Description
Join a host of sector experts who discussed how owners and managers of large complex buildings are being confronted by a rapidly changing landscape. Topics included net-zero targets, rising energy costs and the challenge of stakeholder demands.
Our expert panel delved into the power of data and how digitisation is transforming the way complex buildings are run, enhancing visibility, efficiency, and sustainability across portfolio management globally.
Attendee Questions and Answers
Unfortunately, not all attendee questions could be answered during the webinar. Please find these questions and answers listed below.
Question 1: If you had unlimited resources, where would you focus to deliver value for large clients in their journey to net zero?
Cillian Casey, CIM: It might be better to answer this question with limited resources in mind. We would recommend following the a 5 step process:
1. Monitor and remove drift
2. Optimise
3. Equipment upgrades and electrification
4. Renewables and onsite generation
5. Carbon offsets
Question 2: How realistic is it to electrify everything? Is electric more efficient? How would infrastructure support this? Targets are sooner (2030) than realistic timelines to update infrastructure.
Cillian Casey, CIM: Electrifying everything is realistic, but this will not happen overnight. However, the more we electrify, the more the grid will struggle, the more capital investment will be put in to increase grid capacity and over time we will get to a stage where grid can meet the electrification loads of everything. But this is something that will probably be more realistic in a 15+ year horizon.
An option to help with infrastructure is to take some load off the grid is by creating microgrids for campuses etc which can be powered by renewables and battery back ups. Again this is not an overnight solution
Question 3: Going back to the 'headwind's you mentioned facing us all and how we manage our buildings. we're right in the midst of them now.... how quickly could I see change by adding increased to focus to new data techs?
Cillian Casey, CIM: Thankfully, technology is rapidly evolving. For example, we now have the ability to digitize entire buildings and portfolios in days, where it would historically have taken weeks or months. This means pretty instantaneous results and benefits from the technology.
Also, with the improved ‘smarts’ embedded in the technology, and with CIM's PEAK Platform as an example, we are less reliant on manpower to commission, onboard and drive the functionality and adoption of the technology.
We have invested a lot of time and money into PEAK with a view to making the transition from issue identification to realisation of the benefit as seamless as possible, whilst also insuring that all the insights automatically generated are as functional and valuable as possible. This cuts out the noise.
What all this means is that the price point can be substantially reduced as we transition to more of a SaaS license model. What this is doing for buyers is removing what can historically be a pretty large budgetary barrier.
Transcript
Introduction
Jim McClelland:
So, hello and welcome to this lunch and learn. Thanks for registering for our webinar panel discussion, hosted by world leader in building analytics software CIM. The chair for the next 45 minutes, my name is Jim McClelland, founder and editor of SustMeme, home to both the magazine and top 500 rankings.
Our topic today: the future of building operations, data digitisation, and drive to net zero. So, we know owners and managers of large complex buildings are being confronted by a rapidly evolving landscape, plus market disruption and volatility. Challenges including looming net zero targets, rising energy costs, stakeholder demands that are, together, elevating the complexity of building operations.
So, is the key to overcoming these challenges, and at the same time improving operational efficiency, is it to embrace technology? And adopt a forward-thinking data-driven collaborative approach? That's the kind of question we're asking. Our expert panel will delve into the power of data and explore how digitisation is transforming the way complex buildings are run, enhancing visibility, efficiency, and sustainability across portfolio management globally.
So, let me introduce you to our panel. Joining me on screen this afternoon are: Dan Hosko, senior project engineer at Aero Build. Beyond typical energy audits and analysis, Aero Build's unique services include existing building commissioning, energy retrofit implementation and project management, plus energy star benchmarking. Highly-qualified, Dan's a licensed professional engineer and member of ASHRAE. He is a lead accredited professional for green building and a certified energy manager with the Association of Energy Engineers.
Steve Gorvel, engineering and facilities manager at Element Six. Steve currently manages the maintenance and facilities within a global manufacturing site in the west of Ireland at Shannon, where he's implemented the ISO 50001 energy management system. Like Dan, Steve is a certified energy manager with the AEE, and has an electrical background with a BSc in engineering science and over 30 years' experience worldwide.
Stefan Schmidt, head of smart buildings technology at WiredScore. WiredScore is the organisation, not surprisingly, behind the WiredScore and SmartScore certifications, market leading digital connectivity and smart building rating systems for real estate. They help landlords design and promote buildings and powerful digital connectivity and smart capability. Stefan's background is in building energy optimisation, including an MSc in carbon management.
Last, but of course not least, Cillian Casey, regional VP EMEA at CIM. Cillian leads on all sales and operations for the region. Cillian's an expert in building data analytics, and understands the challenges faced by clients and prospects, drawing on over 15 years of experience in sustainability system integration and data analytics. He's a certified energy manager with a degree in mechanical engineering from Munster Technological University, and is an MBA candidate at Smurfit Business School, University College Dublin.
