This post article updates a post originally published on January 8, 2016 by CEB, now Gartner. Current research may include updated and/or alternative positions on these issues.
As organizations develop their corporate strategy for the year, corporate real estate teams need to make sure they can keep the lights on — quite literally — and continue to work on activities outside of their traditional remit, looking beyond cost and space reduction to find ways to support company strategy.
Learn more: 32 Key Real Estate Activities
These six steps will help.
Lay the groundwork
Heads of CRE teams must first define and set objectives and action plans. The team will then need to build project proposals and estimate resource requirements. Portfolio planners and project leads should conduct planning analyses and provide process- and activity-level input.
The CRE team should also collaborate with external stakeholders, particularly the CEO or executive committee, to set out a timeline for the strategic planning process and obtain approval for key investments.
CRE teams should consider that even the best-laid plans can be upended by short-term priorities, so they will need to design plans that they can manage and track through the year.
Understand business goals and how they relate to CRE
Heads of CRE should collaborate with C-level executives and other senior managers to understand how they can support long-term strategy. CRE can then assess external forces (economic, regulatory and technological factors) and assess how they will affect real estate priorities.
Managers of different corporate functions may not completely understand their real estate requirements, so CRE teams should look at the overall objectives and offer support, when possible.
Identify improvement areas
Next, CRE leaders will need to determine the status of their function. One way to evaluate the effectiveness of CRE’s key capabilities is to ask business partners for their opinions on the strengths and weaknesses of the team.
One thing all heads of CRE teams have to remember is that it’s important to consider the impact of CRE on fulfilling corporate goals, rather than just tracking operational metrics.
Determine how to achieve real estate objectives
CRE leaders have to use their knowledge of the team’s capabilities to translate business goals into functional objectives. Once CRE teams determine how to fulfill these goals, they then need to identify metrics to measure progress, determine the resources required and assess the risks that could affect their plan.
Ultimately, the end goal is for CRE to obtain a prioritized list of strategic initiatives that also includes metrics to measure them.
Communicate your plan to stakeholders
Heads of CRE should communicate the strategic plan to different stakeholder groups. The plan should then be reviewed and approved by the organization’s CEO or executive committee and communicated to business-unit leaders and staff. The key thing here is to deliver a consistent message across the organization to ensure employees don’t receive conflicting information.
Monitor your progress
Once the plan is implemented, employees have to measure progress against defined objectives. CRE teams should encourage and document feedback from key stakeholders and make adjustments to the plan if needed. This is crucial to reassure business partners who are typically risk-averse and could hinder the execution of the whole strategy.