The real estate industry is on the verge of a breakthrough that could transform brokers and salespeople from transaction babysitters into high-tech coordinators capable of anytime and anywhere access to streamlined, end-to-end transaction systems.

Sales agents have begun to notice that today's online transaction management systems can boost top-producers' productivity and big brokers have started to see how integrating these systems into their back-office management workflow can cut costs and free agents to concentrate on closing more sales. The industry's attitude toward Web-based transaction management systems has evolved from the mere curiosity that existed when such products were introduced four years ago to a much greater sense of urgency today.

Now it's more like "you have to have it or else," said consultant, author and economist John Tuccillo.

Brokers and agents understand they need to adopt automated transaction systems to keep up with competitors who offer a more efficient, automated and transparent transaction, Tuccillo said.

But despite the heightened interest in automated transaction system, widespread adoption is still far from a fait accompli. GURU Networks President Ike Broaddus estimates that only 1 percent of the real estate market currently is using a Web-based transaction systems. But he also expects adoption to spread rapidly this year.

"We've already seen the adoption rate go up in all our markets," he said.

The first generation of transaction management systems didn't achieve much market penetration because the product quite simply didn't work all that well. Early-to-market vendors burned through millions of dollars and the industry was left unconvinced about the benefits of their wares.

The expensive lessons of the first round of products left the surviving companies with a clear picture of what went wrong. The outcome was that the benefits of using an automated Web-based system were more obvious in the next generation of products.

Every real estate deal requires between 150 and 200 tasks, depending on how the brokerage handles its transaction. Brokers and salespeople want transaction management systems that manage every piece of the transaction from listing to closing, enable everyone involved in the transaction to communicate at any time and seamlessly integrate with other software applications they already are using.

"This is not an industry that has historically adopted technology very quickly. The average meaningful adoption in real estate is three to five years," said Steve Bedikian, a partner of Los Angeles-based RealIQ Consulting, a provider of technology marketing and e-business strategy consulting for the real estate industry.

Venture capital-funded technology companies designed most of the early products on the market. These companies failed in part because investors didn't have the patience to wait for profits while the costly and difficult-to-learn products struggled to gain market acceptance, according to Bedikian.

"The savings weren't obvious in the beginning," Bedikian said.

Brokers thought the systems were overpriced and too complex and time-consuming for the typical real estate agent to master, according to Bedikian. The products tried to do too much and weren't widely adopted because they were "Cadillac solutions in a Kia market," he said.

"The early products were designed from a techie's perspective as to how a real estate transaction logically should work, as opposed to real-world experience," he said.

Another problem was that the original systems were standalone platforms that couldn't interact with title companies' or lenders' software. Brokers and agents found they had to re-key information and vendors faced an uphill battle of trying to convince them that the new systems were better than the traditional methods of organizing transactions.

Online transaction management has come a long way since the 1990 dot-com days, but many brokers and Realtor associations still think the products on the market today aren't quite ready for purchase and use. These prospective customers retain their wait-and-see attitude toward the new systems.

Oscar Gonzalez, head of strategic relations at the Houston Association of Realtors, said the association hadn't been quick to endorse an online transaction management system for its members because it's still waiting to see what newer products will offer.

The vision of less paper and more integrated lines of communication also has changed dramatically over the years. Some transaction management systems now include back-office management capabilities for brokers or offer the ability to store an entire transaction on a CD that the broker or salesperson can give to the buyer or seller at closing.

Broaddus said some early adopters are willing to try new technology while others stand back and watch what happens.

"The products have evolved from the feedback of those brave souls and now the general market is ready to say this is not a passing fad, this is real," he said.

Tomorrow: How online transaction management works