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Corporate Real Estate and Facilities Innovation: Why Is Change So Hard?

Buildings Talking About MetricsIt’s 2013. We have instant connectivity, cloud technology, “smart” everything. Some argue it’s already more than we need considering few of us have managed to put to use even a subset of the products and services already available. Clearly the next evolution in managing our corporate real estate assets will be less about technology itself and more about how humans and organizations manage change. How we integrate sophisticated technologies into traditional facilities, sustainability or energy management practices is now a function of culture, HR departments, and leadership.

At this year’s CoRE Tech conference sponsored by Realcomm, I sat on a panel alongside Dave Pogue, commercial real estate behemoth CBRE’s Global Director of Corporate Sustainability, and Ben Tranel, Technical Director for the respected architectural firm Gensler. We fielded questions about how such change could be promoted and managed.

Today’s technology and design theory can allow corporate America to reduce space requirements, save energy and resources, and be more productive and sustainable. We also know designers and developers are pushing the design and renovation envelope to the point that sentiment among commercial real estate industry has started to yield to a consensus: we’re near a tipping point at which everyone is attempting to outcompete their peers in how they design, build and operate real estate.

Still, reluctance to adapt is pervasive. Based on our panel discussion and feedback with the hundreds of attendees, we generated a list of reasons “why not.” I’ve excerpted five here:

  1. Getting started: It’s the hardest part. Many attendees were not sure how to start the transition to a new mechanical system or design. They wanted all the answers before they began for fear of failing by going beyond “what was safe.”
  2. Learning curves: There’s a cost to making informed decisions, selecting vendors and implementing new processes. Getting up to speed on the best dashboards, energy monitoring and reporting systems takes time, effort and patience—these are stocks of human capital that seem to be in ever shorter supply.
  3. Fear: Contrary to conventional wisdom, people love change. What they fear is the uncertainty that comes with it. Many attendees were not sure what vendors or systems to pick even after learning about the choices. To make matters worse, picking the wrong vendor can be costly to the firm, especially if the vendor goes out of business or doesn’t come with an extensive track record.
  4. What’s around the corner: Technology changes fast. So fast that there’s a tendency to “wait and see.” Wait for prices to come down, or for an even newer, shinier technology to come out. That means firms end up in analysis paralysis mode.
  5. Silos: Firms today are large. Sometimes absurdly huge. The lack of communication and coordination between divisions means the finance guys talk in ROI and payback and the energy folks talk in kilowatts, utilization rates and wasted energy units. The farther apart people are to begin with, the less likely it is they’ll share or find a common language.

The world is changing. What we call “Big Data” has so far succeeded in overwhelming as many managers as it’s empowered. The key to dealing with Big Data is to develop simple visualizations and exception reports that help us poor humans act. For example, a visualized pattern may reveal that a vent allowing outside air into the building is stuck open. This type of monitoring requires both a high degree of connectivity and easy to read and interpret visualizations. These are the techniques deployed by some of the world’s most enlightened firms like Microsoft whose Director of Facilities and Energy, Darrell Smith, wired 125 buildings at its Redmond campus into just such a state of the art system. But Darrell has repeatedly made the point that massive resources are not a prerequisite for action.

Instead, today’s solutions are themselves scalable. They start small and grow with you. Cloud computing is perhaps the most famous example of this phenomena. Transposed to the world of commercial property owners, these solutions include Software-as-a-Service (SaaS) providers like Measurabl, Lucid Design or Switch Automation who offer simplified building data management and reporting solutions tailored to corporations with large and diverse portfolios or operations. These solutions should in turn help building owners and managers surface the actionable data about their portfolio. Half the battle, after all, is just getting started.

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