Digital interfaces – why transparency protects against too much work
Let us imagine a tenant complains that there are a few broken paving stones in the driveway of the office property he uses. What the investor ultimately hears after numerous e-mails and phone calls, however, is the news that the entire driveway for the property has to be repaired at a cost of several thousand euros. And without any further scrutiny he approves the costs.
As exaggerated as this scenario might sound, such serious misunderstandings certainly do occur. Often the information passed along the value-added chain between differing service providers in facility, property and asset management is erroneous or there are differing assessments of the same situation. Much more common, however, is unnecessary duplication of a task, with different service providers doing the same work and each of them invoicing the investor (directly or indirectly).
The catalyst for this situation is the pressure for perfection on the individuals involved: the activities in real estate management have increased in complexity, something which is due not least of all to the large number of tenants and the ever-increasing technical challenges. Asset and property management companies are adapting to these developments, increasing and enhancing their services accordingly with the objective of managing commercial real estate in the best-possible manner. As a consequence the asset manager is assuming more and more operational tasks, yet many property managers are also thinking outside of the proverbial box and providing ideas for the respective property strategy.
Duplicate structures result in superfluous measures
What is actually intended to benefit tenants and investors, ultimately leads to a decisive problem. All the parties involved endeavour to perform their tasks as thoroughly as possible and without any mistakes, at the same time underlining their importance for various matters. This often leads to measures being initiated which are not part of the actual core business of the asset, property or facility manager, and thus to duplicate structures. The result is over-management of commercial real estate, from which neither the individual management parties nor tenants and investors benefit.
This duplication of work can be avoided by having clear structures and coordination processes. Although a service provider which covers all areas of the value-added chain is at an advantage, there can still be misunderstandings between individual departments, however. This is why a common digital platform – which serves as an interface for all processes and which also encompasses the accounting as well as the classical management activities has to be at the heart of a possible solution. Such a platform guarantees that all the parties involved are familiar with all the assignments and that the required specialists can be called in at the requisite points in time. The result is solution-oriented and efficient management.
Specialists and generalists at the same time
In conjunction with a digital tool such as IRES+, for instance, corporate structures such as those that we have at IC Immobilien Gruppe counter the problems of over-management. On the one hand, we aspire to ever-greater specialisation on the part of our teams so that we can overcome complex challenges with the greatest-possible efficiency and precision. One example of this is our process management as support for the property management. On the other hand, we cultivate a consistent, cross-departmental two-person principle. At our company property managers know exactly what is happening in accounting and at the same time pass on their assessments with regard to questions from asset or investment management. In this manner one department supports the work of the others rather than hindering it through duplicate processing or erroneous information.
In this respect we make our findings from the individual projects available to our entire team. For the documentation of the individual steps has another decisive benefit: it the long term it can ensure performance enhancement as we can anticipate real estate-related changes on the basis of our existing knowledge.
About: Heiko Dietel is Managing Director of IC Asset Management GmbH.