So that's the panel - it is all live, and recorded. You'll all receive a copy of the recording following the broadcast. So, we are on a tight schedule. 45 minutes. If you do have any questions for our panel, please pop them in the box at the bottom of your screen - you'll see appropriately named "Q and A". We'll try to get round to them at the end of this session. We'll also be picking them up offline after the event. Right. Let's crack on, let the debate begin.
Is Data Digitisation and the Drive to Net Zero the Future for Building Operations?
Jim McClelland:
So, first question. Data digitisation, drive to net zero, is this the future for building operations? Is technology supporting the built environment? Are leadership and operations teams embracing it? We're going to start with you, Stefan. So, WiredScore, working with buildings all over the world, certifying digital transformations. A question to start for you is, is this actually going in the right direction at present? Is digitisation and tech truly supporting sustainability, Stefan?
Stefan Schmidt:
Thanks, Jim. Really exciting to be here with everyone today and to be talking on decarbonisation. It's been something that we've been tackling for a long time. Sustainability has been at the forefront of many of our agendas, especially in the building operations world, for several years, and I think unfortunately what's happened is that the incentives around it have been misaligned. So your energy costs get typically passed on, especially in commercial real estates, to tenants, the kind of cost incentive or cost-optimisation incentive maybe wasn't there previously, which slowed us down. And that's a shame, because we know that buildings are responsible for a huge amount of emissions that we see going into the atmosphere every year.
What is happening now, though, is that I think the stars are starting to align. On one side there's the regulation that's pushing - we have Local Law 97 in New York, we have the Washington D.C. city regional initiatives that there's nothing gas-powered on new developments by 2026. Sydney is doing something similar in Australia. So really, it's starting to bare teeth and create financial incentives there for real estate owners and landlords to optimise their energy, which then in turn is actually leading to a greater investment in digitisation and technology, because those macro themes provide the tools to enable landlords to take action.
Jim McClelland:
Excellent, great. Very nice summary to kick us off, so as you sort of imply, the issues are not necessarily new but the impetus behind trying to deal with them is. There's a lack of joined up thinking and working, but, now you suggest the stars are beginning to align and you gave some nice examples of initiatives from around the world in different geographies. So, Dan, coming to you - so what about Aero Build? You work across a number of building types, what digital transformations are you seeing when it comes to sustainability?
Dan Husko:
Yes, certainly, and I think Stefan stole a bit of my thunder there. New York City certainly has that Local Law that forces buildings to be cognizant, look for energy savings in a building, which really drives the digital aspect. But where we're at in Chicago, we have something very similar. We have a climate action plan that was just drafted up, and their goal is to reduce emissions 62% in buildings by 2040, and they have other legislation that goes along with that. Specifically, we have a lot of commissioning and energy incentives paid out by the utility companies to try to force these buildings into adopting measures to reduce and be more sustainable. In Chicago, while we're a very competitive market, so a lot of times buildings will go for a lead, and well, and they keep comfort and that energy efficiency at the front of their minds, because they're really trying to attract tenants and people to lease into their space, and this really got more on the forefront as well with Covid and the pandemic, where people are much more cognizant of efficiency in buildings and air quality, and really operations in general. So, with all this it leads to a digital shift. You really have to leverage these technologies and analytics and all that to get in front of potential issues, and really give the best product, to who you're signing the lease to in an office or building environment.
How Important is Digital Technology to Advancing the Sustainability of Buildings and Operations?
Jim McClelland:
Excellent, thanks, so nice points there. So, climate action plans you mentioned, interesting of course the role of utility companies, but crucially it's a very competitive marketplace and that is raising the stakes for all players in the game, especially post-pandemic where there's potentially more choice, and also clients and customers are arguably more demanding. So that's where the digital shift potentially gives them that advantage and that differentiator in the market. So, nice intro there, so if we're now moving maybe to more look at strategy and sustainability, I'm coming to you Steve and Cillian in your respective roles, you'll have heard from many different senior leaders on their plans for digital transformation. So, Steve, coming from manufacturing, how important is digital technology to advancing the sustainability of buildings and operations from your view?
Stephen Gorvel:
I think it's very important if we're going to achieve our sustainability objectives, what it does, certainly for us, it enhances what we have already with our building management systems, but it takes the data from there, analyses it, provides us with valuable information from which we can make decisions. We can plan our sustainability roadmaps more effectively. That includes providing input, of course, to capital expense where we can spend the money. A lot of the big items that are obvious are relatively easy, i.e. we've done something there where we've changed out an oil boiler for a heat one. But the smaller items - and there's lots of smaller items - they collectively impact the sustainability and they're a lot harder to identify without a smarter technology to help us do that. If we look, from an operations perspective, it's helping us to understand our efficiency, how efficient systems our systems are operating, our energy costs, where our energy is being consumed, when it's being consumed, and importantly, the costs which are associated with that. Because, of course, from a manufacturing perspective, our operating costs are one of the biggest things we have. We also see a lot more where we're getting customers asking about carbon footprint of our products. So, this is kind of helping us - or it will help us as we get more integrated with it - to kind of understand that, quantify it, and reduce it where we can.
