Silos and organizational complexity limit vision so that you “can’t see the forest for the trees”. I recently took an October vacation to Cannon Beach on the north coast of Oregon. It was incredible, and if you know much about Oregon, there are lots of trees; big ones! So not only do you get to enjoy a beautiful beach vacation, there’s a very nearby Sitka spruce forest overlooking the Pacific. These trees were incredible, not only are they massive and tall, many had very intriguing growths of mushrooms and moss. We had to stop and look constantly. This got me thinking.
The Variables of Real Estate
In real estate portfolio management (corporate and retail), occupiers have to deal with so many variables, moving parts and business aspects of their real estate portfolio, just to name a few:
- Site selection
- Construction, projects
- Market planning
- Transaction management
- Lease administration
- Lease accounting (GAAP/SOX/FASB13)
- Asset management
- Preventative maintenance
- Space planning and utilization
- Performance metrics
- Resource management
The real estate component for a mid-size to large business is essential and necessary, although not the core business of the organization. That said, it must be managed effectively to make it a non-issue to the core business practice.
As such it can be easy for teams or departments to get lost in the trees (minutia). The greater and more diverse the portfolio (forest), the larger the teams and/or departments are to manage every detail. Some firms outsource all or parts of the process, some keep it in-house. Either way, you need vision.
“Vision without execution is just a hallucination”. Henry Ford
When managed internally, there can be the natural propensity for unintended corporate silos to appear. Whether it is a real estate environment of nurture or of harvest, performance bonuses are typically based on the trees output or yield. Myopic site is not intentional; it’s just lost in the business.
Large Portfolio Management
It was so easy for me to get caught up in the majesty of the Sitka spruce trees and the individual details of each tree, that it could have been easy to lose sight of the incredible forest or nearby Cannon Beach and Haystack Rock.
So how do you gain focus on the forest?
When managing a large portfolio of real estate, you need the proper tools to give you insight and vision. When there are various teams working on different and specific tasks or aspects of forest management, they are focused on their goals and can overlook the end game.
Business Intelligence (BI), Data Visualization, and Dashboards delivering metrics, analytics and KPI’s have become key tools to solve for and thwart practical and potential opportunities and/or challenges.
To get the full vision, you may be best served by a platform that easily consumes and aggregates Big Data (i.e. – demographics, POS/sales, expenses, employee data, etc.) from the forest area and beyond, providing a single source of truth to aggregated and actionable data. This enables comprehensive and dynamic oversight of the portfolio and its influencing surroundings. Today many software companies offer visualized views of their data, which is definitely beneficial. Unfortunately, these functional tools may not incorporate the entire forest; it can only present different perspectives of the trees (data) it sees right now.
Should you or your firm be evaluating a CRE BI/dashboard platform? do your due diligence. Ask questions:
- 1) Does it easily aggregate data from various sources?
- 2) Does it support actionable decisions?
- 3) Is it mobile?
- 4) Is it workflow incorporated?
- 5) Does it have collaboration tools?
- 6) Does it measure results for continuous improvement?
- 7) What’s the typical implementation time frame and cost for a like client?
These are a few important examples to answer upfront in order to find a true ‘business operations’ platform.
Look for a configurable platform, not customization. Look for actionable data and workflows, not static report views. Look for simplicity in design, power in execution, and a proven track record. Look for a system that operates ‘the way the world really works’.
And most of all look deep into the forest, not at the tree in front of you.
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