Charlotte Dove McCarthy, Commercial Director at Infabode (www.infabode.com)
If you have been deciding whether to join the UKPA or not, I can tell you first hand that it is a place for innovation leaders. People who want to change mind-sets and traditional thinking. This was my first introduction to a discussion on open data and it has been on my mind since. It was inspiring and thought provoking, the UKPA roundtable events are ones to add to your calendar.
Eddie Holmes kindly invited me to be UKPA’s media partner for this inaugural event hosted by the Doordeck team at their cutting-edge offices at IDEA London. A perfect setting as the space was designed specifically to foster innovation. The open data discussion was held in a modular, distraction-free, mood-lit boardroom filled with leaders of innovation in the London real estate scene. Companies involved included Doordeck, RICS, Kykloud, CloudsUK, TechBlue, GVA, CBRE, CBRE Global Investors, JLL, Datscha, Guestready, Re-Leased, Blueprint, Qube Global Software and James Dearlsley, the ‘UK Proptech Evangelist’. Dan Hughes from RICS was at the head of the table and led the discussions.
The purpose of this roundtable session was to improve the understanding of open data and to discuss the importance of data within PropTech today, in this technology driven era. An engagement piece on how “we” can work together as an industry to innovate in the data revolution.
It was apparent that these industry leaders recognised the importance of capturing and analysing data and its value. It was a pleasure to be a part of this discussion. Here are the findings:
Well, one thing is for sure. Data is the future, and even if we cannot put a dollar amount on all of it, if the data is accurate and complete, it has REAL value. Data will be the next tradable commodity and is a subject which people should read-up on, discuss, and understand.
What is open data?
Open data is any data which is free to use, reuse, or distribute with a correct attribution. Below is a chart which will help in understanding the language of data.
The value of open data
The Open Data Institute revealed that The Shakespeare Review identified £6.8bn of total value in UK public sector data, a report in 2011 estimated that the EU market for public sector data would grow to €40bn per year, while McKinsey estimated a global market powered by open data from across seven sectors would create between $3tn and $5tn a year.
The Open Data Institute has identified open data-driven UK companies with a combined annual turnover of over £92bn, employing over 500,000 people. Transport for London alone has seen a 58:1 return on investment by releasing transport data, in the process helping create global leaders such as City mapper. Denmark has identified a 70:1 return on investment by choosing to publish address data openly. In the US, an open data company has sold for $930m and Landsat data create savings of $350m to $436m per year, while at least 84% of American smartphone owners use an application powered by open data every single day.
Data yields new insights
Technology is growing and evolving at an incredible speed, and computing and data touch almost all aspects of modern life. This means that the rate of growth of data we generate, and the devices we use to process it, can only increase. This data can yield new insights and support better decisions.
Sharing is caring
The more open you are – the more relationships you can cultivate. Data sharing should be compared to a personal relationship. The more open you are with a partner, the more trust you share. The more secretive and closed you are with information, the less your partner will trust you. I think this a great way to spread the open data word. Sharing is caring. When discussing data sharing with clients, it is important to come to the table with a service-oriented solution. The hard sell will not fly. Relationships need to be nurtured. Trust is paramount. It would be interesting to get a psychologist opinion on the space- fear is the one thing which is slowing momentum.
Start-ups vs Big Boys
It was agreed that start-up companies are able to take bigger risks in testing new technologies. Larger companies have a much harder time trialling or implementing them, as there is far more risk and red tape. Larger companies can afford to wait until they have a very large value proposition as well as tight business cases sewn up. Start-ups may not have the luxury of being able to wait to implement as they must remain as competitive as possible. It was also mentioned that mobilising is much easier for smaller companies due to their size and ability to make quick decisions.
Times, they are a changin’
There was a comparison made on the views on tech and data just four years ago and demonstrated the extreme difference in which people rank its importance today. There has been a massive switch in thinking even since 2016.
Start from within
Another important point which was made is the fact that data should be shared internally within organisations so that operational staff can use the data to improve service levels and KPI’s. Apparently data is not shared enough within organisations, and this is where real estate companies should start with a fundamental entry point to data sharing. Engaging people within the business and collaborating with different departments to share insights is key. A business case must be built to achieve this successfully. Operational teams and Innovation teams need to merge. It was said that job descriptions will ‘blur’ especially in Lifecycle FM. I think the term ‘blend’ is also suitable when thinking about internal departments linking to share data. Data must be used to drive decisions.
