“Upskilling” the Organization Advances Relationship Building, Cross-Functional Collaboration and Change Management

Corporate real estate (CRE) departments strive to provide their companies with the right space for business and employees at the appropriate cost structure. Over the last decade, many in the industry have aimed to better align with their companies’ strategies to proactively deliver real estate solutions. Customer relationship management (CRM) and portfolio planning are two programs becoming more established in the industry, as evidenced by increased demand for support in these areas, as well as several panel discussions and presentations at CoreNet Global Summits in recent years.

But how do CRE teams reorient their focus as the business and economic environment becomes more challenging? A 2009 joint CoreNet Global-CBRE study found that CRE organizations sought more strategic and consultative skills as in-house teams played a more strategic role with the business. Following that, a global survey of 211 CoreNet Global members late last year identified specific skills CRE leaders believe are growing in importance, where their own teams experience capability gaps and how they plan to fill those gaps.

Survey Results

Four of the top five skills growing in importance for CRE organizations are the “soft” business skills of relationship building, strategic thinking, cross-functional collaboration and change management (see Figure 1). For all of the skills that make up the top 10, CRE leaders report capability gaps in their organizations. Relationship building reflects a slightly lower gap as the CRM role has become more prevalent in the last several years. But other soft skills reflect larger gaps: More than half of those who rate strategic thinking and change management as high in importance also report gaps in those skills within their own team.

A number of technical skills also rank among the key capabilities needed for CRE teams. Several of the most important technical skills, such as strategic planning, alternative workplace and sustainability, also reflect capability gaps.

How to Achieve Upskilling: Case Studies

How are CRE executives planning to close capability gaps — or “upskill” — their teams to meet the growing demand for these key skills? The vast majority intend to train existing staff in the soft skills where capability gaps currently exist (see Figure 2). In addition, nearly half plan to turn to service providers for technical skills expertise, including the growing areas of alternative workplace and sustainability. To provide more insight, CoreNet Global and CBRE interviewed a handful of CRE leaders on how they are tackling upskilling.

1. McKesson. Tom LaDue has led the Strategy and CRM team at McKesson for 10 years. In 2010, his team evaluated all the skills they required and realized that rather than upskill, they needed to refocus skills. At the time, each existing customer relationship manager was tasked with representing a business unit’s (BU’s) real estate needs, planning across BUs in specific metros, developing and managing the adaptive work environment (AWE) program and managing portfolio metrics and reporting for each BU. “That’s too high of an expectation for one person to perform and excel at all of those tasks,” said LaDue.
   • Upskilling strategy. The McKesson Real Estate team had already developed a program management office three years prior to relieve customer relationship managers from individual project stewardship. In this round of review, LaDue determined that adaptive workplace and portfolio planning and metrics were two specific areas with impact across businesses. Thus, he reorganized his team to focus existing customer relationship managers solely on developing real estate solutions specific to each BU’s needs. Then, he converted two open CRM positions into one portfolio-planning role and one AWE role that brought expertise and focus to enterprise-wide initiatives. “Allowing each relationship manager to focus on the skills they need for their specific role is core to the success of our CRM program over the last two years,” said LaDue.
2. Regions Bank. Like many other financial organizations today, one of Regions Bank’s top priorities is cost reduction. In support of this strategy, the CRE team embarked on an aggressive square footage reduction program, which at times included ideas unpopular with business groups. John McGowan, Executive Vice President of CRE, knew that he needed a team of people with the skills to effectively influence business leaders to accept and champion new real estate programs to achieve company goals.
   • Upskilling strategy. Regions Bank created a CRM team tasked with understanding the lines of business, their plans, geographic changes and financial and operational challenges. Customer relationship managers were charged with developing a relationship as a trusted partner to effectively influence business leaders. By understanding the business and the portfolio, the customer relationship managers were also expected to uncover new opportunities for their clients. McGowan recognized that this role required relationship building, strategic thinking and influencing skills. He looked for candidates from Regions internally and externally with experience in sales, where those skills were critical. For these teams that are constantly introducing new initiatives, change management is another key skill McGowan continues to develop on his team.


