Strategic alignment of CRE
Rianne Appel-Meulenbroek
M. Gordon Brown
Yvette Ramakers
Contents
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Introduction
Strategic thinking
Alignment of strategies
The Dutch care sector
Conclusions & recommendations
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PAGE 1
Introduction
• Growing complexity organisations  tuning
business functions
• CREM from financial burden to alignment with
organisational strategy
• studies on alignment use different strategies and
terms
focus on alignment mechanism
Placement in strategic thinking theories
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Strategic thinking
• Stratēgōs = a general
• Field professionalised
• 1950s: longe range planning of demand
• 1960/70s: evolved into strategic planning (due to
increase volatility of org’s)
• 1980s: evolved into strategic management (realisation
need continuous evaluation/adjustment)
• Focus on new theories, even 10 schools of thought
(Mintzberg, Ahlstrand& Lampel, 1998)
• Strategic thinking map as synthesis (Swayne, Duncan &
Ginger, 2006)
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Strategic thinking
Strategic thinking
Strategic planning
Strategic momentum
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Situational analysis
* External analysis
* Internal analysis
* Directional analysis
* Managerial action
* Strategy evaluation
* Emergent learning
* Re-initiate strategic
thinking
External orientation
Analyze data
Question assumptions
Generate new ideas
Strategy formulation
* Directional strategies
* Adaptive strategies
* Market entry strategies
* Competitive strategies
Planning the implementation
* Service delivery strategies
* Support strategies
* Action plans
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Alignment of strategies
• 8 studies in 3 different journals
• The Journal of Real Estate Research
− Nourse and Roulac (1993)
− Roulac (2001)
− Lindholm, Gibler and Leväinen (2006)
• Journal of CRE
− Acoba and Foster (2002)
− Osgood (2004)
− Scheffer, Singer and Van Meerwijk (2006)
• Journal of Propery Investment and Finance
− Krumm and De Vries (2003)
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Alignment of strategies
Author(s), (year)
Corporate
strategies
Real estate
strategies
Alignment
Nourse and Roulac (1993)
Roulac (2001)
Acoba and Foster (2002)
Krumm and De Vries (2003)
Osgood (2004)
Scheffer, Singer and Van Meerwijk (2006)
Lindholm, Gibler and Leväinen (2006)
Singer, Bossink and Van De Putte (2007)
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Alignment of strategies
Corporate
• Driving forces
theory (Tregoe & zimmerman, 1980)
strategies
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Products offered
Market needs
Technology
Production capacity
Method of sale
Method of distribution
Natural resource
Size/growth
Return/profit.
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Alignment of strategies
Author(s), (year)
Corporate
strategies
Real estate
strategies
Alignment
Nourse and Roulac (1993)
Roulac (2001)
Acoba and Foster (2002)
Krumm and De Vries (2003)
Osgood (2004)
Scheffer, Singer and Van Meerwijk (2006)
Lindholm, Gibler and Leväinen (2006)
Singer, Bossink and Van De Putte (2007)
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Alignment of strategies
Real estate
• 7 CRE strategies (Lindholm,
Gibler & Levainen, 2006)
strategies
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Increase value of assets
Promote marketing and sales
Increase innovations
Increase employee satisfaction
Increase productivity
Increase flexibility
Reduce costs.
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Alignment of strategies
Author(s), (year)
Corporate
strategies
Real estate
strategies
Alignment
Nourse and Roulac (1993)
Roulac (2001)
Acoba and Foster (2002)
Krumm and De Vries (2003)
Osgood (2004)
Scheffer, Singer and Van Meerwijk (2006)
Lindholm, Gibler and Leväinen (2006)
Singer, Bossink and Van De Putte (2007)
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Alignment of strategies
Alignment
• Cover entire
step of strategy
formulation
• Indicate alignment each pair (Nourse &
Roulac also strength of each pair)
• BUT based on intuition:
1st
• Why alignment?
• What determines strength?
 1 sector : Dutch care sector
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The Dutch care sector
• Rapid changes  competitiveness
• Desk research + interviews 20 experts
• Care institutions (7)
• Consultants (10)
• Independent organisations (3)
Driving forces
Products offered
Market needs
Technology
Production capability
Method of sale
Method of distribution
Natural resources
Size/growth
Return/profit
Currently
Real estate strategies
Cost minimization
Increase innovation
Increase flexibility
Increase productivity
Increase value
Increase employee satisfaction
Promote marketing & sales
Increase client satisfaction
50% thinks
about
changing
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The Dutch care sector
Driving force: Market needs
Cost minimization
2,75
Increase innovation
4,00
Increase flexibility
4,25
Increase productivity
3,06
Increase value
3,25
Increase employee satisfaction
3,63
Increase client satisfaction
4,81
Promote marketing & sales
4,44
1
2
3
4
5
also for past strategy of ‘products offered’
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The Dutch care sector
A mechanism??
1) Size/growth has no alignment  space is basic need for growth
2) Employee satisfaction with CRE seems unimportant  true in a service sector??
3) Debate whether ‘increase value’ should be a strategy
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Conclusions and recommendations
• Alignment mechanism is complex
• Models still depend on expert knowledge (strategic
CREM necessary)
• More insight necessary for CREM to prove their
added value
• Recommendations:
• Continue alignment along strategic thinking map
• Change in mechanism for different sectors
/ name of department
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