. And purchasing, leasing, and other activity at the sites is now far easier to monitor."

There's been a big change at the properties as well. "You can imagine how much easier it is to use an integrated software system where everything is designed to work together and has the same look and feel, rather than a Rube Goldberg contraption of different pieces and parts," Anderson says. "The result is that the on-site managers have a lot more time for customer service instead of dealing with inefficient software. It's just plain easier to use, whether they're doing work orders, purchase orders, leasing, you name it."

User access control and data security have also been buttoned up—a challenge when the company was using a patchwork system. And support issues are now noticeably lower in number and complexity, with only a single vendor to call if it becomes necessary to go outside the internal support function.

"We're in a competitive business, and those who fear and resist change are destined to fall behind," concludes Anderson. "I think a lot of companies, not just in our industry but many others, have arrived at the same place we were, with an information system bolted together over time as new needs arose, leading to a lot of inefficiency in the long run. The multifamily business is built on wisely managing and acting on data, so being weak in this area isn't an option. We bit the bullet and did what we had to do, and it's turned out to have been a very good decision."

Guy Lyman is a Dallas-based freelance writer who specializes in the multifamily industry.

Prime Group, is one of the nation's most experienced multifamily real estate investors and managers. It is responsible for the property management of its multifamily portfolio which includes Berkshire Income Realty, Inc, an $800 million multifamily REIT and the Berkshire Multifamily Value Fund, L.P. which is expected to be a $1.2 billion multifamily portfolio when fully invested.

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