Upskilling the Banking Industry

The Regions Bank experience is not unlike that of many regional bank ing institutions with which CoreNet Global and CBRE partner. The banking industry has been consolidating for years through mergers and acquisitions, keeping CRE teams focused on tactical integration projects to achieve expected merger efficiencies. The upskilling journey for various regional banks has centered on the recognition that the CRE teams needed to broaden their scope and reorient their focus on longterm planning to bring the most value to the organization and align with corporate strategy. This new focus requires strategic plans with a holistic approach to project and program management. However, teams that had been focused on merger integration often are not appropriately prepared for the new environment and expectations.

Leaders in these organizations approach upskilling through a combination of organizational changes, outsourcing strategies, training plans and a skills shift for the customer relationship managers. They can strengthen the CRM team by hiring associates with specific skills like finance. They can establish strategic-planning teams to focus those with the right skill sets on developing portfolio plans aligned with enterprise objectives. They often discover that a program management team is necessary to ensure proper coordination and integration of complex, enterprise-wide initiatives. Recognizing that the shift to more business alignment requires financial acumen, they focus on strengthening this capability. Mirroring the results of the survey in Figure 2, one organization is looking to bring finance and enterprise alignment MCR courses on site to invest in the existing team while keeping costs reasonable.



Key Learnings

These CRE leaders regularly assess their teams’ skills to meet changing business challenges. Each of the interviewees emphasized that solutions are specific to each company’s business drivers and cycles. The following key learnings emerged that apply to most organizations embarking on an upskilling effort:

1. Training courses need to convey CRE relevance to be effective.
   McGowan advised that generic change management training may not seem as applicable to a CRE team as one that applies change management concepts to actual initiatives, such as implementing an alternative workplace program or new workplace standards.
2. Utilizing expertise within the company can deliver training at lower cost. Patricia Crumley, Real Estate Director at Miller Coors, noted during the San Diego 2012 CoreNet Global Summit panel on this topic that she tapped the company’s sales and marketing team to help teach skills such as influencing and relationship building. While those teams may not have real estate experience, they do understand how to develop the skills and utilize them in ways that are recognized as being successful.
3. Training is not the only way to approach the upskilling of a team.
   LaDue believes that upskilling can lead to organizational change. If business strategy is driving a change in expectations for the CRE team, then the team may need to realign itself to take advantage of the strength of team members’ skills and add skills appropriately.
4. Approach upskilling with a longterm view. Crumley assessed her team’s skills against the demands placed on the CRE department and concluded that there was a consistent need for specific technical real estate skills on an ongoing basis; therefore, she decided to build those in house. Her need for strategic planning tended to be point-in-time when a real estate or business driver required a portfolio review. For that, she partnered with service providers. It may be contradictory to the survey results, she mentioned, but it was right for her team long term. In fact, a recent global study produced by KPMG indicated that an increasing number of CRE executives are turning to service providers to help augment both technical and soft skills.

   LaDue commented that looking out long term also means thinking outside of the box. The McKesson real estate team did that when they instituted a PMO in 2007 to manage real estate projects endto-end and added service provider staff with process-oriented skills. Looking forward, he said the team needs to think about the scalability of any skill-based model: “How do you embed specific skills across the team?”

5. Impact of change can be significant to a team’s performance and shouldn’t be underestimated. Some upskilling efforts result in significant change to CRE teams. Introducing new teams and team members with unrelated CRE experience requires good understanding of roles and responsibilities by all the CRE team members and the value each one brings to the success of the organization. It is important for everyone to rally around a common goal, to clearly understand how success is measured and to understand the role the group plays in achieving success.

   With these key learnings and an understanding of business drivers, CRE leaders can position themselves to successfully upskill their teams and continue to increase their strategic value to the company.