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Shopping Centers Today -> August 2004
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BACK TO SCHOOL
Developers’ education programs keep staff attuned to changing industry
BY DEBRA HAZEL
It
is said that education never really ends. And some leading development and management
firms in the ever-changing shopping center business are determined to keep it
that way.
Continuing education has become increasingly important with the growth of the industry, and companies are using a combination of in-house training, business school programs and ICSC courses to keep their professionals up-to-date on information, technology and techniques.
“The bottom line is that there is nothing more important to us than continuing to develop our people,” said John L. Bucksbaum, SCSM, the CEO of General Growth Properties, which calls its own wide-ranging education program The Learning Mall.
The retail real estate world is more sophisticated than ever, and executives need to keep up, agrees John Rulli, COO of the operating properties of Simon Property Group, which operates a program called Simon University. Indeed, the industry has come a long way from its infancy 40 years ago, and now that some of the companies are either in the Fortune 500 or close to that, it is essential to run Simon like a world-class business, he says. “The education of our people has been very important,” said Rulli, not just for today’s executives, but also for future ones. Simon has about 2,600 full-time employees.
Other firms, too, have created in-house “universities” to educate their workers on subjects ranging from management and leasing to the use of proprietary technology. The instructors include both in-house staff people and outside consultants.
General Growth’s Learning Mall has grown fast since its founding at the headquarters in 1998. The firm, which employs about 4,000, reports nearly 21,000 requests for training in 2003, up from 12,000 the previous year. The $1.5 million facility offers about 200 courses, some Web-based, some instructor-taught, some self-study. Among the course titles: “Creating Center Value” (marketing), “Local Leasing for General Managers,” “Analyzing the Income Statement and Balance Sheet” and “Emerging Managers” (leadership).
Some of General Growth’s courses are free; others charge a fee, paid by the individual’s department.
All new hires go through an orientation that includes an introduction to the Learning Mall and a history of the company, says Judy Herbst, General Growth’s senior vice president of human capital.
The firm’s professional training programs cover four main disciplines: leasing, operations, marketing, and finance and accounting. Systems training acquaints employees with standard and custom software applications.
“We encourage every employee to be the CEO of their career,” Herbst said. Managers are kept apprised of their subordinates’ progress.
The school enables executives to acquire skills outside their core disciplines, says Marty Ehrhardt, the Learning Mall’s director. A marketing director wanting to learn more about leasing or finance, for instance, can take a course on those topics.
Simon University offers management skills, technology tools, technical skills and other training programs. Classes are organized much as they are in a college, with 101, 201 and 301 designations, and certificates are given out upon completion. The firm is working on establishing distinct “majors” within the program by year-end, says Rulli. “We’re trying to create a business professional,” Rulli said, adding that customizing the programs internally allows the firm to teach the “Simon” way of doing things.
The subjects at Macerich’s Make It Happen University (from the firm’s slogan, “We make good things happen”) focus on the nuts and bolts of running a shopping center, says Genene Kruger, senior vice president of human resources. These include “Around Our World with the COO,” “Merchants First: Creative Retail Management” and “The Roadmap to a Deal from a Retailer’s Perspective.”
“We were smaller and have gone through a great growth period,” Kruger said. “There is an increasing focus and understanding of the importance of employee development.” Senior Macerich executives teach most of the classes, but outside consultants are brought in as needed.
CBL & Associates Properties’ training modules include such subjects as cost control and revenue generation, and they encapsulate “CBL principles, concepts and ideas,” says Thomas W. Guerra, SCSM, director of operations.
“This is better for the retailer and better for us,” Guerra said. “It benefits our company, the retailer and the investors.”
Jones Lang LaSalle, a third-party management firm, has courses on mall management and operations as well as interpersonal skills for client service. The curriculum, which takes nearly three days, is offered twice a year, says Kate Sheehy, senior vice president and director of property management.
Smaller companies, too, have internal training programs, though perhaps not as elaborate as those at the larger firms. Costa Mesa, Calif.-based Donahue Schriber’s three half-day sessions on marketing, health awareness and other topics, which use outside consultants, are an example.
But any company, whatever its size, already possesses an abundance of knowledge in the minds of its experienced employees. It pays to tap that information, executives at several companies say.
“If GGP only knew what GGP knows,” said Bucksbaum. “It’s tapping into the knowledge that exists here. We’re trying to incorporate that throughout the organization.”
Along these lines, Jones Lang LaSalle has opened up lines of communication so that managers and marketing directors from different malls can consult together and explore best practices. CBL has taken similar steps for the same reasons.
Not everything can be taught in-house, however. Some companies have turned to business schools with real estate programs such as those at the Massachusetts Institute of Technology and The University of Pennsylvania’s Wharton School (see box).
“That’s been a hot topic of discussion in the last few months,” Simon’s Rulli said. “The real estate schools have gotten so good.” Examples include Wharton’s undergraduate and graduate real estate programs and the master’s program at MIT’s School of Architecture and Planning.
Nearly all companies offer some form of tuition reimbursement as an employee benefit. Donahue Schriber Chairman Thomas Schriber speaks proudly of an associate who is completing a bachelor’s degree while working a full-time job. The firm reimburses employees for the costs of tuition and books, even for undergraduate work, he says.
At Macerich, employees don’t get undergraduate reimbursement, but the firm sometimes pays for post-graduate studies.
Many firms are keen for employees to take advantage of ICSC’s educational offerings and pursue the CSM, CMD and CLS designations, for management, marketing and leasing, respectively.
“We encourage people to get their credentials, and our senior management team helped create the [ICSC] curriculum,” Schriber said.
CBL is creating a customized manual on shopping center management, based on ICSC’s books, Guerra says.
Nearly all companies and ICSC are increasingly availing themselves of Internet training, which saves on travel and other costs. About 80 percent of General Growth’s classes are available online.
“The first question we ask ourselves is if we can do [a new course] online,” said General Growth’s Ehrhardt.
In April ICSC launched eDistance Learning, a Web-based version of the Management I and II institutes of the John T. Riordan School for Professional Development (see story).
The benefits of continual staff training go far beyond an increase of knowledge, all agree. It increases employee satisfaction — and improves retention. General Growth reports a retention rate of over 90 percent among the roughly 300 employees who have taken the firm’s advanced leadership courses. CBL’s Guerra reckons that replacing a valued staffer can cost as much as $50,000 in lost productivity and head-hunting expenses.
Human-resource investment is prudent, says General Growth’s Bucksbaum. “We have shopping centers, and we have people,” Bucksbaum said. “The way to improve our centers is to improve our people.”
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