Innovating the value proposition for corporate real estate

Abstract

The focus of multinational corporations (MNCs) regarding the real estate workplace has shifted from the basic objective of minimising costs to a strategic objective of maximising value. While the workplace continues to evolve as an offensive differentiator for corporate enterprises, the internal corporate real estate (CRE) teams and service providers alike aim to discover new and different methods for driving organisational productivity, optimising costs and managing risks associated with the real estate workplace. Recent key innovations to the workplace include advancing technology platforms, instituting portfolio-wide workplace strategy, building performance management frameworks, talent development programmes and delivering globally integrated service execution models. CRE teams must take into account how these workplace innovations will affect the overall customer and employee experience, and develop a plan for how employees and business units can contribute to a dynamic working environment by establishing a culture of innovation within an organisation. Additionally, the real estate function of large MNCs should forecast and understand the impact that innovations will have on corporate financial performance and how shareholders will perceive the potential benefits and risks associated with workplace innovation.
The fundamental premise for delivering the value proposition is organisational alignment between the core enterprise business and the CRE team. Workplace innovations only achieve optimal value creation if the implementation strategy is in agreement with the overall business goals. In effect, the entire CRE industry incurs a greater degree of accountability to build an advantage for global corporate occupiers. In order to deliver value and enhance workplace performance, CRE teams seek to establish a culture of innovation through creating workplace environments that are conducive to employee collaboration, developing cutting-edge technology capabilities that increase productivity and providing a strategic roadmap for implementing new ideas and processes across a global portfolio footprint.
The CRE industry has witnessed a considerable amount of workplace innovation, including the centralisation of CRE operating models, urbanisation and globalisation, and enhancements to technology and tools deployed by workplace professionals; however, the most significant innovation within the industry to date revolves around the evolution towards the adoption of global real estate operating models. This pursuit of globally integrated service delivery platforms has created the impetus for transformational merger and acquisition activity among real estate service providers over the past decade, as the industry has consolidated to better support the expanded requirements of global occupiers.