The concept of real-time data and management systems has long been the goal of companies in every industry, but the progress made along this front has been slow and, for many, real time is far from a reality. Enterprises recognizing real-time management success are being forced to ask themselves a few questions up front, such as, "What information, if not all, do we need on a real-time basis?," "Is near real-time acceptable?" and "Just what are we willing to pay for real-time data?"
Obviously, not all operational data is dynamic or critical enough to warrant attention in a real-time enterprise, while other data sets are vital to management and must be as fresh as possible. However, taking systems the last mile from being near real time to absolute real time is where the expense and complexity of systems can add up quickly.
Focusing on self-storage, the term "enterprise" does not fit the hundreds of operators who own a single facility. For these owners and managers, data is as real-time as possible, and any software package available can provide instantaneous insight into the facility operations. Those with the information are generally the same people who need it to make operational decisions from day to day. But when those with the data are not those managing the facility, distribution of information becomes crucial. Clearly, this is an issue for owners whose facilities are operated by management companies that handle multiple operations and need to collect data remotely from various sources.
What options are available to enable real-time management? Real-time management requires real-time data. It also requires real-time access to systems that enable organizations to react to real-time information. The reality is if you have two (or more) copies of data, at least one copy is not real-time. Consider figure 1.
This figure illustrates a common arrangement in which a self-storage operator with three facilities might control the operations from a central location and need to collect data from the remote facilities. One option of moving data between locations is to fax reports back and forth, while another popular method is to print hard copies and mail or e-mail them to the office. Many have made use of more modern methods to digitally transmit data from the facility. In each case, however, the real-time data is at the facility itself, and whatever information is collected and available at the central office is stale to some degree. Even in the illustrated example, unless digital transfer of information occurs endlessly and immediately with each change at the facility, the data is out of date. But as we will discuss, latent or stale data may be completely acceptable depending on its intended use.
This article focuses on real-time management, not real-time data. We've already said real-time management requires real-time data. However, in the example above, we are dealing with data that is latent but still extremely useful. Turning our attention back to real-time management, and assuming the data collected is fresh enough to be relevant, can you now manage the facility in real-time?
Almost without exception, the answer is no. Unless you are physically at the facility affecting changes, or on the phone walking the manager through your intended changes, you are not managing in real-time. And, for many operators, this may be acceptable, even if not ideal. Even near-real-time management with latency of hours or days is hard to achieve for most operators in the self-storage industry. With that said, it would be inappropriate to focus solely on real-time management when near-real-time management is an attractive alternative and other methods of automated management might change our perspective or, at least, supplement efforts to manage in real time.
To achieve a real-time enterprise, the model we illustrated above must change. Figure 2 demonstrates this change, moving databases from multiple locations to ensure a single copy of the data accessed in real time from all locations, remote facilities and home office alike. The storage facilities in the diagram no longer own or control their own sets of data. Instead, they access their data from the central copy through online mechanisms such as standard web and Internet connections or dedicated communication lines.
With data centralized, the only access to data is real-time access. The same is true in reacting to centralized information, since administrative changes to affect this data are inherently real-time and at once applied to all processes that use this data. In this orientation, operators can realize each rental or vacate as it takes place, for example, and react accordingly if they choose. Reaction to this real-time information--say, a rate change--implemented at the facility or home office affects operations instantly. Achieved is the real-time management of your self-storage operations, but at what price?
How Realistic Is It?
Figure 2 illustrates an ideal scenario that has already solved the problems of communication between facilities and headquarters. These facilities have the infrastructure to support communication, including networks and databases, and are able to administrate and manage it. The capital costs of this model are enough in themselves to make it an unrealistic option except for the largest of organizations--unrealistic, that is, unless a model is available that shares the burden of infrastructure costs among multiple users without sacrificing functionality. Of course, that model is commonly referred to as the ASP (application service provider) model and is extremely viable--technically and economically--and available. Many of the large industry players and REITS are endeavoring to accomplish ASP style solutions for their private use, and commercial solutions are available.
