September 2005
  
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What Next Part IV: Action Stations!

 

What Next Part IV

The world of technology in buildings is changing; to do nothing is the same as making a conscious decision to go backwards, at a time where new IT-savvy players are moving forward at greater and greater speed.
_________________

Anto Budiardjo
President & CEO,
Clasma Events Inc.

Contributing Editor

In this four part article on the future of Building-IT Convergence, I will cover the driving forces, trends and predictions on how our lives will change as convergence will take root globally. In part 1, we look at the true impact of the Internet, in part 2 we look at the change Convergence will bring to the stakeholders of our industry. Part 3 will explore what needs to change in the route to market of building system solutions and part 4 will tie it all together with some predictions and suggested action for those interested in playing a role in the future of buildings.

In this concluding segment of the convergence review, we explore where you should go and what you should do to make the most of this changing market as building systems and IT converge.

There are eight specific action tasks that should be considered by all stakeholders in building systems, from contractors to integrators to consultants. You should view these as either personal or corporate tasks depending upon your situation.

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1) Decide Your Role

Your number one job at this time is to decide what role you intend to play in convergence. Regardless if you are running your own business or you work for someone, you have to take stock, and based on your personal expectations, risk averseness, skill as well as financial and general circumstances, you have to decide on one of two broad directions:

Become a Domain Expert. If you choose this path, you will focus your energies and business on the discipline of your choice, be it HVAC, security, lighting or even more narrow areas within those areas. There is nothing in convergence that says that any of these skills will go away; in fact, the quality of these skills and disciplines will need to be higher because these fundamental building systems will become more visible as convergence exposes their true performance and effectiveness.

Become Solutions-Oriented. If you choose this path, you will focus on the total solution for the benefit of the building owner. But beware; the extent of the solution will need to be greater than what you would have previously been providing. The solution that owners need will be solutions to their business problems, in other words how their facilities can directly impact their business—so temperature control is not a big enough solution, neither is lighting or security systems. To do this, you must (as a business person) be able to put yourself in the shoes of the highest level person in the owner’s organization and empathize with their problems – then provide solutions.

Beware of one critical thing: When you make the above decision, you will have to make sacrifices on the role you are choosing not to take. Both roads can lead you to successful business, IF you be the best in it.

2) Invest in Education

What is the education budget of your organization?

If you don’t have an answer to this question as a percentage of revenue and you run the company, you are in trouble. If you work for someone else, ask them; if they don’t have a good answer, you are both in trouble. It is critical that you expend at least 2% and up to 5% if you have decided to be Solutions-Oriented.

This is not just in dollar terms; you have to allocate time to educate yourself and your team on the critical issues that are changing your business. This is not an option, it’s not a luxury and it cannot be relegated to be done when time is available.

If you are the owner or manager of your business, then in addition to allocating the budget and time, you must also encourage and motivate your team to educate themselves. Give recognition to those who are taking this seriously. Education topics should be appropriate and relevant to the changing landscape of convergence and be sensitive to the role that you have decided upon in Action 1.

Finding good sources for education can be a challenge, but thankfully there are many avenues from associations, formal continuing education, commercially-organized events such as BuilConn, and of course there is plenty of reading material from Web sites, trade magazines and shelves of IT-oriented books if that is your chosen subject.

One last source for education is self education. The North American culture is made great because of an inherent willingness to try, making mistakes, learning from them and moving on. As long as you limit the risk of mistakes and don’t repeat them, I have found this to be the best method of learning.

So, the specifics of this action is an allocation of budget, time as well as a time table and list of specific subjects on which you need to focus. You may need to discuss this with your management.

3) Partner Up

Control Solutions, Inc The president of one of the largest building systems company in the world made a valuable comment at this year’s BuilConn: Even at their multi-billion dollar size, they cannot do everything themselves, and they have a proactive initiative to partner with other players.

So, what right do you have to think for a micro-second that you can do it yourself? The new world of building systems and IT convergence will require expertise in many areas of discipline and you have the utmost responsibility to yourself to place yourself within a network of complementary skills to get the job done.

