Corporate Solutions at Jones Lang LaSalle (2001)

Agung MahendraHabiburachman

Muhamad Ibnu FauziNurliyasari

Rangga Tri RaerosRia Agustriana Busra

Industry Background

Mid-1990s commercial real estate sector had undergone a significant transformation› Rise in competition, forcing service

providers to compete increasingly on price

Real estate development experienced tremendous growth› In 2001 12,5% of total U.S GDP (JLL one of

the largest player)

Globalization Trends in Commercial Real Estate

The global expansion of many companies in need of real estate service contributed to the demand for integrated, global service providers.

They began to outsource their entire real estate departments to third-party providers› Ensure consistent service, decrease internal

management costs and inefficiencies, and leverage the expertise of professional real estate service firms

Jones Lang LaSalle (JLL)

JLL was the result of a merger of its two formerly independent partnerships-- U.S based LaSalle Partners and London-based Jones Lang Wooton› GOAL: To become world’s leading

commercial real estate management company and the second largest real estate investment management firm. To reach the goal meet with BofA

Preparing for the Bank of America (BofA) Meeting

The bank was growing increasingly frustrated with the lack of coordination among its different real estate providers› Planned to consolidate their business with

other those that willing to “Partner with it to provide forward-looking, integrated services.”

The Challenge

Would the matrix structure work? How should decision-making authority be

shared? What compensation structure would best

motivate the account managers and the business unit managers to work collaboratively?

How would the new function affect career trajectories of promising managers at the firm?

How would the changes affect company morale?

Positioning JLL for the Global Marketplace

The merger failed to reverse the firm’s struggling financials

JLL would become more than a seller of services to its global clients–-it would become its clients partner and advocate› Provide not only diagnose and selling, but

also offer solutions to their real estate needs› Give Win-Win solution, save clients money

and increase its own profitablitiy

But the strategy was hard to implemented, because they are outsourcing, its hard to collaborate them

Also the communication within business units is poor, the service offerings just remained as a concept

Re-Organizing around the Customer

Restructurization for stimulate collaboration among business units

Getting the three business units to work together as a single group.› Differentiate by the service, solution and

service› To reaffirm our client focus and solution

orientation

Creating Corporate Account Manager Position

Work as coordinator of the business units activities

As advisors, assist with long-term planning and be focused on achieving clients objectives and providing strategic insight in addition to fulfilling transaction

The Account manager would create teams composed of members of multiple business units to work on offerings for particular accounts

Structuring the Account Management Function

Account manager able to prioritized the tradeoffs, including promoting services less profitable to one business unit in the name of increasing highly profitable services of other units

Looking to the Future

If Account Manager formalized, must train down into the organization so the lower-level manager could cross-train in each business units

Building working knowledge› Review each unit’s product offerings› Presented case studies to improve understanding of the unit’s

work› Highlighted statistical details to aid the other units in

understanding of the fundamental drivers of that unit› Make standard service & price for all region

Hoped could raise the awareness of each group’s diverse product and service offerings, business units more comfortable cross-selling the service to other units

Building a Culture of Collaboration

Encourage other units to work with Account Manager› Create unified communication and

information platform› Clear job description (Without them this

won’t working) › Employee Gathering