Backing away from the real-time model a bit, the methods for achieving a near-real-time management solution are many and varied. Using almost any software package available for the self-storage industry, an organization could orchestrate systems that provide the data, as illustrated previously in figure 1, on a near-real-time basis. The frequency of this data would be dictated by each organization and their assessment of the criticality of any given set of data.
For some, looking at occupancy might be a daily event, while others would care to see and react to that data on a monthly basis. Near real time is a much more subjective term, and each organization will define it differently. Once the acceptable terms of data synchronization and freshness have been defined, a similar exercise must be done to determine acceptable methods and frequency of affecting management changes in near real time.
Some software packages do have tools to help implement management changes to the facility level, but the majority will leave this problem in your hands to solve. A common method of remotely administrating facility computers and databases is to use software such as PC Anywhere, which allows users to take control of a remote PC. In fact, many software providers in our industry mandate that these types of tools be available, not only for facility management, but also for administration of the software itself.
The bottom line is near-real-time data and management systems rest largely on the shoulders of self-storage operators to implement. There is a vast selection of fine software available, but much of it focuses on one end of the business, such as facility use, and does not offer packaged and complete solutions for the entire enterprise. And most of the operators are all too aware of the work involved to implement a best-of-breed near-real-time solution.
As an alternative, automated management tools might fill some of the holes in real-time and near-real-time management systems. An example of such tools would be yield management. These tools essentially real-time manage facilities in an unattended mode. Once an operator has defined the rules for yield management to follow, the automated agent works behind the scenes to constantly monitor rates, occupancy and length of stay, and then fine-tune the facility's yield potential. These rules flexibly control the street rates at the facility by raising and lowering rates in response to occupancy and competitive data, for example. With automated agents of this type working in the background, requiring only periodic administration to alter the rules or determine the effectiveness of the yield-management logic, sites are programmed to administrate themselves in real time.
Practically speaking, the most elegant and useful solution is likely one that would encompass aspects from all types of solutions discussed in this article. Most ASPs subscribe to the near-real-time model for much of their reporting, since not all data is critical enough to warrant the storage and processing overhead required to enable it on a pure, real-time basis. Further, ASPs and standalone software systems are rapidly implementing automated management tools like yield management, since they work very well in both environments. Solutions for improving the management of any self-storage operation require careful analysis, since each organization will present its own unique challenges and requirements, and there is simply no single solution that will work for everyone.
For more information, read the article by Lana Gates and Jack Vaughan in Application Development Trends, Volume 9, Number II, November 2002. Visit www.adtmag.com.
James Hafen is the chief technical officer at Salt Lake City-based Centershift Inc., a provider of hosted application and online management services for the self-storage and other leased-property-based industries. For more information, call 800.9CHIFT; e-mail email@example.com; visit www.centershift.com.
Contact: Terry Bagley
Software Type: Management software, accounting software, online management/accounting software, online-reservations technology, online-payment technology
Price Range: Subscription license (rental) based on number of facilities or units.
Designed specifically for storage? Yes
Current version on market since: Three months
New version to be released: June 2003
Demo: Can be requested via website or phone.
Tech support: Phone and online support available. Phone support is $50 per month, per facility. Online support is included in subscription license. Phone support: 7 a.m. - 7 p.m. MST. Online support: 7 a.m. - 7 p.m. MST.
Centershift Inc. provides innovative technology solutions that increase the profitability and value of real estate assets. The company's STORE product provides a web-based rental-management and point-of-sale software solution for self-storage. STORE provides owners/managers better control of business assets, improved efficiency at the facility and corporate office, opportunities for increased profitability, and information security. Centershift introduced these industry firsts: real-time, consolidated, multisite reporting; Internet credit-card processing; call-center integration; tenant-insurance integration; web-based business-to-consumer ecommerce (online credit-card payments, account management, unit availability, rent rates and reservations); centralized mail processing for tenant correspondence; online support and documentation; web-based training; centralized yield management and forecasting; and fully integrated company and facility websites and web hosting.