BUILT ENVIRONMENT JOURNAL

Proptech investment

Money and time invested in proptech now can enable surveyors to work more productively in the long run

Author:

Anthony Walker

04 November 2019

US president Abraham Lincoln is reported to have said: 'Give me six hours to chop down a tree and I will spend the first four sharpening the axe.' The remark concerns the story of a woodcutter determined to chop down as many trees as possible. Yet after an excellent start on the first day, on each subsequent day he felled fewer and fewer trees. The woodcutter eventually went to the timber yard manager to apologise, and put it down to a loss of strength. The manager asked when the axe had last been sharpened and the woodcutter replied: 'Sharpened? Ive had no time to sharpen my axe. I have been so busy trying to cut trees.'

The story highlights the positive impact that preparation can have on productivity. The preparation that surveyors should carry out today must take account of technology and digital transformation so they can add maximum value to the services that clients are seeking. In fact, this is now a more important consideration than ever.

"The preparation that surveyors should carry out today must take account of technology and digital transformation so they can add maximum value to the services that clients are seeking"

Latest available figures from the Office for National Statistics indicate that, on the basis of GDP per hour worked, UK productivity in 2016 was lower than the average of rest of the G7 by 16.3 per cent, with the gap narrowing fractionally from 16.4 per cent in 2015. Many reasons have been put forward for this, although limited investment in research and development, poor integration of information systems and the lack of large-scale adoption of digital technologies are among those suggested by McKinsey in a paper published in 2018.

Breaking down the benefits

Construction is the least digitised sector, ranking bottom of the Industry Digitalisation Index. According to an article by Deloitte in late 2017, of 19 industrial sectors, construction spends the least on technology as a proportion of revenue, at 1.51 per cent. The leading sector, at 7.16 per cent, was banking, and the average spend across all sectors was 3.28 per cent, all of which reinforces the view that many still consider technology to be a cost rather than an investment.

This point was stressed in the RICS survey Proptech: Its position and impact on surveying, work on which I led and presented at the RICS Building Surveying Conference 2018. The questionnaire asked what challenges are holding back wider adoption of proptech, with 56 per cent of respondents attributing it to lack of knowledge and training, closely followed by cost at 53 per cent and lack of clarity of benefits at 43 per cent.

Investment in proptech can offer a number of potential benefits.

Productivity

Proptech can enable more efficient use of time on site and back in the office.
Competitive fees and profit

Increased productivity means that firms can set fees at a more competitive level while also maintaining or increasing profit.
Reduced errors

Manual handling of data increases the potential for human error and the need for rework.
Converting data into intelligence

Robust and accurate data can inform property management decisions and maximise the return on future investment. This in turn increases the likelihood of repeat business or follow-up commissions, such as contract administration and project management after a planned preventative maintenance survey.
More opportunities

An increasing number of commissions now require the collection of data by technology and its upload into client systems. An inability to do so is likely to reduce the number of future opportunities.
Recruitment

Many of those now entering the profession are attracted to companies that can show technology is a key part of their business offer, and that have a digital strategy.
Research and development

This is essential for businesses that want an advantage over their competitors. Any investment made in this field – and not just the cost of the technology – is eligible for tax credits.

When adopting new technology or expanding its use, maximum return can be ensured by taking the following steps.

Lead from the top

The rationale for adopting technology and its importance to the business must be clearly communicated to all from the top.
Create a champion

Most organisations will have someone who is passionate about technology, so seek them out and make them a proptech champion. Give them freedom to explore and make mistakes, and allocate them time when they dont have to be earning fees. Set them objectives and make them eligible for a bonus if they achieve these – they must feel that the work they are doing is valued and that they will not be financially disadvantaged in taking on the role.
Map the process

Existing ways of working will need to be reviewed to develop better means of collecting and reporting data. Start with the end in mind, and reverse-engineer new processes rather than digitising existing ones.
Take one step at a time

Choose one survey type that you can digitise first, for example a schedule of condition. Once this version is created, established and used consistently, consider the next survey type to digitise that will have the most positive effect or best align with the services you provide, for example planned preventative maintenance.
Allow time to learn and make mistakes

Without adequate training, staff will not have the skills to use the technology correctly and this creates a risk of mistakes. Accept that mistakes will happen and, when they do, learn from them and apply that learning. Within a short time, staff will be comfortable and confident in using the technology.
Go live

On successful completion of training, start to provide the service. Emphasise that everyone in the business must follow the new ways of working, because if adoption remains optional you will not maximise the benefits or consistency.
Review and check

As with any process, it's important to carry out regular audits to help reinforce agreed practices and ensure staff do not drift away from these.
Seek feedback

Ask for regular feedback, because this will help identify where improvements can be made and new services that may be offered.
Maintain the message

Once technology is adopted it is here to stay – so ensure that staff understand this.

RICS has four broad categories to classify building survey types, and proptech can be used to carry out all of these:

acquisition:

pre-purchase or building survey; reinstatement cost assessment; mechanical and electrical; specialist structural inspection; contamination survey; flood risk assessment; commercial valuation; asset survey; technical due diligence
occupation:

stock condition survey; planned preventative maintenance; defects or latent defect survey; schedule of condition; insurance – loss adjustment; access audit; asbestos management survey; workplace assessment; health and safety audit; fire risk assessment; glass and glazing assessment; dilapidations
disposal:

vendor survey; energy performance
development:

project monitoring; independent certifier; meeting notes and actions; site inspection report; party wall survey.