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13 NOV 2019

Driving business value through PropTech

While real estate businesses recognise the potential of property technology (PropTech), many appear to be unconvinced by the impact it will actually have. In an age of profound business transformation, many companies are struggling to answer the question: "How does this drive business value?"

Today's savvy real estate businesses want to learn more about how disruptive technologies — Blockchain, Artificial Intelligence, and Augmented Reality etc — can support them and create an edge over their competitors. However, many may not realise that they are 'handcuffed' by what may be two-decades-old implementations that they have, at best, done a technology upgrade on.

This could be a HR platform, a filing system, or an operations process — anything that has become 'business as usual'. Fewer upgrades and more archaic technologies can mean higher costs and more time spent supporting them. Slowly but surely, a business will find itself unable to be as agile as it wants to be.

Wanted: PropTech partnerships

It is unsurprising then that an industry that has traditionally revolved around trust has begun looking to other sectors for collaborators. In truth, there are players in the industry have been collaborating with tech startups for years.

Take, for instance, Propell Asia, the Singapore-based accelerator programme created in partnership between JLL and Lendlease. It aims to "uncover Asia's brightest PropTech startups" and fosters solutions so that these consultancies' partners might best-anticipate change that will occur in the next 5, 10 or even 20 years.

"The majority of consulting [JLL] does in the PropTech space right now is around data — 'hygiene' projects to ensure data quality," said Ben Hamley, Future of Work Lead, Asia-Pacific, JLL, during the recent APREA-RICS PropTech Innovate 2019 conference. "Only around 20% of businesses we work with are at the stage where they can use data to make decisions. Programmes like Propell Asia allow us to be ready for when the other 80% [of businesses] are ready."

Bryan Ong at PropTech Innovate 2019
"Business value is the key driver" — Bryan Ong at PropTech Innovate 2019

Lasting decisions

Businesses and their clients are faced with challenges for which digital enablers and innovations may provide the answer. For those that are progressively adopting digital solutions, there is an awareness of the potential of innovation, however, this is tempered by caution.

This is certainly the case for many industry developers, who build real estate assets with long lifespans. They must balance client-demand for slick and smart technology against careful consideration of what solutions will stand the test of time.

Bryan Ong is Head of Digital & Technology for Keppel Land, a premier real estate developer in Asia, and manages the business's Digital & Technology team. Bryan previously worked for Microsoft and is all-too-aware of the potential pain-points of digital transformation and the need to bear both the business and client in mind.

Keppel Land: Paving the way for innovation

Keppel Land is committed to creating value for all stakeholders and focusing on future value by experimentation. Spearheaded by Bryan, they have embedded digital operating models that have made core processes more efficient and cost effective. These include:

  • Agile working: Using agile sprint teams and collaborative processes for product development
  • Customer-centricity: Move from operation-centric to customer-centric design. Drive affinity through personalised services
  • Process automation: Reinvent processes through automation. Rapid development using reusable components
  • Innovative technology: Two-speed architecture that supports a strong foundation for digital innovations
  • Data analytics: Champion a data culture through data-first strategies. Use big data and analytics to demonstrate business value.

"Business value is the key driver," said Bryan during his presentation at the conference. "[Keppel Land] uses data to make business decisions, we focus on driving the digital experience for our clients and development occupants."

Bryan has worked hard to ensure his team is a proactive resource for clients, which enables them to anticipate problems that developments may encounter. This is different from more traditional working methods, where developers would wait for clients to approach them with a problem.

"My team engages with business owners and users, and researches technology and startups to assess what we should invest in," stated Bryan during his presentation. "I evaluate these based on which will generate the most value and financial return. I'm mandated by the business to ensure we invest correctly to create and optimise value."

Value is vital

Technology and innovation can lower operating costs and deliver higher returns; however, it is vital that startups can show added value to large organisations. One such business that has done this in Asia Pacific is Ynomia.

Ynomia provides a low-energy Bluetooth-enabled tracking device that monitors the movement of machinery, people and materials. While the idea was strong from inception, it wasn't until it was put in front of construction industry partners that it really took off — the response was immediate.

Why? Because industry could see value beyond just the operational benefits. The solution could be used to improve transparency in worksite management, helping to reduce construction accidents that might occur, and tackle longer-term concerns over building quality. The company now has the backing of US construction venture capital investors, Bricks & Mortar Ventures.

"There is a list of technologies currently in various stages of development that will attempt to streamline processes and boost precision," says Piers Brunner FRICS, CEO for Greater China, Knight Frank. "Over time, some of them will prove their value and proceed to widespread adoption, while others will languish into obsolescence."

The role of the broker: Read the full interview with Piers in Modus Asia-Pacific edition, Q4 2019