Majestic Consulting ProfitAbility®
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  Tom Ward, Majestic Consulting's CEO
Real people helping real people improve ProfitAbility
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ProfitAbility® Immersion Mentorship - $1335 per month Specifically designed with Owners and Net Branch Owners in mind, participants in the ProfitAbility®Immersion Mentorship Program will have unlimited access for six months to Tom Ward via phone, e-mail or face-to face meetings to discuss any strategic
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  About MBO
arrow For every challenge in your mortgage business there is a mortgage company where that challenge simply does not exist.
That is where a new organization I created for entrepreneurs, called Mortgage Business Owners, or MBO, comes in. My vision for MBO is simple: Create the first national organization strictly for mortgage entrepreneurs to improve profitability and share new ideas. Being a mortgage entrepreneur myself for over 19 years, I realized there was no system or organization created just for mortgage business owners that provides immediate access to business saving strategies and ideas. Sure, as an owner you are “thrown a bone” every now and then at major conferences. But most of the seminars, training and learning opportunities are aimed at loan officers – not brokers and owners. Worse, you need access to these new, innovative solutions today, not once a year at some conference. And quite frankly, there are a number of issues you struggle with as an owner that you have no one to talk with about.
  But now, every single month, I will share via webcast, the most important breakthroughs I have come up with in working with owners and brokers from around the country. Typically, this monthly call lasts approximately an hour and fifteen minutes. I usually spend the first 45 minutes covering these key breakthroughs and then I open up the call to owners, who share their new operational solutions, recruiting strategies, motivational ideas and other profit making strategies with the group. The call also provides you with the opportunity to raise specific, mission critical problems they are struggling with. This is your chance to tap into the wisdom of the entire group. Some months, you will be the one with the challenges and some months you will have the answer to specific issues another MBO member is having.

Additionally, if you can’t make the calls, it’s not a problem. Every word is captured and saved so that you can download and listen to it when and where you want. You’ll never miss a single month of my insights or the new breakthroughs other brokers and owners on the call share.

The Three Pillars of MBO
arrow I. A financial and operations benchmark study, keeping individual information confidential but sharing the aggregates. This answers the “How do I compare?” question.

arrow II. A large national membership organization with the scope to pursue common business interests.

arrow III. Exploration of best practices for mortgage origination, marketing, operations workflow, commission structures, profit-sharing, expense management and more all vetted from the real, measured profit performance of MBO members.

arrow I. Benchmarking
In addition to the monthly phone call, MBO members also have access to a ground breaking benchmarking study. We know that the mortgage industry is not good at providing benchmarking information to the individual entrepreneurs, the people who originate 60% of all home loans across the country. The one study I found before we embarked on our own benchmarking study is for mega lender/services companies, and that’s simply a different game then the one entrepreneurial mortgage origination companies are playing.

The Majestic Consulting benchmarking study uses data from participating MBO members to provide accurate comparisons of margins, cost of goods sold and operating expenses. You will have common ground to compare your own OTT performance against the highs, lows, averages and medians among companies similar to yours. For example, what is par for per transaction processing costs for a mortgage company producing 200 loans per year?

The benchmarking study utilizes my One Transaction Thinking® (OTT®) methodology. OTT ®converts your P&L to one 8 ½ x 11 sheet of paper and looks at revenue and expenses per transaction by referencing your revenue and expenses against your closed loan volume. This allows you to develop pars for revenue, cost of sales and expenses within your company. While this information is very helpful and can show you what is out of line against your norms on a monthly basis, it doesn’t answer the question “What is par for the game?” As one client put it: “What do I have to compare to?” That is where the benchmarking study comes to the rescue. It shows you how you compare to other companies.

In committing to this course, in January, 2007 I hired Ken Maier, a former Director and analyst at Allstate Insurance Company and a CPA. Ken worked 21 years at Allstate and is now directing our financial benchmarking program. He and his staff can help you convert your current P&L to the One Transaction Thinking® format.


arrow II. The Organization

MBO is organized like the Young President’s Organization (YPO). I was eligible for that membership by achieving certain criteria at Majestic Mortgage, the company I founded and grew into a multi-state lending powerhouse. I was a member of YPO for 11 years until, unfortunately, I was no longer a young president. You get a rocking chair when you leave YPO, a perk that we plan to do without for MBO members!