Most important in this is a clear understanding of your strengths and weaknesses. Create a SWOT analysis to list items of Strength, Weakness, Opportunities and Threats. This will help you strategize the most appropriate types of partners with which to work.

Be aware of the term coopetition, a practice becoming increasingly common with partner relationships. Basically, you may need to cooperate with companies that may be considered competition in other areas. While this may go against your instincts, it can bring you and the partner benefit. As long as you both understand the parameters of your partnership, it should be able to work.

4) Get Access to IT Skills

This action is very important if you decide upon the Solution-Oriented direction, but is also important if you choose to be a Domain Expert.

As a solution provider, IT is your basic material and skill base without which you will not be able to deliver the necessary value to the right kind of customer. IT skills have to be significant and available within your organization in significant quantities. In fact, your organization should feel more like an IT company than anything else if you are a solution provider.

As a domain expert, the need for IT skills is less. It’s only necessary for you to understand the landscape in which you will be working. You will also be increasingly using IT-based tools even for your chosen area of discipline. In this scenario it is acceptable to have either low-key IT staff in-house or have a good relationship with outside IT consultants. Beware that knowing some cousin or geek son of a staff member will not cut it here. This has to be a serious business relationship. IT is that important.

Being IT savvy also requires you to be suitably equipped with IT tools. The cost of PCs these days is so cheap that you should not have anything other a reasonably equipped PC (Pentium IV or equivalent, at least 1 GHz, with 512MB of RAM and at least a good XGA monitor), there is also no reason not to run Windows XP or 2000 on all your computers. And there is no reason whatsoever not to have broadband Internet into all of your office facilities.

5) Step up the Ladder

One of the key ingredients for your success is climbing the ladder. Here, I’m talking about the ladder of decision makers within the building owner organizations that make up your customer base.

This is especially the case if you chose to be Solution-Oriented where the way to deliver the greatest value to the building owner is to talk to the CEO (or equivalent). Now, I do recognize that this is not always possible, but at least you now know who is on the top rung of the ladder.

Many building systems contractors or integrators have cozy relationships with some level of building manager, engineer or facility manager/operator. To be solutions-oriented you must aim higher, and I propose that you make it a specific action to identify the person or persons on the next ladder rung, and exert significant effort to influence that person by understanding their problems and knowing how to solve them. And give yourself a target time table to achieve this.

You may think this is politically dangerous since you will undermine a good relationship at a lower level. If that level is not letting you bring greater value to the owner, you have a simple choice to make: stay at the level you are with unsatisfactory results or risk everything for better results.

While it is not the intent of this article to guide you around internal corporate politics, it’s safe to say that many successful sales people find ways to leverage their contacts to go higher up the ladder while providing benefit to original contacts such that they continue to be your supporter.

6) Increase Your Price

Yes, you read it right. Increase your price.

Reliable Controls The problems I often hear about from contractors and integrators are that they are fighting to secure the low bid, that owners are trying to squeeze every penny from your margins, and that owners are playing them against their competitors to get the most competitive bids. And of course the large or desperate companies will “buy” the project with very low bids, with expectation of later rewards.

If you have taken the previous actions seriously, you will now be providing better focused services or products, be better educated in your strength areas, have a strong and complementary array of partners, have adequate IT skills, and be talking higher up the ladder. You have every credible reason to demand more for your services because you are simply worth more to the building owner.

By increasing your prices, you will be differentiating yourself from the low-cost mayhem that is preoccupying the building systems industry at this time. By doing so, you will be making a statement of your worth and capabilities.

Be aware that it will take some time for this strategy to work. You will have to sell your new capabilities ahead of time so the owner will expect you to understand and solve their problems—not just provide another control system. Also be aware that unless you do this right, you may lose a lot of business; it takes commitment. Don’t say you have not been warned, and please don’t complain to me if this strategy does not work for you.

7) Watch New Technologies

In order to deliver safe solutions to buildings, it is critical that you use proven technologies and use newer technologies only if there is a very good reason and you have an adequate backup plan.

