COMMENT: It is hard to identify exactly what the oldest building in the United Kingdom is. According to Wikipedia, there is a farmstead in Orkney built in 3,700BC. There are churches built in the 6th century that are in use today, and the much more ‘modern’ Tower of London was built close to 1,000 years ago. Whichever way you look at it, property has been around for a long time. It is solid, slow-moving, and built for the long term.
The real estate sector has grown up around these characteristics over many years – our processes, our standards and our culture are all focused on meeting these sector needs. Typically, real estate’s culture is slow, stable, evidence-based, low risk. It is one of our sector’s strengths, and it is one of the aspects of real estate that makes it so attractive to invest in, whether buying your own home or as a vehicle for pension funds.
However, we are moving into a new age – one of all things digital. The timeframes for this world are completely different. The first computer was built a mere 75 years ago, and the first iPad was only released in 2010. It is said that of all the data in the world since the start of time, 90% was created in the past two years alone. The technology world moves fast – really fast. Even more so when in contrast to the property sector. The culture of technology is forward-looking, being agile, taking risks, failing fast. To quote Elon Musk, “failure is an option here. If things are not failing, you are not innovating enough”.
The two cultures are diametrically opposite.
Embracing tech
Proptech is a word that means different things to different people, but at its most basic level, it is simply the coming together of property and technology. Whatever this looks like, it is hard to imagine a successful property market that does not embrace and benefit from technology. But to do this means that we have to combine these cultures – property companies need to evolve to become much more agile, quicker at making decisions, recognising that trying something and failing is not always a bad thing. The key is to combine the established property culture with the new tech culture and have the processes in place to allow us to harness the best of these for the benefit of all.
A large part of meeting this challenge is simply recognising that the culture in real estate is neither right nor wrong, just different from that in the technology world. Having business strategies in place to embrace a digital age will fall flat if culture is not also addressed. As Peter Drucker said, “culture eats strategy for breakfast”.
Nurturing diversity
In order to successfully evolve culture, the sector must continue to encourage diversity in everything it does. For these two different cultures to come together successfully, it requires different people, different skills, different approaches – all of which can only be achieved with a diverse workforce. This diversity of thought will allow us to more successfully combine the two cultures, to make sure we truly understand the end user, and have the skills needed to manage increasingly human-focused, technology-driven buildings.
Real estate has made tangible strides in becoming more diverse in recent years, and while it is the right thing to do, it is also going to be the key to combining the culture of these two sectors, allowing the property sector to prosper in a more digital world.
Dan Hughes is founder of Alpha Property Insight
