Innovate or Die

Vice President - CBRE Spain

The main elements of business progress are not only survival mechanisms but evolving processes that provide corporations with intelligent mechanisms for adapting to an ever more demanding environment. One of these mechanisms is innovation, something that, although it may seem like a cliché because of the recent overuse of the word, is key for any organisation in today’s world.

It would be a big mistake to think that innovation is simply a technological metamorphosis. Just as athletes cannot attribute their success exclusively to their racket, shoes or other equipment, corporations cannot put all their faith in technological innovation as if it were their holy grail. Innovation is much more than technology, a miraculous drug, design or unique discovery. It is the essence that –if present in a company’s DNA– becomes the enemy of complacency.

Innovation is also about transforming, adapting and refining a company’s internal processes as well as the services provided to its various stakeholders. We are referring to all those little routines that have not changed over the years and which, if small improvements were introduced, would reduce traditional processes by half or eliminate the bureaucracy to better represent interested parties. It is about resisting the idea “but it has always been done this way” with determination to reflect upon the situation and make the necessary changes.
Innovation as a culture means being in continuous movement, careful not to stop and fall as we would off a bicycle. In business terms, it means preventing our competition from getting ahead of us. It is a discipline that needs to be cultivated and practised in order to ensure it is in good form. There are several close examples of multinational companies, such as Bosch, that require their employees to dedicate 10% of their time to innovation and R&D. Other well-known technological companies, such as Google, have created a business culture that has become a hotbed of ideas and progress, or have created environments to promote and bolster business creativity.

We are talking about companies whose goal is to constantly be at the top, the most cutting edge in their field. They are almost always the doers instead of the followers, setting trends in their industries, and looking for ways to differentiate themselves in terms of quality and not only ways of surviving. Companies such as Sony, Ericsson or BlackBerry, which over the years have been forced to transform their companies or die, have had to change their original course for a more viable path. As American CEO Jack Welch once said, “Change before you have to”.

Displays of Technology

But what does innovation mean in the real Estate sector? Several answers come to mind with regard to this question, from how information is presented in Real Estate portals to how assets will be digitally sold in the future, passing through the already existing augmented and 3D reality that transforms the experience of purchasing and/or renting into a process with great emotional impact. Solutions such as Airbnb or Homeaway are not the only options we can expect in terms of innovation in our sector. There has been a clear shift in trend towards the experience of the occupant in non-residential sectors. We can clearly expect smartphones, tablets and other devices to become dynamic Real Estate showcases and the main suppliers of big data in the Real Estate industry.

Over the next few years will see significant advancements in terms of collaborative spaces and we may even see the creation of a UBER Real Estate company. It is a reality that these spaces are already being configured and will be presented in digital showcases as a flexible and efficient solution for users and owners. In fact, there are already offices where users have virtual maps of the parking spaces available when they arrived at the building, in the same way that car parks are able to intelligently manage and optimise their operation. Office spaces or shopping centres can now be visited through augmented or 3D reality devices, thereby offering users an innovative virtual experience. This technology will enable customers to visualise finished spaces on the screen of their tablet before beginning and altering them to their own liking.

«Innovation is also about transforming, adapting and refining a company’s internal processes as well as services»

In the case of offices, the tendency is to contribute to reducing employment absenteeism and increasing productivity. The configuration of spaces or the selection of furniture and technological devices that facilitate these solutions are some of the tools available in the most cutting-edge management formulas. It is even conceivable that many companies will allow their employees to carry out their duties from home, with the evident and subsequent savings and improvements this entails.

The most cutting-edge Real Estate companies in the retail sector are exploring the “figital”: the integration of a physical commercial space and a digital showcase. The trend is looking at how to replicate shopping centres in digital spaces that not only keep their audience captive but also increase their area of digital influence. We know that e-commerce is increasing and that companies are readapting their business model to offer customers the option of picking up products acquired online at shopping centres.

On the other hand, the way in which we analyse the huge amount of data generated by users that visit Real Estate portals or virtual commercial spaces will continue to be developed in the coming years. This is the big data revolution. This data will allow us to better analyse trends in consumption and users’ preferences. This means that supply is better adapted to demand and that commercial actions are created in Real time in order to be more effective. In 2016 historically traditional services with few angles for development, such as valuation services, market studies or asset management services, will use dynamic analysis tools that will allow us to graphically depict our products via dashboards in such a way that only the financial industry has been able to do until now.

We also cannot forget about “wearables”, which, when taken to the professional level, provide companies with data on their employees and their tasks in order to increase efficiency and human management. In the logistics sector, they will allow companies to optimise stock management, especially in terms of product distribution via drones or trucks without drivers.

Commitment to innovation

We have known about home automation and intelligent automation and energy management systems in the residential sector for quite some time now. These smart homes will be designed more and more often through smart architecture and seek to integrate the digital and the physical world in a more harmonious manner. The main electrical appliance suppliers will continue to focus their new developments –such as Samsung with their Smart Home– on a range of products that can be managed remotely.

In short, innovation may seem to be a business cliché due to its extensive use in corporate messages. But it is not. It is a primary ingredient in the formula for business success. It is the key to becoming stronger and, therefore, making it through the process of natural selection that only the most responsive and flexible companies will survive.

«We can expect mobile devices to become the main suppliers of big data in the real estate industry»

INNOVATE-IMPACT

What does innovation mean in the Real Estate sector? From how information is presented in Real Estate portals to how assets will be digitally sold in the future, transforming the experience of purchasing and/or renting into a process with great emotional impact.

 

BIG DATA

Thanks to big data, we will be able to better analyse trends in consumption and users’ preferences. This means that supply is better adapted to demand and that commercial actions are created in real time in order to be more effective.

 

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Vice President - CBRE Spain