What building data strategies do you need to ensure meaningful capital planning? We discuss three key considerations for real estate managers.
We’re all familiar with the phrase “analysis paralysis.” It describes the difficulties in working with so much data: where do you start, and how do you make sense of it? Often, data becomes the focus of analysis efforts instead of the questions themselves.
Real estate capital planning is no different. Executives, directors and managers looking to deploy or justify a capital expenditure strategy typically find themselves challenged to compile and centralize large amounts of building data. They face a struggle when looking for a starting point in data analysis. It becomes more challenging when they attempt to derive meaningful findings with the information.
For the capital planning process, we list three building data strategies to consider.
Define Building Data
Before analyzing any data, organizations need to first understand and define their data needs. Usually, they focus on available building data and work from there. But it’s more beneficial to think creatively about how they can filter data to solve capital planning requirements. For example, simple data calculations, filtering or combinations with other sources could provide new and meaningful information. This is often considered “pre-analytics.” Using raw data alone to derive answers is not the only way. It’s often limited in scope and singular in purpose.
Defend Building Data
One of the most powerful aspects of data is that it is largely unbiased. Operating costs, energy use and employee counts, for example, are raw numbers available for analysis.
As such, when optimizing or scenario-testing a potential capital strategy, focus on what the data tells you. What are the incremental cost savings or financial benefits with a specific capital plan? What about alternatives? Do scenario results actually confirm the stated benefits of the original capital plan and investment strategy? Using data analysis to confirm (or adjust) capital plans is critical. Biases can often form when allocating investment dollars for projects. Having sound quantitative rationale for capital planning is a necessity. It ensures the investment and/or project gets full organizational support.
Detail Building Data
For firms who can produce insightful results from vast data, the most difficult step is actually presenting the data in a meaningful way. Despite many scenarios tested and alternatives researched, many real estate directors continue to focus too much on the data. They forget to work on final recommendations when seeking executive approval. As such, directors need to be concise and results-oriented when preparing to present and justify their capital plans. What are the top findings from the analysis and what are the top recommendations? What is needed to move the project forward, both financially and organizationally? What are the top three benefits of the plan?
Directors and mangers may want to present the underlying analysis guiding their decisions. But it’s the end results and recommendations that often carry the most weight and meaning during presentations.
Organizing your building data for analysis can be made simpler with 4tell™’s iPlan™ Portfolio Solution.
Share on Facebook
