3 Portfolio Benchmarking Challenges and How to Solve Them
If you are a building owner or work in operations and facilities management, chances are you’re always striving to reduce costs, explain budget variances, and increase efficiency and sustainability. Benchmarking is one of the best ways to achieve these goals. That said, benchmarking one building or facility is tricky enough – what happens when you have an entire portfolio of buildings across your city, state, region, or even country? In this article, we’re breaking down the different challenges of portfolio benchmarking and how you can address them.
Challenge Number 1: Data Availability, Quality, and Centralization
This is one of the most obvious challenges of portfolio benchmarking. If you are attempting to benchmark the energy use or sustainability of multiple facilities and there is no consistency across facilities in the way data is collected or stored, portfolio benchmarking will turn into an uphill battle. For example, you might have different utility companies or meters collecting your data and displaying it in different portals that do not align. You then must manually transfer all the data to one spreadsheet or database. This is both time-consuming and tedious and leaves the door open for errors.
To effectively execute portfolio benchmarking, you should first make sure that all your data:
- Is easily available
- Is in one central location
- Uses common definitions
Challenge Number 2: Benchmarking Topics are Too General or Too Specific
Another challenge of portfolio benchmarking is that the topic that needs to be benchmarked is too general or too specific, which makes it difficult to take specific steps for improvement.
An example of “too general” could be benchmarking “operational efficiency.” This means many things to many different companies and it is difficult to garner real actionable steps for improvement when companies look to benchmark such a topic. In such a case, you may find it useful to look at your utility bills and identify the biggest areas of energy use across your buildings. Let’s say this turns out to be the HVAC system – you would then benchmark its performance across your different facilities.
On the other hand, there is a similar issue if what you choose to benchmark is too specific. For portfolio benchmarking process to be successful, it is important to understand how the outcome of the process impacts your goals for your buildings and overall organization. This is not to say that being specific is bad – just keep in mind that it can make the search for useful data challenging.
Let’s go back to the HVAC example. Trying to benchmark the performance for a very specialized piece of machinery in the HVAC may cause you to become bogged down in data that is not particularly relevant or is hard to benchmark against national standards like ENERGY STAR Portfolio Manager or GRESB.
Challenge Number 3: Getting Value from the Results
The final portfolio benchmarking challenge focuses on the way you utilize the results of the portfolio benchmarking process. This stage may be more important than the benchmarking process itself, because if what you learn from the results of the process isn’t applied to your business, the entire exercise was pointless. That said, it is vital to decide on the right actions based on the results of the benchmarking process and effectively execute them.
Secondly, you need to answer the question: What happens next? Organizations that view portfolio benchmarking as a one-and-done process are unlikely to see much improvement in energy efficiency/sustainability across the board. The key to success for any benchmarking process is setting up a culture of continuous improvement.
The real value of portfolio benchmarking comes from learning the results of the program, implementing recommended efficiency projects, measuring and verifying their success, continuously improving your efficiency projects based on new data, and then benchmarking again.
Solving Portfolio Benchmarking Challenges with EnergyWatch
Having a strong energy management platform is the easiest way to address all the above portfolio benchmarking challenges in one fell swoop. EnergyWatch’s energy and sustainability management platform, WatchWire, offers interval data monitoring so that you an get the latest performance data from your facilities. WatchWire then compiles the data in one place, ensures all data uses common definitions and provides insight into how your properties are performing against each other to prioritize improvement opportunities. In addition, WatchWire tracks all building characteristics through qualitative data that can be logged into the platform, allowing you to create Custom Groupings of similar buildings that provide further analyses among your portfolio. WatchWire also has integrations with the US Department of Energy’s Building Performance Database, ENERGY STAR, and GRESB, providing more variations to benchmarking and meeting your organization’s compliance with benchmarking laws.
In addition, EnergyWatch’s expert staff can help you identify proper areas to benchmark, so you can avoid the too specific/too general problem discussed above. Finally, WatchWire offers measurement and verification technology to determine the effectiveness of your efficiency projects. To learn more about measurement and verification, check out our new e-book, Properly Tracking Your Energy Efficiency Projects – A Guide to Measurement & Verification in 2021. Or, to discover more about WatchWire’s capabilities, download the WatchWire Solution Brief.