Avoid these CRE business intelligence mistakes with tips from industry pros
Corporate real estate (CRE) and IT professionals face more pressure than ever to combine and evaluate complex data streams to make informed strategic decisions.
Unfortunately, most organizations simply don’t have the tools, resources, or expertise to effectively capture, aggregate, and analyze every disparate—but crucial—data stream generated across their portfolio.
JLL Digital CIO Edward Wagoner discussed how CRE professionals can respond to these challenges with a panel of subject-matter experts, and he referenced a recent Guidehouse whitepaper that analyzed the most common solutions that CRE teams employ to address their business intelligence (BI) needs—as well as Forrester research about the sudden market shift toward CRE BI solutions.
According to Ian Fyfe, director of data and BI product marketing at JLL Technologies, the industry is in dire need of a purpose-built BI platform designed for CRE professionals. Alternative solutions ultimately drive costs up instead of down and prevent organizations from extracting the full value from their data.
Inability to manage multiple data streams in real time
The current technology landscape for CRE professionals is complex and multifaceted. With many different types of data being compiled from many different applications and siloed sources, a CRE’s ability to distill this deluge of information into actionable insights is simply more than most are equipped to manage.
”When it’s siloed or homegrown, you don’t have the real estate market data. Are we overpaying or underpaying? Are we underperforming or overperforming? You don’t have the industry standards to answer these questions,” said Fyfe.
“Think about how long it’s going to take to manually grab that data, then try to integrate it and make it clean. The rule of thumb is that 80% to 90% of analytics is preparing the data before you analyze it,” said Fyfe. “Unless you have those capabilities built out with a reliable tool, it’s going to take you days or weeks. The biggest challenge out there is people are forced to do it themselves.”
Integration and benchmarking limitations
Another recurring pain point discussed was that custom solutions, often built without CRE expertise or historical data, lacked the business benefits of built-in benchmarking data.
”When it’s siloed or homegrown, you don’t have the real estate market data. Are we overpaying or underpaying? Are we underperforming or overperforming? You don’t have the industry standards to answer these questions,” said Fyfe.
In addition to missing benchmarks, custom solutions developed with generic BI tools need ongoing attention to integrate with other apps and account for the unique needs of corporate real estate teams.
According to panelist Krystal Maxwell, research director, networked buildings at Guidehouse: “Solutions using existing tools can be cost-effective. However, the metrics specific to the CRE industry will need to be built into the solution and may require ongoing customization to be effective.”
Timely analysis is needed to generate relevant, actionable insights
Panelists warned that CRE and IT teams could invest so much time into organizing data that the insights it generates when the analysis is complete are no longer relevant.
“If you look at the scope of CRE analytics, we estimate it would take you a year to build out all the dashboards you’d need,” said Fyfe. “We estimate it’d cost close to a million dollars in labor to build those capabilities in-house.”
Guidehouse recommends a platform purpose-built for CRE
“One of the key benefits is the holistic view, being able to generate insights about the entire real estate portfolio,” said Maxwell. “Customization is minimal, as the tool is pre-built to serve the needs of CRE. These strategies can be driven around current market data and be used to leverage legacy systems.”
Want a closer look at what a purpose-built CRE BI platform can do to help pull together your disparate data streams? Schedule a product demo to learn more.