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Apps for success

Simplifying work orders with tech.

By John Salustri
IStock 1025744816

Apps run our lives. Or more appropriately, we are more than ever running our lives through apps, whether it be entertainment choices, health monitoring or business issues. For property managers, especially those with a hard-driving focus on customer service, work-order apps can help drive success. Old-school or new, retention and renewal come down largely to service response.

Implementing Work-Order Apps: All or Nothing

It’s safe to say that the bulk of properties represented by IREM membership are tech-enabled to one extent or another. Nevertheless, as new wrinkles to existing systems come on the market (remember the flood of VC-based startups out there) the question of implementation raises its challenging head: Should you go one-off to test the waters or go all in? The answer might surprise you.

“It has to start at the top,” says Robert J. Finlay. “Embracing any technology demands a cultural shift, and everybody needs to see the vision for it to be successful. Besides, from the provider’s standpoint, the cost to get one property up and running doesn’t pencil out.”

Greg Cichy agrees: “If I have 100 different tenants, do I have to go to each one individually? If I do, some will embrace the shift and others will say, ‘No way.’ With any technology, the ability to roll it out across the portfolio will be much more successful than a one-off situation.”

Besides, a one-off will probably engage the property with the most problems. You’re putting out fires here. “If the onsite manager isn’t buying into the fix, good luck,” says Finlay. “It’ll be very hard to set benchmarks and expectations. All technology needs to be utilized as an aid to help the firm as a whole, not just serve as a quick fix to a problem.”

Pure and simple, “the No. 1 factor for a renewal comes down to the response time from a property manager as it pertains to maintenance,” says Robert J. Finlay, CPM. Finlay heads R.J. Finlay & Co. of Nashua, N.H., which manages multifamily and commercial properties primarily in the Northeast. He also manages Lyra Intel, a software firm focused on tech-enabling real estate practitioners. And that includes work-order apps.

Ironically, while the intent of such apps is to simplify life, choosing the right app for your business can be a daunting task—unless you do it properly. Needless to say, the market is jammed with options, from the basic to the most “gee-whiz.”

“The market is flooded with programs, and they’re all competing for market share and popularity,” says Paul R. Gottsegen, CPM, executive asset and acquisition manager for Canada and the U.S. for Time Equities Inc. in New York City. “There are about 3,000 real estate programs that exist today. That’s just ridiculous, and of course, they all have pluses and minuses.”

In essence, any app’s basic function is rapid communication, whether it be for a new project or an issue at a property. For purposes of this article, we’ll focus on the latter. The communication starts with a text from the resident or tenant alerting management to a problem. It might contain a photo of the issue. The key here is rallying the appropriate technician, gaining access to the problem site, fixing the issue and recording feedback.

Obviously, with a fully engaged network of on-site staff, managers and vendors, that fix should be rapid-fire and, assuming the expertise of the technician on call, successful. However, this is only part of the battle. Work-order apps are getting smarter, folding in predictive analytics that can, as much as possible, forecast maintenance and even flag oncoming trouble. But we’re getting ahead of ourselves. First let’s look at the selection process.

“There’s a big difference between choosing a company with two employees with a funding round of $100,000 and a large public company that’s raised $64 million.”

—Paul R. Gottsegen, CPM, Time Equities Inc.

Choose Wisely

Do a Google search for “real estate venture capital,” and watch the bevy of deep-pocket investors who are laying massive bets on real estate technology. The result is the above-mentioned flood of bright ideas. Before engaging any of them, “the most important thing for any property management firm is to start with a real understanding of the scope of your business requirement and what you need to do to execute on that,” says Finlay. “The industry has been very slow to adopt new technologies if they’re not under the umbrella of a RealPage or Yardi.”

Not that there’s anything wrong with that. Working with software consultants with whom you’re familiar and who have demonstrated a proven track record makes sense. (IREM has a robust list of industry partners that speak to this very issue.) At the very least, they can float a recommendation.

“You have to be careful where you invest your money,” says Santa Barbara, Calif.-based Brian Sutherland, industry principal for Yardi. “In real estate, there are a lot of startups, so you do have to make that determination if they or their technology is going to be around long term.”

You should evaluate their bench strength, he advises: “Is there an accounting group to handle the billing, for instance? Longevity would certainly also be a criterion.”

