Building Analytics ROI | BuildingFit

ROI on Building Analytics — Part 2

 

Comfort

 

Facility management teams really start to pay attention once building analytics and KPIs that focus on maintaining and improving comfort are deployed. Counterintuitive as it may seem (especially from an energy efficiency engineer’s perspective), energy savings are not a large driving factor in facility management (FM), but cold calls are.  They’re a significant pain point.  Building analytics that allow FM teams to solve problems in their buildings that lead to cold calls make their lives easier.  It also allows FM teams to start being proactive in terms of how they address cold calls, instead of reactive.  Reactive maintenance usually involves responding to complaints from unhappy tenants.

Pinning down the return on investment associated with maintaining higher levels of comfort, reducing cold calls, and generally increasing occupant satisfaction, is not easy – mainly because the benefits are not direct, like energy savings, rather they are indirect, things like better lease renewals rates, higher patient satisfaction scores in hospitals, or increases is productivity.

Losing a tenant can be expensive and just downright painful. What are the costs exactly? – using a  20,000 sf space in a 200,000 sf building as an example.  At $30/sf, lost rent alone is significant at $50,000 month. Realtor fees to find that new tenant let’s say 6% of the total lease value – so if it’s a 3 year deal that’s a $108,000 fee.  Vacant space can also negatively impact the overall property value. Clearly as a building owner anything that can be done to keep a tenant happy, and profitable, aligns with their best interests.  The cost of a building analytics deployment on a property of that size, is about $40,000-$60,000.  Costs from not keeping tenants happy and not keeping spaces leased can quickly escalate, dwarfing the cost of building analytics.

A major revenue driver in healthcare is patient satisfaction scores.  Higher patient satisfaction scores result in higher reimbursement payments (more revenue) not to mention a better reputation.  There’s a lot more to the patient satisfaction scores than patient comfort, things like quality of care, cleanliness, and responsiveness.  Since Medicare and Medicaid account for roughly 1/3 of a hospital’s annual revenue, anything that can be done to drive higher patient satisfaction scores leads to increased revenues and really drives a quick return on investment in building analytics.

Keeping tenants (employees) happy and productive, can really help drive business results.  The 3-30-300 rule, $3/sf for utilities, $30/sf for rent, and $300/sf for payroll, illustrates this best.  Let’s look at what we get from a 1% improvement in the 200,000 sf building we were talking about before.  Some quick math gets us to 1% reduction in utilities = $6,000/year, 1% lower rent cost = $60,000/year, but a 1% improvement in productivity can yield a $600,000/year benefit.  Clearly if you believe that comfort = improvements in productivity, then the investment in building analytics will have a fast payback.

The challenge is that the major benefits from improving comfort in buildings, longer leases, higher patient satisfaction scores, and increases in employee productivity are not directly measurable. While tracking cold calls and closely monitoring comfort related key performance indicators is easily achievable, correlating improvements that directly have a positive impact on the bottom line is difficult.  One could argue the benefits are real but the leap is, is it really driving value for your organization? Given the amount of value it could be driving – it’s probably worth the risk.

Bringing IT and OT together with BuildingFit

Bringing IT and OT Together

Overview

Most people are familiar with the term Information Technology (IT).  However, over the past few years we have seen Operational Technology (OT) and Information Technology (IT) become increasingly intertwined, where in the past, these two technologies were kept separate.

What is Operational Technology?
Operational technology (OT) refers to the hardware and software used to change, monitor, or control physical devices, processes, and events within a company or organization.  The devices this technology refers to typically have more autonomy than information technology devices or programs.

What is Information Technology?
Information technology (IT) refers to anything related to computer technology, including hardware and software. Your email, for example, falls under the IT umbrella. This form of often constitutes the technological backbone of most organizations and companies. These devices and programs have little autonomy and are updated frequently.  Access to IT programs and connected devices are typically less restricted than to OT devices, and many, if not all, employees at a given organization may be granted access.

The main difference between OT and IT devices is that OT devices control the physical world, while IT systems manage data.

Operational & Information Technology Coming Together

From the overview above, IT and OT may not seem compatible. OT systems are isolated and self-contained, designed to run autonomously, and rely on proprietary software. On the other hand, IT systems are connected by nature, have little autonomy, and generally run using readily available operating systems.

In recent years, what was known as “traditional OT” has started to change, since the rise of the fourth industrial revolution, also known as “Industry 4.0”. Companies taking part in this change have begun implementing new digital solutions in their networks looking to stay ahead of their competition. These solutions aim to increase automation, add “smart” devices, make data more efficient and available, and interconnect networks for convenience.

As part of the interconnection, and to make OT components more accessible while being able to collect and analyze data about them, IT and OT networks are also becoming interconnected. This movement is referred to as IT-OT Convergence.

Industry experts predict that IT-OT will only continue to converge. This means that OT administrators should do their best to understand the IT environment, and vice versa – the sooner the better. Organizations should begin to align their standards, policies, tools, processes, and staff between the IT and the business to the changing OT systems. The approach to dealing with the organizational changes in response to IT/OT convergence is called IT/OT alignment.

