Commentary

No one doubts the value of good data. It can transform enterprises, informing their marketing, their procurement, their production techniques – in fact, their entire strategic direction. But in the corporate real estate (CRE) sphere, the potential of management data is possibly less appreciated than it should be. Yes, finance departments appreciate the value of market data, and of data like cost per square metre and cost of occupancy. But in many instances the management and operational data they track does not reflect changes in the way people work. Businesses are missing opportunities to improve performance. In 2011, Regus published a report by two highly-respected academics, Barry Varcoe and Martha O’Meara, on how best CRE practice correlates to company success.[1] The report analysed forty Global Fortune 500 companies, with a total operational portfolio size of 221 million gross square metres. One key finding of the report is the correlation between company performance and CRE data. The authors found that a well-developed operational and management data practice correlates positively to return on assets (RoA) and return on equity (RoE :) a 25% improvement in management information practice relates to an addition of 0.82% to an organisation’s RoA, and of 1.77% to its RoE. Most people realise the link between data and performance: the ability to make better decisions relates to better returns on resources. But the Varcoe and O’Mara research is ground-breaking in that it quantifies the benefits of good CRE data. In turn, it encourages companies to explore what good data entails. Traditionally, property departments think in terms of average cost per square metre, rather than how space is used. But as employees become more mobile, traditional corporate space sits un-used for some of the week. Companies know this, but they may not measure it.