When J.J. Barnicke Ltd. was sold to global real estate conglomerate DTZ Holdings PLC, the deal was hailed as a lifesaver for the Canadian commercial brokerage.
After years of struggling to compete with such global giants as Colliers International and CB Richard Ellis, the $26.6-million DTZ deal promised a stronger international network and deeper ties among its agents across the country. Indeed, just before the deal was sealed in 2007, J.J. Barnicke – which was just two years from its 50th anniversary – lost two significant international relationships because of its lack of reach beyond Canada's borders.
The deal couldn't have come at a worse time, however. The recession was about to corrode both the number of deals and the amount of money spent on real estate services in Canada, and the distraction of becoming a public company proved a challenge.
Now, the Canadian arm of DTZ is looking for its third chief executive officer since the merger and vowing to get back on track. Chairman Tom McCarthy has been tasked with revitalizing the company as the economy shows signs of recovery.
Where does your CEO search stand?
We are in the market for a high-profile individual. The outgoing CEO, Alan Colquhoun, came from our European division in Poland, and he was here to integrate our organization into the global network. Now that the company is to be back in Canadian management's hands it's very important for us to get back to the core business that we are in – the transaction business. I hope we can get someone in fairly short order to take care of the administrative stuff. For now I'm here to get the ball moving after a difficult and brutal recession.
How were you affected by the recession?
The perfect storm hit us. We were converting from a private company to a public company and there were many changes associated with that. It wasn't always popular with the people we have here. So we did have some attrition. We lost some of our good people. And we lost marginal people who weren't succeeding. My own personal philosophy, however, is I'd rather see a leaner, meaner organization than a lot of people who aren't productive. We now have 300 agents across Canada.
What sort of changes did the merger bring?
In a public company there is so much more reporting. They bring in HR people. The entire transparency of a public company is so vastly different than when the company was private, when it was basically our own rules as management. It's a very different culture to work for.
How did that affect the day-to-day operations of the company?
When the public company thing took place the integration made us lose the connection that is the heart and soul of our business – transactions and relationships. We got away from the basics, where the client is the king. This business is not about filling forms in – we never did any of that before.
We worked hard every day, all day looking for new opportunities. Without criticizing my own people I can tell you the transition from a private company to public got our focus switched to other areas.
What do you do differently to keep people around now?
We need to nurture and provide support as the economy moves into expansion. Consider most of our clients are corporations and most of our revenues come from commissions or fees. So most of the people that we deal with in our company are in their minds independent contractors who are commission-driven. It's a challenge to manage them because they are eat-what-you-kill people. They see themselves as hunters, not skinners. It's difficult to tell someone who is in the commission business – so they are self-funding – to tell them what to do. You can just support them and lead by example.
