The workplace is evolving: as telecommuting becomes more common, the office now goes to the worker rather than the worker goes to the office. This radical shift frees corporations from costly real estate and severs the last geographic ties to any sense of place. Geopolitical restraints are becoming less of a factor, talent can be recruited and used anywhere, IT is moving to the cloud, and behemoth corporate headquarters are fast becoming cavernous relics. Is this the agile future that corporations were hoping for?
Several factors came together to bomb the commercial real estate market, effectively and forever reducing the notion of “corporate headquarters” to a fraction of the space it once commanded. “It was a perfect storm of [changes in] real estate, human resources, and information technology,” says David Rush, vice president of Interior Design for HOK, a global architectural firm. Indeed, first outsourcing and then the recession shrank workforces to minimal levels. Legions more were unshackled by technologies from cloud computing and software as a service (SaaS) to laptops and smartphones. Now, savvy companies are dumping behemoth-sized facilities in favor of smaller workplaces peppered around the globe.
“Companies are moving from sprawling suburban corporate campuses to smaller scale headquarters — a hub and spoke model — as they represent much more efficient operations,” says Rush.
The new reality finds a glut of open office space, deserted and cavernous, where a sea of cubicles once washed through. Huge data centers have shrunk to mere skeletons in tiny closets, as workloads ascend to the cloud. Many a company’s sense of place has thus faded into a sense of wasted space.
“Due to the technology advancements, changes to the workforce, and cultural impacts in many companies, there is tremendous opportunity for facilities and workspace planning in corporate America,” says Scott Archibald, managing director for Bender Consulting.
As Archibald points out, many workers no longer need a dedicated cube or office, and younger workers are more interested in working in social environments with couches, easy chairs, and lounges. “Replacing dedicated cubicles with shared cube space and more multi-use areas are likely changes,” he says. “Quiet work areas may also be needed for those sensitive calls or management activities.”
“Investments will be required to make these and other facility changes; however, afterwards companies should be able to lower a building’s footprint and associated energy costs,” he adds. After these sea changes, profits are predicted to soon rise above pre-recession levels for many companies.
However, the initial investments needed often includes buying more technology – not less – in order to glue together a diverse workforce that now has no geographic boundaries.
Head Counts and Tech Beats
This new change in place and pace is not without its challenges. Topping the list is getting an accurate headcount of workers and the technologies they need to function. Given that outsourced, remote, and mobile workers are hardly new concepts, one would think corporations already have at least part of this problem already under control.
“Our survey results indicate that many companies don’t have control over employee mobility costs or benefits,” says Kathy Sharo, director of marketing for Runzheimer International. Runzheimer provides products and services to government agencies and 60% of the Fortune 500 in support of the growing mobile workforce.
“Seventy-three percent (73%), for example, have no policies in place for virtual office programs, which includes mobile device management, and 56% are unaware if the programs are productive,” she adds. “The point then becomes not just about buying or optimizing technology, but about adopting a more structured approach, complete with methods for measuring success.”
Runaheimer’s fifth annual survey of mobile workforce trends indicates that over 51% of a typical corporation’s workforce is mobile on any given day, and that number has increased by 31% since 2006.
“The total investment in workforce mobility per employee has increased significantly in the past four years and currently stands at $7,426 — a cost comparable to corporate health care costs,’ says Sharo. “Clearly, it’s a trend that will continue as new technologies proliferate and companies experience the service and growth benefits of allowing their employees to define their own office spaces.”
Time alone does not address the problems, certainly not in a world where change is measured in Internet speeds. “The evolution of the workplace is a process that has been underway for the past 15 years; however that period of transition is far from over with employees continuing to find themselves facing new dynamics, largely by circumstance,” says HOK’s Rush. “You don’t just make a choice to be highly mobile.”
Technology as Workforce Glue
The challenges deepen when corporations begin to add the intricacies of remote workers permanently stationed somewhere beyond the firewall.
“Without question, technology is at the forefront of the age of ‘working anywhere, anytime on any device,’ and this mindset is here to stay,” Rush says.
This flexibility is not a matter of convenience but a business case for more efficient and profitable operations.
“We believe that virtual work environments, like using remote offices and virtual work spaces, are critical to our business success,” says Jean Cholka, CEO of Freeborders, a provider of technology solutions and outsourcing from China that counts such industry giants as DuPont, Citigroup, Expedia, GE, and MorganStanley among its customers.
“As a global IT consultancy about 80% of our U.S.-based work force works remotely, at a client’s office, or at home,” explains Cholka. “Not only does a flexible work environment reduce the costs of a physical office space, it also helps employees achieve a better work-lifestyle balance.”
“For example, our work requires a close collaboration with colleagues in other time zones and frequent client visits,” she explains. “Working remotely provides the flexibility to better connect with colleagues in Europe or Asia.”
Such working conditions call for more than standard technology fare. It calls for technologies designed to be mixed and fixed into a fluid glue that holds the organization together. Cloud computing and Software as a Service (SaaS) are certainly mainstays of this formula.
“Cloud hosting means that IT can now be used more like a utility, and the anywhere, anytime access increases worker mobility, provides greater information security, and makes the workforce infinitely more flexible,” says Byron Attridge, executive vice president for ClubDrive Systems, a cloud computing provider based in Atlanta, Georgia. “It also makes fixed office space much less relevant.”
Smartphones and laptops are also central to leveraging the new workforce. Those corporations that use operating systems such as Windows 7 that unifies the remote and mobile workers with the overall organization are particularly well positioned to handle this change. However, these technologies alone are often not enough.
The Office Follows the Worker
“We use teleconferences and video-conferencing in our daily work,” says Cholka. These technologies are not so much for communications with clients and customers, she says, but with co-workers in the same organization or with collaborative partners.
The point is that the office now goes to the worker rather than the worker goes to the office. That calls for a technological shift across the entire organization.
“The way that people do business is changing. That’s undeniable,” says Dave Heimbach, vice president of Evolve Business Solutions by CBTS (a Cincinnati Bell company). Evolve Business Solutions is a VoIP, cloud-based technology that enables the traditional office to follow a worker by routing business calls to any number in the world. It also allows employees to dial in through their business line no matter what number they call from.
“Yet we’re seeing this interesting dichotomy between how people want and need to work in the digital age and the technology that is available to assist them with this,” he added, “ROWE, for example, is a revolutionary new management strategy that allows employees to work whenever, wherever they want to — there’s absolutely no requirement to go to an office or give face time to an employer.”
ROWE stands for Results-Only Work Environment and is a human resource management strategy wherein employees are “evaluated on performance rather than presence.” ROWE was co-created by Jody Thompson and Cali Ressler, former executives at Best Buy, who now own a consulting group called CultureRx. The concept is widely reported as being originally piloted at Best Buy; employees were paid for results (output) rather than the number of hours worked.
Business basics, from management strategies to the traditional copy room, are changing. For example, standard office equipment (from fax machines to industrial strength copiers and printers) can become obsolete as work shifts to online and outsourced alternatives. Faxes can be sent and received online, and copying and printing can be outsourced online from anywhere to third parties such as Fed Ex Kinko’s. As adoption of these alternatives increase, the resulting shift in operations radically alters what a corporate office should look like and contain.
“Technology has freed workers from cubicles and employers from huge facility costs,” says Filip Tack, CEO at Nomadesk. “There is a complete surge in the Digital Nomad, [an] independent location worker who can be more productive outside of the corporate office and extremely effective in working remotely.”
“With Cloud computing quickly coming into the fold, companies don’t have to spend a hefty sum of money on custom solutions to enable a geographic spread in the workforce, and they can save tremendously on real estate,” he adds.
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