Do you have a naïve forecasting model of the future?

DOIhttps://doi.org/10.1108/JPIF-12-2019-0154
Pages267-269
Publication Date20 Mar 2020
AuthorLarry Wofford,David Wyman,Christopher W. Starr
SubjectProperty management & built environment,Real estate & property,Property valuation & finance
Do you have a naıve forecasting
model of the future?
Larry Wofford
Department of Management and Marketing, University of Tulsa, Tulsa,
Oklahoma, USA
David Wyman
Department of Management and Marketing, College of Charleston,
Charleston, South Carolina, USA, and
Christopher W. Starr
Department of Supply Chain and Information Management, College of Charleston,
Charleston, South Carolina, USA
Abstract
Purpose This paper addresses the increasingly rapid and disruptive changes caused by technology
innovations impacting commercial real estate (CRE) and how leaders in todays CRE business environment can
better anticipate, and even experiment with, disruptive technologies while maintaining current business assets
and practices.
Design/methodology/approach This qualitative research is based in systems theory, through which the
impact of disruptive technology innovation cycles on business models is described for tactical and strategic
utility.
Findings The advent of the fourth industrial revolution (Industry 4.0) is characterized by a convergence of
multiple technological innovations including artificial intelligence, the Internet of things, smart buildings,
autonomous agents, and automated decision-making. Industry 4.0 promises a future of discontinuities and
disruptive innovation superseding the deployment of digital technologies enabled by Industry 3.0.
Ambidextrous leaders need to maintain two concurrent foci: one on the current CRE business environment
for incremental improvements and one on new opportunities made possible by the next technology
innovation cycle.
Practical implications By anticipating the inflection points of nonlinear technology adoption cycles, CRE
leaders can reduce risks and increase innovative opportunities as participants in the next disruptive cycle
rather than falling victim to it.
Originality/value This work examines CRE market disruptions caused by technology innovation cycles
through the lens of systems theory. A connection is made between the nonlinear nature of technology
disruption cycles within the CRE business environment and how CRE leadership can better anticipate and
prepare for change through ambidextrous thinking.
Keywords Complexity, Sustainability, Disruption, Resiliency, Business environment,
Technological innovation
Paper type Viewpoint
The impact of technological innovation on commercialrealestate(CRE)overthelasttwo
centuries is clear. Electricity, hot and cold running water, and the flush toilet have had
major impacts on the built environment. Structural steel and elevators have had major
impacts on the type and intensityof development, and they have changed the fundamental
economics of CRE. Design and business model innovations have led to the creation of the
department store and enclosed shopping centeraswellasatriumlobbyforhotelsand
office buildings. Legal innovation has led to time-share condominiums, zero-lot-line
townhomes, and development in air rights in our major cities. These changes have
generally involved physical elements and have been incorporated into new construction
and existing buildings where retrofitting made economic sense. While the impact of these
Naıve
forecasting
model of the
future
267
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1463-578X.htm
Received 11 December 2019
Revised 12 December 2019
Accepted 12 December 2019
Journal of Property Investment &
Finance
Vol. 38 No. 4, 2020
pp. 267-269
© Emerald Publishing Limited
1463-578X
DOI 10.1108/JPIF-12-2019-0154

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