State of the Industry Report 2007-2008

Chapter Seventeen related Issue: oVerComIng obstaCles to Industry data standards osCre – the open standards Consortium for real estate What are the obstacles to a high adoption rate for OSCRE as an electronic data exchange model, and what are the best ways to overcome them? One of many challenges to wide-scale adoption is that although while corporate real estate (CRE) is reportedly the world’s largest business sector at $4-trillion, it’s also “the most fragmented industry I’ve ever seen,” one industry executive commented in 2007. the Industry’s breadth has determIned osCre’s wIde sCope of work now well under way In the followIng areas: • • • • • • • • • • Commercial Information Exchange Facility Management Work Order Space Classification Standards Geo-location Classification Standards Space Utilization Metric Commercial Property Management Appraisal Institute Real Property Unique Identifier Lease Abstracts Residential Property Information Exchange The critique proved constructive, however, because participants also advised OSCRE to take a modular approach driven by a system ‘backbone’ that would also allow for users to tap pieces of the platform in cafeteria style instead of having to integrate it as a whole into their existing systems and operations. Because the entire supply chain of the industry is being integrated into OSCRE, it’s also important to sell adoption not with a single value proposition, but through multiple messages corresponding to various industry segments like investment, brokerage, appraisal, development and portfolio management, participants also advised. Still, there are forces driving OSCRE that require a high degree of attention to the need for data standards: • Cross-border transactions and monetary exchange • Definitions of key terms and practices that vary from region to region • Lack of inter-operability among supply chain players and CRE stakeholders • Sarbanes-Oxley (SOX) compliance and the regulation of transparency • Hostile takeovers for the sake of monetizing underappraised assets • Corporate divestiture of real estate These and other drivers cause friction across the supply chain. They also require that companies spend extra time making data from multiple sources consistent enough to aggregate and roll up into reliable information for the C-Suite and business units to manage against. For example, one service provider estimated that his firm spends at least 30% of its time manipulating data for customized integrations, data scrubbing, and manual data entry or reentry. Consistency, efficiency, transparency, lower costs and better outcomes would be the benefits OSCRE can deliver to overcome the added cost and time that companies are spending on data management. “The cost is a lot higher without standards,” a CRE executive mentioned. OSCRE “will lubricate the flow of information,” as advocates point out. “It will make business work better, and improve interactions along the supply chain and internally (inside the enterprise).” Its ultimate value is as a life-cycle and decision-support tool that reduces product and project cycle time. Its impact will be across the real property supply chain. chapter seventeen One advantage, however, is that OSCRE represents about half of the industry’s total valuation. About $2.1 trillion in assets are represented among OSCRE stakeholders largely in the commercial real estate services and technology sectors. Another advantage is that corporate end users are pushing their service providers for consistent data standards to reduce the extra cost and waste associated with often manual nature of data conversion without standards. CoreNet Global’s launching of OSCRE as eCRE in 1999 laid the foundation for the end-user influence driving OSCRE’s advancement. The fragmented nature of CRE stems directly from the diverse industry mix seen on the demand side among corporate end users which in turn extends to the supply side and the broad spectrum of specialists and disciplines serving the demand side. But the enormity of developing OSCRE’s functionality can be like “boiling the ocean” and is overwhelming, as some executives advised in 2007. State of the Industry 2007-2008 63 http://www2.corenetglobal.org/home/index.vsp

Table of Contents Feed for the Digital Edition of State of the Industry Report 2007-2008

State of the Industry Report 2007-2008 Contents Chapter 1: Introduction : CoRE 2010 Framework and Report Structure Chapter 2: The Changing Business Environment Chapter 3: Executive Summary of Key Findings and Conclusions Chapter 4: CoRE 2010 Adoption Rate Chapter 5: Sustainability/Corporate Social Responsibility Chapter 6: Global Sustainability Survey and Roundtable Findings Chapter 7: Workplace Practices/Work Environments Chapter 8: Workplace Related Issue: The War for Talent Chapter 9: Asset Management/Portfolio Optimization Chapter 10: Solutions Delivery Chapter 11: Location Strategies/The Strategic Role of Place Chapter 12: Location Related Issue: Site Selection Morphs to Portfolio Alignment Chapter 13: Strategic Competencies/Enterprise Leadership Skills Chapter 14: Competencies Related Issue: The War for Talent in Corporate Real Estate (CRE) Chapter 15: Integrated Resources Infrastructure Solutions – IRIS Chapter 16: Technology and the Web Chapter 17: Technology Related Issue: Removing the Obstacles to Industry Data Standards Acknowledgements and Sources

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