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Early shelters made from wood and stone had one purpose: keep people safe from outside elements. But modern people expect more from the buildings where they work and live. It isn't purely about survival anymore. Now, thanks to smart buildings, the functionality, efficiency and comfort of the places where we live, work and play are unprecedented.

The smart building market is expected to quadruple its previous market valuation of $7.45 billion in 2017, reaching a net worth of $33.7 billion by 2023, according to the . In fact, according to a 青青草App survey of IoT decision-makers, 47% are working to develop smart building solutions (such as energy efficiency, lighting, security, etc.) to support increasing demand for this market.

When is a Building Considered Smart?

On a technical level, smart buildings use sensors and actuators to remotely monitor, manage and control a range of building systems, from heating to lighting to security. Smart buildings use automation and artificial intelligence (AI) to control the building's operating systems and store operational data to better understand occupant needs, trends and behaviors.

But more than that, the smart building drives people to achieve their goals. It enhances comfort, wellbeing and productivity, while saving on operating costs. They're meant to make facilities management easier through automation.

Here are the technologies you'll typically find within a commercial smart building:

Building Management System (BMS) - This is essentially the central nervous system of the smart building, controlling and monitoring all the other "smart" systems via computer. The smart building management system includes heating, ventilation, lighting and power systems, as well as security, safety and access.

Building Energy Management Systems (BEMS) - A more focused version of a BMS, this controls the smart building's climate: heating, ventilation and air conditioning (HVAC), plus smart lighting.

HVAC Environment Controls - These technologies control indoor environmental comfort. Smart HVAC systems have become an area of particular interest, with researchers looking into ways to help companies bring employees back into offices safely during the pandemic. In 2020, Boston University developed a smart HVAC system called that uses a network of cameras and thermal door sensors to determine the number of people in a room and adjusts the ventilation and airflow accordingly - ensuring occupied rooms, but only occupied rooms, have a healthy amount of air moving through them.

Security & Access Control - Most modern access control systems are computer-based and allow access via electronic cards, like ID badges, or codes. In a , though, security company HID Global found that more than half the companies they surveyed either had already or were in the process of upgrading to mobile IDs - a more secure technology that also happens to be touchless.

Commercial & Industrial Lighting - This includes all types of buildings, from hotels and offices to warehouses and hospitals, and lighting from basic overhead to emergency, controlled via panels.

Fire & Safety - Smart building fire safety is a package that incorporates multiple tools to keep people and property safe from fire or other danger. This includes construction methods, mechanical and electrical devices (think: control panels, electronic signs, smart doors and locks, etc.), management practices, and an organized human response designed to reduce the impact of fire upon people in and near the building, along with the building itself and property within it.

Occupancy Management - Using heat sensors and other automated technologies, companies can efficiently place staff within large offices or warehouses.

Digital Video Surveillance - Similar to occupancy management, in addition to providing security, cameras can help B2C businesses move employees where they're most needed. For example, if cameras at a grocery store notice a buildup of customers at the checkout, it can trigger management to open more cash registers. Alternatively, if business is slow, employees could be sent to stock shelves.

What are the Core Components of a Smart Building?

There are four components to the smart building ecosystem. The first one is an Internet of Things (IoT) center. We're reaching a world where almost anything can be connected to the Internet. This is especially true in smart buildings; almost everything will be connected, from coffee makers to doorbells to lighting systems. This enables devices to collect data that can be analyzed to deliver better experiences.

In addition, this connectivity extends to how different devices communicate with one another, an important piece of a smart building system. 青青草App's 2020 Smart Home Technology trends report found that 61% of companies surveyed described their B2B solutions are "interoperable," meaning they can easily connect with other smart devices. In that same report, 46% of companies said their B2C solutions were interoperable.

The second component of the smart building ecosystem is the analytic software that takes the data collected by the sensors and turns it into personally curated action. Sensors can monitor or manage virtually any aspect of the smart building, such as temperature, humidity, occupancy, lighting, motion and air quality. But simply collecting information isn't enough; in order to provide true convenience and value, the building needs to turn data about habits, behaviors and preferences into action that makes the occupants' lives easier. For instance, say occupants of an office building clear out around 6 p.m. The building can automatically start turning off lights and decreasing air conditioning at this time.