The evolution of HR and hiring
There was a lot of discussion around the evolution of HR and hiring for the future. Data Officers and Strategists are now being hired within large real estate organisations which has not been required up until now. It was mentioned that hedge funds are training up their finance teams to become data science experts, so that they can capture and analyse important data in-house. Upper management want to up-skill their own workforce. This says a lot about the future of all industries, not only real estate. There has been a rise in new real estate professional roles. Job titles are evolving to get tech people excited about real estate and the new property technology revolution. Property is becoming ‘cooler’ for tech focused individuals to consider. Those real estate companies who are innovating using HR are going to be leading the way. Changing competencies is key. Companies who can afford to hire the top data scientists should do it, and do it quickly. Creativity is essential in order to think of new ways to use this data and stay ahead of the competition. Demand for skilled graduates in the areas of data science is growing rapidly in both public and private sector. The Harvard Business Review has described the job of Data Scientist as the ‘sexiest job’ of the 21st century.
What gets measured, gets improved
I heard a very good quote in a presentation by VTS recently. “What gets measured gets improved”. I think this is a very good way to explain how open data is going to change things for the better. By sharing data and analysing it in different ways, it allows us to improve things. It allows us to predict trends, spot opportunities and see what requires more focus.
“90% of the world’s data has been created in the past two years”. This is an amazing quote. This is only the beginning for data and its immense capabilities. We are only beginning to see how real estate will benefit from data sharing, using evidence based research.
Testing and trialling is imperative to see what works and does not work. Companies need to test out a variety of solutions to see what works for them. The PropTech world is getting larger every day and is getting more and more competitive. It is important to research what technologies do what and how they could potentially give you a good ROI. The platform which implements ratings for these technologies will succeed in my opinion.
Residential Real Estate vs Commercial Real Estate
Alot of efforts have been made already in the real estate sector to share information freely. Residential real estate has been much more open to the idea of sharing data due to market drive. They recognise the value of data and sharing it because of consumer demand. Commercial real estate requires more engagement.
Accurate and Complete Data
One thing which was quite interesting was that with datasets, it is important for them to not only be accurate but complete. It was unanimously agreed, that open data is a good thing, which should remain free. It is not the data alone, but what we DO with that data that is important. Linking data sets together like bits of software is where we will see the greatest benefits. With open data there are no restrictions. When we have open platforms to share these datasets freely is when we will see people engaging more. There are so many data points out there that no one has an idea as to how much there really is. Only the controllers of the databases understand the true amount.
Look to other markets
There was great advice given in looking to other markets when thinking about data. Look at Scandinavia, where they are years ahead in regards to sharing data. Their transaction volumes have improved greatly due to their attitude towards data sharing. We can learn a lot from other countries and their attitudes towards data.
IP & Data protection
Another discussion topic was about intellectual property, data protection and licensing. This is something which should be heavily researched. It is important that sensitive info is not abused. Data controllers and data processors must follow requirements.
The fines for breaching data privacy laws are currently 4% of a company’s annual global turnover! Guidelines must be strictly adhered to. Law and ethics play a big part in open data. We do not know how these laws will change and how we will be able to share information in the future. These laws could change drastically. Laws are potentially going to hinder clever ideas about data sharing. Breaking data apart for legal reasons devalues the data.
A lot of data within real estate in the UK is interlinked. The Land Registry seems open until you are asked to sign in to access data on behalf of the Ordnance survey who uses the post offices path addresses! It must be looked at more like a web of data. The Land Registry & Ordnance Survey shares thousands of datasets. It was said that if one of these organisations were to give their data away free, it would completely put the other out of business.
Skill Sets and Data Sets
We need to understand the ability of interpreting data. The amount of skill and patience this requires. Hiring the right people – this is going to play a huge part in how organisations will benefit from data. Education is paramount. Upskilling and training are going to need to be factored into budgets. Because tech is ever evolving, upskilling is extremely important as software changes so quickly. It is important to factor in more money for training if businesses want to be industry leaders. The agents will differentiate themselves by how they USE data. There was a good comment about working with universities and implementing this software into universities to teach students who can then get decent and higher paying jobs having learnt the tech first hand.
Conversations about data and its importance are currently too conceptual. Conversations need to change. We need more dialogue like we had during this UKPA event. Discussions like these are critical in moving forward. There is a huge education piece here. There is much to be discovered, but, by sharing information on open data, we will all benefit.
Public vs Private Sector
A very good point was made about the public sector vs. the private sector. These sectors have moved at very different paces. The public sector has placed great focus on aggregating data, for 20+ years. They invest in long term projects and have to visualise the future. We can learn a lot from their meticulous data capturing. Private institutions are only now seeing the value in aggregating and sharing data. This is more difficult for the private sector as market demand changes quickly.
Remember your clients when sharing data
Data is getting the market to move forward. This will only be accomplished through communication and transparency. Not only should this benefit the organisation, but more importantly, it should benefit your clients at the same time. This is a win-win situation. Be sure to remember that this is all of value to benefit our clients who will in return benefit us. We need to maintain relationships and trust. By giving your client the reins and full control, you reinforce that trust. There is no resistance once the client is in control! Open data IS decentralised control.
Helpful or annoying?
