Lighting as a Service – Part Two
Industry News December 7, 2017 TiL Editors
Lighting as a Service – Part Two
The first blog on Lighting as a Service covered a basic overview of the subject and looked at the supporting factors around the idea’s increasing popularity in recent years. The second part will look at how lighting design might work with in the LaaS Framework.
As mentioned in the introduction, this blog hasn’t really mentioned Lighting Design up to this point, and that’s because at the moment there isn’t really a pathway for independent lighting design within the current LaaS models. Most LaaS projects at the moment tend to be retrofitting large existing installations, or design services come from the manufacturer of the light fittings. So how could or even should the independent lighting designer get involved in LaaS projects?
Let’s take a more detailed look at the stakeholder interactions, firstly the client. The client gets a brand new installation using the latest technology, saving their company maybe up to 75 or 80% of their running costs, to make the deal even better they don’t’ have to pay for it upfront. The lighting manufacturer makes a large sale, increasing their turnover. They also have a relationship with a client that is ‘sticky’, the longer the client is a customer, the harder it will be for them to leave. The contracted installer has regular work and long contracts allowing them to keep a consistent workforce and invest in training them. Increased familiarity with the product range and knowing that they will be responsible for fixing issues for the life span of the installation creates an improved standard of work. The financiers of the project have a very stable investment low-risk investment, which pays regularly and over a long time. A kind of investment that would be perfect for pension funds or savings.
But what about the designer where do we fit in? Does design have a value in this business model? is the purpose of LaaS to get the client the most efficient scheme possible?
A great lighting scheme is not always inefficient but features that make projects the nicest for people such as coves, indirect lighting, and wall washing will be less efficient than a fitting designed to deliver the most illumination for the least Watts. If every Watt that is designed into a project has a direct impact on the long term cost of the project to the client will the human element be sacrificed for cost? On the other hand, if a scheme can be supplied with no capital expenditure up-front, and creates a net reduction in OPEX, it has potential to enable clients to embrace some of the more expensive lighting ideas of the moment ‘Humancentric Lighting’ for example.
Another big issue for lighting designers in the LaaS model is who might our clients be? Currently, a lot of LaaS projects are being delivered by lighting manufacturers, so a logical response might be, the manufacturers could hire lighting designers. This could be complicated for a number of reasons, to start, nearly every lighting manufacturer will already have a department that provides a level lighting design service. Although if LaaS takes off to the scale predicted in the next five years many manufacturers might not be able to cope, so outsourcing design might be a way to help with the scalability of delivering large quantities of projects without the complexity of expanding their own operations. Design might also be a way for a manufacturer to differentiate their ‘product’, access to high profile design companies could be an interesting way to encourage clients to sign up to their service. A hybrid approach could also be possible, where a Lighting designer could be appointed for concept and schematic phases and the technical design handled by the manufacture ‘in-house’.
However working in this way asks a question that is at the heart of the independent lighting industry; who is the advocate for the client? As independent lighting designers we carry out our work in the best interests of the client and the project because that is what we are paid to do, we have no conflicting interests. We are not trying to sell products so the number of lights on project is not a motivating factor, we are not concerned about the margin we can make on product is. So when we make a recommendation the client knows it with their needs in mind. If we are in the employ of manufacturers, however transparently, can the client trust our decisions in the same way. Can we designers trust the manufacturers to not row back on the expensive elements of our design to increase their profit, at the detriment of the client’s experience we are not involved in the project anymore.
Another issue is likely to caused by insurance. LaaS projects are in many ways packaged loans and that means risk, which companies will want to protect themselves from. For example, the client could go bust, the building could get destroyed, or the building may not perform as anticipated. If through an error in the design calculations the project does not meet the energy savings to sufficiently offset the scheme. It could result in both losses for both parties and the involvement of a design consultant would further complicate liability. So in practical terms, whether manufacturers will even be able to appoint lighting designers is not firmly known.
If working with manufacturers on LaaS projects creates problems, then could lighting designers manage LaaS projects themselves? Well, in theory, it’s possible but in my opinion, I’m not sure it’s desirable. Lighting designers just don’t have the scale to manage these kind complicated deals. It doesn’t considerably improve much from the client’s position either, the designer is now effectively supplying the products so the issues of advocacy and trust don’t disappear but are shifted from the manufacturer to the designer.
The transition to LED has been very disruptive in our industry, and that is not set to change anytime soon, the IoT and smart lighting are going to continue rocking the boat. However, the disruption is not going to stop at technology. LaaS has a very promising potential to change how we all do business. At the moment nearly all the Laas Projects are pretty unglamorous warehouses and transport centers. But these are the first green shoots, or the gray fluffy signet of LaaS, rather than the elegant swan. As the technology at the core of luminaires continues to develop and expand LaaS is likely to be a very important element in helping clients afford these developments. Also, like smartphones and so many other industries where technology is advancing quickly there is progressively less value in owning the hardware. 30 years ago when you bought a luminaire the model that replaced it a few years later might have only been 1 – 2% more efficient, today it could be 20% better. Is there a defined role for Lighting Designers at the moment? Not at the moment – but does this does not need to mean that there cannot be one. However it is going to need a different way of approaching these projects or in Silicon Valley speak a pivot – to ensure that everyone gets the best value from the experience, and I believe that lighting designers will need to be part of that pivot.
With text and image credits from light bureau, London – www.lightbureau.com