Operational efficiency is something every industry wants to realize. Each vertical has a different approach and aspiration, but there’s no doubt that driving toward this efficiency improves workflows, reduces costs, saves time, and more. Commercial real estate (CRE) is one more vertical that can harness the potential of operational efficiency to become leaner and more profitable.
To reach operational efficiency goals, CRE firms must recognize their gaps and look toward innovation to solve them. One of the proven ways to do this is with automation. In this post, we’ll look at the challenges CRE companies face in seeking operational efficiency and how automation meets their needs.
Commercial Real Estate Has Operational Deficiencies
Running a CRE firm requires you to establish a high volume of processes, which break down into tasks. Those tasks are often manual and tedious, involving a lot of documents, as is necessary in the real estate space. Along with processing lots of documents, you must also produce them in the form of statements.
You also have lots of data from multiple sources, some of which are likely legacy. Legacy systems are built on older architecture, making it hard for them to share data and work interoperably with more modern applications.
Processes within the CRE industry have another layer of complexity due to regulatory requirements. To ensure compliance and track and measure revenue, robust reporting is necessary—but more complex with disparate systems.
To make this all “work” now, you may be dependent upon analog steps that put a strain on staff and timelines. As a result, the industry is in dire need of operational modernization that involves digitization and automation initiatives.
Next, let’s look at how automation transforms deficiencies into efficiencies.
The Role of Automation in Driving Operational Efficiencies for Commercial Real Estate
Simply put, automation leads to efficiency. It has a starring role to play in the CRE world. But what kind of automation can the industry leverage for the best results and ROI?
There are two types to consider: robotic process automation (RPA) and intelligent automation.
How CRE Firms Can Use RPA
RPA drives software bots to mimic repetitive actions to eliminate manual intervention. These tasks no longer need a human touch. By applying RPA, you can shorten process time, allow employees to do higher-level work, and reduce overall costs associated with the waste the manual process causes (e.g., errors, loss of productivity).
These are some common use cases of RPA in the CRE ecosystem:
- Automate tasks such as searching and downloading documents needed for reporting and statements. (See how it works by reading our RPA real estate case study, featuring lender statement automation.)
- Let the software bots match bank statements with invoices, so your accounting is accurate for invoice reconciliation.
- Automate the process of reading or extracting structured data from one system and auto-filling and inputting it into another. This can be critical if you have legacy applications.
- Validate data migrated from one platform to another (e.g., ERP system migration).
- Perform calculations and pre-defined adjustments.
These tasks are rudimentary and rules-based. As such, you don’t want to waste your human capital on them. RPA gets workers out of the mundane admin cycle, so they can use their skills and knowledge to contribute to more strategic work. Using software bots significantly decreases errors that are inevitable with human data entry.
How Intelligent Automation Drives Operational Efficiency for CRE Firms
RPA functionality is just the first level. When businesses add artificial intelligence (AI) technologies, automation becomes intelligent. This combination can enable end-to-end business process automation and accelerate digital transformation.
With this powerful tool, accuracy increases, as does the complexity of automation. Here are some CRE-specific examples:
- Manage commercial lease agreements and lease agreement processing, digitizing the entire process.
- Automate renewal notifications for leases, insurance policies, licenses, and anything else with expiration dates.
- Facilitate investment risk analysis by pulling key information from rent rolling datasets to support better judgments on if the property is a sound investment. AI could also highlight red flag trends like past due balances for many renters.
- Review of compliance areas with notifications if there are any warnings.
When you automate the processes described above with either RPA or intelligent automation, hitting operational efficiency goals becomes more probable.
Automation Optimizes Operations for CRE Firms
With both RPA and intelligent automation capabilities, your firm could be driving efficiencies in almost every area. There is much value to be unlocked by striving toward operational efficiency with automation.
The adoption of these technologies is increasing, so you want to implement them to stay competitive. The journey to operational efficiency isn’t a straight line, so you’ll appreciate some guidance along the way. Find that guidance with Ashling Partners.
