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Like many other industries, the property management sector is starting to shift its focus away from the value in exchange to the value in use. Data forms the foundation of this transformation to a more customer-centric model, offering the ideal way for property managers to connect with their occupants and service providers.
Property: a bespoke service on a large scale
Residential accommodation is somewhat a paradox. In some ways, it is like the ‘large-scale’ version of an individual property, being built by a property developer — instead of a simple builder — and employing major service providers for cleaning, maintenance and management. But on the other hand, a building requires a bespoke approach that is tailored to its specific purpose (residential, commercial, hybrid), its occupants (workers, seniors, families, students, etc) and to the nature of its facilities that need to be maintained.
It is difficult to scale up services in the property sector because the micro often takes precedence over the macro. One example is the fierce competition between service providers. They have all been forced to standardise their services in order to stay competitive on the macro scale, but this results in a lower standard of service when a specific problem arises in a building on the micro scale. Striking the balance between global strategy and local specificities is a tough task when managing a building. The only way around it is to change mindsets and tools.
Follow the lead of service-based models
The economy is a volatile environment. Not only is competition rifer than ever, but consumers are also increasingly aware of the growing scarcity of global resources, which has forced businesses to rethink their traditional models. The sectors that rely most directly on B2C business have thus progressively turned towards a service-based model. Microsoft no longer sells office software on a physical CD, replacing it with a monthly subscription whereby software updates are rolled out in real time via the cloud.
It’s not the product that is at the centre of the strategy, but rather how the customer uses it. The service value takes priority over the financial value, lowering costs and increasing profit margins. The flagbearers for this model are obviously tech startups, but it has spread to other sectors and has now come knocking at the door of the property market.
Data as a vector for change
Changing the business model to focus on the service rather than the product is a major shift in mindset. But the right tools are needed to make the transition a success — and that’s where data comes in. Data provides the information needed to optimise processes along the value chain and tailor services based on customer feedback. It also gives a competitive advantage and can be used to boost efficiency for all stakeholders. But it can prove difficult for traditional businesses to collect and leverage data, and the process should be seen as part of the company’s global digital transformation. Data should be used to break down silos within the business, allowing information to flow freely rather than being stuck in enclosed networks where it cannot be exploited. That’s why any digital transformation must involve a new stakeholder in a property’s value chain who can connect asset managers with service providers. A stakeholder whose core business and purpose is to consolidate data workflows to help property managers better manage their portfolio by delivering a clear overview of all the services they rely upon.
Transforming the job of an asset manager
This means data is going to put the occupant back at the heart of the relationship between asset managers and property service providers. This will constitute a big change for managers, whose focus has traditionally been on the product. By taking into account how the value of their property portfolio is linked to the user experience, they become service operators and active contributors to the platformisation of their industry. They can use data to maximise tenant satisfaction and occupancy rates in a more virtuous manner without ever losing sight of the primary role of an asset manager: to boost an asset’s value by increasing yield. The data platform provides more intelligence on occupants and ensures facilities can be closely monitored, allowing them to better tailor their services based on the how their different properties are actually used. They should therefore choose the partner whose tool offers the best visibility of their property portfolio and supplier network. Because that’s also the beauty of platformisation: being able to focus on your core business and forge partnerships to create the best solution for your ecosystem.
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