Do away with empty desks

Posted on: 20th September 2016

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They say good things come in small packages – and that’s definitely the case for your office. Here's the commercial case for a streamlined workspace

They say good things come in small packages – and that’s definitely the case for your office. Here's the commercial case for a streamlined workspace


They say good things come in small packages – and that’s definitely the case for your office. Here's the commercial case for a streamlined workspace

When you look around your office, do you see lots of empty desks? If so, you’re not alone. The average office is empty or goes unused 55% of the time, according to Regus research. And it costs companies a hefty sum – around $27,000 per desk each year.

But the cost is not just financial. It’s also an obstacle to your company’s agility and employee productivity. The number of desks in your office no longer equates to how productive your workforce is. In fact, a fully fixed office space is more likely to weigh you down, preventing you from reacting quickly to market demands.

An increasing number of large companies are ditching the traditional, fixed-location office for a more flexible set-up. Here’s why.

It’s all about the money

Paying for physical assets like unused office space – whether due to a changing employee headcount or a shifting flexible work policy – is a huge financial drain.

In Hong Kong office space costs $218 per square foot each year, and prices continue to climb. New York sits at $131, Tokyo at $107 and San Francisco at $90. At these enormously high costs, a corporation with 5,000 employees and 75 offices can save around $7.25 million by moving away from a fixed model.

Keeping reactive

From Brexit to terrorist incidents to new tiger economies, economic and political uncertainty means that large companies face various threats but also have opportunities to expand and adapt. Large companies need to be ready to react to the more dynamic, fast-paced market.

One of the most difficult challenges for this rapid change, the “known unknown” of aligning headcount requirements with workspace needs, is now more unknown than ever given the increase in contractual workers, outsourcing and off-site tech centers. Added to that is the changing location needs of large companies – to be closer to both clients and employees.

The pace of change means that today’s large companies cannot predict their exact floorspace needs in any given location even six months out, let alone five years in advance (as traditional lease agreements require). But most corporate real estate portfolio strategies aren't designed to react effectively to market demands. They are founded instead on traditional, fixed office space that needs long-term commitment and ties up valuable capital.

You’re not in charge anymore

Not only are company needs changing, but so are employee expectations. With a mix of corporate employees, mobile workers, project teams and contract workers, the average workforce of a large company has different requirements for interaction, workspace and collaboration.

Author of The Future of Work, Jacob Morgan reminds us that “organizations can no longer assume that employees need to work there” – they must instead provide inspiring spaces that encourage people to use them. And this doesn’t just mean creating an open-plan office. “Organizations investing in [these] plans also have numerous other floor plans that cater to diverse ways of working," he writes. "It’s not a one-way or nothing approach. It’s about recognizing that employees have multiple preferences for how they want to work and enabling that.”

Canadian telecoms provider Telus has followed that advice and established “Work Styles,” which allows 27,000 employees (70% of its workforce) to work wherever they like, moving between home, the office and other locations. Employee engagement increased from 54% to 87% in six years – and the company saved over $4 million in the process. And it cut its carbon emissions by 8,000 metric tons a year.

Flex vs. fixed

Faced with new requirements in terms of costs, agility and productivity, large companies must adapt their real estate strategies. The solution is often not either fully fixed or fully flexible, but a blended portfolio containing both.

By outsourcing flexible space requirements, companies cut down capital expenditures by eliminating the cost of building expenses, furniture and technology, and guarantee more efficient use of their space. Not only that, but they prepare themselves for rapid, agile change and enable a more productive workforce. Time to get rid of those empty desks?

Topics in this article

  • Work Trends


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