Transforming property is a slow process built on small wins
Applying data-driven solutions to your business is a long-term investment, not simply a tick box exercise, writes Julian Carey of Stenprop.
To most of the real estate industry accessing, aggregating, interpreting, and applying data can create significant revenue and cost saving opportunities. That is usually where the conversation stops. When talking to proptech companies, the focus is usually around the upfront cost, but creating a strategy to tap into a business’s data is a much bigger commitment.
Research by Computer Economics in 2020 found that on average companies spend 2.6% of their revenue on IT services. My expectation is that our industry’s spend would be lower, as there is still a hesitancy around investing into technology. More traditional businesses are unsure whether the spend is justified or don’t have the confidence or skills to undertake this type of strategic overhaul. It is daunting.
At Stenprop we have been on our own journey to understand how best to integrate technology and extract more value from our business. We believe that the rewards we can gain from data technology are worth the cost, the time and the stress. Implementing change or modernising how you work is a slow and incremental process built on a series of small wins. However, we have seen that as these wins take hold a company can grow in confidence and become able to structure itself to implement bigger changes and see bigger gains.
Our dedication to technology means that we were able to operate efficiently and support our customers during the pandemic without making any changes to our systems. Our digital leasing platform enabled us to sign over 40 new leases during the second quarter of 2020 despite most of our lawyers and agents being on furlough. We were able to use our customer demand data to underpin the decision to recommence our investment programme three months before most of our competition.
Tech transformation is no small undertaking
The move away from legacy structures requires investment into technology over time: there is no quick fix or off-the-shelf solution that will support real transformation. Understanding how tech and data can optimise your business, and knowing what investment is sustainable for your business in the long-term, can help you structure and build your IT spend over time with confidence.
The key lesson that I have learnt as we’ve gone through this process is that data is the fuel for all technology. If you want to extract maximum benefit from your tech investments, you need to have, and be able to access, high-quality data.
In order to access and clean your data you must look at your business through a new lens. Rather than data for data’s sake you must ask, what data do we have to buy, create, capture and process in what systems – and to what end? Who owns the data (internally or externally)? How do we capture it? How can we monetise the data we generate through our ordinary business activities?
While investing upfront in your data architecture can feel like you’ve not yet achieved anything, once you have control of it, your technology gains are far easier to capture.
Ultimately, our key takeaway as we continue down this path has been that the investment of capital and time is worth it. We’ve worked with some great tech companies and through our own discovery have opened our eyes to the power of data and how it can help to successfully support our growing business.