Data is the new oil, or at least that's what we've been told. In 2017, The Economist published an article titled The world's most valuable resource is no longer oil, data. It has since generated a great deal of discussion surrounding the topic. Companies worldwide are working feverishly to capture and analyze "Big Data," hoping it will underpin new waves of growth in productivity and innovation. The problem with this school of thought is, like oil, unless data is refined, it serves little purpose.
The DIKA model or Data Information Knowledge Action model is an excellent framework to illustrate this process. It begins by taking raw data, refining it into information that you can analyze, extracting knowledge and meaningful insights, and developing a plan of action.
We can summarize this process in five steps:
Five Steps to Transforming Data
1. Pick a Goal
As with any project, you must begin with an end goal that clearly outlines the goal you need to accomplish. This goal could be simple, like reducing the average CAM expense per square foot of your portfolio to something more complex, such as increasing tenant or employee satisfaction. After you've outlined a clear goal, you must identify the quantity and type of data that will help you guide your plan of action.
2. Source the Data
An excellent start to reducing your average CAM expense is to collect all costs related to your portfolio and categorizing them by type. Your accountant or bookkeeper should be able to produce this information reasonably quickly and deliver it to you in an Excel file. Keep in mind that you don't always need large data sets to solve problems. Sometimes the best approach is to use a small collection of high-quality data.
3. Analyze the information
Now that you have a high-quality data set, you can begin analyzing it. Naturally, this is where an analyst becomes extremely useful. When you give an analyst the right data set with a clear goal, they can transform that data into a compressive report that allows you to analyze the information from different perspectives. In the case of average CAM expenses across your portfolio, this could be an excel file that will enable you to sort and restructure the findings based on property, lease, time, and cost category.
4. Produce Insight
Now that you have a comprehensive report that details every expense and allows you to restructure them by a field of your choice, it's time to extract actional insights. Consider your original goal to reduce the average CAM expense across your portfolio. The solution could be eliminating a specific line item across your portfolio or renegotiating a few lease agreements during your next renewal. Whatever the answer may be, this step is going to take some creativity and thought.
5. Make a Plan
Congratulations! You've outlined a goal, collected the data, and analyzed the information. Now the only step is to use this knowledge to develop a plan of action. Let's say that one of the significant contributors to your CAM expenses is an unnecessary line item. Cut the cost and rerun your experiment in three to six months to verify the results.
Data can be a precious resource for your organization, but like oil, it is most valuable when refined and drives action. A significant part of this process is connecting the dots to extract insight in a repeatable way. At Hive, we help you transform data into action by giving you the tools to organize lease and property data and extract meaningful information through our web-based platform. To learn more about Hive, our mission, and our platform, visit us at crehive.com.