VALUE CREATION IN REAL ESTATE BUSINESS

Tuuli Luoma

ERES from European Real Estate Society (ERES)

Abstract: Organisations need real estate, premises and spaces for their business activities. The role of real estates, premises and spaces has changed from a necessary cost to a support function for organisation. Albeit the importance of real estate has been recognised, the actual value creation in real estate services has gained less attention. Service providers that can provide more value for their customer can achieve a greater success and become a more integral part of the value network of the customer. In this research the aim is to understand how real estate service providers could create more value in an efficient way for the end-customer. The focus is on value flows and value creation processes of real estate service providers. The research has four steps. First, the value from the end-customer perspective is studied in order to understand what kind of value to generate. Second, the situation how the current value flow is generated for the customer is illustrated. After this the principles of lean management, a management theory developed by Taiichi Ohno a former CEO of Toyota, are applied into the value flow in order to increase its efficiency. Finally, a new framework, leanREB (lean real estate business), is presented to support the value creation in the service providersí organisations. Because lean management is a general management theory the research has a deductive approach. The leanREB framework will be grounded upon multiple case studies. Through the cases studies the preliminary leanREB framework will be developed and finally tested. The leanREB framework guides service providers in how they can create more value for their end-customers with fewer resources. The goal is to create a win-win situation between the service provider and the end-customer in order to create long-term relationships.

JEL-codes: R3 (search for similar items in EconPapers)
Date: 2010-01-01
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