The evolution of data has transformed a once-reactive CRE role into a proactive, decision-influencing responsibility that can impact business performance.
The availability and quality of real estate data and analytics at our disposal can be a vital factor in assisting C-suite executives to make important capital investment decisions, with an emphasis on maximising productivity and efficiency. The questions to ask are: Is the CRE team up for the task? Do they know what to do with the data? Have they progressed from fragmented spread sheets to centralised data management through interactive dashboards? Perhaps more importantly, have they evolved enough to have a seat at the boardroom table? And are they ready for the promotion?
The role of the CRE professional has certainly matured. Here lies the link between real estate and facility operations and core business decisions. With renewed focus from C-suite executives to get the most out of their property portfolios, there has never been a better time for greater engagement. Pivoted by the shift of organisations taking a centralised approach to data management and analytics tools, the challenge is in ensuring that the CRE team is upskilled to analyse big data and better equipped to provide strategic advice.
To do this, today’s CRE team must embrace a data-centric approach. The industry has the tools and technology to access the right data but strict governance is required to ensure it is accurate and understood. Certainly in Africa and other emerging markets, access to reliable data remains a challenge compared to mature economies, and leveraging that data will ensure competitive advantage. However, data is only a means to an end; it is in how it is viewed in context that develops the insight required to shape business decisions. Sophisticated analysis enables the CRE professional to measure and benchmark revenue against cost and can inform a decision to dispose of property or acquire it; to build, buy or renew a lease, for instance. It’s particularly relevant in an emerging market where a company may be getting in at grass-roots level and needs accurate advice on managing business growth whilst mitigating risk – weighing business growth against risk of doing business in a volatile economy. Appropriate real estate and macro-ecomomic data understanding and application should guide the advice that identifies operational inefficiencies and builds strategic opportunities. It is my firm belief there lies the correlation between business performance and real estate value.
Sound data analysis just makes good business sense. A real estate portfolio is one of a company’s highest costs on the balance sheet so effective data management has a direct impact on the bottom line. A top-performing CRE team will not only manage risk around the portfolio but also engage the C-suite with business cases for the future. It’s the reason why many companies are outsourcing their CRE portfolios (from facilities management to asset management) to niche specialists with a solid investment in technology to leverage these key skills more efficiently and effectively.
We know technology is the biggest disruptor and a popular solution to future business growth but it is clear people are still the key asset in delivering that. It’s people who must still push the buttons. From a CRE perspective, it is important to ensure the team is well equipped and trained to meet the increased demands. In many ways, the vast pace of innovation, technology solutions and big data, have transformed the CRE function and day-to-day activities. New roles have come to market that weren’t there before, such as the CAO (Chief Analyst Officer), CTO (Chief Technology Officer) or CDO (Chief Data Officer). is predicted that by 2019, more than 90%* of large companies will have a CDO and therefore shifting the historic responsibility of data away from IT, to the boardroom. CRE professionals play an imperative role as the operational function and direct source for analytics, strategic insights and business intelligence. They must not only be upskilled but also empowered, with the right governance and compliance structures in place to manage stakeholders both up and down. In today’s digital world, leading businesses recognize the value of data and are leveraging their CRE teams to retain business agility, drive productivity within the organisation and workplace, and deliver customer value.