Gottsegen, who leads a technology committee for Time Equities and sits on the recently formed IREM Technology Advisory Board, agrees, offering ideas for vetting potential providers: “There are tools for evaluating software, like Crunchbase. They’ll tell you when a specific startup was launched, its number of employees and how long it’s been in business.”

It will also give you a startup’s history of funding rounds and its public/private status. “There’s a big difference between choosing a company with two employees with a funding round of $100,000 and a large public company that’s raised $64 million,” he says. “You don’t want to buy into a company that’s going out of business next year.” (See “Implementing Work-Order Apps: All or Nothing”)

Watch Your Tone!

Remember the purpose: At the end of the day, it’s all about simplicity and ease of use. That’s what your occupants are looking for, be they residential or commercial. And even though the essential work-order functions are the same, there are differences between these two occupant types.

For Gottsegen, the differences lie in the human/corporate dynamic. For residential occupants, it’s personal. Commercial tenants, on the other hand, “are integrating the technological side as part of an overall transition to more ‘human’ work environments,” he says. “Coworking and wellness are outgrowths of this, as is a more home-like and comfortable culture.” Of course, the end result is the same. Both types of occupants want it simple and intuitive, even as apps grow broader in scope.

The commercial/residential difference also involves a matter of tone, as Washington D.C.-based Greg Cichy, CPM, points out. “The skill sets required for commercial operations are different than residential,” says the managing director of Colliers International, AMO. “Residential spaces take a softer touch because you’re dealing with people in their homes.”

Cichy, who is an IREM SVP as well as chair of the above-mentioned technology committee, also sees a more amenities- and comfort-based approach informing commercially focused work-order apps. “There’s an amenities culture growing in commercial,” he says. Work-order apps increasingly address that trend.

In fact, in addition to such providers as Building Engines, Angus Software and Accruent, his shop is developing its own version called Neighborhood Curated by Colliers. It’s an app for tenant-engagement designed to provide a one-stop shop for tenants to interface with management on all building matters, from work orders to food orders. He calls it a “virtual engagement platform.”

The Future in Your Palm

This broadening of scope also embraces the future. Artificial intelligence (AI) and machine learning, while still embryonic, are beginning to play into work-order apps. As mystifying as AI can be, it essentially involves the collection of past and current data to inform upcoming performance. Its leading edge is predictive analytics and the data collected thereby.

“For instance, we know that at certain times of the year we have a higher volume of plumbing issues,” says Finlay. “We can stock up on those products and buy them in quantity. So predictive analytics allows us to be more forward-thinking in gaining time and money.”

AI will even flag system breakdowns before they happen, as Gottsegen explains: “Predictive analytics powered by AI will change things radically. Let’s say an exhaust fan is equipped with a sensor that’s connected to the work-order app. A wobble in the fan occurs, and while it may be imperceptible to you, it’s not to the sensor. It will tell you the fan belt will need to be replaced in two weeks. That’s really useful information that will allow you to be more efficient and proactive for your customer.”

“In real estate, there are a lot of startups, so you do have to make that determination if they or their technology is going to be around long term.”

—Brian Sutherland, Yardi

“When you speak about AI in the context of facilities management,” says Sutherland, “you would probably look at connecting to a building management or HVAC system to monitor and regulate airflow based on historical data. When people start coming into the building, the HVAC system knows to come on. It’s leveraging the recorded data elements and telling the equipment to respond accordingly.” And it’s relaying all the activity to your app.

He adds, however, that such technologies, while potent in their promise, are still in the early stages. “The question is how we’re going to leverage these capabilities to bring value to the customer, reduce cost and make them more efficient,” he says. “That’s the direction we’re going in.”

“It’s still early,” Finlay agrees, noting that it can also be tricky to separate the effectiveness of individual app-based programs. Overall, however, he reports “an 18 to 20 percent savings on our maintenance expenses.”

Predictive analytics is just the front end of a much larger but developing movement toward AI and machine learning. “What’s more, property management requires a mature, proven product, so we won’t necessarily lead that charge. But as the capabilities expand, we as an industry will get on board,” Cichy says.

While there’s still a way to go before we reap the full impact of predictive analytics, “we’re currently gathering the data,” says Finlay, “so over time, we’ll be able to say with absolute certainty that this capability has contributed to that much cost savings.”

And, he could add, it has contributed to that much more occupant satisfaction.

Issue: July/August 2019  

Journal of Property Management

John Salustri is a contributing writer for JPM®.

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