I've written before about how the real estate industry needs to stop thinking of technology as something the IT Department deals with and needs to create multifunctional teams that integrate different skill sets to ideate and deliver new products or services. Which is exactly why, using a food analogy, this article refers to an omelette not a Battenberg cake. To transform Real Estate, as every industry is being transformed, requires a vigorously mixed up set of ingredients. Five in fact.
First, the RICS issued a report in July entitled ‘The Impact of Emerging Technologies on the Surveying Profession’. This contains a chart of 42 tasks required within the industry and a figure of how much they are or could be impacted by technology today and how much within the next 10 years. This is an excellent signpost as to which areas of your business might be vulnerable to value destruction or candidates for competitive advantage. Every ‘high impact’ task is both: those who ignore the vulnerability will suffer while those who address the issue and leverage technology to reconfigure services will gain an advantage. There will be direct causation here.
Secondly, it is vital to develop situational awareness vis a vis your own business and the technologies that you might build, buy or partner with a 3rd party to acquire. Every technology goes through a life cycle, from first use by innovators and early adopters, through to mass market take up and on to ubiquitous use by late adopters and even laggards. What is table stakes and what is a competitive advantage is defined by where each technology is in the cycle. Anything after early adopter stage is table stakes; it might be new to you but not to the market. Anything before early adopter is risky but potentially a source of competitive advantage. Knowing where the technologies you are looking at sit on this plane is vital. And bear in mind that anything that can be bought is by definition not a differentiation. Where your business sits, somewhere between start up and entrenched incumbent, will have a major bearing on whether this matters.
Thirdly, and this requires strong human skills, analyse your ‘Domain’. Who is your customer? Who is your competitor? How does your customer want to interact with you? What part of your job could be done by a robot? What data do you have access to? I have expanded on these in another post, but this step really is pivotal. The transformation of modern business is required because the digital world and new technologies are upending our understanding of the answer to these questions.
Fourthly, there is no substitute for knowing what technologies are available now, or will be available within a year or two. Referring back to the first point, given your business focus, what technologies might you employ to allow you to either do things a lot more efficiently, or to do a lot more of what you do already. Being able to do X 50% cheaper is good, but so is being able to do 50% more of X. What is your business imperative? And how can technology help you fulfil it? Your new toolkit might include VR/AR, 3D Modelling/BIM, Chatbots, Podcasts/Video, Marketing Automation, Blockchain, Drones and 3D Printing. Or AI might be the key to 10X performance, but what subset? Voice Recognition, Image Recognition, Text analysis, Classification, Regression, Dimensionality Reduction? Each of these, the canonical problems AI excels at, suit different needs. Understanding what is possible, and how these tools could be utilised will be a critical skill within all businesses over the next few years.
And fifthly, none of the above matters a jot if your fundamental Value Proposition to your customers is not good enough. Get hold of the Value Proposition Canvas, a subset of the Business Model Canvas, and use it to rigorously examine each of your products and services, to each of the various customers you serve. Focus first on the ‘Job to be done’ by a specific customer, examine what ‘pains’ they suffer in efficiently and effectively getting this job done and what ‘gains’ could be developed that would make their lives easier. Then consider what you offer that helps them meet their goals and how well it accommodates their ‘pains and gains’. If you have a perfect match, that you can empirically validate, then just do more of that, but most probably the fit will not be perfect. With your new knowledge and awareness from the previous four steps you should be in a good position to know whether XYZ technology would make it perfect. Not that perfect ever exists, for more than a fleeting moment, so return regularly to the VP Canvas to assess where you are.
So, five steps to the Real Estate Omelette. Each disappears into the final product but is nevertheless a vital component. Each supports and underpins the other. Only five ingredients but you need them all.