Innovate or die
A great enthusiasm for innovation has gripped the German real estate sector, as experienced at the recent ZIA Innovation Congress in Berlin. It is reminiscent of the more desire than fact-driven euphoria that had the industry toiling away at the topic of sustainability 10 years ago, but which is nowadays of hardly any interest to anyone.
It is with admiration and foreboding that the “wild boys” of the close to 150 PropTech companies in Germany are being watched; as they stand ready to shake up the Old Real Estate Economy with their disruptive digital inventions. But if one looks closer, the matter is not as clear cut as it would first appear. Many of the new companies are marketing and crowdfunding platforms which, it is assumed, will be facing some form of consolidation and regulation process. A second large group is occupied with the optimisation of existing processes in portfolio, asset, property and facility management. Behind this there is a great deal of digital innovation which, whilst it probably leads to more effective processes, improved service and cost savings, does not in itself create new markets. Truly new products and services are very thin on the ground. One is still more likely to find them in the Internet of Things (IOT), Virtual and Augmented Reality (VR/AR), robotics, 3D printing, and in new transport solutions, such as drones. But a real “Next Big Thing” is still not yet in sight.
So as not to miss the boat, we at CBRE and VALTEQ pursue a variety of approaches to innovation management. These include the monitoring of technological developments and the establishment of close ties with the innovative scenes at the company’s numerous global locations. Beyond this, there is the internal linkage of this knowledge base and reconciliation with the needs of customers and of the own company. Depending on the field, we then follow different procedures in the implementation of innovations. There are a number of conceivable methods: from the programming of complete applications by dedicated software developers, to development partnerships with start-ups, all the way up to the acquisition of entire solutions which we combine with existing applications to form new products.
In this regard, every company must find its own way. But what ought to be clear to all managers in the sector is that without providing resources and the cultural opening for innovation, the risk of being outpaced by new, more agile competitors will grow with each passing day.
Dr. Thomas Herr, Managing Director of VALTEQ Gesellschaft mbH (CBRE)