Building management systems traditionally focus on a few core areas such as heating, ventilation, and air conditioning (HVAC), lighting control, access and security systems, power and energy systems, and fire systems.
In a rapidly changing market where stakeholder needs evolve and digital transformation with IoT and analytics at the center allow to connect ever more solutions, other ‘smart building’ capabilities/applications become more important as they meet growing demand in some areas and can increase building value. Building automation 2.0 as ABI Research calls this new wave of smart building solutions.
Emerging applications in space management, environmental monitoring, asset management, and cleanliness & hygiene management will grow at 32% CAGR over the next 8 years to create US$2 billion in software and services revenues by 2026
They’re emerging types of smart building applications that come in many forms and shapes with different systems hitting the market, depending on the type of building and its purposes. While many of the traditional players in the building automation market already expand their core offering with such applications across several segments, they see new suppliers entering the market that explicitly focus on such next-gen ‘building automation 2.0’ smart building applications.
Adding them to their ecosystems or at least making sure their building management systems (BMSs) are interoperable with these new smart buildings applications will be essential for the big BMS players in meeting evolving customer demand and making sure they don’t lose out on opportunities their competitors have seen, for instance by integrating players that offer new types of applications. Some are much better positioned to achieve this than others as you know.
Building automation 2.0: space management, environmental monitoring, asset management, and cleanliness & hygiene management
ABI Research has identified four categories of such smart building applications that, together, will grow at 32 percent CAGR over the next eight years to create US$2 billion in software and services revenues by 2026.
These four categories, mentioned in a report on ‘building automation 2.0’, are:
- Space management solutions
- Environmental monitoring
- Asset management solutions
- Cleanliness and hygiene management
A quick look at each category of emerging smart building applications.
Space management solutions are already present in commercial real estate with office buildings. However, according to ABI Research, new space management solutions, equipped with a variety of smart sensors (e.g., contact, motion, and occupancy) are becoming more useful in large commercial buildings with critical power buildings such as airports and stadiums.
Research analysts Harriet Sumnall: “Occupancy and motion sensors can be used to help improve the speed in which travelers can maneuver themselves through the airport. Real-time insights mean that managers can deploy staff as needed to relevant areas of the building”.
As the smart building market evolves, the ecosystem is no longer limited to traditional Building Management Systems (BMS) vendors. It now includes the OEMs of consumables and construction materials adding complementary IoT solutions
With the environmental monitoring category of next-gen smart building solutions, ABI Research doesn’t mean applications in the scope of recent initiatives to move towards net-zero carbon buildings but environmental monitoring to improve occupant wellness and comfort, another hot topic in the commercial real estate industry for all the obvious reasons. Think about solutions with sensors that monitor noise levels, air quality, and natural lighting systems enabling to monitor real-time conditions for these parameters in specific areas and adjust according to preferences.
ABI Research gives the example of workspaces with Saint-Gobain’s subsidiary Kandu which was created in 2018 to offer turnkey IoT service for companies to enhance the quality of their workspaces. Such environmental monitoring services obviously also tend to have an impact on energy consumption and sustainability and are already in use in buildings where wellness of occupants is vital such as healthcare facilities and, again, hotels.
Asset management solutions become increasingly important within specific commercial buildings, especially healthcare entities, per ABI Research. By using asset management solutions, hospitals can, among others, improve their inventory management, lower operational costs, and automate the clinical inventory processes. As an example of a company/solution, ABI Research mentions Zebra Technologies that offers solutions that track assets that are specifically made for hospitals using RFID technology.
Cleanliness and hygiene management finally is a next-gen smart building solutions category we hadn’t covered before but that doesn’t make it less important. This newer solution for the smart building market is, among others, offered by Georgia Pacific (GP) and Kimberly Clarke. Their intelligent systems enable to run restrooms more efficiently. Sumnall: “their biggest value comes from reduction in labor costs through cleaning optimization and higher customer satisfaction by reducing stock-outs.”
For BMS vendors, integration with emerging ‘building automation 2.0’ solutions is key
ABI Research says that these new emerging applications in space management, environmental monitoring, asset management, and cleanliness & hygiene management are either offered as standalone solutions or to augment existing building automation systems. For existing BMS players, integrating with them will be key.
Research Analyst Harriet Sumnall states that “the more important competitive dynamic to recognize is that newer suppliers, most with wireless solution offerings, can more easily sell into the untapped market of older and smaller buildings.”
And while this won’t necessarily change the focus of the traditional building automation system vendors, their competitiveness will be greatly diminished if their systems are not interoperable with solutions from these newer suppliers Sumnall adds, concluding that in this more complex supplier market with more applications, interoperability will be what differentiates all market participants.
We couldn’t agree more and are sure that some participants realize this better than others.
In some market segments, the capacity to integrate with other systems at the edge (edge computing) and in the cloud has already proven to be an essential differentiator, enabling BMS market leaders to increase their presence in these segments.
With more advanced needs than automated lighting and temperature regulation, along with changing working environments, the smart building market has begun to grow and evolve (Harriet Sumnall)
Schneider Electric, for instance, became a key technology partner for leading hotels, thanks to, among others, a holistic approach on the entire hotel life cycle and third-party integrations between the BMS and all sorts of applications, existing and emerging ones, which modern hotels leverage since their guests demand them.
As Shovan Sengupta, who is responsible for the hotel business of Schneider Electric says, it’s becoming mandatory for specific industries to integrate third-party ecosystem players.
No doubt, we’ll see similar evolutions with these so-called next-gen smart building application categories: integrations on a technological level or on a business integration level, which requires a strong ecosystem approach and ‘open philosophy.’
Some of these solutions are also already offered by some of the main BMS players with their IoT-enabled platforms that make it possible to combine solutions that are typical for specific verticals.
Take the example of asset management solutions in healthcare entities such as hospitals. Patient and asset location management, as well as preventive, condition-based and predictive maintenance in a broader asset management approach, is already something offered by healthcare facility experts who are specialized in building management systems at Schneider Electric, for example.
More in ABI Research’s Smart Buildings 2.0: Building Automation application analysis report.