The third foundational component of smart buildings is the user interface or human machine interface (HMI). These are the touchpoints occupants use to interact with and control the systems and devices in the building. They can come in many forms, such as multitouch and display screens. But whatever form it takes, the HMI needs to be simple, intuitive and aesthetically pleasing.

The fourth and final component is connectivity. All of these devices need a medium through which to communicate. Currently, the two options are Wi-Fi and cellular-based applications. Wi-Fi provides good coverage within a building but is relatively short-range and can be vulnerable to security threats. Cellular connections are more expensive but more secure and cover longer ranges. Also, with its speed and reliable connections, the advent of 5G could open new frontiers in smart building technology.

Different Drivers for Residential and Commercial Smart Building Market

Although the benefits of smart buildings - whether they're being used for residential or commercial purposes - are the same, the building occupants and owners have different goals in leveraging smart solutions. Hence, the primary drivers in the residential and commercial smart buildings are different.

Comfort and Convenience are Driving Residential Smart Building Investments

Home is where people go to relax after a long day, where they spend a rainy weekend and where they welcome family and friends for a warm meal. They want minimal friction and effort so that they can enjoy the place where they lay their head down at night.

Thanks to remote monitoring and control, they can close a window or check to see if they left the oven on - all while they are away from home. Around their typical bedtime, the air conditioning can lower to their preferred nighttime temperature with automated systems.

Moreover, preventative and predictive maintenance will make life much easier for residents. Instead of having to take a day off work to "stew" in your crockpot-of-a-house waiting for a repairman, buildings can self-diagnose and either warn you before your air conditioning breaks down or fix the problem itself.

Sustainability and Productivity are Driving Commercial Smart Building Investments

Commercial building investors are hoping to increase their sustainability. Supporting eco-friendly companies is becoming increasingly important to consumers, and - consequently - important to businesses hoping to support their corporate social and environmental responsibility goals. In fact, the commercial segment holds the greatest shares in the global smart building market, "owing to the necessity of appropriate and tailor-made solutions to reduce energy consumption without compromising comfort or security," according to .

Sensors and building automation can help companies reduce their environmental impact. For example, when people leave a room, the building can turn off the lights and turn off or reduce the air conditioning. Additionally, water consumption and energy usage tracking and analysis are easier.

Commercial smart building investors are also excited by the possibility of proactive building maintenance but for another reason: greater productivity. By monitoring and proactively maintaining its systems, office buildings will experience fewer malfunctions and issues.

It is worth noting that because of the elevated level of sophistication and spend, the opportunities for manufacturers are greater in commercial smart buildings than residential.

A Solid Supply Chain Helps Smart Building OEMs & Integrators Manage Costs

For Original Equipment Manufacturers (OEMs), there are a few main cost drivers of smart building systems. A variety of smart building solutions leverage a camera, which can be one of these cost drivers. Proper alignment of the camera's lens is critical for proper functioning, and misalignment is a costly mistake. However, finding a manufacturing partner who specializes in , a speedier and more effective alignment process, can reduce your potential for loss in this area.

Another potential cost driver is in the plastic molding for many of the devices that make up the smart building system. This can get expensive if OEMs request decorative plastic options and in devices that involve molding glass and plastic. Additionally, like in every other industry, OEMs of IoT technology are still facing shortages of components like resin (for molding) and semiconductors. Even as business for commercial buildings dropped in 2020, residential orders skyrocketed for A/V systems, smart thermostats, lighting and more, placing an increased strain on supply chains.

For both OEMs and integrators of smart building devices, creating solid, dependable partnerships throughout your supply chain is the key to managing costs and creating systems that function as needed. It can be tempting for integrators to choose hardware or software from one OEM or another based on cost alone. But it's important to remember each of these devices will ultimately be part of a smart building ecosystem.

Choosing components based on price, rather than compatibility, can create interoperability issues down the line - or worse, cybersecurity concerns. The increased reliance on connected devices means safety of the networks and the individual technologies is of the utmost importance. Preventing cyberattacks by choosing high-quality components from the beginning is something that integrators and companies investing in smart buildings should prioritize from the start.

Residential and commercial buildings today are moving beyond simple, traditional structures into complex consolidations of structures, systems and technology. Smart building solution and technologies can help us make better decisions and meet the challenges of tomorrow head-on, to provide a future that is more comfortable, efficient and eco-friendly.