Corporate real estate executives face many challenges in the constant quest to create efficiency in their business use of property.  According to a study done by Boston Consulting Group earlier this year, at the top of the list: 1.  Business Unit issues, 2. Flexibility, and 3. Service Providers.  For anyone in the trenches, there's no big surprise there.

I'll cover 2 & 3 in future posts and today write about the business unit considerations.  It is hard to overestimate the emotional charge involved in deciding on a location and facility for a business group and the internal conflict that such decisions can create.  Not only does everyone have their own personal preferences, they also have a business reason why geographic placement, quality and type of building, nearby customers or competitors, traffic and access, parking, signage, and a few other considerations are either ideal or absolutely unacceptable.  And to exacerbate those variables, they also have an opinion on who should ultimately choose the final site: them. 

The C level executives need to decide if these decisions will be financial-based (top driven using corporate standards and metrics) or operations-based (field driven using business need and accountability).  Either method can work, although one or the other usually tends to be better depending on the industry.  Whatever the methodology, it needs to be 1) Decided upon, 2) Communicated well, and 3) Implemented consistently.  While that advice may seem to be obvious common sense, you'd be astounded to find out how many organizations don't apply it.

The best way to minimize business level issues is to start early.  I'd recommend low level discussions at least two years out for most branch locations, and earlier for major operations centers or distribution hubs, to make sure that everyone is on the same page.  When it comes to internal conflict over site selection, less is most definitely more.