What Makes Real Estate Companies Invest in a Business Intelligence System

by Nikolai Narvestad

Since our inception, we have dedicated our efforts to develop and tailor a business intelligence system specifically for real estate companies. This article shares our insights into the unique value a business intelligence system can bring to these companies.

Understanding a Business Intelligence System

The term "Business Intelligence" has broad applications and is often associated with dashboards or dashboard tools such as PowerBI, Tableau, Qlik, among numerous others. We intentionally use "tool" rather than "system" to describe these software products to highlight a crucial distinction. These tools represent only a part of a comprehensive business intelligence system. One can draw a parallel to a car; the dashboard tool is analogous to the chassis, while other components together form the drivetrain.

A BI system comprises three main elements, (1) data integration and transformation technology, (2) a centralized database optimized for analysis (also know as a data warehouse), and (3) dashboard software. 

So, how does this connect to real estate professionals? Real estate companies are data-intensive entities, with intricate core data systems. Employees spend considerable time sorting and organizing raw data from their distinct data systems, particularly their property management and accounting systems. This meticulous and manual consolidation of data is indispensable because their systems do not store data in an analysis-friendly format. Often, they also combine data from multiple systems into a single report.

This implies that simply connecting a dashboard tool to our databases cannot eliminate the manual data organizing and combining processes, resulting in unsatisfactory results for many companies across industries. To overcome this obstacle, one needs to employ advanced technologies that can automate these manual processes. This is why a comprehensive BI system is a necessity; a dashboard tool alone cannot get the job done.

Several other reasons exist to justify why real estate companies need a comprehensive BI system rather than merely a dashboard tool. However, the above example should make the case and point.

What Makes Real Estate Companies Invest in a Business Intelligence System

Humans, by nature, purchase solutions to problems rather than added benefits. Here are a few challenges real estate professionals face in relation to business intelligence systems.

Person Dependency and Information Delays

In most real estate companies, a few team members, often labeled as power users, manage the respective data systems. These individuals, usually business controllers, finance team members, and property controllers, are knowledgeable about the systems and regularly supply data to their peers. However, this model creates fragility within the organization, and disruptions occur if these power users are unavailable.

Moreover, their expertise often leads to an increasing volume of requests that interferes with their primary responsibilities, creating an unsustainable backlog. Over time, this can cause frustration and even job dissatisfaction among power users due to the expansion of their roles and responsibilities.

Inconsistent and Unreliable Information

Data quality and reporting consistency remain ongoing challenges. Power users not only distribute data but also control the data being distributed, thus altering, adding, or withholding data according to their discretion. This situation can lead to risks associated with manual data management and reporting.

Furthermore, it's often the case that system power users and recipients of data and reports are unaware of missing data, incorrect entries, and other anomalies. A robust business intelligence system can not only distribute data to appropriate roles at the right times but also highlight data gaps and errors in the underlying systems. This can provide peace of mind for all data consumers in the organization and assist system power users in maintaining a tidy data foundation. 

Incomplete Picture

There are often essential data elements needed in reports that do not exist in the data systems, such as forecasts, property values, custom area segmentation, and more. This gap can further reinforce the need for manual data management. However, a robust BI system can easily handle such data even if it resides in spreadsheets.

In Conclusion

Real estate companies have unique and complex needs that simple dashboard tools cannot address. A comprehensive business intelligence system is more than a luxury; it is a necessity. It solves various problems such as heavy data dependency, reliance on few power users, delays and inconsistency in information, and the challenge of integrating data from different systems. A fully-equipped BI system streamlines data integration, transformation, and presentation. It reduces person dependency and the associated risks, enhances information reliability, and provides a complete picture by collating data from multiple sources. Thus, the question shifts from "why does a property management company need a business intelligence system?" to "how soon can they implement one?"

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