How to align the organization of the CREM-department to strategy during a recession

Purpose - In times of recession a lot of companies need to reduce costs. This also affects the budgets that are available for corporate real estate (CRE). Therefore it is important that the organization of the CRE management (CREM)-department is optimally aligned with CRE-strategy. This study provides a tool for evaluating the organization of the CREM-department when applying the CRE-strategy of cost reduction.Design/methodology/approach - The evaluation tool for alignment of the organization of the CREM-department is a result of an explorative study. First a literature study was conducted which led to a theoretical model of factors that influence the organization of the CREM-department, with regard to five components: Organizational structure, Sourcing, Centralization, Process management and Company culture. Then empirical data was collected through interviews with two groups of respondents, namely CREM-departments who served as cases and CRE-consultants to hear their expert opinions. Cross-case analysis and a comparison of these results with the expert opinion of the consultants were used to look for links between the CREM department components and each CRE strategy.Findings - It was not possible to formulate links between every possible CRE strategy and the CREM-organization as most of the cases had implemented the same strategy, namely cost reduction. This did provide the opportunity to construct a clear evaluation model for this particular strategy. Not all the themes were aligned with the chosen CRE-strategy identically by all the CREM-departments with a cost reduction strategy, but many similarities came forward and were backed by the CREM experts. This was worked into an evaluation model on the alignment of the organization of the CREM-department with a cost reduction strategy.Research limitations/implications - The model developed is especially relevant for CREM-departments who have similar characteristics as the CREM-departments who served as cases: large companies with a division macro-organizational structure that apply the CRE-strategy of cost reduction. The evaluation model does not spell out exactly how the CREM organization should be managed and formed, but does provide insight in a number of main choices that can influence the organization of CREM. The purpose of the evaluation model is that the CREM department becomes aware of the consequences for the organization of CREM when implementing a cost reduction aimed CRE-strategy.