Here’s an outline of this week’s newsletter:
🤔 On my mind this week
📚 What I’m reading
💡 New from Nexus
🧐 New to me
1. 🤔 On my mind this week
As I reflect on all the meetings I had last week, there was one underlying thread: stickiness.
An icky word for a beautiful concept.
As our industry transforms from project-centric to SaaS-centric, stickiness is the name of the game.
My friend Tyson Soutter summed it up well on an upcoming podcast episode:
“Point number 2 is making sure you're selling something that has continued value. So if you sell energy savings projects with some sort of digital thing, what happens in year two and three, when you stop saving energy?
We’re in a cutthroat industry when it comes to (operational) budget. Capital expenditure (CapEx) is something that once you get that decision made, it's made and you get the project. Great. All is good. You don't have to revisit it that often, maybe to justify the cost once. But operational expense (OpEx)—that is a cost that you need to be able to show value year on year, every year.
If you save or add a huge amount of value to a customer (in) year one and add no value in year two and three, you're gone. They review their budget, they look at the line items on the OpEx, and they say, why are we spending money on this?”
Our industry has a tried-and-true form of stickiness: vendor lockin. But that’s the old way. That’s not going to work moving forward. What’s the new stickiness?
A deep dive on this topic is coming later this week for Nexus Pro members. In the meantime, what do you think are the keys to continuing to add value?
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2. 📚 What I’m reading
Why is Digital Twin Important?—Property technologist Pete Swanson of Lendlease on the potential of digital twins to revolutionize the real world (WSP—The Possible)
BIM was introduced 15 years ago, but increasing tech adoption in the construction industry has been accompanied by a decline in productivity. We didn’t remove inefficiency in the design process, we just digitized it. Digital twins hold the potential to actually change workflows.
We’ve been reducing our carbon impact by eliminating concrete and moving to cross-laminated timber (CLT). The digital twin enables this kit-of-parts approach, but it works the other way too — it’s the modular and the more readily configurable that allows you to leverage what a twin can do.
Exploring smart thermostat users’ schedule override behaviors and the energy consequences—Results from an interesting study on the energy effects and user behaviors in the smart thermostat market. What happens when people override the smart stat? (T and F online)
Only the consistently overridden but infrequently adjusted population of thermostats showed poor energy performance, but these accounted for less than 5% of thermostats with energy performance roughly 2% worse on heating and 4% worse on cooling than the remaining population.
While there may be effective ways to modify thermostat user interfaces to dissuade users from long-duration energy-inefficient hold settings, we conclude from our study of smart thermostats that user holding (overriding) behavior may not be as detrimental to collective energy savings as commonly believed.
Although this is focused on residential or small buildings, I think these results hold some key insights for larger commercial buildings as they start getting into advanced supervisory control.
Google’s Digital Buildings—Brian Turner interprets what this project means for Haystack and Brick implementations (Automated Buildings)
When I read "cross-compatibility" and "convergence" I see the opportunity to align the three standards in a toolset to make them each more robust and usable in and of themselves. One of the biggest problems with ontologies as they exist for buildings today is the lack of direction on how they are applied.
Other pertinent reads from just (a bit) outside the smart buildings industry:
Tesla instead decided to produce one hardware set that improves with software updates. The business model requires an integrated and centralized IT architecture and a “vehicles build around a computer” approach. It is superior because, as a consumer, you have a new vehicle all the time regardless of how many years you own it.
There are so many parallels to our industry in this extremely well-written essay. Such as:
Without the after-sales business, most automakers would be structurally unprofitable, because the revenue stream from the fleets on the roads is tremendously large and much more important for their bottom lines than new vehicle sales.
The question is… when is someone going to do this to our incumbents?
BONUS: Nicolas Waern did a thought experiment… what if you replace ever mention of the auto industry in this article with “smart buildings”? Well done, Nicolas.
This installment of NEXUS is free for everyone. If you would like to get full access to all content, join the NEXUS Pro community. Members get exclusive access to the Nexus Vendor Landscape, monthly events, weekly deep dives, and all past deep dives.
3. 💡 New from NEXUS
- PODCAST—🎧 #017: Friendly rants volume 4: You can't get fired for... (Pro members only)
- PODCAST BITE—Deb Noller on how Switch Automation reduces the risk of smart building projects... (full episode)
4. 🧐 New to me
Even though the Nexus Vendor Landscape has over 100 vendors on it, I still learn about new companies/products to track every week.
Here are this week’s discoveries:
mCloud—I originally heard about them when they almost purchased BuildingIQ several months ago. I learned a bit more about their value proposition this week and was impressed with their approach to bringing connectivity and advanced supervisory control to less sophisticated buildings like small box retail.
5. 🧱 Foundations
The dates are set for cohort 1 of Nexus Foundations, an introductory course on smart buildings. From 10/1 to 11/19, we'll publish weekly content, host weekly live workshops on Zoom, and hold weekly office hours.
The weekly content will feature the story of Charlie, a smart building rookie who eventually grows into a smart building champion thanks to his mentor, Maureen.
In week 3, Charlie continues learning. This week’s story was written by Rachel Kennedy, Digital Solutions Engineer at Switch Automation, who is doing an amazing job helping me develop the course. She’ll also be an instructor. If you missed weeks 1 & 2, check previous newsletters for the rest of the story.
Week 3: Why don’t they log in?
Charlie’s third coffee session with Maureen could not have come on a better day. He had just finished a meeting about one of the “smartest” buildings he’s ever worked on, where he had carefully selected the latest technology and deployed many custom analytics. And yet, several months after deployment, only a few stakeholders had logged into the platform. They couldn’t care less. He was devastated.
When Maureen walked in, he couldn’t help himself. Before she could even sit down, he blurted out his frustration:
“Why won’t they use the technology? They won’t even log in!”
Was it that the users were laggards and risk-averse to technology? Should he have designed the system better? Charlie was beginning to reassess every feature, analytic, and aspects of the design.
As usual, Maureen had seen this all before. Systems failing to be adopted because they were just that—another system, another login, another thing to do. She carefully thought about how to explain this phenomenon to him. After all, the design was the latest and greatest and Charlie had thought out every detail. Well... almost every detail.
“How did your project improve the user’s workflow?”, asked Maureen.
Charlie thought for a second and began to rave about all the new KPIs and how they provided new insights the stakeholders had not even thought about before. As Maureen got another refill, Charlie realized he hadn’t answered the question. Did he even know the answer to the question?
Maureen began to explain how, after many similar projects, she learned to take a step back before she even considered looking at technologies. Next time, Charlie will know how to analyze the workflows of key personas and map technology use cases to them. Not only will he know how his users feel about technology, but he’ll also be delighted when they log in to complete their daily, weekly, or monthly tasks.
To be continued…
We're capping this (deeply discounted) first cohort at 25 students to maximize the time we can spend with each student.
Reserve your spot now. 👇
OK, that’s all for this week—thanks for reading Nexus!