Profitability is the issue for both brokers and agents. When one makes more, the other makes less. Agents negotiate for bigger portions of the commission, yet they want more service from the broker. The broker wants agents to sell more and to recommend in-house ancillary services to consumers.

Are they adversaries or partners in each other's success? Sometimes it's hard to tell from the bitterness they show one another. Is there a better way?

The Keller Williams business plan puts brokers and agents on the same side of the table instead of negotiating against each other, explains Dave Jenks, vice president of research and development and dean of the Keller Williams University.

"Sometimes where people miss the point is they don't take the big view," says Jenks. "They stay in the nuts and bolts. We are excited to give them a big-picture look at what can happen to them in their real estate career. The issue about ownership is wealthbuilding."

He says what prevents wealthbuilding is "Us VS Them" thinking.

"There are lots of complaints. I'm an agent and I think you are keeping too much of the money," explains Jenks. "I can go down the street, and it will cost me half as much to be there because of the commission split. You don't have enough staff. When I need a report or to put something in the MLS, I can't get it done. This software is crap. We need better software. We need better fliers and information in our listing packages. We need a four-color brochure about how we are better. I need someone to help me design my own personal marketing."

He continues, "A lot of traditional shops where owners keep more are starting to bill back, and the agent is saying you are nickel and diming me to death. You're ripping me off for all these bill-backs. Why should I have an individual card for long distance calls? I have customers trying to reach me at night - how come someone isn't here to answer the phone? I have been here seven years - why is my office so dinky? I need more space, and on and on."

Broker/owners have their complaints, too. "Agents don't appreciate what I do," Jenks mimics. "They waste materials. They beat up on the staff. I keep putting supplies of brochures and if I did a trunk check, I'd be able to collect 5000 brochures that are getting warped and wet. What is happening to our lockboxes? We have 200 active listings and 300 lockboxes are unaccounted for? Agents want ads - I need my agents to get more listings."

He says that if agents become owners, then they automatically want to be on the same side of the table as the broker/owner, especially while making decisions about how the brokerages' resources are spent.

"You need to let agents make decisions with you," suggests Jenks. "Brokers come up with a brilliant idea and change things in their office and change is always problematic if agents don't have a say."

Here's how the Keller Williams plan works. Agents are paid as agents, but they have a second revenue stream as recruiters. Agents are paid a percentage of the production of their recruits and their recruits' recruits - up to seven levels. The profits generated by the recruits can help pay agents beyond retirement and to the agents' heirs after death. Any significant decision at a Keller Williams office must be made with a board of directors consisting of the owners and the agent leaders because they are given a stake in the success of the office through recruiting and through ancillary services which they also own part of.

"You have to be in top 20 percent of producers in the company, so that the decision making body is made of the people who do the most in production. That makes a lot of sense," says Jenks

Then you have consensus between the owner and a body of agents, says Jenks. "The two things that I would say are fundamental is that the agent gets to keep more of the money, and if they have to spend money on their business, they get to choose how that money is spent."

He explains, "If you are looking at another model where the brokers keep more, they have agents who expect more to be done for them, and they are justifying to the agent 'That is the reason you want to be with us is because we do more for you. You don't get as much commission, but we reduce your costs.' We've found that the agent would rather spend the money than somebody else spend it for them. They get to promote themselves to a targeted client base instead of the company spending the money. They might spend the money differently, if it were their money to spend."

"They can't go spend the owner's money but the owner's decision needs to come by them when changes are made," suggests Jenks, "then it is the leaders of the council who bring the idea back to the sales meeting. 'Here's what we decided and why.' It is a good business decision-making system. It goes back to the original hook. It moves the agent more on the same side of the desk as the broker/owner and gives them a chance to understand why things are being run the way they are being run."

Jenks report that profit-sharing was way up this year. "Through October, last year, profit-sharing was $6.3 million," says Jenks, "and this year, it was $11.5 million, and it is on track to more than double in one year. Owner profits, and that is net profits (all losses against all gains) last year was $3.4 million. This year, it was $12.8 million. We have 284 offices. That's about $50,000 profit per office, but that figure includes all offices, including 70 offices that just opened this year that aren't profitable yet. Subtracting those losses, it is a net total."

He says, "The trend that is important is the increase from $3.4 to $12.8 million in losses against gains. The average office total profit was $101,000. The top 25 office made $380,000. If owner profits have gone up that much in one year, that means that more and more, our model is working for people."

So what are some ways brokers can get agents on the same side of the table?

"I call it the battle for company dollar and bottom line," says Jenks. "From an owner's point of view, that is what it is. You are battling how much can you justify having your agents pay you as a percent that you get to keep as company dollar and take the best to the bottom line. The struggle for most owners is the difficulty in getting agents to cooperate with them."

A big issue is who pays for consumables. Keller Williams solves the problem with transaction coordinators, graphic artists and other professionals whose job it is to take the contract to closing. But how do you handle the people who waste resources?

"This is a bill-back-for-service model," says Jenks. "The best offices are trying to run a similar model and we create an office environment where you can do that less expensively."

So how do you get rid of the us VS them attitude? "You have to get your leaders to understand and trust how you keep your books," suggests Jenks. "If they don't know, they can think whatever they want, they see the broker's success. If you are wiling to open your books and let them take a part in the finances of the company. the best producers will be the opinion leaders, and second you have to give them a reason to care. It is a relationship-based business. Owners who are respected and loved and trusted by agents have built an environment where agents aren't working against them. It helps to give them a tangible financial reason to care about profitability of office. That is where sharing of profits gives that tangible evidence."

Advises Jenks, "Another way is to teach them to run their practice like a business. As an owner, if you will step up and say, 'My goal is to help you build your practice and I'll teach you how to do it.' Then take them as far as you can."