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ERES 2011 Eindhoven

ERES 2011 Eindhoven. Structuring-clustering-visualizing – What are the tasks of a “Value Manager”? A methodology to analyze management jobs in real estate Dr. Annette Kämpf-Dern TU Darmstadt, Department of Law and Economics Chair of Real Estate Management and Construction Management

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ERES 2011 Eindhoven

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  1. ERES 2011Eindhoven Structuring-clustering-visualizing – What are the tasks of a “Value Manager”?A methodology to analyze management jobs in real estate Dr. Annette Kämpf-Dern TU Darmstadt, Department of Law and Economics Chair of Real Estate Management and Construction Management 16.06.2011

  2. Agenda Problem & Approach – Job names don't tell enough Methodology – Structuring – clustering – visualizing Results – Selected job profiles Outlook – Job profiles are fundamental for success

  3. Value creation in REM requiresspecialization jobnamesdon‘ttellenoughExampleofstrategicmanagement firm (AuM: € 1 Billion) Strategic Real Estate Management (Assetsunder Management: Circa € 1 Billion) Depot Bank Funds Accounting Strategic RE Management: Effectiveandefficientstructure Interdisciplinarythinkingandacting Experienced & qualifiedpersonnel Ongoingcommunication assure Analyticexpertise & steering High qualityfiduciarydecisions Effectiveassetmanagement RE-Controlling/Portfoliomgmt. (3 MA) Controlling/PFM Data Analysis Valuation/ Contract-Contr. 1 MA Special Topics Valuation Transactions Value Management (Economical) 3 MA Refurbishments/Projects Value Management (Technical) 2 MA MF-System Maintaining Source: Participatingcompany, Kämpf-Dern (2010), p. 358 Letting ObjectAdm. Invoices Which tasks, responsibilities, qualifications, earnings are associated with the job of a “Value Manager”?

  4. Websurvey to find out81 respondentsfrom 6 differentlyorientedcompanies # of Websurvey-responds per company Type ofcompany Real Estate Stock Company: 44 % RE Funds / RE Fund Service provider: 31 % Asset Manager (Service provider): 25 % n=81 Source: Kämpf-Dern (2010), p. 359

  5. Focus: RE Asset Management# ofresponds per function1 n=81 Source: Kämpf-Dern (2010), p. 362 1. Based on functionalnames, qualificationandresponsibilitieslisted

  6. Questionnairerequiresconcretizeddifferentiationofgeneralmanagementtasks, …… but analyzed „classically“ Detailedwebsurveyquestions … … areanalyzed „classically“ A) Plan Research & analyze A), B) Plan strategy & prepare Operate G) Operate F) Report &controlperformance Control Organize C), D), E) Consult, decide, organize G) Implement Steer/coordinate &controloperations Levels: Company, portfolio, object, measure

  7. 280 taskscouldbechosen – structuredby 4 blocks, 42 topics, 7 phasesExcerptfromwebsurvey 7 Phases Blocks: • Target systemsituational, marketandobjectinformation • Real estatetopics • Financial topics • Administration, accounting, reporting, riskmanagement 4 Blocks with 42 Topics 280 Tasks Source: Kämpf-Dern (2010), p. 456 ff. 73 respondents could result in 20.440 possible data points. Problem: Some chose 15 tasks, others 120 – How to calibrate and get an impression on focal points per job?

  8. Agenda Problem & Approach– Job names don't tell enough Methodology – Structuring – clustering – visualizing Results – Selected job profiles Outlook – Job profiles are fundamental for success

