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Where’s my office? The CEO’s guide to developing workplace strategy

Thought Leadership on Office Space presented by Colliers International|Baltimore region. 

Whether you are starting a business, growing a business, running a business, or providing services to the people that do, the one overriding question today is “where and how do we work?” After all, as a result of technology, people today can work anywhere and everywhere. So thinking about office space is a lot more complicated today than when “location, location, location” were the three most important aspects of a real estate decision.

Choices for workplaces

CEOs have more options than ever before in deciding where and how to work. Some of these options include: 1) the traditional office in an office building; 2) home offices; 3) retail locations offering Wi-Fi; 4) shared office environments; and 5) collaborative work spaces.

The home office has been around a lot longer than people think, as it has been the traditional venue for sales reps (e.g. pharmaceuticals, foods), independent contractors, consultants, and entrepreneurs. Due to mobile technology, more options outside the house exist in any establishment offering free Wi-Fi and a desk, table, workstation, etc. For the large corporation seeking a “physical presence” in a marketplace, as well as upwardly mobile entrepreneurs, there is the shared office environment (e.g. Regus, Business Suites, etc.).

Today, in part fueled by the millennial generation, there are now incubators and collaborative work spaces like We Work popping up all over. These spaces incorporate aspects of an office, a hip bar & grill, and a networking environment for those seeking a place to do work, get work, and connect with like-minded professionals. Recently, enterprising real estate developers are leasing space in malls to collaborative work space operators.

What’s a company to do?

With so many options, what’s a Smart CEO to do, particularly as there are so many different approaches being taken by different companies in different industries?

On one end of the spectrum is Marissa Mayer, the CEO of Yahoo! She eliminated telecommuting and required all Yahoo employees to show up for work. Based on her experience at Google, it was important for people to be around each other, constantly communicating, brainstorming and finding new and exciting ways to create revenues.

At the other end of the spectrum is Automattic Inc., the web services company that runs Automattic elected to go virtual. Its employees work out of their homes in more than 25 countries, 90 cities, and 25 states in the U.S. There is a modest office in San Francisco, for conferences and events, but that’s about it.

And then there is Virgin Group’s Richard Bransom, who proudly states that “he has never worked from an office in his entire career, and never wanted to.” (We can assure you that thousands of his employees know what office space looks like.)

So to assist in the decision making process, here is Colliers’ “Top 8” Things to Consider in Developing a Workplace Strategy:

  1. It’s not about real estate. Colliers can find any client any type of facility it needs. That is not a problem. But more important than the physical location and the facility is what you hope the real estate will accomplish in implementing your business strategy;
  1. It’s all about corporate culture. Your physical space should mirror your corporate culture. If your business requires individuals to focus (e.g. law firms), spaces that enable focus efforts should be created. If yours is a collaborative business, the space should reflect that by providing areas for people to meet and work together;
  1. Remember the big four workplace functions. According to renowned design firm Gensler, office space offers workers fundamentally four types of space that addresses these functions – focus, collaborate, educate, and socialize. Make sure your office space addresses those four items. How you address them reflects your culture.
  1. One size does not fit all. What may work well for Yahoo may not work at all for Automattic Inc. You need to understand your industry, workforce, cost structure and culture. Law firms are not suited for an open office environment; most design and engineering firms are not suited to extensive private offices.
  1. It’s okay to ask. In thinking about how you want your workplace to look and operate, it is very important to get input and feedback from the folks who will be working there. Make sure your vision and their vision are compatible. Do not rely exclusively on the architect’s vision; they will be gone once the space has been finished. Do not be afraid to consider what the competition is doing – and how it seems to be working. Speak with real estate professionals, like the two of us and our colleagues at Colliers, to learn what other businesses in industries similar to yours are doing.
  1. Balance is good; be cautious of trends. The temptation may exist to “double down” on today’s workplace trends that promote collaborative work space and higher densities of employees at the expense of private offices or focus areas. As Fast Company senior editor Jason Feifer stated, “The open-office movement is like some gigantic experiment in willful delusion.” Moreover, an article in The New Yorker stated, after reviewing more than 100 studies, that “workers in open-office settings experience more uncontrolled disruptions, higher amounts of stress, and lower levels of concentration and motivation than those in standard offices.” So get input and if you decide to charge ahead, make sure – in advance – that the troops are charging with you.
  1. Less is more. According to CoreNet, the real estate trade association for corporate America, in 2001 there was an average of 300 SF per person in the use of office space. Today, that average has dropped to 176 SF/person and is still trending downward. More people are working out of less space than ever before, and that trend will continue. This will definitely impact on space leased and occupancy costs incurred.
  1. Have an open & flexible mind. We have found that clients who have an open and flexible mind in the area of workplace strategy usually make the best decisions moving forward. They get input from employees, design professionals, and real estate advisors. As a result, they obtain a more holistic understanding of workplace strategies and which ones best serve their interests.

Click here for more Thought Leadership from Jonathan Manekin and Robert Manekin.