As at the time of writing (mid 2005) the use of wireless technologies is maturing. Wireless is a broad term and while some of wireless is stable (GSM and WiFi for example), the most interesting development for building systems lies in wireless mesh networks, specifically for “edge” devices such as sensors and actuators. Initiatives such as ZigBee stand a good chance of stabilizing and becoming a standard and be used almost everywhere expect where absolute critical applications require wired solutions. Only time will tell.

Other critical technologies to keep an eye out for are PoE (Power over Ethernet), PLC (Power Line Carrier) and IPv6 (IP version 6).

Someday soon, PoE will fundamentally change building control systems, enabling devices to be powered through the Ethernet CAT5/CAT6 cable. This turns Ethernet cabling from a liability to an asset, and will be a game changer.

You should keep an eye on PLC (Power Line Carrier) technology. This, in a way, is the exact opposite of PoE as it carries data over what we normally think of as power cables. While this technology has been around for a long time (e.g. X10), it has yet to provide the reliability required for prime-time commercial-grade use, but work continues as this media is refined with new techniques to overcome fundamental hurdles.

IPv6 is unlikely to affect much of building system devices in the near term, but is likely to creep into play in unforeseen ways, as the number of public IP addresses becomes no longer limited. The scenario of every single sensor having a globally unique public IP address accessible from anywhere will dramatically change building systems at some time in the future.

The action here is to watch these and other emerging technologies, keep up to date with their developments, and try them out when appropriate. You will also benefit from conveying your knowledge of these issues to your customers.

8) Demand IP Products

The final action is to help the industry grow into what many feel is the right eventual path for the industry; the adoption of native IP products is ultimately the only way for the future of building controls.

While we all understand this will take time, many in the industry are resisting this trend and some have very good reasons, for now anyway. There are some types of products and devices that are too costly to be connected via Ethernet at this time and maybe even forever. The cabling cost and the management necessary for IP nodes can be a hurdle, and there are plenty of non-IP based devices that work just fine.

All of this is true, but if you are planning to increase the value you bring to building owners, you need to do this on the terms of the IT departments by using technologies that are well understood by enterprise integrators and players. IP-centric technologies, including Web-centric technologies and XML / Web Services, are the only language that is understandable by your new constituency of customers.

If you cannot have IP at all levels, it is imperative that all the information installed in any building with which you involved be visible at the IP level natively or through a combination of accessible gateways and protocol translators. Integration between building systems is best done at the IP level, and integration with the enterprise can only happen here.

In the meantime, continue to insist to your vendors that IP be used as low in your building systems architecture as possible.

Conclusions

The world of technology in buildings is changing; to do nothing is the same as making a conscious decision to go backwards, at a time where new IT-savvy players are moving forward at greater and greater speed.

While the perspective outlined in this paper may be overly generalized for many specific instances, it is hoped that you would glean what is clearly a very strong trend of convergence. Some commentators note that since the building systems industry is actually moving toward the IT industry, this is not really convergence, more of a diversion. This view has great validity since the IT juggernaut is not likely to shift to the ways of the building systems industry. But Building-IT Convergence is the term we will continue to use because from a buildings perspective, the domain skills necessary for buildings to operate is not likely to shift either, not if buildings need to continue to be comfortable and safe.

The title of this paper is “What Next”; in reality what is next is up to the stakeholders of this industry—in other words, up to you. My closing comment is that you should focus on developing good valuable business for yourselves; this is not the end of building controls, it is the beginning of the new period of intelligent buildings, enabled by technology and you.


About the Author

Anto Budiardjo is the President and CEO of Clasma Events Inc., a marketing and event planning company whose primary focus is providing professional services to the full spectrum of the building systems industry. Anto is a contributing editor for AutomatedBuildings.com and a frequent speaker at numerous industry events. He is also a contributing writer for several trade publications where he discusses the issues and trends facing the emerging industry of networked building systems. 

Clasma Events Inc. is the organization that produces the BuilConn Forum, a four-day forum uniting consultants, integrators, distributors, manufacturers and technologists from the disparate disciplines of the building systems industry to learn and discuss the trends, technologies and their applications for tomorrow's intelligent and integrated buildings.

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