Jim McClelland:
Excellent, thanks, so very important - enhances BMS, helps plan the roadmaps, input on capital expenses. But as you say, happily the big stuff is relatively easy, but it's the small items that really add up and they make the difference - they're less visible, hard to identify, potentially hard to tackle, and in your business in manufacturing, those operating costs are absolutely critical. A nice mention there for carbon footprinting, and interestingly I think we already have a few questions and the very first one was about carbon, so that no doubt is going to be a topic running through the whole session today. So, coming to you then Cillian, similar sort of question but different perspective in your terms, senior building owners and operators who work with yourself at CIM, where do you see them placing digitisation within their broader sustainability and corporate strategies? Where does it fit?
Cillian Casey:
Digitisation is becoming a key enabler for building owners and building operators in their drive towards net zero. It is now, certainly one of the first things people are looking for and that is essentially what is our data telling us. Historically the real estate industry probably has been pretty slow to adopt technology at the same rate as other industries, but I have noticed - and other guys have mentioned it - things like ESG commitments, investor pressure, consumer demand, and even legal requirements have driven property owners towards that and technology to help them achieve what are often complex and challenging targets. Building owners do realise now that, without that, you're dealing with a lot of opinions and given the impending climate crisis decisions can no longer be made based on opinion alone, and this is especially relevant given that a lot of the targets that are in place are all metric driven.
We have seen client completely tear up how they manage their business operations, now making key decisions, both the day-to-day decisions and our future investment decisions, based off specific data related to their buildings. This can be anything from automated data-driven maintenance activities, or capital planning forecasting based on actual equipment performance. Or even things like space utilisation optimisation. It is also now understood that building data is critical to allow people to communicate where companies are coming from, in their net zero journey where they currently are and also where they want to be, and having that data available from their facilities allows the building operators to clearly plan and communicate our digitisation and net zero strategies, and also how they're progressing which also helps ensure expectations and perceptions are better managed with the key stakeholders.
I suppose the good news, if you're a building owner in this, is that there's a lot of data and studies to show that once the asset is verified as being more sustainable, it is not only cheaper to run and better for the environment, but it is also more attractive for tenants which means higher rental yields and also probably means the building has become a lot more valuable off the back of it as well.
Jim McClelland:
Exactly, some very pertinent points there. So yeah, key enabler, as you say, admittedly real estate as a sector is probably a bit late to the party, but particularly pressures from investors and ESG criteria, they're accelerating uptake. It's crucial, you're describing a market that's clearly in transition, moving from opinion and subjective positions on things, to a more evidence-based scenario where data is critical. And that feeds into the targets and the metrics crucially behind them. And also a nice point that this digitisation is fundamental to organisations being able to tell their net zero story as well, and tell it with credibility.
We are seeing in the media, just this week, a major bank being criticised heavily for potential greenwash, and we're seeing a lot of noise around greenwash at the moment. So also in terms of the negatives and communications storytelling, having that verified position, as you suggest, and that credibility around your net zero ambitions and progress is critical in this marketplace. So, nice points to start us. I'd now like to look - I mean if you like the old saying "culture eats strategy for breakfast", I'd now like to have a little look at the role of culture in all of this.
How Important Is Culture in Successful Digital Transformation and Building Operations
Jim McClelland:
So of course, digital transformation of DX can involve significant change, and it would be fair to assume that bringing all levels of a business along on a journey should be key. So, Stefan, if I come to you first, how important is culture in successful digital transformation and building operations we've been talking about?
Stefan Schmidt:
Yeah. Critical, in short. To Cillian's point, there's a lot of interest now in doing this from an investor perspective as well. People coming in and saying "look our tenants are asking for this, or investors are asking for this" we need to be seen to do more. That, in turn, is driving the interest internally, but you still need that champion, and I think that that's true from a culture perspective, both when you're procuring and getting that internal buy-in and showing the ROI, but also when you're implementing and your people on the ground who are operating the buildings need to be able to use the software that you've put in place, need to have the right training, need to have the right mindset as well to be able to push it forward.
So, more often than not I think what we see from a WiredScore perspective is that technology is more than capable. We have more advanced applications of technology in other industries than we do in real estate, that's being used to optimise some of the automation that we have in play in our buildings. But the organisations are not. There's a fear, in some places a lack of knowledge, perhaps, which is then causing delays and problems in implementation. I would say that's kind of my personal mission, as well, and something that we're really targeting with SmartScore and the certifications in general is to give people that confidence that they can go out into the market, they can make that change, and they can be successful in doing because the case studies are there. It's just about having the right kind of mindset internally to be able to act on the evidence.
Jim McClelland:
Excellent. Yeah, and confidence is a key word, obviously in turbulent times, more important than ever. So as you say, culture is critical - yes, organisations are responding to demand, but it's always been the way, especially with sustainability initiatives, that you need internal champions. You need them to help, on the inside, secure that buy in. In theory, the science suggests you don't, but you do. It's a people thing, it's a human nature thing.
