2018 New Year Message - Why CHANGE?! Because staying put is not an option.
The ability to adapt is the key to survival in a world of relentless change. Mr Lim Ming Yan, CapitaLand’s President & Group CEO shares.
Dear colleagues
Happy New Year to all of you!
We will be starting 2018 organised along our four investment units covering Singapore/Malaysia/Indonesia, China, Vietnam and the Rest of the World (or ROW); a renewed emphasis on our private equity (PE) fund management platform; and three operating platforms in Ascott, CL Commercial and CMA – covering the spectrum of live, work and play for our customers.
This arrangement will allow us to be more nimble and efficient in allocating the Group’s capital on a global level. Each investment unit can better focus on understanding its market, establishing a strong market intelligence network and seeking out the best investment opportunities across the various asset classes in its respective market. Real estate is capital intensive. Hence, a strong PE fund management platform will allow us to tap into global funds to take advantage of the real estate opportunities and to invest alongside our own balance sheet and our REITs. Through smart investment decisions, we must create above market returns for our stakeholders, thereby growing our asset base and scale.
Just as importantly, this arrangement will let our operating platforms focus and develop capabilities to truly “own our customers”. In recent years, it has become increasingly clear that our customers are changing and we need to engage with them both online and in our physical spaces. The real estate landscape has evolved and will continue to do so with the entry of many new players such as Airbnb, online travel agents (OTAs), ecommerce platforms such as Alibaba and Amazon, and coworking operators such as WeWork. There will be both competition and opportunities for collaboration. Economies of scale and the ability to provide a “total solution” to our customers are critical in a globally connected world. Our ambition is to build Ascott, CL Commercial and CMA into world class operating platforms.
Leveraging Technologies
To be a smart real estate investor and world class operators of real estate, it is important to leverage technologies to help us differentiate and diversify our property offerings. We have embarked on this journey with construction tech, smart buildings and tech focusing on customer experience since a few years ago.
In construction tech, Building Information Modelling, Virtual Design and Construction, 3D printing, drone surveillance, fully automated site management system etc are now part and parcel of many of our projects such as our Raffles City Chongqing (RCCQ) and our Funan development. The hoisting of a 1,100-ton segment of a 300-meter-long platform to be fixed between two 250-meter-tall towers in RCCQ was such a complex operation that the process was even broadcast throughout China during primetime news on CCTV.
In the area of property management, IoT and sensor technologies have also allowed us to enhance our buildings by making them safer, more secure, cleaner and more comfortable. Project Deep Blue has now reached implementation stage. The final goal is for all our buildings to be smart buildings – well maintained, sustainable and enjoyable for the occupants.
In the area of customer experience, we launched our shop-in-shop with Lazada which positioned us as Singapore’s first omni-channel retail landlord. We have also redesigned our digital presence, capitaland.com, to become a gateway for our customers who shop, stay, lease and invest with us.
As we do more to capture the mindshare of our customers in the digital space, we are seeing a trend of e-retailers moving offline to create a more holistic experience for their customers. The future is in seamless offline and online (O&O) experiences. It is no longer about online being more important than offline or vice versa. It is about harmonising these two realms to create maximum value for our customers.
Advancing its omni-channel strategy: In Singapore, CapitaLand signed an agreement to launch an exclusive online mall on Lazada Singapore, which is part of Lazada Group, Southeast Asia’s largest e-commerce platform. In China, the Group inked an agreement to manage Alibaba Shanghai Center, the e-commerce conglomerate’s new Shanghai headquarters comprising four office towers and a retail podium.
Our unique advantage as a real estate owner and manager with close to 700 properties worldwide is the treasure trove of data in offline interactions that take place at our buildings, as well as our ability to bring digital insights into the real world. Looking ahead as we roll out cashless payments, facial recognition, video analytics, beacons and sensors, not only will we be able to create spaces of choice for our customers, we will also be building a valuable database with a single O&O view of our customers. It will give us the powerful ability to personalise our offerings to our customers. This is something we have started doing with our CapitaStar programme. We have close to five million CapitaStar members today, and through their transaction data, we have been able to value-add to our retailers with aggregated data on our customers’ purchasing habits and help them with stocking and promotional efforts.
CapitaLand ELEVATE and C31V - Preparing for the Future
The changes that we are going through are disruptive in nature -- fundamentally changing the way we think, the way we respond and the way we will lead the real estate industry. But these disruptions also promise future opportunities. To capture the future, we will equip ourselves with new skills and competencies. We recently launched CapitaLand ELEVATE a S$10 million programme to build a future-ready workforce and new proptech-enabled capabilities. We look forward to upskilling about 300 of our colleagues in the areas of data analytics, digital marketing, and digital assets management.
In addition to strengthening our staff capabilities, we are also building partnerships with emerging companies. We have invested S$10 million through C31 Ventures in startups with good value propositions to our customers. Whether it is a change in business model, how we organise ourselves, the way we conduct our business, or the cities and products we choose to focus on – our transformative efforts are geared towards creating value for all stakeholders and building a better life for all. Those of you who can be effective in this new playing field will outdo and outshine.
Conclusion
These changes, including the new organisational arrangement, will take some getting used to. As Albert Einstein said: “the world as we created it is a process of our thinking. It cannot be changed without changing our thinking”. In this regard, I urge everyone to adopt an open mind and not be limited by our past experiences.
“The world as we created it is a process of our thinking. It cannot be changed without changing our thinking.”
Adaptation is never easy, but difficult as it may be, the ability to adapt is the key to survival in a world of relentless change. With new innovations and redesigned corporate strategies to broaden our global investment portfolios and strengthen our operating platforms within each asset class, we must continue to anticipate long-term trends and have the willingness to learn, unlearn and relearn; because staying put is not an option. When we change with purpose and conviction, I am confident that CapitaLand will not only survive but thrive - emerging stronger and fitter.
It is good for us to be reminded by this familiar quote often attributed to Charles Darwin:
“It is not the strongest of the species that survives, nor the most intelligent; it is the one most adaptable to change.”
Here’s wishing you a Happy New Year and a great 2018 ahead!
LIM Ming Yan
President and Group CEO
CapitaLand Limited