How Microsoft plans to transform buildings worldwide

This is the last of a three-part series. Read Part 1 here and Part 2 here.

In one memorable scene from the 1987 movie "Wall Street," Michael Douglas stands on a beach, hair slicked, wearing a black bathrobe, barking orders to his protégé via a brick-sized cell phone as the waves crash behind him.

It was one of the first times a mobile phone appeared in a movie, and at the time talking on the phone on the beach demonstrated the high-tech fruits of a stockbroker's wealth and power. Twenty-six years later, the scene feels dated – solely for technology reasons.

That brick with an antenna that Douglas is holding? That is the current state of commercial buildings, says Darrell Smith, Microsoft’s director of facilities and energy.

“At first, all mobile phones were bricks – basically two-way radios. Now, in just a few short years, they have advanced to become a laptop in your hand,” Smith says. “Buildings are still that brick phone. We want to get buildings to where phones are.”

Microsoft’s campus went from bricks to brains, and Smith believes all commercial buildings can follow suit.

Jessica Granderson, a commercial building and lighting research scientist at Lawrence Berkeley National Laboratory, agrees. She says smart buildings are becoming more prevalent, and the commercial real estate industry is going through a “time of rapid change and maturation.”

Granderson, whose research focuses on intelligent lighting controls and building energy performance monitoring and diagnostics, says the commercial real estate industry is reaching a major tipping point as people realize the power of capturing and analyzing data from buildings.

Granderson says it’s still not as easy as it should be to get data out of today’s buildings.

“There are two sides to the coin, really. There’s data that is out there that’s not put to good use, and businesses that aren’t using it. The other side of the coin is that once we do become in the habit of making use of what’s there, then you quickly realize the challenges of getting what you really need and want,” she says.

Another challenge is having the right people in place to analyze and interpret the data and act on it.

Granderson contributed to a white paper on Microsoft’s new software, “Energy-Smart Buildings: Demonstrating how information technology can cut energy use and costs of real estate portfolios.” The paper investigates and evaluates Microsoft’s smart building tool, which Granderson says deserves to be held up as a best practice in the industry.

“It’s one of the more sophisticated implementations that I’ve seen,” she says. “There are a lot of lessons to be learned (in what Microsoft created).”

Probably the most important takeaway from Microsoft’s smart buildings breakthrough is just how much money and energy businesses can save with relatively little up-front investment, says Jim Young, CEO of the commercial real estate and information technology company Realcomm.

Image courtesy of Microsoft

Next page: The power of partners

Young has traveled all over the globe for more than a decade, visiting and studying all manner of smart buildings and smart campuses.

“Companies, even a lot of Fortune 500 companies, have these massive real estate portfolios that they’re running with sledgehammers,” Young says. “What Darrell and his team can do is watch their buildings at a rate no human has before. When you start connecting to the buildings, generating data and grouping inefficiencies by cost and priority, all of a sudden you go from the sledgehammer to running buildings with laser precision.”

Smith’s plan to take Microsoft’s smart buildings software worldwide is to adopt the role of matchmaker. His team developed the smart buildings software, with the help of vendors, exclusively with off-the-shelf Microsoft software such as Windows Azure, SQL Server and Microsoft Office.

Smith says these partners and vendors are eager to help businesses of every size, shape and need to take their buildings from piles of bricks to data-driven brains. Some companies need only a little push – the know-how to incorporate weather data, or energy meters, or perhaps just the right connections. Others need both hands held, procedurally and technologically. Regardless, Smith and his partners can help.

“People may be bumping their heads, but they come here and get a glimpse of the potential,” he says.

Young says Smith has been talking about the possibility of making buildings smarter since the two met more than a decade ago at a Realcomm conference on the collision of commercial real estate and information technology.

“He’d say, ‘I’m going to figure this out.’ I’d call him every few months and say, ‘How are you doing, Darrell?’ and he’d say, ‘I’m not ready to talk to you yet.’ Then, when he finally had something to show, he was like, 'Here it is,' and it blew us away,” Young says.

Although Smith and his team were quiet for the years they spent developing the software, their work already has garnered serious attention in the industry.

There’s now such an interest in smart buildings in general – and Microsoft’s smart buildings software in particular – that Realcomm plans to host a conference on smart buildings in the Seattle area next year. He will hold it there so attendees can visit Microsoft and experience one of Smith’s enthusiastic show-and-tells.

“Darrell’s going to be a rock star. Well, he already is in our world,” Young says. “If he’s not shaking the president’s hand in a year, then we’ve all done something wrong.”

Unsurprisingly, Smith is more measured about his part as the leader of a team that developed a game-changing smart buildings tool. Although his team started with little more than a notion that there had to be a better way, they used Microsoft’s own software, their own background and expertise, and an unyielding determination to solve an industry-wide problem. Smith played the roles of catalyst and mortar in this process, sparking the revolution but also helping to hold his small team of “ninja innovators” tightly together.

“It’s not me that’s great, it’s our story,” Smith says. “Yes, I’m passionate, but you could put someone else in my place and it would still be a great story.”