Trend analysis is a crucial part of property management. Why? It lets you highlight issues, determine their cause, and fix them at their source. It can help you reduce the cost of claims and insurance premiums. It will tell you what strategies you can implement to improve your business or justify and gain approval for your ideas.
Interested in these benefits? The best part is that you can analyze trends simply by pressing a report button on historical data. Then it’s just a matter of considering the results and putting your next step into action.
The first step to effective trend analysis (or any project) is setting appropriate goals. What types of data are you going to look at, and how do you know this would be most helpful? What are you hoping to learn? As a property manager, you likely have a lot of data, including tenant information, rent details, property data and more. Trying to run reports without knowing what you’re looking for won’t produce helpful results. As an example, a goal might be to identify the tenant or location that has filed the most claims or cost you the most in the past year.
Once you’ve figured out the type of trend analysis you want to run, you have to determine what data to include in the analysis. Reports are only as good as the information that goes into them – if there’s poor input, there will be poor output.
All data should be accurate, reliable and complete. This means there should be no errors (or as few as possible) and that information is up-to-date, including everything up to the moment that you run the report. You may need to do some data clean-up to ensure these conditions are met. For example, you can do spot-checks to ensure that data is error-free and implement a process that will automatically refresh data.
If you have trouble with data integrity or timeliness, consider upgrading your data management systems before running any reports. Paper files or spreadsheets are often filled with errors, mostly due to mistakes in manual entry, and may not be updated over long periods. There are now systems available that automatically collect, organize and authenticate data, simplifying the report process.
Let’s continue with our example of identifying the tenant or location that is creating the most costs. For this analysis, you would want to tally up all the claims and incidents in the past year and compare each location to the others. Although incidents don’t typically cause direct costs, they are the No. 1 predictor of future claims, so it’s helpful to take them into account. Run the report and there you have it: you can tell which property is costing you the most money.
Again, this process can be made much quicker and easier with an upgraded system. Rather than waste your time pulling data from multiple sources and manually manipulating the numbers, new systems can run reports on any information in the database at the push of a button. These tools often present the reports in multiple different formats, such as bar charts or pie graphs. Data visualizations make reports easy to understand and share with relevant parties.
Now that you have identified a problem area, you can do something about it – a task that is impossible when you don’t know where the issue is coming from, or even that there is one. Dig into the costly property to determine a root cause. What is really causing so many claims? Maybe the building manager needs additional training, or there’s a dim stairwell that needs new light fixtures. Whatever the issue, you’re now able to fix it at its source. This will eliminate repetitive claims that are causing you to pay out on the same problems year after year. You can also implement the same strategy across all of your locations, likely reducing occurrences and claims even further.
Make sure you continue to monitor the effectiveness of your trend analysis. Did you learn what you were hoping to, as defined in your initial goal? More importantly, did it produce actionable information that allowed you to improve your operations in some way? That’s the main point of trend analysis, after all: to gain insight that can help you reduce costs, implement new strategies and aid decision-making.
Rebecca Webb is a writer and student marketing specialist at ClearRisk, a provider of cloud-based risk management software solutions. ClearRisk has 12 years experience helping customers streamline tasks and focus effort on high-value initiatives.