So, as you suggest, technological progress actually isn't the issue. We've got those advancements, not necessarily - it's much more the organisational culture that is applying the breaks unhelpfully, and it's crucial that technology solution providers, and those who do the "things" part of the story also appreciate that it's a people story and they need to- If they don't have those communication capabilities in house, they need to work with others who do, in order that the story gets told to those who need to hear it, effectively and in a winning fashion.
So, Cillian, I can ask you - how can a culture of change and innovation be actually embedded company-wide? It's one thing having hotspots and one or two people who are on message, but how do you get it end-to-end, you know, from head-to-toe in an organisation, Cillian?
Cillian Casey:
Yeah, look, similar to the message, Jim, yourself, and Stefan just went through there, having a cultural change is critical to ensure a successful digital transformation roll out. This is supported by a number of papers - one paper I read recently was a McKinsey study published, I think it was 2016, which found that culture is actually, you know similar to what you're saying, the most significant barrier in effectiveness. So really for a cultural change to be embedded company-wide it needs to come from both the top down, and also the bottom up, and it's the role of the leadership team to create the structure and the roadmaps, however the work force really needs to buy in to bring about the effective change.
This means that staff need to be adequately trained and upskilled, with designated champions allocated to work with the technology partners and to transfer the embedded already in-depth knowledge and skills across the entire organisation. You know, the most important thing in digital transformation roll outs is managing people and data skills, more so, and identifying any individual piece of technology, and the people are key in the adoption and the success of any technology implementations really.
In CIM, we've seen the technology adoption rate accelerating when people on the ground take the lead to drive the required outcome, and this really of paramount importance. I think the way of easily explaining it, is that technology helps explore and find the needles in the haystacks, but it really requires people to convert the data and the information into actions and results.
Jim McClelland:
Excellent. So as you say, cultural change is critical but it's easy to assume it's all just about vague concepts of mindsets and soft skills and confidence and mood or vibe within an organisation. But this can be underpinned and furthered by training, skills, knowledge transfer. There can be programmes, there are toolkits, there are mechanisms for helping embed this, and helping spread the word throughout an organisation, which at the end of the day is going to make a difference, and once it's databased and you can see the results, then it's easier for everybody to remember, you know.
They've actually seen it with their own eyes, they know how it works, it's easy for them then to relay it to somebody else. So a lot of your ambassadors and communicators then are energised because it's an easy story for them to tell. They understand it.
So, Dan, if I were to come to you, we're talking about some of the positives there, but I'm not saying you're going to be the glass half-empty guy, but sort of, so from a company culture perspective, what actually might be the roadblocks, the barriers, the obstacles to successfully integrating your digital processes? Where does this fall down, Dan?
Dan Husko:
Certainly, yeah, and we're on the implementation side so we see it on the ground day-to-day. But the biggest roadblocks, there are going to be two of them for us, that we really see in our market. The first being just the physical building itself - we deal with a lot of existing buildings, and trying to retrofit these and really update them to newer technology can be extremely difficult, especially some of these facilities that were built way back 10s or 20s of years ago. They have really dated networks, they have slower automation systems, they just may not be capable of integrating something like a PEAK Platform or a data analytics software, just because they're just not there yet.
Where we look at those, we have the utility companies which I mentioned earlier which do provide some rebates, that to try to offset maybe the capital investment that would upgrade some of these networks and get them to a place where they can take on more technology and do a little bit more, but it still is a capital investment that the ownership or the property management team would have to go for. You've heard it a couple of times before, but the second part is going to be that human element. You have some people that have been in these facilities, operating a building a certain way for 30, 40 years, and they're going to be reluctant to change. We can give them all the technology we want, we can point them in the right direction, and say "we're trying to work with you, we're not trying to say you were wrong, we're just trying to help", but they've done things a certain way, they're entrenched in that way of running a building, and they may be resistant to some of the change and updates.
Jim McClelland:
That's a good point and some of the business-as-usual is because people's tenures may be coming to a close and they're happy just to remain within their comfort zone. Can I just ask you a follow up there Dan - would you go as far as to say it is up to a point, a slightly generational thing? Roll on a few years, in the nicest possible way, will some of those human obstacles be off in retirement and clearing the way for the next generation who are more alive to the opportunities?
Dan Husko:
I think you will see that, especially with new construction projects, we see a lot of technology being implemented from the start. It's really driven on those kind of projects. You know, these buildings have been around a while and people operating as well, they phase out, you get newer staff in there, they're definitely more open. Because one, they're learning this building for the first time and they lean on that tool more so, to help them operate a building and they want to be more efficient. But they're also generally the generation that you know, has grown up with that technology, they know how to leverage it, they know how to use it, they like to use it, which- Really I think we're going to see that shift, for sure.
How Is the Role of the Operations Team Evolving as Buildings Become Smarter?
