The Importance of Standardized and Normalized Data in the Multifamily Industry
Multifamily operators collect more data than ever, but raw, inconsistent data makes it nearly impossible to compare properties, spot problems, or make confident decisions.
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What is standardized and normalized data?
Data standardization and normalization are two processes used to convert raw data into a format that is easier to use and interpret. Standardization is the process of converting data into a standard format — for example, converting occupancy data into a single format, such as a percentage carried out to two decimal points (92.73%). Normalization is the process of transforming that data into a standard range, such as 0-100%.
The benefits of good data
By utilizing standardized and normalized data, communities are able to make much more effective and accurate comparisons across properties. Comparing similar properties gives operators context, which is critical for highlighting what is working and what is not working at the asset level. Without standardization, it is nearly impossible to compare information across multiple properties, which can lead to inaccurate conclusions and poorly run communities. Standardized and normalized data also makes it easier to track trends and set goals, so communities can identify problems and reach faster, more effective, data-driven solutions.
The problem with bad data
Inaccurate conclusions from incomplete and inconsistent data can affect more than a community's immediate bottom line — they affect the people who make up the community too. Decreased communication between residents and management can lead to higher turnover at both the resident and staff level, which may negatively affect the well-being of the community over the long term. The longer data is left untended, the more challenging it becomes to resolve inconsistencies and errors that built up in the past.
Crafting a plan
Having a data strategy is similar to going on a diet: planning a massive, immediate overhaul that requires a total change in behavior is not likely to succeed. Rather, finding the right tools, defining easy-to-reach incremental improvements, and building training and top-down commitment toward an attainable goal will put most real estate companies on track to developing better data standards for the future. With the right data and a well-planned approach, companies can both enhance quality of living at their communities and improve their bottom line.
Put standardized data to work
A clear data strategy starts with clean, consistent, standardized information across every property.
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