”What’s the purpose of the office?” that is a question I’ve been asking many people in recent years – not ever imagining that the future of offices would be the most hotly debated topic in 2020. Current circumstances have certainly thrown a massive spotlight on the unexciting world of office work, so much so that the mainstream press now regularly feature pieces on the ‘death of the office’. It might make for sensational headlines but I don’t believe that the office is dead or dying, just that it’s not going back to normal.
Regardless of your point of view, the challenges imposed on us by the pandemic force us to consider options and scenarios which are unprecedented, complex and pose real dilemmas in the ways we live and work. We are all facing widescale personal fear of the unknown, existential threats to business survival and even greater levels of uncertainty all at the same time globally.
A Brody Moment for Commercial Real Estate?
Interviewed recently on Forbes by David Komlos, CEO of Syntegrity and co-author of “Cracking Complexity: The Breakthrough Formula for Solving Just About Anything Fast” , I was introduced to the concept of the “Brody moment” – a reference to the famous line from “Jaws” when Police Chief Brody played by Roy Scheider realises that he’s “going to need a bigger boat” to tackle the monstrous Great White Shark. Looking at the future of office debate the property industry is facing its equivalent of a “Brody moment” as it come to terms with the realisation that the old way of doing things (aka the traditional leasing model) is not going to cut it post-Covid-19. The pandemic has not only changed the ballgame but the entire stadium!
Six Dilemmas for Office Providers and Users
For many players who are investors or property companies on the supply side; the hope is that this will play out like any other market downturn. For occupiers this pandemic has fanned the flames of change into a firestorm when it comes to figuring out how to attract and retain the best talent, how to gain competitive advantage and sadly for many, how to survive.
Rather than debate the return to work and the re-opening of offices, we need to realise we are all in this together. Because of the mutual dependency between the supply and demand side of the property equation, we need to stand back and look at this situation holistically – since the dilemmas facing one side impact the other side in equal measure. Demand is fundamentally changing and this is going to impact how offices are supplied and operated. Based on my research for my book “Where Is My Office?” I identified six dilemmas affecting the way we work in offices today:-
- The fundamental difference in how real estate providers view office buildings as assets, while the enterprises who occupy the space perceive it as a resource, to facilitate their work. This has brought about a leasing system based on medieval constructs, highly adversarial in nature and full of inefficiencies.
- Enterprises large and small are changing radically and rapidly -so are the ways that people work. Yet the nature of the workplace and how that space is organised has not fully responded to these significant changes.
- The way we have done things until now fails to recognise the way that workspace is managed and operated is the key ingredient which enables productivity. It has not been fully understood that it is not just about clever design, great furniture systems or how the space is managed and curated to deliver great experiences.
- There is an over-emphasis on the physical ‘workplace’ viewing it purely as a fixed destination where work is carried out. Alternative working practices can produce meaningful outcomes and measurable impact – irrespective of the physical space where people are working.
- When we talk about the ‘workplace’, Human Resources naturally focuses on the ‘People’ aspect; while for Corporate Real Estate and Financial Management the focus is on ‘Property’; which leads to division within organisations.
- Occupiers’ internal support systems, such as Human Resources, Information Technology, CRE/FM/Property and Operations – typically work in silos. It is natural and unsurprising then, that they all have divergent points of view on how an organisation uses and operates its workplaces.
It will be interesting to see if readers have any feedback on these areas of concern for the real estate industry and its customers.
Key Ingredients for a Shift from Fixed to Fluid
Personally I believe that we need to figure out a new model for how we use offices. One based on a move from the rigid ‘one-person-one desk’ mindset and the large consolidated CBD office block to a more fluid distributed arrangement. One where an enterprise can retain a flagship CBD facility for collaboration and socialising purposes along with a range of flexible and on-demand solutions. All of which would be fully serviced as we embrace the concept of ‘Space as a Service’. To kick off such a dialogue I would suggest the following topics as key ingredients for this shift from fixed to fluid:
- Real estate professionals need to create better relationships with their clients and look to broaden their services – helping educate the owners/occupiers as how to make the best use of their property.
- All parties – the businesses, the providers, the managers – need to recognise that the provision of workspaces has shifted irretrievably from fixed to fluid. This makes for new dimensions in terms of demand and this should be seized as an opportunity.
- The enterprise that recognises the link between an engaged workforce and a well-run productive workspace — now underpinned by distributed working – gains clear competitive advantage with new opportunities opening.
- Spaces and places can be used in smarter, more sustainable ways for all the stakeholders – providers, users and intermediaries. The key is to adopt a fresh approach based on improved awareness and stronger relationships between all parties.
- Internal support groups (HR, IT, CRE/FM and Procurement) need to be reviewed and combined to enable work and productivity. These functions should consolidate to empower a fresh focus and support multi-dimensional or omnichannel working.
- Real Estate providers and enterprises need to be better informed to deliver workspaces that generate meaningful and measurable outcomes. Places that deliver not only entrepreneurial and financial value, but social value as well.
Looking Beyond the Pandemic
We need to try to look beyond the pandemic to create a vision for 21st-century workplaces. One which inspires employee engagement, foster creativity and increase productivity. While also improving an enterprise’s capacity to compete and create value in all its guises. By working together both landlords and tenants of commercial real estate can create effective and engaging workplaces which play their part in leaving a more sustainable ‘built’ legacy for future generations.
In the words of social thinker, art critic and poet John Ruskin, “when we build, let us think that we build for ever. Let it not be for present delight, nor for present use alone; let it be such work as our descendants will thank us for”.