Jim McClelland:
Excellent, yeah good point. And I like your initial point earlier about, of course a lot of this is retrofit scenarios, where never mind the age of the people, but the age of the buildings can be a real complexity multiplier. There can be a lot of issues and a lot of different one-off scenarios encountered which can make the implementation journey difficult, and in some cases, downright not viable, you know, worst case scenario. So, moving on to energy efficiency. So obviously operations teams play a vital and dynamic role in effectively managing commercial properties. It's important to understand how they fit into the digital transformation process, so I'm going to come to first you, Cillian, and then Dan. Same question to you both, really. So first, Cillian, how is the role of the operations team evolving as buildings become smarter, Cillian?
Cillian Casey:
Yeah, so, one of the key benefits smarter buildings bring to operations and facilities teams is the ability to inform and drive cost reduction activities, whilst also reducing the overall environmental impact of the facility. You know, accurate consolidated data from all corners of a facility, which the operator can now trust, kind of replaced the siloed, disjointed, inaccurate information from the disparate systems that were there in the past. The operator now has a clear, true view of the building's current performance, right.
What all this means, essentially, is that the operator can now be a lot more proactive with his or her decision-making, having more confidence that they're allocating their resources in the correct areas. You know, also, to add to that smarter building tools such as building analytics which were touching on means that operators have an essentially efficient extra set of eyes running across their facility 24-7, and pinpointing any discrepancies and outliers, and then recommending solutions as well, So, for example from the maintenance perspective, historically, a contractor will have been engaged maybe to undertake a list of predetermined maintenance checklist tasks, often focused in areas that add no value or maybe little value to the facility.
Now the operations team can modify the maintenance contracts to look at incorporating, rectifying the issues and opportunities the technology has identified in lieu of those less valuable activities, and then this is obviously beneficial for both the facilities team but also for the contractor. Another benefit of the smarter buildings is that they enable facility managers to sometimes even undertake their work much more remotely, this is something that probably would not have even been heard of pre-Covid, but you see it more and more in the industry now where it's happening that they're not necessarily on site and they can carry out their day-to-day within reason.
On that note, the analytics can also be used as a leading indicator for future complaints or issues, things like CO2 levels rising may indicate that areas that are overpopulated are inadequately ventilated, or FCU valve issues that have triggered alerts, they're either getting too warm or too cold, you know, the data allows them to make the required adjustments before any complaints are logged.
Finally, another area where the traditional operational model is kind of changing is in even things like the cleaning regimes of facilities - we're now working with clients and have analytics on their toilets or on their fixtures and their fittings, and alerts are triggered based on the number of activities, and these alerts are then used to prioritise the cleaning schedules, moving from the reactive to the proactive.
Jim McClelland:
Excellent. Yeah, so as you say, smarter buildings definitely can feed through into cost reduction as well as reducing environmental impact. It's about this clear, true view, it's about visibility, the extra set of eyes as you describe, and a key word: proactive. Now that might feed through into maintenance prioritisation, even cleaning schedules as you say, but also I think, and we'll come onto this later probably, I don't know how you can be futureproofing unless you are proactive. You know, you can't futureproof on a reactive basis - that's not how it works. So, if you're going to have that kind of strategic plan we discussed earlier, then this proactive capability is going to be crucial for you setting out your stall for the coming years. So, Dan, if I give you the same question there, a quick addition under what Cillian said. So, the role of the operations team - how is it evolving as buildings get smarter for you, Dan?
Dan Husko:
Yeah, I'll build off it. I mean, Cillian touched on a lot of really great points with it, where we really see it is we have a lot of facilities that have just thousands of pieces of equipment, tonnes of square footage, and you just can't physically get through all that, even with a maintenance check or preventative maintenance style plan, you can't do it, you can't see everything at once. So in the past we typically had just a BAS alarm that says "hey I'm hot" or "hey I'm cold" and you are being reactive, you're going just putting out fires, that's your day-to-day. Now, we're able to look at all this equipment, all this data, all these points at once, and we can really figure out the areas that are the problem childs, the areas we need to focus on, and we can kind of spend our time being more efficient without operating staff, going to the areas of concern before they may become a problem that a tenant notices or a person in the building notices, and fix it before you get that hot or cold alarm, which is really like the last step you would get typically, now we're getting out in front of that.
Jim McClelland:
Excellent, so, nice point. As you say thousands of pieces of equipment, potentially millions of square feet even. It's that kind of granular, that close-up 360 kind of visibility that allows you to spot the problem hotspots before essentially that problem is manifest necessarily, before it moves into complaint territory. And it gives you that, be able to shift gears between those really tiny minute specifics day-to-day and those kind of strategic objectives, and all those client and customer communication things as well.
So, I think it was Dan previously who I asked to be the bad cop in this, Steve I'm coming to you potentially here. So, what are the key challenges for operations teams that might actually make it difficult for them to embrace change successfully? Why might it not work as easily as we hope, Steve?