A question was raised about “knocks on doors”. Are real estate companies being bombarded by PropTech sales teams? It was agreed that most of the proposals are not relevant or customized to meet the customer’s needs. It sounded as if there was not a proper platform in place for real estate companies to go to, to see all of the available options and that it was not clear as to what technologies would help.
Lessons from CBRE
CBRE mentioned that they are in fact creating a PropTech platform for PropTech – to showcase these technologies in a clear way to their clients. I think this is an excellent idea. CBRE have bought up a handful of PropTech companies. CBRE not only gets the tech which they require, but they get the brains behind the technology. The tech companies in return get security and financing. Together they are embarking on a data led journey which is a good example to other large RE firms. Now is the right time for this kind of platform, as there are so many solutions out there.
Both possibilities and challenges lay ahead
The fundamental barriers to data sharing are:
- FEAR & ENGAGEMENT – It is important to start talking more openly about data. It is important to educate on the subject. It is important to find a combination of people to engage with. Operation and innovation teams must collaborate to succeed in this market. Organisations who are managing this well are creating an environment where operational teams can engage. There must be sufficient training and up-skilling of workers to redefine roles. The property industry in its entirety, must adopt a new attitude. The change in attitude and process must start from within. The data sharing mind-set must start internally within organisations so that they can see first-hand how valuable the data can be. Until this is done, only a few will share the mind-set that data sharing is valuable. Look to other markets outside of the UK to get inspiration for engagement pieces. Show the ability to enhance service lines.
- DEPLOYMENT – Until clients can see a benefit, there is no reason for them to share their data. A good value proposition must be created for the industry as a whole. More guidance must be given on what can be achieved with data. We must be able to provide robust evidence of output and provide new variables. Offer proven solutions. Mobilisation periods must be understood. This is very important as people do not have time to wait. If they have a clear understanding of when things are likely to take place and be completed by, they are more likely to say yes and implement between major projects. Evidence based research and proof must be provided so that key decision makers have the backup to take the risk.
- ATTITUDE AND ACCOUNTABILITY – Internal operational issues can be a barrier as no one can be held fully accountable. It is a shared responsibility to ensure accuracy of data. Credibility and validity of data are of the utmost importance. As I mentioned earlier, the penalties are extreme for breaching the terms.
“What could we collectively do to improve data sharing?”
These were a few suggestions on what “we” as an industry and individuals can do to improve:
WHEN CREATING DATA:
- Ensure data we are capturing is accurate
- Ensure data we are capturing is complete
- Focus on interoperability
- Structuring and Labelling data
- Apply creative thought behind application
EDUCATING ON DATA:
- In-house training on open data / induction training even
- Change competencies
- Embed innovation teams
- Create an education piece around collaborating
- Up-skill own workforce
- Ensure the right people in the right positions
GETTING OTHERS TO ENGAGE:
- Rethink the engagement process
- Get industry leaders to commit
- Educate clients / Educate people on what data is and what they can do with data
- Teach the difference between big, personal and open data
- Rethink in-house marketing initiatives
- Property professionals are used to tangible commodity. Change mind-sets
- Be transparent
- Change the conversation from past to present tense
- “Speak the language” and move from concepts to adding real value
- Think about the advice you are giving
- Get to grips with Open Data Certificates
- Research the 5* deployment scheme if you have not read about it
- Ask trusted sources to create reading lists
- Research and understand global jurisdiction
- Be aware of penalties of regulations are breached
- Resolve data ownership queries to be resolved. Define who owns what?
- Clearly show the cash value and time savings
- Create data sharing schemes
- Explore industry data standards
- Try to put a £ amount on data value
- Share T’s and C’s
- Link / stitch datasets together
- Be proactive not reactive
- Evolve as needs will change
- Repackage data
- Take risks
- Invest in technology
- Look at trends and other markets
- Be one step ahead of the game and do your homework
- Rate systems you are currently using or trialling
- Attend more roundtable discussions
CREATE NEW SHARING PLATFORMS
- Create new platforms for sharing datasets
- Create new platforms for sharing available PropTech options
- Add your knowledge to WIKI platforms
The UKPA believes that consultations will be the best way to figure out what solutions are available. By collaborating and sharing datasets openly, we can grow the industry. This conversation would not have happened 5 years ago. The industry has come a long way. We are far behind but are catching up and will most likely surpass other industries as the entire industry is having to change their attitudes and skillsets. It is the push that the industry needs. The future is very uncertain. Will the big boys stay at the top? Will the tech underdogs succeed in a “death from below” win? Will data collaboration see the rise of new real estate giants?
I will leave you with a few links:
The Open Data Institute
Tim Berners-Lee, “Open, Linked Data for a Global Community” https://www.youtube.com/watch?v=ga1aSJXCFe0
Tim Berners-Lee: The next Web of open, linked data
Online materials used for reference:
The Open Data Institute website
The Urban Land Institute
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