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By Ken SinclairCreating value in the $300 part of the “3-30-300” rule
Our industry has always been about controlling measured variables, but in the past these have been the likes of temperature, pressure, flow, and other physical things. The Internet of Things or IoT is now connecting us to new measured variables in our buildings, "the occupants," via cell phone apps and social media feedback, while displaying all our interactions and visualizations in the very accessible cloud.There is a “3-30-300” rule of thumb that organizations typically spend approximately $3 per square foot per year for utilities, $30 for rent, and $300 for payroll. While these figures are just archetypes, they are useful in providing an order of magnitude between the three areas of expenditure. According to the 3-30-300 model, the greatest financial gain from greening a workplace is not energy savings but improvements in productivity.Last month I talked about the focus of CABA and LightFair on creating savings in the $300 part of the rule rather than the $3 part. This seems to lead us logically to this month's featured event which I am attending, The Smart, Connected, High Performance Intelligent Buildings Conference or "IBcon," part of RealComm. I hope this IBcon event will help us all to better understand how to play and interact with our newest measured variables.Jim Young's comments: “There is no doubt that artificial intelligence will someday make its way into our industry. There is no doubt that AI will radically change how we design, build, lease, operate, transact, and use real estate. The only questions are when, and who, will be the first to take the lead.“We are going to address this topic head-on in our Realcomm | IBcon 2016 General Session with a keynote by Cade Metz, a senior reporter for WIRED, who will focus on Silicon Valley and all the emerging technologies including AI. Cade will lend his insight on these transformational new innovations and how they might someday change the way we think about how we design, build, lease, operate, transact and use buildings."We use the term “machine learning” from this article, “Machine Learning in HVAC Controls.” HVAC systems are often non-linear, poorly behaved, noisy, and very unpredictable under real-world circumstances — Mike Donlon, director, research & development, Computrols This article talks to and describes the new class of algorithms that have become staples of modern programming. These algorithms use large amounts of real world data to “train” generalized computer programs to perform tasks more analogous to human problem solving.We are amazed by the quantity and quality of the articles/interviews speaking to our topic this month, plus the valuable resources linked within each. I have gathered some industry comments on this in my review, “Documenting Productivity and Well-being” — Health, well-being, and productivity and the 3-30-300 rule, theme that is a good fit with IBcon, San JoseOur June editors have upstaged me and made me aware of several resources I had never heard of.Articles like:• “The Trillion Dollar Opportunity in Transforming Existing Buildings.” — If you had $3-5 million to invest into a 50,000 sq. ft. office building could you significantly reduce energy consumption, improve space utilization, and increase worker productivity? — Brad White, P.Eng, MASc Principal, SES Consulting Inc.“I certainly believe this is possible and I hope to use the rest of this article to convince you that the opportunity is real and achievable today, or at least that it’s not entirely hogwash. The path to these outcomes is certainly not straightforward and requires pulling together many different components like deploying IOT and other smart building technologies, lighting upgrades, space planning, renewable energy, training and occupant engagement while also overcoming significant institutional obstacles.”• “Applying All the Laws of 3 to See the Future of Smart Buildings.” Edge control will shift BAS-industry focus toward people and productivity — Alper Uzmezler, BASSG & Therese Sullivan, BuildingContext"If you understand the 3-30-300 Rule, plus Murphy’s Law, Moore’s Law and Metcalfe’s Law, you can make this prediction about the future of smart buildings: A lot of the processing workload involved in automating control over building infrastructure will be moving to edge devices, rather than to a remote cloud, and people will be more comfortable and productive in building spaces as a result."• “Why Care About Workplace Productivity?” Delivering even a 1 percent increase in employee productivity dwarfs any cost cutting measure and creates a sustained value for our customers — Erica Eaton, director, business development, Comfy“Eaton: As an industry we’ve historically focused on the benefits we can deliver in helping our customers cut costs. More efficient light bulbs, variable speed drives, and many other efficiency measures have us constantly debating ROI and payback with our customers. But this scenario is subject to the law of diminishing returns — there’s only so much juice that can be squeezed from energy and operational budgets. “By focusing on the highest cost within a building — the people — we can drastically change the conversation with our customers and tap into new avenues of added value. Delivering even a 1 percent increase in employee productivity dwarfs any cost cutting measure and creates a sustained value for our customers.”These articles are all full of links to resources to allow you create and document value in the people-productivity part of the $300 per square foot equation. Extracted from the presentations from the CABA event in San Diego are a summary and slides from the session titled "We Can Prove It!" The session was in the intelligent buildings track: high performance buildings improve employee productivity.I have provided a quick photo essay overview of what I saw and heard from that and other great sessions.I would like to thank the over 120 folks who took time on LinkedIn to wish us the best on our 17th year anniversary of AutomatedBuildings.com, our retirement project that goes on and on. But seriously we are still having fun bringing you the news and being an industry resource. My editorial in the year 2000 talked of our first year of rapid change and provides insight to the why of AutomatedBuildings.com and the over 170 issues that followed.After being in the large building automation industry for five decades, "change" has become the norm and reporting and adapting to it has become a way of life. We need not to be paralyzed by what we do not know but empowered by our deep understanding of the subject of buildings, their systems, and their occupants and use this knowledge to guide the rapid change upon us. The new practitioners will guide us and lead us to new ways but we all need to be involved to successfully make this transition to this exciting world that is evolving in the cloud, on the edge, and in the fog between.Ken Sinclair is the founder, owner, and publisher of an online resource called AutomatedBuildings.com. He writes a monthly column for FacilitiesNet.com about what is new in the Internet of Things (IOT) for building automation.