Stephen Gorvel:
Well other than, I suppose, what's been mentioned already about what people are familiar with, one of the big challenges is familiarisation of the technology. Learning how to use it, but importantly, how to interact with it. Now that could come down to some of the points already raised about the age profile of the people doing the maintenance, and how willing and able they are to engage with new technologies.
But having that feedback and getting the people to interact with it allows us to finetune that system as well, which is quite important for us. It brings a greater understanding, so that's obviously a good point. And I think to use an analogy on it, if you take what happens with a lot of motor mechanics and vehicle diagnostics at the moment, is it's normal for people to drive their car into a garage, mechanic plugs a computer into it, tells him what's wrong, off he goes and fixes it.
So, the technology that's there now for the buildings enables us to do the same thing, that same approach. I think from an operations, from a team perspective it's going to take time, because it's not how we've done it so far in most cases. We've got people used to going in like Cillian and Dan said, doing it traditionally, there's a checklist you work through that, you do whatever was on the list. But what we're able to do now is to kind of take those traditional maintenance strategies and move them more into a condition-based strategy. You know, focus on what's value add for the system as opposed to, you know, just doing the checklist and mind-numbingly going through the same motions all the time.
Jim McClelland:
Excellent, yes. So, as you say, fundamentally it does just come down, perhaps, to a question of time. You know, we are talking about finetuning, we are talking about evolving and transformation, and some of these traditional ways of doing things, moving on from them but bringing the people with you, obviously. And as you say, tech can enable diagnostics but you're moving towards a condition-based strategy and a value add rather than simply, as you say, mind-numbingly running down checklists every day because that's what you always have done.
What Are the Key Insights Building Owners and Managers Should Look For In Their Data?
Jim McClelland:
So, we talked about the human side and now, in a way, that leads us nicely onto the digital transformation and the key component here which is the data. You know, the success of these DX endeavours often comes down to ensuring the data generated truly drives actionable insight. We all can quote a few examples where there's a lot of data collection that doesn't actually do anything, it isn't used, it doesn't inform any decision-making. What we're looking for is the stuff that drives actual insight, quantifiable results.
So let's dig a bit deeper from a building operations point of view. So, Stefan, first you, so, your perspective, what do you think are the key insights that the building owners and executives are looking for when it comes down to that four-letter word, in a good way, data?
Stefan Schmidt:
Yeah. I think, I mean from sustainability perspective it's the carbon piece, right? And you know whether that's embodied carbon or carbon emissions based on energy consumption or building use, you know, people need this data now to be able to report effectively, and if you're a public traded REIT you typically report in your annual report, if you're looking to report to GRESB or a similar building certification standard, you're doing that for certification perspective, which we really just need to get beyond now and are getting beyond now a point where that's critical, and people are doing it.
The other side of it, and I think the reason that people are looking for broader datasets as well, is making sure that their assets aren't dark, right? You think about other industries where you have, you receive insurance premiums for putting a box in your car that tells you how safe you're driving, you can think about how those insurance models apply to real estate and they're starting to do similar things.
If I'm trying to insure a building or develop an insurance premium for a building, and I don't have sufficient information available to me, I'm going to increase the cost of that insurance and that's going to make my building less valuable, less attractive to tenants because the service charge is higher, less attractive to their investors who are trying to buy my asset. So there's kind of this need now to have a holistic dataset, and a lot of that data need from an owner or an executive perspective, rather than a ground level operator, is focused on those high level metrics like carbon emissions for that property.
Jim McClelland:
Excellent, thank you, so yeah, okay, critical for reporting as you say you cannot be doing that in this day and age without the necessary data to back it up. You're talking about holistic datasets and that kind of level of transparency and visibility, and there's a direct business case for it because you will face penalties or at least disincentives if your assets are dark and if you're not being open about who you are and what you do and where it is.
So, Cillian, if I'm coming to you then, so historically why have building owners and managers, it sounds like a win-win, why have they struggled to make that data visible and accessible, and how can this actually be addressed so you can use it effectively? What's the problem been, and how are we fixing it now, Cillian?
Cillian Casey:
Yeah, so, I mean, buildings typically have a mountain of data being collected every second which equates to hundreds of thousands of data points each day. As previously mentioned by other panellists, the value of the insights derived from this data is transformational for buildings and building operators, however there is, and Daniel touched on it a while ago, an industry-wide challenge with accessing this data, and there are probably a number of reasons for this.
Firstly, looking at proprietary software, it's a real challenge in the BMS industry, what proprietary protocols really mean is that the data is kind of pseudo-locked in and thus makes it more challenging to extract that data, and then this can actually often restrict the insights that can be derived from the building's existing dataset. Secondly, there is no real consistency with the configuration of the data and no real industry-wide standard that has been actually adopted globally. This means that every building will have maybe the same or similar data, deciphering what these data points actually represent, often quite difficult.
Really having access to the data may not necessarily lead to value derived from the data, which Jim you touched on a moment ago as well. In terms of addressing these challenges, I guess firstly from a data accessibility perspective there is definitely more focus in the industry, and particularly from the building owner's perspective, to demand these open protocols such as BACnet, when specifying their BMS, for example.