  9. Investment Decisions &Controlling Service Providers Investment Planning &Portfolio Target Setting InvestmentResultsControlling Advising REIM &Organizing Implementation Accounting & Reporting Portfolio Decisions & Controlling Service Providers Portfolio Planning &Object Target Setting PortfolioResultsControlling Advising REPM &Organizing Implementation Object Decisions & Controlling Service Providers Object Planning &Measures TargetSetting ObjectResultsControlling Advising REAM &Organizing Implementation Measures/Action Decisions & Controlling Service Providers Action Planning Action ResultsControlling 5-Step-Methodology toidentifyandvisualizejobclusters in Real Estate Management (REM)Overview 2) Organize 5) Account& Report Step 1: Use an overallframework Step 2: Organizetaskswithinframework Mgmt.phases: 4) Control 1) Plan Plan Organize Imlement Control Operate Mgmt. Phase 3) Implement/Steer Functional Levels Level Rechnungswesen und Reporting 111F 112F 113F 311F 312F/T 313F 314F REIM Structuring REIM G11 G12 G13 LC Phase REPM 121R 122R 124R G31 G32 G33 G34 REPM G1R 321F/R 323F 134F Step 3: Weighandnormalizetasks Step 4: Buildjobclusters G3R 322F/T/R 324F/R G14 REAM 211F 212F 213F Target-oriented coordination and value-management Target-oriented coordination and value-management REAM/SOM 333F 334F Clustering 412F 413F 421F/T/N 423F/T/N OOM PrM/REFM 422F/T/N/R 424F Step 5: Visualizeclusters G41 G42 G43 G44 G4R&5R 221R 222F/R 223F 214R 515F/T Core Processes RES Visualizing G2R G5 233F 234F 525T/N/R G21 G22 G23 G24 50 Life Cycle (LC) Groups 20 Functional Groups

  10. Step 1: Structurethetasks (I)In REM 5 Functional Levels canbedistinguished RE InvestmentManagement(REIM) • Real Estate Management (REM): • Planning/Developing, • Organizing, • Implementing/steering, and • Controlling • lower management activities or • real estate core processes Strategic REM Real EstatePortfoliomanagement(REPM) Real Estate Asset Management (REAM)(Strategic Object Management) Property- & Real Estate Facility Management(PrM & REFM)(Operative Object Management) Operative REM Conception/Supply Usage/Operation Recovery Real Estate Activities(Core Processes in Life Cycle Phases) Source: Furtherdevelopedfrom Kämpf-Dern (2010), p. 20

  11. Investment Decisions &Controlling Service Providers Investment Planning &Portfolio Target Setting InvestmentResultsControlling Advising REIM &Organizing Implementation Accounting & Reporting Portfolio Decisions & Controlling Service Providers Portfolio Planning &Object Target Setting PortfolioResultsControlling Advising REPM &Organizing Implementation Object Decisions & Controlling Service Providers Object Planning &Measures TargetSetting ObjectResultsControlling Advising REAM &Organizing Implementation Measures/Action Decisions & Controlling Service Providers Action Planning Action ResultsControlling Step 1: Structure the tasks (II):All management levels have to perform planning, organizing, steering and controlling tasks (marked: REAM) 2) Organize 5) Account& Report Functional Levels Mgmt.phases: 4) Control 1) Plan 3) Implement/Steer REIM REIM REPM REPM REAM Target-oriented coordination and value-management Target-oriented coordination and value-management REAM/SOM OOM PrM/REFM Core Processes RES Source:,Furtherdevelopedfrom Kämpf-Dern (2010), p. 309 But: Functional levels ≠ job designs  What are typical / reasonable combinations for jobs?

  12. Step 1: Structurethetasks (III)Eachtaskismatchedwith a managementlevelanda lifecyclephase (LC-phase) Plan Organize Imlement Control Operate Mgmt. Phase Level LC Phase Source:, Kämpf-Dern (2010), p. 307f.

