The innovation unit at Jones Lang LaSalle, the commercial real estate services firm, is set to hit $100 million in cumulative revenue from 35 different offerings it has helped launch. Not too shabby for a program that sprang into life just five years ago, after a meeting between one the firm’s executives and a Fortune 500 client.
As company lore goes, the JLL exec was pitching the client, emphasizing how innovative the firm was, recalls Alec Humphries, VP and Product director, Innovation & Product Development. “The client said. ‘That’s great. Why don’t you tell me a little bit more about your people and your process and tools?’ The JLL person put his hands in his pockets, and was like, ‘Uh… let me get back to you on that one.'”
The realization that innovation needed to be more than a talking point was the genesis for a new Innovation & Product Development (I&PD) unit that has sorted through more than 10,000 ideas, with over 2,500 of those turning into approved and vetted best practices for the benefit of employees and clients.
But Humphries, who co-manages the unit with Terry Harris, Managing Director for Innovation & Product Development, is quick to tell you that only 20 percent of those ideas generate revenue. But the firm expects those to produce about $36 million in revenue this year.
How are they doing it?
In addition to the firm’s traditional consulting services, Humphries says JLL derives revenue from fee-based products, many of them digital.
It’s been a busy five years; below are five new product offerings that have helped JLL move the needle on revenue.
Blackbird: Humphries calls this “Google Maps meets commercial real estate.” When a corporation is considering a headquarters move, JLL’s Blackbird tool allows them to virtually survey potential areas, after filtering by relevant data points such as workforce demographics, tax incentives, and access to transit.
HiRise: Humphries likens this to a “Groupon-like technology” for commercial real estate owners looking to lease smaller spaces, less than 5,000 square feet. Aimed at opening up real estate to small- to mid-sized businesses, especially tech startups that need more flexibility and can’t be locked into long-leases and large square footage requirements, HiRise allows owners to connect and complete real estate transactions online.
AIx: This business intelligence tool allows clients to compare costs and service levels across an entire real estate portfolio, so that they can zero in on areas that have the biggest opportunities for cost savings in facilities management.
Smart Buildings: With this product, JLL is offering its clients a smart-building strategy, such as one equipped for Internet of Things connectivity or a LEED certification. JLL aggregates expertise from across the industry, pulling in contractors, architects, or one of JLL’s in-house experts, “So our clients have a full picture of what goes into a smart building,” Humphries says.
PortfolioCommand: With PortfolioCommand, JLL uses portfolio and market data to provide clients with a portfolio management software product. It aims to help clients make faster and smarter real estate decision and manage long-term goals.
Opening Its Innovation Platform to Clients
Until 2016, Humphries says that IP&D stored all of its ideas and innovation products in a digital warehouse, but recently it moved it into proprietary marketplace, a cloud-based application called Idea Stream, which not only allows employees to submit ideas, but also them and clients to shop for innovation, rate products and read reviews on how various products performed. Product ratings and reviews are analyzed to show clients’ preferences and how products performed with ratings on metrics such as scalability, sustainability and overall value. Customers can even search for best practices. “The collaboration and the level of social interaction is the same level as Facebook,” Humphries says. “It’s as easy to connect with someone on an innovative idea as it is to take a photo, tag it and post to Instagram.”
Clients might add a little narrative, Humphries says. “What did they change? When they took this and operationalized it in the banking industry—how is that different from the automotive industry, life sciences? healthcare? And what were the cost savings they achieved?”
Idea Stream has also become a great source of data. Five years ago, I&PD was manually gathering and analyzing all its data ad hoc. As Humphries puts it, “It was a giant headache.” Now he says JLL is leveraging big data, business intelligence, analytics, and automation of data collection in order to make the process a lot easier and more robust. For instance, Idea Stream can supply metrics on a product’s revenue, benefits, client use, case studies and narratives. Among many uses, that data helps clients make decisions through several products including RED, JLL’s own data and insights platform.
“We’re leveraging information and big data from our innovation platform, all the knowledge we’re gaining the marketplace,” Humphries says, “and pushing to our clients so they are informed and they can make actionable insights.”
Creating New Incentives
None of the innovation products would fly without JLL account directors — the client-facing employees — embracing them. From the first year into the innovation program, Humphries says it involved them by building innovation into their compensation package, giving them credit for suggested ideas. By 2013, the account directors needed to show proof that they had brought innovation programs to their clients. Now using Idea Stream, they are required to fill out implementation surveys proving and detailing any innovation ideas they might have, as well as how they’ve brought innovation to their clients and how many times they’ve done it.
“We’re moving from being an A Student — where we want to build a Cadillac before we roll it out to our clients — to, let’s be entrepreneurial with our clients,” Humphries says. “Let’s come together and say, we’re thinking of these things; let’s get them involved in the early stage processes.”
He says the account team at first had a difficult time grasping the value of everything in the innovation products’ offerings, and conveying that value to prospective clients. “We have this great story to tell, and we just weren’t telling it because as you can imagine, it wasn’t in their sales tool kit. Now this is one of our biggest differentiators.”
Getting that message across is a matter of sheer repetition, he says. “It’s telling the story over and over; continually reminding them that this is a differentiator and, and that our clients do care about it, and that there’s qualitative metrics and ROI to go along with it. It was worth the time and investment because now we’re going out and leading the conversations around innovation and what we’re doing.”
Timeline of the Innovation Initiative at Jones Lang LaSalle:
2011 — the “Awareness” stage. Hired a Director of Innovation, began using a crowdsourcing tool. Revenue: $0.
2012 — the “Engagement” stage. Bonus incentives for employees to contribute ideas; ad-hoc tracking of new products. Revenue: $200,000.
2013 — the “Adoption” stage. Bonus incentives for employees to bring innovation to their clients from around our firm. Changed corporate structure so that innovation group reported to President of Corporate Solutions. Innovation as a shared service; structured tracking of new products and accountability for product owners to C-Suite. Revenue: $13 million.
2014 — the “Simplification” stage. Focus on “big bet” innovation, since firm felt it had the incremental down. Simplify the message (less is more.) Revenue: $22 million.
2015 — the “Cascading” stage. Our team stays small, but we create a global network of innovation champions at the local business unit levels to inspire innovation, evaluate ideas, and celebrate innovators. Increased external focus – demo days with startups incubators/ accelerators. Revenue: $28 million.
2016 — the “Scaling” stage. Created proprietary innovation marketplace known as Idea Stream, rolled out globally at JLL. Also offered Idea Stream, for a fee, to clients to collaborate better, and for their own use. Projected revenue: $36 million.