Strategy & Operations » Real estate » Why firms are getting flexible working wrong

Flexible working is a hot topic in the corporate world. UK employees now have a legal right to request it, and their employers are duty bound to respond. But that is not the real reason big corporations are investing time and energy in re-imagining their working practices and workplaces.

Large firms compete to recruit and retain the best people. This, of course, is an expensive and time-consuming business, and flexible workplaces are becoming a crucial tool in winning that talent battle.

These new work environments are the result of a new era in office working where one person-one desk is no longer the rule. Hot-desking is the most tangible manifestation of flexible working, a function of the fact that people are no longer expected to be chained to their desk nine-to-five. Instead, they can be working in different kinds of spaces within the building, at home, co-working, with clients or even in cafes.

But employees sharing desks is only the start. This new kind of office layout allows for a new kind of interior design – one that sets apart progressive new companies. Flexible working as an option, and the bright new work spaces that often go along with it, are a useful card in the hand of HR teams trying to attract the best people, especially when they need to be lured away from competitors or are part of a new generation coming into the workplace with different ideas about how working life should look and feel.

All of that is great from an HR and productivity standpoint, but there are clear financial benefits too. Apart from savings on recruitment costs, switching to flexible working can mean big corporations can offload under-utilised office space. For most corporations, next to their people, that Grade A real estate is their biggest overhead. So, especially during lean times, that can be an attractive proposition.

So it seems that flexible working is something of a no-brainer, and yet many firms are getting it horribly wrong. Why? In my experience, there are three key reasons.

What went wrong?

The first is that businesses are making decisions based on poor data about how they use their office space. It really shouldn’t be that way. Ten years ago, we pioneered the use of sensors to measure office use, and we’ve seen hundreds of corporations worldwide make good use of the data it generates. So it’s actually really disappointing to still see today many managers relying on gut feeling or flawed systems to make what are very important – potentially mission critical – real estate decisions.

If you don’t have really good data, chances are you’ll fail to understand how you currently use their office space. That’s inevitably going to lead to “flexible” solutions that don’t work because they don’t offer enough of the right kinds of spaces or because they inflate or deflate the amount of real estate that an organisation actually needs.

One of the problems is that there are a lot of ways to do it badly. We recently published a report on emerging trends in occupancy management listing unreliable methods being used to assess usage statistics. These included manual “clipboard” studies and video tracking of people coming into or leaving an office space. The former doesn’t allow for detailed analysis of work patterns while the latter doesn’t deliver data on individual desk use.

Abintra’s WiseNet system gathers reliable space utilisation data from purpose built, proven and professionally installed wireless and unobtrusive sensors mounted to the underside of work surfaces to detect presence. Unlike camera-based, human observation or systems that rely on using employees’ phones, it is a non-invasive solution, making it easier to win staff approval. More on that subject later.

Those sensors are linked to our software to gather real-time data on exactly which spaces within an office are occupied at any time of day and night. Typically, we carry out a discovery survey over four weeks. We then work with managers to review the data and make recommendations about how they can improve the way their office works. In our experience, the amount of space that can be saved is astonishing. I would say typically 30% of a given portfolio will be highlighted as a potential opportunity. Even for businesses that have already adopted flexible working, the findings can be eye-opening.

There is no doubt that corporations have an awful lot of real estate to play with. We recently undertook a study which concluded that large office-based firms with 250 or more employees in England and Wales are together spending more than £10bn on under-used Grade A office space.

Once businesses have implemented a new flexible layout based on sound empirical data and some expert advice, they can continue to use the sensor technology and software to monitor how the space is being used via their web browsers. The data can be interrogated to give an accurate view of office use over different time periods.

Employees can use the same system on their web devices or via an app to see where there are vacant desks or other areas where they can work, depending on what type of work they are planning, who they need to collaborate with or the mood they are in. For firms with multiple locations, employees can even choose which office they want to work in.

With the launch of a new combined sensor, we can now also provide data on key environmental metrics as well as space utilisation, such as temperature and air quality. That allows facilities managers to deliver high levels of comfort for office users while helping to reduce energy waste. For example, by collecting data on the environmental conditions at each workstation, systems can be adjusted to provide improved levels of temperature and humidity control.

The second reason things go wrong with flexible working is the lack of a joined-up approach. Put simply, corporations must break down the silo mentality of their teams to unlock the potential of agile working. In our experience, unless firms take a business-wide approach, they will fail to implement flexible working properly and will miss out on all it delivers.

What is required is a holistic approach to rorganising the way the business works. It shouldn’t be just the preserve of the real estate or facilities management team. It needs to be communicated across the whole business. HR should be fully involved to help to create an improved environment. The financial director and his or her team clearly ought to be taking a keen interest in this huge overhead and how it could be used more efficiently.

Other departments, such as IT, have important roles to play. Instead of relying on real estate to take care of itself, the CEO should be driving change towards corporate objectives, such as improved efficiency and better recruitment and retention. To make it happen, the CEO needs to do more than delegate it to a single team, he or she must bring teams together on an enterprise-wide mission.

Advances in smart buildings add new emphasis to the imperative for a well-rounded approach to workplace design. We now have the technology, not only to enable flexible working but also to monitor the environment down to the individual desk level. As smart buildings gain traction, it’s crucial that teams work together to reap the rewards, looking beyond energy savings and towards creating a better, more productive work environment, one that contributes to employees’ health and wellbeing.

Adapting to change

By monitoring the office environment and how and when it is being used, we can create adaptable workplaces that address all users’ needs, from physical comfort and wellbeing to how the environment supports them to do their job effectively.

Recruitment and retention are massive priorities for major corporations, and this is leading to more and more of them reviewing their working environments. Added to this, the public debate about mental health is having an effect. We are seeing an increasing number of enquiries from companies wanting to overhaul their working environments as a direct result of employee wellbeing rising up the corporate agenda.

The third reason for failure is a lack of buy-in from the workforce. We believe involving the workforce in the process is a crucial step to making it work, and that is borne out by experience and the views of leading experts in the field. Conveying respect to the worker is one of the linchpins of theory put forward by people-centred-design researcher professor Jeremy Myerson.

The reason this is important is that so-called knowledge workers, the kind that typically populate the offices of major corporations, have a strong sense of control. There is a risk of threatening that sense by failing to involve them or, on the contrary, offering too much choice, which can be alarming for some people.

Also under the banner of conveying respect to the worker is silent messaging, the cues that an office environment gives to the people who work in it. That speaks much louder about an employer than any mission statement. Ideally, it should not only present an image but also provide a sense of community.

Flexible working directly relates to organisations valuing their number one asset, their people, and leveraging their second biggest overhead, their workplace, to develop environments that are attractive, productive and cost-effective. Managers owe it to themselves, their businesses and their people to get it right.

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