Who Will Lead our Robots in Real Estate?

Written by Holtby Turner

In the future, with continued exponential growth in technology, the scope of robotics and cognitive intelligences will dramatically increase. Whatever can be automated, will be automated – why would we not wish to increase efficiencies in real estate wherever possible? With Brexit looming, it’s debatable we even have a choice.

Cleo Folkes, a Research Manager at St Martins Management Corporation, made a very good point when we spoke. “What I have noticed” Cleo said, “is that people wary of change in real estate, merely become late adopters. But adopt they do.” Indeed.

According to McKinsey’s insight report, Where Machines Could Replace Humans– And Where They Can’t (Yet), “49% of the activities that people are paid to do in the global economy have the potential to be automated by adopting currently demonstrated technology.” In July, RICS wrote in The Impact of Emerging Technologies On The Surveying Profession, that “surveying appears to be an industry in which 88% of the core tasks are ripe for automation to a greater or lesser degree.”

For leaders in real estate, the key question will be where and how to unlock value, given the cost of replacing human talent with machines. The bulk of these benefits may not directly come from reducing staffing costs, but rather from increasing productivity through a lower margin of errors, higher output and increased levels of quality, safety, stability and speed.

So where does that leave us in real estate?

Through artificial intelligence, McKinsey estimates a 9% automation potential in the management and development of people, and 18% for jobs which ‘apply expertise to decision making, planning, or creative work’. As things stand with technology capabilities in 2017, AI is ideal for well-defined activities, but as McKinsey points out, “humans still need to determine the proper goals, interpret results, or provide common-sense checks for solutions.”

With open-source software that anyone can access and build with, Orchestra makes it easy to see why Bain believes by the end of 2027, most business activity will be automated or outsourced. As The Firm Of The Future states, “teams will be self-managed, leading to a vast reduction in the number of traditional managers”, predicting “employees will have no permanent bosses, but will instead have formal mentors who help guide their careers from project to project.”

How this all translates to the job of managing people in real estate we don’t know. What is clear is that a new style of leadership will appear, innovating the very core of career development. “Some [career] tracks will recognize and reward the efficient management of routine processes,” authors of The Firm Of The Future claim, “while others, just as highly prized, will value the coaching and development of apprentices as they migrate from one role to another.”

Innovation has never been more important to real estate. It’s no wonder that finding talented innovators to transform organisations is a recurring topic in almost every conversation we have with CEOs in the industry.

Do the answers lie in mergers? Or acquiring start-ups? Or hiring a Head of Innovation? Or is the answer in intrapreneurship, as we explored earlier

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