Well just read that headline again, and note the quote was not written by me. It is part of a response to an article I wrote titled: What Is Your Business Model Today? What If It’s Completly Wrong?
In that article, I thought I made the point that automation and the processes we use today may be far outdated. I have also written several articles lately championing Big Data and AI.
But as he read the article Mr. Dickstein thought otherwise.
“Honestly, I have to wonder about the motivation of a guy who spends 80 percent of the article knocking the ethics of the industry instead of the real issue he is raising which is time management and better business methods through automation. I have been in this industry for 40 years now. I have seen technology transform the way we do business. CoStar has made getting data much easier. Email has created an instant demand for my time. Now you are suggesting that I automate my business process. Dumb. You can’t automate the information in my brain. Information designed to help the client with his or her unique issues. Nothing has really changed in the real estate business in the last 100 years, and frankly, it never will. I laugh at the notion of online information superseding the knowledge of an experienced real estate broker and advisor. Yes, LegalZoom may have cut into the low-end business of legal forms; Indian computer software companies have cut into the low end of the Software Consultants; but frankly the notion that we at the high end will ever allow ourselves to be automated, at this stage, is simply a tired joke.” -Lawrence Dickstein
And as I have stated many times over the years my site (platform) is open to all and that “Opinions and Points of View Are Always Encouraged and Appreciated.” Today is no different and power to all who stand up and do just that.
I do however think I need to further the point with a little help from KPMG and their Annual Global PropTech Survey titled, The Road to Opportunity: An annual review of the real estate industry’s journey into the digital age. Released September 2018
If there is one thing you read when not watching Tiger (He’s Back!) anytime soon please put this survey on your list.
There are many well-made points but that first one that stuck out to me was the fact that the survey found that 93% of the 270 people surveyed agreed that they need to engage with PropTech, and 90% thought that it would help their business. But just a third have a strategy for how to engage with PropTech, and digital innovation more generally. That is up from a quarter last year but still means huge percentage the real estate industry has no real plan for how to engage with technological change.
So I guess the point that “nothing has really changed in the real estate business in the last 100 years, and frankly, it never will” is therefore validated by almost the entire industry.
Or maybe not.
The potential benefits of data, automation and Artificial Intelligence are widely recognized, but is the industry giving enough attention to less mature but potentially hugely transformative technologies? -KPMG
“Data and automation are the main areas that respondents expect to generate the most change in the property industry. 30% of respondents ranked automation as having the biggest impact on the industry in the short term. A further 27% placed big data and data analytics first. In the long term, 32% of respondents focused more on Artificial Intelligence, with 17% and 8% focusing on data and automation respectively. This is also reflected in the technologies that incumbent real estate organizations are most likely to utilize. Almost a third (31%) ranked automation highest and 27% voted for big data and data analytics in the short term. 28% placed Artificial Intelligence highest in the long term.”– KMPG
So Automation, Big Data, and AI are singled out as the three most impactful technologies for the short and long-term.
Hmm, I wonder how many of those organizations will be around in the next five or ten years. How many were here 100 years ago and still do it the same way? Hell, it might be all of them.
Or maybe not…
“Automation will address many inefficiencies that exist in the property sector. The challenge with Big Data & analytics is that as we collect more and more information, we need to constantly consider ‘why are we collecting this data.’ For those organizations that are truly customer focused this will become a differentiator.”
Jonathan Hannam – Managing Director, Taronga Group Source- KMPG
Becoming Truly Digital.
Many property organizations may still be behind the curve in developing an enterprise-wide digital and innovation strategy.
“Last year less than a quarter (24%) of real estate incumbents claimed to have an enterprise-wide digital and innovation strategy in place, but the latest survey results are more promising with this having increased to one-third (33%). The proportion of respondents who neither have a strategy nor are working on one also decreased from 17% in 2017 to 10% this year. However, this is still a significant proportion of the industry who feel that they do not need to have a plan for managing change in the digital age.” Source-KMPG
But there is hope…
Growing The Ecosystem.
The PropTech sector continues to mature and evolve, and incumbents are recognizing the value start-ups can add to their organizations.
“Collaborating with a supplier remains the most popular option for how incumbents expect to develop their digital and innovation capability. However, more respondents this year were open to new suppliers in addition to existing suppliers. Firms in the Americas are more likely to consider collaborating with a new supplier (77%), compared with 62% EMA and 41% ASPAC. This could be the reason that new US PropTech companies often experience quicker traction amongst customers compared to elsewhere.” Source-KMPG
More the point…
Speaking The Same Language.
Bridging the gap between property and technology organizations can help both “sides” maximize the opportunities that the digital age presents for the industry.
“There remains a consensus amongst incumbents that they need to engage with PropTech companies in order to adapt to the changing global environment – the proportion of respondents who agreed with this statement increased slightly from 89% in 2017 to 93% this year. There is also a perception amongst 90% of all respondents that the corporate real estate industry views PropTech as an opportunity.”
Property companies should be embracing technology and innovation today to ensure that they are successful in tomorrow’s world.
“The real estate sector has made promising progress over the last 12 months as more incumbents become aware of the potential for technological and digital innovation to transform their business. Whether this transformation is positive or negative remains in the hands of decision makers – those that choose to act now and engage with the digital age will be the ones to thrive, whilst those who do not may not survive. We are not yet at a point where failure to engage with technology may lead to imminent collapse, but organizations need to recognize that now is the time to be trialing solutions, making mistakes and understanding how their value proposition may have to evolve in the future. This means developing a holistic strategic vision and taking steps to become more agile and innovative in implementing it, which often takes time and requires a cultural shift in the organization.” Source-KMPG
So here we are September 2018 and a full 40-page in-depth report from KMPG titled The Road to Opportunity: An annual review of the real estate industry’s journey into the digital age laid out before us all.
We all have our opinions and we are all certainly wanting willing and able to voice them.
Mr. Dickstein has stated that “Nothing Has Really Changed In The Real Estate Business In The Last 100 Years, And Frankly, It Never Will.”
You may agree.
I don’t and never will because it is 2018 and the world is changing in ways some may have never imagined…and for the better. I have a simple question to ask and I ask this to all but more specifically to a certain generation of people in CRE. How much did you cringe and roll your eyes when you read that headline?
Why am I such a champion of technology and change? Change for the better of all?
It’s because I’m betting on YOU.
YOU will change the world!!!!!
Or do you want your children’s children to say “Nothing Has Really Changed In The Real Estate Business In The Last 100 Years, And Frankly, It Never Will.”
+1 That’s not a legacy I’m willing to leave. #CRE will change like never before while I’m on this planet. That I can MF guarantee!