In order to help the industry adopt IT-OT convergence, BuildingFit will be doing a series that will cover several aspects of the movement, including how to deal with cyber security.

Salt Lake City, Utah

BuildingFit Wins 2020 Utah Business Green Business Award

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BuildingFit helps reduce the environmental footprint of our clients and community by minimizing the amount of non-renewable energy they use.

BuildingFit has been selected a winner for the 2020 Utah Business Green Business Award Innovation category. Every year, Utah Business honors companies, communities, and individuals who are taking a stand in sustainability and making a difference for our state’s environmental future.

Because building systems are complex, it is common for buildings to waste tens of thousands—to hundreds of thousands of dollars annually on energy waste,  when building systems like HVAC don’t operate as intended. BuildingFit helps reduce the environmental footprint of our clients and society by reducing the amount of non-renewable energy they use.

BuildingFit analytics have been widely used in more than 50 million ft2 in customer facilities worldwide. Projects are most commonly healthcare, higher education, government, casinos, commercial spaces, luxury condominiums, and medical manufacturing plants. Many of our energy saving projects are here in Utah. BuildingFit provides energy management services to numerous enterprise organizations, with a retention rate better than 90%.

Read more here what BuildingFit and other Green Business honorees have to say for sustainability and greener Utah.

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About BuildingFit

BuildingFit™ is a Fault Detection & Diagnostics (FDD), analytics and visualization platform that identifies opportunities, to make buildings more energy efficient, reliable, comfortable, and safe. Engineered for large quantities of data from disparate sources such as building automation systems (BAS) and smart IoT devices, BuildingFit™ insights are delivered through analytics, Key Performance Indicators (KPI), automated reports, and interactive dashboards that help users prioritize daily operations, minimize energy waste and reduce costs. Learn more at www.buildingfit.com.

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BuildingFit Banner Health Smart Building Innovation Awards

Banner Health Named Finalist for 2020 Verdantix International Smart Building Innovation Awards

We are excited to announce that Banner Health is a finalist for the Verdantix 2020 International Smart Building Innovation Awards.

Banner Health implemented an enterprise wide Monitoring Based Commissioning (MBCx) program utilizing the BuildingFit (www.buildingfit.com) Fault Detection and Diagnostics platform. To date, the program has saved:

– $11.3 million/year

– 80 million kWh/year of electricity

– 530,000 Dth/year of natural gas

– 6,000 tons of CO2 emissions – equivalent to the annual CO2 emissions from 7,600 homes or 14,000 cars

For more information about this award and finalists, please go to https://www.verdantix.com/newsroom/press-releases/verdantix-announces-the-finalists-for-the-2020-international-smartbuilding-innovation-awards

 

fault-detection-and-diagnostics

BuildingFit Featured in CABA Journal. Finding Our Way: Take the Established Success Path for Implementing Building Analytics

By Rob Glance, BuildingFit

While most industries have adopted and are aligned with industry standards relating to IP networking and enterprise data management, building automation is stuck in catch-up mode. Owners understandably want to manage their sites with the latest technologies and information management systems. While many building automation systems (BAS) products are becoming IP-compliant, many existing buildings have older legacy and proprietary BAS systems. This creates big problems for those charged with managing buildings.

The result of this is that applying analytics on building performance, building owners are locked into a cycle of needing to upgrade outdated BAS while knowing that outright replacement and attaining the capital needed to justify ROI are often insurmountable. Many of these BAS are incapable of offering much more than simple trend data and weren’t designed to provide any real operational diagnostics beyond basic alarms.

Read the full article in CABA Journal here.

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smart-building-analytics

Implementing Data Analytics Into Building Automation Systems

I can’t help feeling that it’s 1999 all over again. As a software development professional with experience across multiple industries, I hear a consistent lament from building owners who share the same set of problems. While most industries have already adopted and are aligned with industry standards relating to IP networking and enterprise data management, building automation has yet to catch up. Owners want to manage their sites with the latest technologies and information management systems. While many building automation systems (BAS) products are becoming IP-compliant, many existing buildings have older legacy and proprietary BAS systems, creating big problems for building managers.

To apply analytics on building performance, building owners are locked into a cycle of needing to upgrade outdated BAS. But outright replacement and the means to justify ROI are difficult challenges to overcome. Many of these BAS don’t have the ability to offer much more than simple trending, and weren’t designed to provide any real operational diagnostics beyond basic alarms. What more: getting any kind of meaningful information out of a BAS can be complicated and usually has limitations on the data’s availability.

 

…Continue Reading on FacilityExecutive.com

 
Integrating data analytics into building automation systems has been difficult, but it’s getting easier.
By Rob Glance

BuildingFit

Building Fit
+1-385-246-3759
contact@BuildingFit.com

1997 South 1100 East
Salt lake City, Utah, 84106

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