When it comes to strategic property asset management, you might be surprised how much success or failure can depend on your set of personal beliefs.
It may not be something that you have previously thought about, but your belief system affects how you see the world and how you respond to internal and external stimuli.
I see this all the time, where organisations struggle with a particular property related challenge. In response they deploy strategies or tactics that are based on what they believe is needed. But if their beliefs are flawed, their response will be flawed. Rarely do people challenge their own beliefs, which means they will continue to rely on responses that will not resolve their property challenges.
Beliefs are very powerful things. We see this in the large scale religious festivals, events and pilgrimages that take place around the world every year. This week for example saw the start of the Kumbh Mela Festival in India, which in 2019 attracted over 55 million people in 48 days. Despite the rising wave of Covid cases in India, it looks like the numbers attending this year could be equally high. The power of belief.
The thing with beliefs is that they are deep rooted, and hard to resist. They control our emotions and how we think. In turn this affects our actions and reactions.
Belief systems are of course not confined to religion. They impact our everyday domestic life and work life just as much, although we may not always realise it. As a consequence, our beliefs have real impact on our results.
Shortly I will summarise some of the misplaced beliefs that I commonly observe around strategic property asset management, and how these misplaced beliefs often lead to misplaced actions. But before I get into the common misplaced beliefs, I want to expose three common pain points that organisations will often, and which they are commonly seeking to resolve.
Pain Point 1
You see bad decisions being made in relation to the property assets all the time.
Especially frustrating is where you feel forced into making or supporting property decisions that you do not really believe in, and which create ethical challenges and stress for you. Often you might observe a succession of bad decisions, as the organisation seeks to extract itself from earlier flaws of judgement.
Such decisions often arise through lack of strategic thinking, either by elected members or your property team. This can result in bad investment and disinvestment decisions, which can make operating costs unsustainable or result in a property portfolio that is simply the wrong operational fit.
When bad property decisions are made, you will pay the price at some point in the future.
Pain Point 2
You don't feel like you have all the answers, and nobody else in the organisation seems to either.
You know in your gut that the way your organisation is set up to manage its property portfolio is not right, but you struggle to really pin down what is wrong. You are uncertain about the scale or scope of changes needed. You struggle to articulate what the pay back will be.
This can result in you being too tentative. You avoid bold or radical proposals, in favour of small or incremental changes that lack impact. Or you try bold changes, that simply don't work.
Without impact, you struggle to sustain the change needed.
Pain Point 3
You feel that your property team just do not get strategy at all.
Your team are highly qualified and knowledgeable property people. They are great at operational decisions and tasks. But they struggle to see the bigger picture, within which operational decisions are taken.
Despite your best efforts, the team just seem incapable of changing their mindsets and behaviours.
What this creates for you are constant frustrations, because everyone works within their immediate circle and professional boundaries. They operate in silos and there is no proper horizontal communication or collaboration.
This results in failure to identify key risks and, more importantly missed opportunities.
In my experience, often the reasons that you are frustrated by these 3 common pain points, is that you approach your challenges with a certain set of misplaced beliefs. These misplaced beliefs are very common, and here are my top 5.
1. All property professionals are naturally strategic
It might surprise you to learn, when surveyors go through their professional qualification process they may spend very little time at all learning a bout property strategy. They are far more likely to specialise in one of the surveying disciplines, such as valuation, building surveying, quantity surveying etc., where strategy hardly features. At that stage of achieving a qualification, property strategy is unlikely to be in the minds of those studying.
Those in your organisation that now operate in a strategic role, are doing so most likely having learned it on the job. Not only does it not come naturally to most surveyors, it is also an area of discipline that is not that popular. Finding strategic thinkers among surveyors can be a real challenge.
2. Having an Asset Management Plan will change everything
If only this were the case. It would be so much easier. The fact remains that an asset management plan is only as good as the thought and the process that created it. And it is only as good as the robustness of strategic property asset management actually happening across the organisation.
The asset management plan represents what is actually happening on the ground, and may not in itself change an awful lot. Whilst the asset management plan may be a catalyst for change, it is generally the creation and production of it, involving key stakeholders, that is actually the catalyst, rather than the document itself.
3. Adopting a Corporate Landlord model will make everyone operate strategically
In recent years many organisations have adopted a form of corporate landlord model. Many times, the process can be flawed, because it is something that is often imposed on parts of the organisation that resist it.
Often the reasons for it and the benefits of it are not explained well enough. The truth is that there are as many forms of corporate landlord model available to you as there are clouds in the sky. You have to choose the right model for you, and that takes thinking about. It needs to reflect your internal dynamics and your particular challenges and culture.
Personally, I detest the term ‘corporate landlord’ as it suggests a formal landlord and tenant legal relationship, which for me is a long way away from what it should be. I much prefer the term ‘property partnership model’ as this for me is a better reflection of what organisations should be aiming for. It should be a model that has been developed, not by the strategic property people sat in a dark room, but collaboratively across the organisation.
4. You think you know why you have your property assets
It is a sad fact that most organisations have never gone through a process of truly understanding what property assets they have, and why they have them. It is more often than not left to property officers or finance officers, in the absence of any direction, to assume a reason for having each property asset.
This creates an environment where that lack of clarity over purpose, creates a lack of clarity over expected asset performance. It also generates crossed lines and confusion when the time comes to make key decisions around specific property assets. Without clear purpose, how can the organisation know what is expected of an asset, and what should happen to that asset?
The result is that organisations make poor decisions on investment or disinvestment, and around retention or disposal.
5. You think that you are in control of how your property assets are performing
This is a natural follow-on from the previous bad thinking around why you have your property assets. But it is not simply a case of lack of clarity on purpose leading to lack of control on performance. It often goes much deeper.
The lack of clarity on purpose makes it difficult to know what the important aspects of performance should be. But even if you know what you should be measuring, organisations are rarely geared up for asset performance management. They can lack the systems and monitoring processes that bring real performance challenge. They can also lack the knowledge of what good performance even looks like, to appreciate when performance is acceptable or not.
As mentioned above, beliefs affect emotions, thoughts and actions. If you have suffered from any of my top 5 misplaced beliefs, you may well have resorted to one or more of my top 5 mistaken responses.
1. You write a new Asset Management Plan in the belief that this will make everyone behave strategically
2. You reorganise the structure of the property service or move it under a different directorate, believing this will bring everyone together
3. You bring in consultants to carry out a diagnostic health check, believing that once you identify the problems, the solutions will follow
4. You create a Corporate Property Board to discuss and oversee property strategy, with representatives from all the main service areas
5. You bring in an experienced interim Head of Property thinking they will sort it all out
Do these responses remind you of things that you have done in the past?
Did it make any difference in trying to get your organisation to be more strategic about its property assets and property decisions?
If the answer to the first question is yes, and the answer to the second question is no, there is a good chance you have some misplaced beliefs that need challenging. You may need to revisit why you responded the way you did. Dig deep and see if you can identify why you responded that way.