Turning smart buildings into a lever for growth, resilience, and competitive advantage

Amid rising economic volatility and times of rapid technological change, smart buildings are no longer optional—they are essential.

In a time when everyone is trying to do more with less, it’d be easy to view buildings as merely overhead: electricity costs, heating bills, and other drains on the enterprise budget. But what if an organization’s building stock could be transformed from a cost center into a strategic asset?

“Smart, sustainable buildings are not just about environmental stewardship. They are fundamental to business success in a volatile world,” says Katie McGinty, vice president and chief sustainability and external relations officer at Johnson Controls, a world leader in smart, safe, healthy, and sustainable buildings.“Investing in these solutions can mean cutting operating costs, preserving capital, and hardening organizational resilience.”

Katie McGinty, Vice President and Chief Sustainability and External Relations Officer, Johnson Controls

To meet the moment, leaders must reevaluate the rules of how they create their built environments. Those who will win in this new era will see sustainability not as mere compliance but as a catalyst for growth and long-term competitiveness.

Fortune Brand Studio sat down with McGinty to learn more about how smart buildings help organizations mitigate risk, adapt to disruption, and stay ahead of evolving trends.

In today’s uncertain climate, how is Johnson Controls positioning smart buildings as a driver of growth, profitability, and long-term value creation?

Our driving mission is to ensure the success of our partners in mission-critical environments, helping them transform buildings from cost centers into strategic assets. We create technologies for smart buildings that can be deployed at scale across three critical levers: efficiency, electrification, and digitalization.

More than 75% of our new product research and development focuses on purpose-built solutions such as smart chillers for data centers that can lower energy consumption and heat pumps that can turn waste into renewable energy.

The long-term value creation is clear. Since January 2000, we’ve delivered nearly $9 billion in energy and operational savings for customers and more than 41 million metric tons of avoided CO₂ and equivalents. Our view is that sustainability is synonymous with competitiveness.

What role does technology, including AI, play in helping organizations future-proof their operations?

Technology is at the heart of our strategy. True resilience starts with designing for real-world constraints. Consider our OpenBlue smart building platform. It combines secured and scalable open data with AI to orchestrate building systems in real time. It automatically adjusts temperature set points, predicts faults, and optimizes energy use minute by minute.

Our advanced controls and digital capabilities are worlds away from the traditional, outdated models that run systems at maximum capacity no matter the actual conditions. We’re using real-world conditions to optimize and create significant energy savings and improved reliability. Our customer, Standard Chartered Bank, for example, reduced energy spend by 12% across 700 of its leased properties in the Asia-Pacific region. To do it, our platform integrated with third-party systems to resolve building inefficiencies, enable smart monitoring, and identify opportunities for preventive facility maintenance.

Is it critical for leaders to take that type of holistic view if they hope to transform data into actionable insights for long-term resilience?

Absolutely. It’s how they gain a competitive edge and build resilience for whatever comes next.

And that’s the benefit of AI. OpenBlue integrates more than 100 data points from multiple data sources so businesses can holistically manage even highly complex environments such as hospitals and data centers. For example, OpenBlue is helping us deliver $681,000 in annual savings and 69% reduction in use of natural gas for our partner Children’s of Alabama, a nationally recognized children’s hospital. That savings equates to a strategic benefit, freeing up capital to go toward the hospital’s main mission—caring for patients.

The most powerful efficiency combination comes when you combine AI with other innovations. We see this at Johnson Controls when our customers use OpenBlue in tandem with our smart cooling technologies, such as connected chillers, overlaid with smart controls, such as our Metasys building automation system.

Overall, an independent Forrester study found OpenBlue can deliver up to 155% return on investment over three years, energy savings up to 10%, and a 67% reduction in annual chiller service costs. It shows how even greater efficiencies and strategic advantages are possible when you overlay complementary solutions.

How are shifts in customer priorities reshaping demand for those sustainable solutions? And how is Johnson Controls positioning itself ahead of those trends?

Today’s customers want results. There’s been a shift from aspirational green intent to a demand for measurable green impact—and that means businesses want solutions that deliver concrete outcomes, such as lower energy bills, reduced emissions, and improved uptime. And this is really a story about growth for our customers. Take data centers, for example. When we cut the energy needed to cool chips by 40%, that is 40% more capacity for our customers to serve theirs with advanced AI solutions. So, it’s about cutting carbon and costs while driving growth opportunities as well.

This business case and competitive advantage are what’s compelling. Regulatory changes are also driving the conversation and trends, of course, so the evolving policy landscape is one that can’t be ignored. But the organizations that will win are the ones who understand that they can shape markets and policy by putting smart building technology to work to drive efficiency, growth and productivity. When you do that, policy follows what already works.

Looking ahead, how do you see innovation in this space evolving over the next five years?

New innovations will completely transform and redefine what buildings can do. I see five emerging trends:

1. Grid-aware buildings will flex based on real-time demand to support energy resilience and stability.
2. AI will advance from diagnostics to more autonomous orchestration, which will allow systems to self-optimize and respond dynamically to changing conditions.
3. Sustainability will become a core financial metric—one increasingly priced into capital decisions, with investors understanding strategic sustainability as a growth and productivity engine.
4. Organizations will increasingly demand healthier buildings, as environmental improvements, such as enhanced indoor air quality, have been shown to increase employee productivity and reduce absenteeism.
5. As-a-service models and strategic partnerships will help add predictability to cost models, shifting some of the technical responsibility back to the experts—us!—so our customers can get back to operating their businesses.

What should leaders debating green investments understand about the role of smart, sustainable buildings in future-proofing their organizations?

Organizations should prioritize data-driven decision-making, pilot innovative solutions, and align capital to scale what works. Performance-based, as-a-service models and strategic partnerships can accelerate the transition from someday to now.

Sustainability is good business, enabling companies to win in an environment defined by uncertainty and change as they shift spend from waste to innovation and growth. By embracing smart building technologies, CEOs and chief financial officers can future-proof their organizations, ensuring long-term competitiveness and value creation.