Leveraging Technology to Increase Corporate Real Estate Value Proposition to the Enterprise

Posted on 18 June 2009
Tags: Deloitte, George Bouris, Whitepapers

This week we will publish some very interesting white papers which I received from George Bouris SLCR, MCR who is a Principal with Deloitte Consulting. This article first appeared in the May/ June 2007 issue of CoreNet Global’s LEADER magazine.

Despite the multitude of Corporate Real Estate (CRE) technology offerings – and notwithstanding the conventional wisdom – there really is a right answer for each organization. Surprisingly, feature analysis and functional specifications are not the major determinants in finding the right answer. The key is adopting an approach which is enterprise-centric, not CRE-centric. Of course, the right answer is not universal; it’s different for each organization, and context and value are critical.

Address Business Needs, Not CRE Desires

Irrespective of the organization’s core business, the Corporate Real Estate Department has essentially three objectives:

deliver and manage a cost-effective yet productivity enabled workplace;
effectively and efficiently manage assets and facilities;
maintain a real estate portfolio that is flexible and capable of meeting the ever-changing demands of the enterprise.

Each objective is related to detailed corporate requirements and is supported by specific technology requirements. While each objective is important, rarely are all three
equal in importance at a given point in time. Further, the order and relative importance of these objectives are highly correlated to the realities and objectives of the enterprise. An organization pursuing aggressive revenue and market share gains will have a greater need for portfolio management than asset management.

That is not to say asset management is unimportant to the organization; however, at this point in time, it is of less importance. Likewise, a company pursuing aggressive cost reduction goals will emphasize asset management and perhaps portfolio management over workplace management. This will be evident in effective CRE organizations, but even astute real estate managers may not understand the need to give more weight to the appropriate business drivers in selecting a technology solution.

For example, one organization had earmarked a sizable amount for upgrading its asset management capabilities by investing in new technology for field operations (on-demand maintenance), including hand-held devices, new software and new hardware. At the time, field operations were highly manual, with little technology support and ere thought to be the cause of low business-unit satisfaction with the CRE department. However, closer scrutiny revealed that on-demand services were delivered 90 percent of the time within the required service level and that 95 percent of business-unit customers were highly satisfied with on-demand services. So why had the decision been made to invest in this technology solution?

Clearly, two factors were at play here. First, the CRE Technology Leader hoped that technology could address the concern that his staff was being stretched to the limit by the ever-increasing workload. Second, CRE management was taken by the notion that this technology solution would position their organization as a clear leader in technology adoption, garnering accolades from its peers within the industry.