The office and the role of office space in our working lives are changing. Working from home on some days and from the office on the others – so-called hybrid working models – are becoming more prevalent and are here to stay.
Generally speaking, if fewer employees come to the office on any given, offices don’t need to be as big. At the same time, growing companies want to ensure they have room for their employees as they grow, so a bit of extra space might be worth keeping.
So how big does an office need to be? How can office space be optimized?
Summary
- The increasingly flexible use of hybrid work provides an opportunity for companies to achieve significant medium-term cost savings
- But there is no one-size-fits-all solution. Every company’s needs are unique, which means that every office needs to be unique
- Nonetheless, even relatively small reductions in the need for physical office space through the introduction of hybrid work can represent significant medium-term operating costs in the form of reduced rent
How much space does your hybrid office need?
Well, the bad news first: there is no one-size-fits-all answer.
But for companies that work hybrid and introduce desk sharing (also called hot desking), the need for physical space is lower. And it's easy to see why: for companies where most people work 2 days per week from home, for example, on any given day, only 60% of the workforce needs a desk in the office.
That could translate into a straightforward 40% reduction of space (of course it is not always so straightforward, because we are not counting areas like cantines, bathrooms, storage, etc.).
Beyond desk sharing, there is another important factor: office design.
For firms that require high levels of privacy inside the office - for example, legal firms - the need for private, individual offices is likely to remain unchanged. Which means that their space requirements will be relatively high. Firms that already have open office concepts will have much lower requirements.
In general, there are several factors that determine office design:
- Location: whether a company is based in a metropolitan area, suburban area or rural area has a significant impact on the size & cost of the office.
- Growth aspirations: every company wants to grow in some way. However, when the number of employees increases, the need for space can increase as well.
- Company culture: Does the CEO want her own corner office, or will she be happy to join everyone in the open space? Culture is often reflected in the office setup.
- Employee desires: What do the workers want? More remote work? An equal balance?
- Industry and business model: for manufacturing and other production firms, there are often significant portions of the work that cannot be done remotely. Balancing the desire of office employees to work from home with the importance of a unified policy can be tricky.
Why does the office need to change at all?
OK - a smaller office makes sense. But why not just leave it there? Why not keep the office I have today, but make it smaller?
The answer: It's not just that people are coming to the office less often. It's that they are behaving differently while they're there.
Numerous studies have shown that people now view the office as a space for two things above all else: socializing with colleagues, and as areas for focused innovation.
Rows of cubicles won't enable colleagues to easily socialize with one another. Nor does it provide the context for the free exchange of ideas and brainstorming that have been proven to boost innovation.
Redesigning offices to make them fit for these two purposes means that workers will come to the office more often. This will further enhance social interaction as well as spontaneous and planned collaboration, creating a virtuous circle of cause and effect.
Trends in hybrid offices
We have noticed at least two major trends amongst our customers as they seek to both reduce costs while boosting productivity and innovation.
Flex Office/Co-working spaces
A first, fairly radical approach to space optimization is the move away from long-term office rentals and towards short term (6- or 12-month) leases, or even simply providing employees with access to co-working spaces like WeWork.
Advantages: the benefit of flex space is primarily in flexibility. The total amount of office space can be increased and decreased on relatively short notice, and is thus quite responsive to the current needs of the company.
Additionally, co-working spaces are often attractively designed, with a mix of space to enhance socialization, creativity and innovation. This means that companies do not have to hire interior designers themselves.
The disadvantage: the company does not have its own long-term ‘home.’ This can have an unsettling effect for employees, particularly if they are considering relocating to a new area to be closer to the office. Outside of large metropolitan areas it can also be more difficult to find enough flexible space or co-working offices.
Do-it-Yourself Hybrid offices
Companies that decide to design their own hybrid offices, on the other hand, pursue a more long-term approach. Typically, they have implemented a global corporate policy that regulates how often their workers can spend working from home. And they often have a relatively fixed portfolio of real estate assets (either long-term leases or owned buildings) that they either cannot or prefer not to significantly divest.
Instead, they undertake to redesign their offices that give workers flexibility. Social interaction and innovation spaces are prioritized, but there are also quiet and concentrated zones with IT equipment that can help people work in a more focused way.
Advantage: long-term stability and investment in their real estate portfolio means that the change management process is not very drastic. Companies have full ownership of how much their offices change - or do not change. Even for long-term leases and corporate campuses, certain areas can be sublet or repurposed (for example, turned into logistics centers) on a limited basis.
Disadvantage: Immediate cost savings are rather limited. Particularly if companies have long term leases or own their own building(s), there are few savings that can be immediately realized.
Less space: Does this mean a "fight for desks" will follow?
For companies that work hybrid and implement desk sharing, there can be a certain hesitation among employees about losing ‘their’ desks. And to a certain extent, this hesitation is understandable. Desk sharing means that desks are no longer assigned to specific employees. But this does not need to lead to conflict. It is just a matter of organization and communication.
Desk sharing software can help facilitate communication and at the same time give employees the guarantee of a workplace on site. Employees can quickly and easily book a desk for a whole day or a few hours via a workplace booking software. This helps with organization in the office, and ensures that desks cannot simply be assigned on a ‘first come, first serve’ basis to whichever employee can arrive at the office the earliest.
Introduce hybrid working & save costs with Seatti
With our desk sharing software, you can optimize your office space based on actual usage data, while at the same time giving your employees more flexibility.
Not only can you quickly implement it into your existing Microsoft 365 ecosystem, but you can also make hybrid working intuitive and easy. Seatti not only allows you to book workplaces, meeting rooms and parking spaces, but also offers employees the possibility to arrange meetings with each other via a location overview.
In addition, the integrated data analysis helps you to track office utilization on the basis of anonymized booking data. Collect long-term data and make data-driven decisions regarding your office investment. This way you can see where you can make potential savings.
