Today we have a guest post of Larry Simpson with CRE3. He discusses the Workplace of the Future and its’ impact on the CRE strategy today.

What is your organization spending on corporate real estate occupancy costs per employee? $1,000? $5,000? According to discussions at a recent meeting of the Carolinas CoreNet Global Chapter the 300 participants cited their companies were spending $8,000 to $12,000 per employee. Continue Reading

Have you ever tried to use Outlook to schedule a meeting room or data projector?  If you’ve got a lot of rooms and a lot of resources like AV equipment, catering, furniture, etc., then it can be a real drag scrolling down an endless list and figuring out which room and resources to choose and how to actually reserve them. Continue Reading

By Eric Kline, Michael Swanstrom and Simon Davis

Today’s post originally appeared in the July/August Issue of CoreNets’ Leader Magazine.

“Be sure that, as you scramble up the ladder of success, it is leaning against the right building.” – Stephen Covey.

This quote appears appropriate, given the “green wave” of decisions organizations are facing as they launch and expand sustainability programs that seek consistent success across geographies, business units and partner networks.

Software is certainly a part of the answer with its ability to cast opportunities in the proper light, align compasses and provide a degree of assurance that the initiatives undertaken are appropriate and timely and deliver business benefit.

While not a silver (or green) bullet to ensure desirable return on investment (ROI), it is an accurate and consistent way undertakings can be managed, evidenced and replicated in many cases.

Properly designed, software solutions provide both strategic and tactical insight, helping facilitate the core decisions that have a direct impact on an organization’s bottom line.

This article will present some options organizations might consider when selecting an appropriate technology solution to support their sustainability efforts and include brief commentary on value measurement, scope, implementation strategies and importance of price and delivery methodology in the ROI equation.

How Value Is Measured

The answer to the value question is fundamental and specific to each organization (apologies, still no green bullet) and is often measured across a number of spectrums, including the triple bottom line of people, planet and profit.

While software is primarily geared toward presenting insightful data, metrics and opportunities in an efficient and flexible manner, ultimately the professionals charged with managing the organizational real estate assets prioritize and execute to deliver the desired ROI.

While scalable software provides clarity and enables effective oversight of initiatives and metrics (i.e. energy consumption, waste streams, carbon footprint, LEED/BREEAM tracking, etc.), its true value only comes to the fore in the capable hands of the subject matter experts who pro actively guide the core sustainability of their operations.

Various catalysts are driving the organizational desire to undertake, demonstrate and measure program efficacy as part of its overall sustainability performance scorecard. This includes the need to effectively communicate with, attract and retain employees and foster workplace communities where an organization is seen to be benefiting those around them.

The July 2008 CoreNet Global Competing for Talent survey indicated that company reputation and brand are the most important aspects in attracting talent, and environmental awareness can often be the most public display of that reputation.

Tracking of data – such as carbon avoidance associated with reduced corporate travel, virtual meetings, alternative work strategies, etc. – are visible examples of elements many consider important. (As an aside, it may prove elusive to measure with any degree of accuracy the ROI of attracting extraordinary talent and individuals who deliver exponential benefit to the organization.)

Solution Considerations

As Malcolm S. Forbes stated, “The best vision is insight.”

A good starting point on the path to success is to implement the right solution specific for your business needs that is scalable and flexible to meet new challenges including, when appropriate, international expansion.

Integrated Workplace Management Systems (IWMS) enable practitioners to obtain insight on key components of real estate portfolios such as leases, projects, facility requests and occupancy metrics; IWMS are delivering enhancements on the sustainability front that identify opportunities for improved organizational and environmental performance.

These integrated solutions complement sustainability initiatives by leveraging a common database engine (i.e. space measurements, headcounts, properties, etc.) that provides a comprehensive view and instant access to facility drivers, empowering users to easily view issues that may be impacting performance (i.e. equipment approaching the end of its useful life, running sub-optimally or locations requiring long commutes).

Clearly, the dimensions of sustainability are expanding far beyond energy source consumption monitoring, requiring visibility into related supply chain impacts, among other things. An example might include tracking how an organization uses energy to operate its facilities and the impact that generating the energy required at the source has on the environment.

The ability to measure progress and make proactive adjustments to the sustainable components utilized in a project, via robust project management software (i.e. milestones, resources, budgets, workflow, etc.), enables organizations to demonstrate their ongoing commitment to renewable product.

Content & Implementation Strategy Considerations

“In the business world the rearview mirror is always clearer than the windshield.” – Warren Buffett

Attempting to pivot from Mr. Buffett’s wisdom, perhaps one appropriate starting point for considering implementation options and timeframes is to ensure the essential building blocks of the program have been properly identified.

This includes:

1. clarity around the initial sustainability goals the organization desires to achieve,
2. an understanding of how value will be measured and
3. a clear focus on software and other options that will holistically provide the required insight based on client-driven metrics.

