The Leader Magazine

SEP-OCT 2015

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Innovations in CRE Innovation can be defined as the introduction of new ideas, tools, practices, technologies or processes that enable better outcomes, enhance efficiency or create value through change. The panel spoke to an array of recent key innovations to the workplace, which include advancing technology platforms, instituting portfolio- wide workplace strategy, building performance management frameworks, talent development programs and delivering globally integrated service execution models. To create value, CRE teams must take into account how these workplace innovations will affect the overall customer and employee experience, and develop a plan for how employees and business units can contribute to a dynamic working environment by establishing a culture of innovation within an organization. Additionally, the real estate function of large multinational corporates should forecast and understand the impact that innovations will have on corporate financial performance and understand how shareholders will perceive the potential benefits and risks associated with workplace innovation (Figure I). Once again, the panel concludes that the fundamental premise for delivering value as it relates to innovations in the workplace is ensuring a strategic alignment amongst the core enterprise and the CRE function. Workplace innovations only achieve optimal value creation if the implementation strategy supports the overall business's goals. CRE Value Proposition The focus of multinational corporations (MNCs) regarding the real estate workplace has evolved from the basic objective of minimizing costs to the more strategic objective of maximizing value. The revised mandate focuses on generating the optimal level of value from all available resources, thus increasing productivity and ultimately attaining greater operational efficiency. This means driving real estate value creation for all business units within the enterprise, beginning with those most impactful on the corporate balance sheet. The panel of senior CRE leaders collectively view that the focal point for CRE leadership is to discover how the workplace environment and CRE function can drive value and help the enterprise achieve operational excellence. Although desired outcomes may differ across various enterprises, the fundamental value proposition for CRE filters into three primary principles: Organizational Productivity, Cost Optimization, and Risk Management. The CRE function plays a vital role in delivering these key business outcomes through constructing a workplace environment that drives: • Maximum worker output and organizational productivity; • Optimal operating and capital cost efficiencies; and • Effective performance and risk management capabilities. The panel of CRE leaders believe the underlying factor enabling the value proposition for CRE is organizational alignment. As the workplace function climbs the value chain supporting the company's overall business strategy, the CRE function has greater responsibility towards facilitating the corporate strategy within the workplace. While the workplace continues to evolve as a tactical differentiator for corporate enterprises, the internal CRE teams and service providers alike aim to discover new and different methods for driving organizational productivity, optimizing costs and managing risks associated with the real estate workplace. Figure I – Fundamental value proposition of corporate real estate and the key outcomes Figure II – Recent innovations driving value in the workplace by enhancing the employee, customer and shareholder experience. September/October 2015 | the LEADER 33

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