We’ve heard all the stories about expensive technical implementations and the difficulty navigating appropriate scope to capture the lease to open processes. We know this is difficult, we live and breathe these difficulties and now provide technology to streamline this process. What beggars belief is why companies are still spending millions of dollars trying to squeeze square solutions into the proverbial round hole. This $12 million dollar problem I speak of is widespread. If you aren’t experiencing it yourself, you know someone who is. Here is the data supporting this as an ongoing issue.
Combined with the throes of coming out of a global pandemic, we have been looking at the impact proptech has had on the property industry to date and guessing how it will be applied in the future. The definition of proptech, from the recent Property Council of Australia and Yardi second annual proptech survey is “any innovative technology that reimagines property’s core processes and business models.”
“Proptech is helping the real estate industry to better connect with its core purpose – to create places for people.”
Yet, during this year’s Urban Developer Retail Summit (see my earlier LinkedIn posts), not one of the presenters spoke about the application of technology in the creation of retail spaces, let alone the actual delivery of the assets.
MIT’s Real Estate Innovation lab estimates it takes 11 years for a technology to transition from inception to R&D, another 7.3 years to hit the market and a massive 21.3 years to be embedded in standards. To put it bluntly, the application of software takes time. A long term view must be applied.
The proptech survey highlights that retail is the second last leading sector to adopt technology. I agree, I’ve seen this time and time again over the last 6 years since the inception of TCPinpoint. You might say this is representative of our value proposition or our experience in the market. To this I disagree. We’ve gone through countless proof of concepts whereby hundreds of thousands of dollars of early revenue has been identified as being driven by the use of our technology. I’ve delivered billions of dollars of retail property via my experience as a tenancy coordinator working with some of Australia’s largest retail landlords. Yet, the decision to move forward with the implementation of technology hits hurdle after enterprise hurdle. 49% of survey respondents thought Australia was trailing the rest of the world in terms of proptech investment – up from 30 percent in 2020. It’s simply not good enough. Australia, we can do better!
Nikki Greenberg, Head of Technology Strategy and Digital Management, QIC Global Real Estate, leads with her insight saying ‘Those who embrace the power of technology to make data driven decisions will be leaders”. But how do we encourage this when the biggest element holding back the adoption is the attitude of ‘we’ve always done it this way’.
The survey sets out the impact of COVID 19 pandemic on technology investment as having a major impact (29%) as companies seek deeper insights into portfolio performance and market movements. Bernie Devine, Regional Director for Asia Pacific, Yardi Systems reminds us that ‘the overriding lesson from the pandemic experience is that the world is now consistently inconsistent. Things can change overnight. Preparing for ongoing unpredictability requires new systems and processes”.
What is clear in the survey is that changing existing behaviour still remains the biggest obstacle to proptech adoption. This is ahead of other reasons like outstripping resource, time or cost constraints or confidence in project success.
At the end of the day, as per Sheridan Ware’s, Chief Information and Technology Officer at Charter Hall, insight hits the nail on the head:
“People adopt technology when it makes their lives easier. It’s as simple as that. So we need to focus less on people adopting technology and more on how we can co-create solutions that solve for their most pressing challenges”.
So, why isn’t the rate of proptech adoption changing? It feels hard. It feels expensive and it feels time consuming. While it might feel that way, we actually have a solution that isn’t any of those things. Our collaboration with Stone & Chalk with the application of TCInspect across their properties reinforced the ease at which the technology was able to be put in the hands of their staff. The team use TCInspect for their monthly facility, health and safety audits and spot checks around their assets.
The team at TCPinpoint are eager to not only co-create, but to lead you and your team into the benefits of applying collaboration and process management software across your projects. We’re keen to continue to educate property people on the benefits technology can bring to your projects. Afterall, nothing will change if you don’t change anything.
Stop trying to over engineer technology at a whopping multi million dollar cost! Squeezing something square into a round hole will not ultimately serve your team, your business or your bottom line. Manage the scope and implementation at small and manageable intervals, whilst having the bigger picture in mind and understanding why it’s being implemented in the first place. Only then will we be able to reimagine property’s core processes and business models.
So what are you waiting for? Give us a call. The worst thing that can happen is you save $12 million. Would that be so bad?!