YPO was an international organization and had about 150 members in the Chicago chapter alone. The most powerful things I learned came from my forum meetings: 15 to 20 of us sharing what challenges we faced and how we overcame them in our businesses.
Forum members were genuine, authentic people. We promised complete confidentiality, put all our cards on the table and helped each other. My forum members helped me become a better business person. MBO has an optional forum component. If you would like a separate session from the monthly calls to meet and discuss issues with your peers, MBO offers you that opportunity.

Two issues are critical here. First, the information you share is completely confidential as are the discussions and information shared among forum members. Second, firms competing in the same geographic markets won’t be in the same forum. This is why my YPO forum was so powerful. With complete confidentiality among non-competing businesses, we shared the most intimate details of our business experiences. The more deeply we shared, the more we each grew. Therefore, we’ll separate competitors at the forum level on geography. The charter MBO members represent 26 states so we have significant geographic diversity.


arrow III. Best Practices

Recently, I was speaking with one of my consulting clients who was generating a point and quarter margin over wholesale. He believed that was a home run. About two hours later, I spoke with another client who was making two points over wholesale yet was discouraged.


The bottom line here is what’s the benchmark for points over wholesale? Just as important, both of these people have best practices to learn from. If the person making the point a quarter is profitable, he must be running a very efficient organization. Similarly, what value equation is the second person delivering in order to achieve a two point margin over wholesale in a competitive market? Combine the benchmarking data and the best practices and you have a powerful equation for ProfitAbility®. As a group, we have a great deal to offer each other.

The benchmarking data we have gathered leads to best practices. By combining the OTT® financial benchmark and operations questionnaires many members have completed, leads us to the best way to handle specific issues, such as:

arrow Is it best to meet your clients face-to-face or by phone?
arrow What is the maximum commission split you should pay?
arrow How many fi les should a processor handle?
arrow Are you paying too much for processing & support staff ?
arrow Do you have a production/production capacity imbalance and should you reduce staff?

I liken this to gaining the power of a franchise. Franchises work in the restaurant business because everything can be duplicated. The franchise system tests, refines and shares what works best. I witnessed this in action recently when I sat in on the Jimmy John’s national convention, where franchise owners share their experiences on what worked best and most profitably for them.

Jimmy John has more than 1,000 sold franchises. At the convention, the owners were sharing detailed practices on efficiency in sandwich preparation, all the way down to how to cut bread, why franchisees shouldn’t buy produce on a Tuesday, and how to compensate delivery drivers. One owner showed a detailed analysis on why a carefully defined, smaller delivery area was more profitable.

The Jimmy John’s franchise owners have obvious commonalities. Entrepreneurs in the mortgage business have commonality as well. Everyone in MBO will benefit from open, honest sharing of ideas and methodologies. The best practices is the real deal because we select the presentations by MBO members based on their profitability. This vetting process enables us to put best practices into context with the P&L. Here’s the P&L before and the P&L afterward. We dollarize the effects of best practices so you can see the impact. Keeping everything in the OTT® format puts everyone on the same page.

MBO is all about real people helping real people improve ProfitAbility® through shared experiences.

arrow What You Will Get

3 Levels of Participation Available:

arrow Level 1 $29 Per Month or $299 Annually
Monthly members call that explores key issues and best practices for mortgage origination, including marketing, operations, commission structures, profit-sharing, expense management and more. A copy of Tom’s book The Empathy Effect and access to all previous members calls.

arrow Level 2 $49 Per Month or $499 Annually
All of level 1 plus participation in monthly forum calls. Forum groups are smaller than 20 members of like-sized companies in non-competing areas.

arrow Level 3 $895 Annually
All of Levels 1 & 2 plus Confidential Financial Benchmarking Report using One Transaction Thinking®, a personal OTT® report on your company, 1 hour consulting call with Tom Ward and Ken Maier.

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