The Service Imperative: A New Mind-set for Corporate Real Estate, Site Selection April/May 1998

I
n May, the International Development Research Council (IDRC) Spring World Congress in Baltimore will focus on the subject of service delivery and why it has emerged as a corporate real estate imperative in a sustained period of unprecedented change.

Service management has always been a central element of the corporate real estate (CRE) and facilities management mission statement. In many respects, the primary role of corporate real estate has always been to provide effective and productive work environments for the organization (project management services), to manage the company’s real estate resources both leased and owned (asset management services) and to provide on-going infrastructure support (facilities management services). In recent years, the CRE service role has expanded to include an integrative role (strategic planning services.)

What has changed? What is the new service imperative, and what are the implications for both the CRE executive, his organization and the service firms which support the corporate real estate clientele?

As we have learned from the IDRC Research series, Corporate Real Estate 2000ä
, the answer to the first question is just about everything. Globalization, the shift from an industrial to a knowledge-based economy, the extraordinary growth of network-based technology, the demise of Communism, the growth of third world markets in Europe, Latin America and Asia, the shift in demographics, and the unrelenting increase in the speed of business, have transformed the nature of work, the workplace, the work force, the work process, and the fundamental relationships between customer, employee, employer, supplier, service provider and shareholder.

Survival or Extinction?

A common thread that winds through these changing relationships is the concept of the service imperative, what I call the

service mind-set.

For the corporate real estate executive, his colleagues, and his service partners, the service mind-set is both the strategic and operational success factor that will determine survival or extinction in this brave new world of global business.

What is the service mind-set? First, it is an attitude that permeates the organization and is singularly focused on customers. Everything begins and ends with meeting and exceeding customer expectations. There is almost an obsession with delighting the customer, of astonishing the customer with consistent, outstanding, and exemplary service. And the mind-set is relentless in always improving, innovating and seeking new and better ways to delight the customer.

This kind of service begins with an effort to understand customer needs, and aligning the service offering to meet those needs. For the CRE executive, this means walking the halls, flying the friendly skies, meeting with division heads, understanding explicitly the priorities of the users, surveying the users and choosers of service delivery, project results, costs, and quality of the work environment. And it means communicating with senior management, measuring performance, identifying opportunities for improvement, scorecarding progress, and constantly raising the performance bar in service delivery, quality and cost.

The service mind-set is grounded in the concept of partnership. It has become a cliché in corporate real estate, but it is axiomatic that the CRE team must establish a partnership relationship with its service providers that is anchored in common goals and incentives, shared expectations and values, and a spirit of mutual respect and trust.

I met recently with the CEO of one of the largest real estate services firms in the U.S., and I asked him what was fundamental to his firm’s success. He summed it up in one word: trust. He changed his company’s culture from one focused on transactions to one that was focused on relationships that were sustained by earning and preserving a sense of trust between his organization and his clients. Earlier in the decade, his organization spent valuable time on selling. Now this time is invested in servicing long term clients, and the revenue per person has quadrupled as a result.

World-Class Standards

Another key element of the service mind-set is perhaps the toughest to achieve, but it’s critical to the CRE organization that is expanding its services globally. The point here is to think and deliver locally but with world class consistency and quality. Too often, the CRE team imposes the corporate way of doing things on local clients in international markets. The service mind-set would dictate a different approach grounded in understanding and respecting local customs, cultures, and social and political dynamics. Service delivery includes local service providers who understand the local scene and can adapt corporate methods and techniques to local customer requirements.

For the CRE executive and his or her service partners, the service mind-set embraces new technologies and innovative practices. A key component of world class service is speed, and the medium for speedy delivery is utilizing the latest network tools, such as the Internet, and groupware tools. As Jim Schiro, Chairman of Price Waterhouse in the U.S., recently wrote,

To develop business and serve clients, an e-mail address is now more important than a corner office.

The service mind-set must instill in the CRE organization and its service providers the concept of lateral thinking, peripheral vision and integrative delivery. The silo model of specialists working like a bucket brigade, passing the project bucket from specialist to specialist in project delivery will no longer render world class service. Customers demand seamless service and integrated work environments. They want one-stop shopping, and they expect the CRE group assigned to their case to work as a team with its service providers and functional counterparts in human resources, information technology and finance. This service imperative is grounded in the concept of teamwork and empowerment. It assigns projects to service teams that are organized as integrated units and work together with shared empowerment and accountability to meet customer requirements. Team leaders are chosen not on the basis of rank or tenure but on the basis of skills, experience and ability to move the team forward with a sense of urgency and purpose.

The new service mind-set is relentlessly focused on getting things done. In the service-driven CRE organization, there is a passion for results. There is an impatience with long meetings and endless debate. There is a willingness to take risks and a tolerance for making mistakes, since people learn quickly from doing. And there is typically a culture of rewarding and celebrating accomplishment — not just the home runs but the little successes. People feel good about themselves, their colleagues and about their organization, because they are focused on performance, not on politics.

Finally, the new service mind-set is about eliminating barriers between stakeholders, service providers and customers. The concept of a

boundary-less

organization is grounded in the free flow of ideas and information without penalty or prejudice. It is an organization where rank and hierarchy are secondary to performance and value contribution. It is an organization that is mobilized and animated by a common vision of excellence in customer service. It is typically an organization that values and expects leadership thoughout its ranks, not just at the top of the organizational chart.

The service imperative is, indeed, a state of mind, an attitude, and perhaps a mobilizing vision for the IDRC and its membership. In the final analysis, all members of IDRC, both Active and Associate, are service providers. We are really partners aligned and joined together under a common purpose to deliver outstanding infrastructures and services to corporate users and choosers. It is this partnership model that exemplifies the best in class in our industry, and it will be this partnership model and the new service mind-set that will insure our collective success in the wild, wonderful, and scary future before us. SS

Michael A. Bell is Managing Director, Corporate Real Estate Consulting Services Practice, at Price Waterhouse LLP, New York.