Also, there are options to inject the data directly from the source, or if it's not available directly from the source, then you really need to have the capabilities to get that data out via other avenues such as APIs to databases, or data from historians or maybe even use proprietary drivers. You know, that's kind of accessing the data. And then secondly, from a data consistency perspective, that's really quite hard now, you know, we've done a lot of work in CIM with machine learning algorithms to kind of assist with the point commissioning and tagging, and to help speed up the process and also help with the verification and validation of the accuracy of the data that's commissioned, but really it would be a lot better if there was kind of a consistent standard pushed out and adopted across the board to make these systems a lot more compatible with one another.
Jim McClelland:
Very interesting. Yes, so, as you say, effectively it has been an industry-wide challenge, there's been a lot of proprietary software, basically data's been locked in, information in siloes, lack of communication, and also the ongoing question with any kind of, if you like, emerging or evolving market is a cry for standards and consistency and a level playing field. Now on the first point, as you say, therefore open protocol demand, you're seeing some progress there, you're honest about the fact in terms of the standards and consistency, that is still a work in progress, there isn't necessarily any game-changing or eureka moment happening on that front yet, so that's still an area where we could hope for some advances. And so, we're moving now to the final ten minutes or so of the session, so Dan, if I just come to you on this: data - how can it be used to improve the performance across building operations supply chain? Everybody, namely the FMs, the contractors, the consultants, the operations managers, etc., so talk to me about the whole supply chain giving in on this, Dan?
Dan Husko:
So, you know in every building operation there's a lot of moving parts. You know, we analyse all this data and we try to identify these problems, but then obviously the thing we want to do is fix that problem, and knowing who's responsible and what needs to be done to fix that can really be streamlined with this data, and leveraging it properly, and having good analytics set up. You know, like I mentioned before, you get a cold call or a hot call, a lot of times there's a lot of investigation that goes into fixing that problem, and the engineers going to start with going to the space, maybe looking at the equipment, maybe trying to figure out what may be wrong there, and then they find out they're not the one that can even repair it, or they need a part.
If we can identify exactly what needs to be replaced ahead of time, and then we know what that part is, and we have our attic stock, and we know we have that well stocked up at this time, we can quickly make that fix and get the right parties involved, whether it be a pro contractor or a mechanical contractor, or to just facility personnel in this case. And then if we see a lot of failures in a certain part, you know say analytics just catches a lot of damper failures in this case, and we know we need a certain part, perhaps we can load up ahead of time, get that ordered, right now equipment and lead times or extremely long with supply chain, which is more than just the building supply chain but the global supply chain. It could be months, you know, weeks before you can even receive the part you need to make that repair. But if we're able to maybe plan ahead of time, maybe order extra knowing we're seeing these failures, you know, it can really alleviate some of those pain points, do things much quicker.
Jim McClelland:
Excellent, yes. So, obviously I mean, you're saying it's a supply chain-wide scenario that you need the access to the data, you need to leverage it, but also you need the quality of analytics that effectively can be used by these different players on the same team. In fact, you put them on the same team. So, we're just about bang on time, we're moving into about the last five or 10 minutes or so, so now, we're going to look ahead to the future.
Digitising building operations is going to play a key role, the way we run buildings, portfolios, critical in helping ongoing industry challenges, some of which we've already touched on of course.
Key Pointers and Take Aways
Jim McClelland:
So, I'm going to come to you each for a quick sort of minute or so wrap up, looking ahead. First up, Steve, sustainability perspective, what do you see as the keys for building owners and operators to maintain progress on their emission reduction targets as they head towards, rapidly, 2030 and beyond? Give us a few key pointers and take aways, please Steve.
Stephen Gorvel:
I guess three for me, key points, and one's already been mentioned, is the data-driven decisions. The ability to create a roadmap from qualitative and quantitative data enables us to make better decisions for the future. It enables us to model different scenarios, and do this or do that, how does that affect our objectives as a corporation, as a company. And it also gives us a greater degree of confidence in whatever plans you might make.
If we look at it from an emissions perspective, and the objections there of course are to reduce, having measurement and verification, it is very important. And so this technology assists us with that, so we forecast that we're going to save this much in our emissions, or the gains we're going to get, measuring it to be able to confirm that we've actually got that. Also important of course with the energy management systems.
And then, finally, from a perspective of what we're doing from a labour perspective, it's what it does to us. We can do all of this manually, of course we can, but it takes a long time and it takes a lot of effort to kind of get it, whereas with here we've got the information, it's consistent, it's concise, and it's there very quickly.
Jim McClelland:
Excellent, nice points. So you said, as we kept saying almost for the whole 40 minutes so far, it's this data-driven scenario, just where measurement and verification allows you not just to keep your promises but to prove you're keeping your promises, which is crucial, and it's just a question of speed. It's already later than we think in many cases. We're under time pressure between now and 2030, and we do not have time for a lot of very labour-intensive and slow processes, so speed is a real winner. So, speaking of speed, it's this one minute fast finish now. Stefan, coming to you, so, headwinds facing the industry. We've mentioned some of them, remote working, rising energy costs, government regs, cost of capital, so give us a few tasters of how can operators of properties navigate these headwinds now and into the future?