  13. Step 2: Group taskswithinstructuretofacilitateanalysis – Lessdetailed, but betterto handle50 Life Cycle Groups combinelevel, lifecycle & managementphase Plan Organize Imlement Control Operate Mgmt. Phase Level 111F 112F 113F 311F 312F/T 313F 314F G11 G12 G13 LC Phase 121R 122R 124R G31 G32 G33 G34 G1R 321F/R 323F 134F G3R 322F/T/R 324F/R G14 211F 212F 213F 333F 334F 412F 413F 421F/T/N 423F/T/N 422F/T/N/R 424F G41 G42 G43 G44 G4R&5R 221R 222F/R 223F 214R 515F/T G5 G2R 233F 234F 525T/N/R G21 G22 G23 G24 50 Life Cycle (LC) Groups 20 Functional Groups Focus: F=Financial, T=Technical, N=User, R=Accounting/Reporting

  14. Step 3 (I): Givegroupsweights (addingupto 100%)Here: 20 functionalgroups (combining LC-Phases) with 5 % each All 20 groups (G2R and G3R counttogether) get 5% each. M-Phases 1) Plan • Analyze • Plan & prepare 2) Organize • Consult • Decide • Organize 3) Implement • Steer/coordinate • Controloperations • (Operate) 4) Control • Controlperformance 5) Account& Report M-Levels G11 5,0% G12 5,0% G13 5,0% G145,0% G1R5,0% 25,0% Investment G235,0% G215,0% G225,0% G24 5,0% Portfolio 23,0% G2R3,0% G335,0% 22,0% Strat. Objekt G3R 2,0% G315,0% G325,0% G345,0% G435,0% 25,0% Oper. Objekt G4R&5R5,0% G415,0% G425,0% G445,0% G55,0% 5,0% RES  20,0% 20,0% 25,0% 20,0% 15,0% 100% Equal weights signify that a job is maximal broad / shows no focus on levels or phases Source:, Kämpf-Dern (2010), p. 309.

  15. Step 3 (II): Normalize individual answers so thateachperson‘ssumaddsupto 100%Example 1) Plan • Analyze • Plan & prepare 4) Control • Controlperformance 5) Account& Report M-Phases M-Levels Investment 17,9 17,9 % 35,7 % 35,7 % Portfolio 82,1 10,7 %  35,7 % 35,7 % 28,6 % 100 % Percentages are visualized by area of rectangle – proportional distribution of 100 % = “Variwide Diagram”

  16. Step 4: Cluster jobsby (normalized) LC-%agesForinternallyhomogenous, externallydistinguishedclustersthe Ward method was used (similarresultswithAverageLinkage M.) Analysis based on 50 „lifecyclegroups“ (insteadof 280 tasksor 20 „functionalgroups“) Source:, Kämpf-Dern workingnotes

  17. Step 5: Visualizeusing „Variwide“-DiagramExplanation Variwideand Interpretation (usingdata „over all“) M-Phases 1) Plan • Analyze • Plan & prepare 2) Organize • Consult • Decide • Organize 3) Implement • Steer/coordinate • Controloperations • (Operate) 4) Control • Controlperformance 5) Account& Report M-Levels 4,0 2,9 3,4 2,2 15,4 Investment 2,9 2,7 4,0 6,4 5,0 4,3 Portfolio 20,0 6,7 (F 3,7, T 3,0) 2,0 9,0 28,6 Strat. Objekt 9,4 (F 1,7, N 2,7, T 5,0) 6,9 1,8 31,3 8,8 (F 3,0, N 2,5, T 3,4) Oper. Objekt 9,0 (F 3,0, N 2,4, T 3,6) 4,7 2,7 4,7 1,4 RES  28,3 22,4 24,4 16,7 8,1 100 Source: Websurvey (n = 73), Kämpf-Dern (2010), p. 376 On average, 73 asked REM-managerscheckmarked 36% of operative (management) tasks; Methodcouldbeusedforeach individual, but clustersarewhatinterestsmost.