In reaching for the ultimate green organizational goals, some may find it necessary or appropriate to deploy a phased approach toward full-scale data population and in-depth tracking capabilities.

Solutions that provide a scalable model and have the ability to permit multiple means of data loading (i.e. imports from billing aggregators, real-time pulse meters and direct input) are among the considerations that should deliver effective results for an organization consistent with the disparate technological infrastructure for a global portfolio.

The software solution should ideally enable users to easily identify green opportunities and insights across the portfolio based on client-driven metrics and might include:

1. kBTU utilization
2. GHG emissions and carbon footprint
3. Electric consumption (kWH) and demand (kW)
4. Energy sources/costs/measurements with flexibility (i.e. currency, language, etc.)
5. Progress and target reduction measurement
6. Waste streams and water utilization
7. Carbon avoidance based on proactive initiatives

These and other client-chosen metrics, trending insights and business intelligence dashboards should be easily assessable on a real-time basis and contain appropriate historical data.

Metrics and conversion rates are dynamic, based on evolving intelligence, so point-intime comparative reporting will be a desirable functional element.

Also desirable for many is the ability to rank locations based on key criteria, empowering resources to prioritize their focus to deliver on the organizational mission.

Pricing and Scope Impacts on ROI

Software pricing should certainly be a part of any evaluation process, and a thorough review of license fees, terms and implementation costs are all part of the due diligence process.

The overall investment analysis should include a consideration of the application delivery options, including whether a web-based hosted solution, which mitigates the requirement for up-front capital associated with hardware and ongoing dedicated IT resources; enabling the organization to use the tools on a flexible pay-as-you-go subscription basis, is preferable.

Thought should also be given to the desired integration with other enterprise databases, including financial, human resources and any required harmonization with the current information technology system.

If a provider is offering rebate incentives for certain parts of the application, the organization will be well served in examining the associated details to ensure that the time and cost of implementing the free features is worth the investment.

Particular attention should be focused on the total costs to implement future functionality, as the organizational requirements evolve. The ROI an organization achieves from sustainability initiatives is based on many factors, including the software application’s ability to provide insight; the real estate and facility professional’s ability to capitalize on the opportunities identified; and the ongoing prioritization, support and commitment an organization puts forth toward the endeavor.

Organizations and solution providers that collaborate with a common purpose to achieve the desired goals and continuously apply new knowledge will be positively positioned to maximize the triple bottom line of people, planet and profit.

About the Authors

Eric Kline, Western Region Facilities Manager, Adobe Systems, oversees facility management and is responsible for technological initiatives that promote the health and growth of the real estate team and its customers.

Michael T. Swanstrom, President & CEO, Business Integration Group, formulates the client-centric strategic vision; provides organizational leadership; and directs the operational, capital planning and resource allocation processes for assignments across the globe.

Simon Davis, Managing Director, Client Solutions, Business Integration Group, is responsible for supporting global business relationships, ensuring the firm provides exceptional service and continuously innovates to deliver maximum value.

OSCRE (Open Standards Consortium for Real Estate), a non-profit organization driving the development and adoption of e-business standards, is pleased to launch its multilingual iForum www.OSCREiForum.org. It is powered by CREOpoint, the online meeting point exclusively for Commercial Real Estate decision makers worldwide. Continue Reading

Last week, the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) issued the Exposure Draft of the proposed lease accounting standards. As many expected, the Exposure Draft is nearly identical to the initial Discussion Paper issued in March 2009. Continue Reading

The following post was written for corporate real estate executives to relate the importance of information systems to succeed in their role managing their organization’s portfolio leased and owned facilities. By Larry Simpson, CRE3 Consulting

Are you ready?

More to the point, are your information systems ready? Continue Reading

Kelvin Smith, Vice President, Financial Computer Systems, Inc., and Chief developer of EZ13 Lease Accounting software has posted a very useful post on his Lease Accounting Blog about the release of the Exposure Draft by the FASB and IASB this week.

The FASB and IASB have released the Exposure Draft of the proposed new lease accounting standard (FASB topic 840 in the new Accounting Standards Codification).

Downloads

• FASB Exposure Draft
• IASB Exposure Draft
• IASB Basis for Conclusions
• IASB Snapshot Summary
• IASB Press Release

Comment Deadline

The comment deadline is December 15, 2010. The FASB invites people to send comments by email to director@fasb.org, File Reference No. 1850-100. The IASB asks for submissions on their web page.

As with the Preliminary Views document last year, the comment letters sent to both boards will be combined for the boards’ review (and it is not necessary to send a comment letter both places).

“Global warming is undeniable”

Recently, the National Oceanic and Atmospheric Administration published the annual State of the Climate Report summarizing the key climate indicators of 2009. The report, compiled by 300 scientists from 48 countries, concludes that “global warming is undeniable”. Not only was the past decade the warmest on record, but almost every climate indicator shows that climate change is occurring at a more dramatic pace than was predicted by scientists just a few years ago. Continue Reading