Stefan Schmidt:
Yeah, brilliant, thanks, it's a huge amount of disruption now in the real estate industry. I'll properly kick off by saying I'm glad it's not tech disrupting real estate any more, it's actually just real estate disrupting real estate, and tech is here to solve some of those problems, which is really nice. But I think generally speaking, the key thing to focus on, and we still see this happening all the time, you know, have a strategy. There's all these different things going on right now, you know, whether or not you're focussing on return to work, you're focussing on your net zero. Understand what your challenges are, have that be a dynamic understanding, because your challenges are going to keep evolving, and prioritise against them as well.
You know, I think everyone's favourite word in 2022 should be "focus". Our focus is being dragged more and more into different avenues, it’s the people in society all the time, and we need to be able to choose what's important to us as an organisation, as well, focus on that one deliverable and then kind of run through and push ahead. Obviously change management is a big part of that, we've spoken about that already, you now, getting the right people on board, getting them to focus on pushing through with initiatives. And so is monitoring, and success metrics which Steve mentioned already. You know, once I've implemented technology, once I've bought a piece of software, it's not over, I'm not suddenly going to hit my net zero target because I've implemented that software. I need to keep monitoring, I need to keep improving, and I need to keep engaging with it, even at the executive and the C suite level to be successful.
Jim McClelland:
Excellent, some very nice points there. Tech - part of the solution, no longer part of the problem effectively for real estate, but it's those nice crunch words we've kept coming back to, strategy, a nice phrase you used, dynamic understanding, and focus, focus, focus. Of course, the data and the digitisation enables you to refresh that focus repeatedly to make sure you are on track. So we're moving into the final minutes, final word I'm going to come to you Cillian, so we're going to wrap up on data and digitisation. Last couple of nuggets from you so, final thoughts, how building owners and managers, how can they embrace these concepts to benefit their operational models? So, tell us how this embracing is going to happen, Cillian.
Cillian Casey:
Yeah, look, as previously touched on, you know, we've already seen a substantial growth in interest and adoption of digital technologies in the built environment, and this is driven by a number of factors, with net zero targets certainly being towards the top of the priority list. You know, with the cost of energy obviously almost tripling somewhat overnight, many of the initiatives that were earmarked for the net zero map, have all of sudden been catapulted to the top. And that's also good, given that many of these initiatives probably benefit both the cost-saving side of things, but also the sustainability side.
The key thing though, and I kind of touched on it before, is really bringing all the people and stakeholders in the organisation on a journey, when driving any digital transformation. This includes ensuring all the people have adequate training, and all the tools, and a clear understanding of the benefits of all these initiatives. This may also mean an element of upskilling for all the staff, to ensure that they have all the required staff for what their job is now, but also pretty importantly, what their job will need in the future as well. And we have seen, with our clients, the importance and value of ensuring the people and the technology kind of work hand in glove, so CIM really put a massive emphasis on the training component when we onboard any of our users, because we understand that in isolation they don't really work.
So, in summary, although digital transformation is well and truly underway, the most important cog in the success of these initiatives remains with the people driving and using the technology. You can have the best software in the world or the best technology in the world, but if nobody is really using it, it's pretty worthless.
Jim McClelland:
Excellent. Nice point to close on. So, we're bringing all these stakeholders on this DX journey together. It is ultimately a team game. So there we are, we are bang on time for the finish. A few final thoughts from me - I'm afraid we won't be able to get to questions, but fear not, they will be responded to after the event.
So thank you very much for posting them, some nice ones in there, and so I'm sorry to say panel your work won't be quite done yet in that there will be a little bit of homework afterwards in terms of the questions. So final thoughts from me, very interesting debate, so given the economic volatility we're experiencing in the UK and Europe, we all know about that, plus the disruption to energy markets, the long shadow still cast over supply chains by both Covid-19 and Brexit.
Frankly it would be naive to imagine the context of building operations is going to get any less complex any time soon - it's not. Yet, net zero targets are not going away, so the job is difficult but it still has to be done. This is where data can help - it can help in a big way. To de-risk investment, as we've heard, optimise efficiency, and ultimately drive the sustainability agenda forward. The future of building operations is digital. So, embrace the change, together, as Cillian said at the end.
So, in closing then, big thank you to all our panellists, Dan, Steve, Stefan, and of course, Cillian, and our hosts at CIM. To yourselves, our virtual audience out there for joining us this lunchtime at your desks and screens, and some really good questions which we'll be responding to. As mentioned, you will also all get the webinar recording after the event for you to look back over. So in the meantime, that's it for today. An extra big thank you to the panel for all their hard work.
I've been Jim McClelland, editor at SustMeme. Thanks for watching, and we'll see you all again soon. Thank you, and goodbye.
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