  18. Agenda Problem & Approach– Job names don't tell enough Methodology – Structuring – clustering – visualizing Results – Selected job profiles Outlook – Job profiles are fundamental for success

  19. Result: VisuallydifferentiablejobprofilesSignificantdifferences – Example: Clusters withmostparticipants Cluster 5: Portfolio-/Asset Manager (n=11) Cluster 1: StrategistandDecisionMaker (objectlevel) (n=10) Cluster 6: Asset Manager, focused on technicalstrategy (n=10) Cluster 4: Object Manager (n=15) Source:, Kämpf-Dern (2010), p. 373

  20. Cluster 5: Portfolio-/Assetmanager, planningandcontrollingwithhighlystrategicfocus (I)Example * Standard deviation> average Source: Websurvey (n = 11) Source:, Kämpf-Dern (2010), p. 504

  21. - Backup – Cluster 5: Portfolio-/Assetmanager, planningandcontrollingwithhighlystrategicfocus (II) Major tasksofcluster 5 Source:, Kämpf-Dern (2010), p. 504

  22. Cluster 6: Strategic-technicalassetmanager (I) Exampleofmore operative organising, implementingandoperatingpredominantlytechnicaltasks Source: Websurvey (n = 12) Source:, Kämpf-Dern (2010), p. 509

  23. Agenda Problem & Approach– Job names don't tell enough Methodology – Structuring – clustering – visualizing Results – Selected job profiles Outlook – Job profiles are fundamental for success

  24. Job Profilesarebaseforfurtherresearchtosteerimportantcompany- & HR-developmentmeasures • Based on jobprofilesfurtherresearchcanbedoneto find out, differentiateanddecide on • qualificationcharacteristics (knowledge, skills, abilities, yearsofexperience, …) • bestfittingrecruitingmeasures • relevant performancemetrics • adequatecompensation • furthertrainingandeducation • correlationbetweenthenamedparameters • companycorecompetencesandareasofdevelopment • a supportingcompanycultureandfinally • a promisingstrategicorientationofthecompany (resource-basedapproach). In a professional service business where (nearly) everything depends on the peoplegood knowledge about their job designis a major base for success!

  25. I am happy to answer your questionsContact Data Dr. Annette Kämpf-Dern Bereichsleiterin Immobilienmanagement & Projektentwicklung Tel.: +49 (6151) 16-5264 Fax: +49 (6151) 16-4417 Email: kaempf-dern@bwl.tu-darmstadt.de

  26. Agenda Problem & Approach– Job names don't tell enough Methodology – Structuring – clustering – visualizing Results – Job profiles Outlook – … Backups Further job profiles (evtl.)

  27. Step 2: Grouping – 1st approachGroupingof Life Cycle phasesusingfactoranalysis … Base Plausible? … resulted in 6 clear factors – but hard to visualize and only partly plausible

  28. Investment-/Unternehmens-Ebene Portfolio-Ebene Objekt-Ebene Resultsaredifficulttointerpretortocompare – maybemethodandvisualization not optimal?First approach: Visualizationoffactoranalysisresults Anlageorientiertes IM = Return-oriented REM (ROREM) Immobilienmanagement-fokus Invest-Entscheidungen& DL-Controlling Investment-Planung &Portfolio-Vorgaben Ergebnis-controlling Beratung REIM &Umsetzungsvorb. Rechnungswesen und Reporting Konzept/Beschaffung& Verwertung F2 REIM Portfolio- Entscheidungen & DL-Controlling Portfolio-Planung &Objekt-Vorgaben Ergebnis-controlling Beratung REPM &Umsetzungsvorb. Konzept/Beschaffung& Verwertung REPM F3 Objekt-Entscheidungen& DL-Controlling Objekt-Planung &Maßnahmen-Vorgaben Ergebnis-controlling Konzept/Beschaffung& Verwertung F6 Zielorientierte Koordination und Wertschöpfung Target-oriented coordination and value-management Beratung REAM &Umsetzungsvorb. REAM/SOM F5 Maßn.-Entscheidungen& DL-Controlling F4 Maßnahmen- Entwicklung Ergebnis-controlling OOM Betrieb F1 RES

  29. Clu1: Objektstrategen & -entscheider * bedeutet: Standardabweichung > Mittelwert Quelle: Websurvey (n =10)

  30. Cluster 11: Letting Manager (n=3) with 62% of operational (management) tasksExample * bedeutet: Standardabweichung > Mittelwert Quelle: Websurvey (n = 3)

  31. Major tasksof CLU11 aregettinginformation on theobjectand all lettingtasks (management & ops)

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