The digital transformation journey in real estate: Returns from moving up the maturity curve

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By now, we’ve all read stories telling us that digital transformation has gone from potentially valuable to mission critical. Businesses are finding themselves managing a wide range of resources – from employees to laptops to entire buildings – remotely, all while operating in a rapidly changing and uncertain business environment. Having easy off-site access to all of the pertinent information in a single application, coupled with the power of advanced analytics, seems an obvious benefit right now.

Yet for those firms that are only at the beginning of their digital transformation, the demands of this process are daunting. At a minimum, companies need to figure out where all of their information is stored today, determine what technologies they will need to process and centralize everything, and then decide who should access and control what types of information. The benefits may be significant, but the learning curve can be steep.

Understanding the steps to digital transformation in real estate

Even as we are told about the need to implement rapid digitalization, it seems clear that not all firms need to move up the digitalization maturity curve all at once. There are substantial benefits to be gained at each stage of the journey and the pace of transformation should be weighed against the ultimate needs of the organization.

  • Stage 1: Distributed, Manual Entry
  • Stage 2: IWMS Light
  • Stage 3: Fully Integrated IWMS
  • Stage 4: Optimized IWMS
  • Stage 5: IWMS + Smart Building
  • Stage 6: Digital Twin

We see at least six stages of digital transformation in real estate, based on current technologies.

In stage one, building and facility managers rely on stand-alone tools and manual procedures to manage dispersed information. Cost data might be collected as paper invoices filed away in a desk drawer, while HR data is stored in separate Excel files across different computers, or business information might be gathered into various databases. Problems are addressed reactively because spread-out information and responsibilities make it difficult to anticipate issues before they arise.

To gain better control over management issues, stage two might involve a light version of an IWMS. With fewer functions and lacking the extensive configurability of a full IWMS, such an application nevertheless centralizes and structures data and helps to establish standard workflows that bring structure and efficiency to an organization. This, in turn, allows management to become more proactive. Such an IWMS Light solution is well-suited for small organizations with relatively straightforward management needs that want to gain the efficiencies and benefits of digitization without the complexities and costs of a full IWMS.

The third stage in digitalization is a full IWMS like Axxerion and MCS. As with the light version, the IWMS centralizes information across the organization, with the ability to control who accesses which components, but adds more modules and configuration options. The IWMS connects to a variety of service provider and end-user touchpoints, carrying the benefits of better management to the full organization. For medium and large organizations, a full IWMS is invaluable. The level of customization, configuration, and integration with other corporate systems might vary, but the potential to bring together the full range of modules for real estate, workplace, facility services, and other functions, allows managers to track, benchmark, and improve processes and outcomes across the whole organization. This allows managers to drive proactive improvements in performance and cost.

Stage four of real estate digital transformation takes the effort to optimize processes further, focusing on such things as life-cycle costs and long-term planning. Products like O-Prognose, for example, enable extensive optimization of maintenance planning, bringing together functionalities around inspection, planning, and developing insights that are rooted in deep, specialist knowledge.

The first four stages tend to rely on manual data collection (even if automated processes can push information to different business units). Stage five, on the other hand, elevates the entire model with automated data collection using IoT devices. By monitoring space, utilization, comfort, and other aspects of buildings at a truly granular level, Smart Building technologies like Cobundu drive new insights into the way assets are being used. These platforms can guide management with dashboards while also improving service delivery and end-user support. This technology is ideal for organizations undergoing significant change or that are seeking to drive further optimization of workflows, but given the greater cost, it may not be cost-effective for smaller organizations.

At present, the maturity journey peaks in stage six, when software and hardware integrated across an entire ecosystem of building systems combine into a digital twin. These virtual replicas of the building continually update themselves with real-time data that draw from the entire building life cycle. The wealth of information in digital twins, coupled with advances in AI, will eventually enable growing automation of buildings, ultimately reaching a stage of fully autonomous buildings that can manage building processes and the user experience without any human intervention.


While we all hear about the need for digital transformation, what that means and how far it makes sense for a given company to proceed is variable. While we might all aspire to a future of autonomous offices, the returns from advancing to stage six in the near-term may only be sufficient for companies with large portfolios of assets that can build economies of scale by carrying insights from one twin to adapting the design of another building.

Yet even if stage six remains out of reach, this by no means should deter organizations from advancing to the early stage of digital transformation in real estate. The benefits of advancing even from stage one to two or three are enormous – estimates for time savings alone are in the range of 50-80%. What this tells us is that, regardless of where a company is on the maturity curve, there is always room for improvement and optimization. As we have seen in the remarkable spurt of innovation around remote work and back-to-the-office solutions, technology continues to evolve to address new problems; digital twins may be just the beginning.

Wouter Hartemink

By Wouter Hartemink

Chief Executive Officer at Spacewell

Wouter is a seasoned technology executive with over 15 years of international IT & Big Data experience. His diverse mix of managerial skills and leadership experience enable him to quickly take a ‘big picture’ view, weigh up business situations and develop opportunities. He is an open and direct communicator, focused on driving positive outcomes for all stakeholders.

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