November 05, 2013

| By By Darryl Benson, Vice President of Solutions

Keys to Making Better Outcome Centered Decisions

By Darryl Benson, Vice President of Solutions, Environmental Systems Inc. (ESI)

Over the past 36 months, the industry has gone through an awakening of sorts with respect to their needs around building automation and automated fault detection and diagnostics.  In essence these technologies have moved along the technology adoption curve to the point that we’re seeing the Early Majority users start to take advantage of what advancements the industry has to offer.  During this time, we’ve “Leapt the Chasm” from Early Adopters toward the Early Majority.  If we’re not to the Early Majority, we’re definitely in mid-air and heading there fast.  How will the Early Majority make their buying decisions in this rapidly changing market place?

Availability

Contributing to leaping of the chasm has been a slew of technologies that have rolled out over the past 3 years.  Platforms have matured and can deliver the goals building owners and managers have wanted for over a decade.  These technologies cover the spectrum from specialized building automation equipment tuned to optimize specific systems to software driven automated Fault Detection and Diagnostics (FDD), often called “analytics”.  These technologies have not only started to deliver results, but they’ve enabled their channels to deliver results to a host of Early Adopters.  Delivery channels of the technology providers have developed and matured from the existing channels that have served the building automation and energy management industries, some are new.  As the channels have matured over the past three years, so have the business models that have been developed to deliver these new solutions.

This develops into part of the root cause of the problem customers are experiencing: Everyone sounds the same.  While the technology has enabled the channels, there is quite a lot of overlap in the messaging the technology companies and solution providers are pushing into the market.  There are claims for large energy savings, substantial operational savings and automatic demand response, just to name a few.  Where should the CEO and CIO start?

Be Outcome Focused

It may sound obvious, but there are numerous corporate initiatives that suffer from a lack of a clear purpose.  Between scope creep and lengthy project cycles, the primary goal is often diluted or entirely overshadowed.  Project teams tend to take focus away from Why (Outcome) the project is being proposed and focusing too much on the How (Technology).  This contributes significantly to why programs don’t deliver their expected results.   The value of staying Outcome Focused cannot be understated.  This is especially true at the early stages when you are reviewing solutions and partners to aid you in meeting the programs objectives.  Only when the team develops a clear vision of where they want to go can they start to identify the best path forward. The act of finding an execution partner to help you achieve those goals is far easier when you understand and focus on the desired outcome.  By staying focused on the outcome, the technology questions become easier to answer.

Stay the Course

Often the goals of a program get subjugated to old company decision making idioms that may have been ideal in the past. The old decision making methods may have worked for small, low impact projects, but they breakdown when making decisions about programs that deliver on enterprise and corporate level initiatives that occur over a lengthier lifecycle.  You must rethink the business processes around decision making for building systems project types.  You can do this by borrowing from the segment within most businesses that has been the most rapidly changing and high impact for the past 15 years – The IT industry. Many project decision cycles in the building system space utilize a simple payback method as the key to measure any successful project outcome.  It simply doesn’t paint the entire picture when you factor in lifecycle costs and lifecycle benefits that reach beyond the payback period.  If your organization looks at IRR (percentage return over time) or NPV (profitability of a project over time) both of them take the entire lifecycle into account versus the less sophisticated simple payback method.  Don’t let the lure of an overly simplistic decision model keep you from making decision about how to best utilize your companies resources.

Look at the Track Record of Partners

Very early on, it’s extremely important to take into consideration the track record of the solutions providers of the various technologies that are under review.  If there are competing technologies that offer comparable capabilities, the solution provider will be a key differentiator in delivering the technology, services and program success you and your team have put together.  In short, with the wrong partner the best technology may be misapplied, run into budgetary overruns, and not deliver on your desired outcome.  With the rapidly changing landscape your due diligence will be rewarded with long term success and a partner who will more than likely deliver for you into the future.

Conclusions

When breaking it down, it can be quite simple:

  • The industry is in a state of rapid evolution.  Enabling technologies are progressing rapidly and the channels making them available are maturing.
  • Stay focused on the outcomes you and your team have determined for your programs.  Stay focused on the Why of your program particularly at the early stages of a program.
  • With a rapidly maturing market, the decision process should mature as well.  Take long term views on returns versus overly simplistic models.
  • Many of the technologies have many competing features where the utility of one solution over another can blur significantly.  Rather than making a decision based on technology alone, it’s key to consider your partners’ capability to deliver on your outcomes.
  • Consider your partners’ ability to make long term contributions to your organizations continued success.  This may be a key differentiator that can tip the scales during the decision process.