A CRE Leader’s Ultimate Guide to Workplace Planning

Can you turn workplace planning into a competitive advantage?

Workplace planning has always been a lever for competitive advantage. But employee expectations of their workplaces have changed dramatically and your workplace strategy must respond. 

There is both an essential need here - to respond to a paradigm shift in workforce behaviours, expectations and patterns, but there is also great opportunity. How you respond may be the difference between gaining a significant advantage and dealing a detrimental blow to your company's bottom line by not supporting a changed way of working. 

What might this look like?

Need:  An engaging, collaborative workplace where employees are supported in their different ways of working 

Opportunity: A purpose-driven workplace with spaces specifically designed for work best done together which will inspire innovation, learning and improve client outcomes. 

A workplace strategy should translate into business advantage. But with so much to consider and without hard data to inform your decisions, it can seem easier to take a ‘wait and see’ approach. 

By engaging in a workplace strategy, you can define how your real estate footprint will support your business requirements, explore employee wants and needs and plan for your future business vision – using data to back up your hypotheses and a formalised workplace strategy to bring it to life. 

More hybrid workplaces

The utility has evolved significantly. While remote work was trending upwards pre-2020, the pandemic accelerated it. With a mix of office and remote work, the new norm for office workers, a now commonly-accepted and widely permanent hybrid working model needs to be better supported by the physical workplace. 

Flexibility is critical

As flexible working has become more prevalent, so has the need for a more flexible workplace. A flexible workplace empowers staff to choose where and when they work (e.g. agile working) and ensures the workplace itself is flexible to a scaling headcount. 

Destination Workplaces

The old office where employees come to do everything from returning emails and admin to deep, focused work is gone. The past couple of years have shown us that lots of work can be done efficiently and productively from home. It's also clarified that some work is done much more effectively in a face-to-face, collaborative setting like workshopping ideas and getting to know a new colleague. 

The new office is a destination that invites people to come in for a specific purpose and is designed to support this. For some businesses, this will look like building connection or collaboration hubs, and will potentially move away from having one CBD location, to having localised hubs that enable more accessible collaboration. 

Health, Safety and Wellness Focus

What was once a competitive advantage and more thought of as an EVP value-add, has now become a mandatory feature of any workplace. Wellness initiatives have now expanded to include contactless technology and on site density awareness and sensitivities to how employees feel in highly populated work areas. Additionally, more than ever before, we are now aware of how anxiety and stress have a measurable impact on commercial performance and that workplace has a role to play in this realm. According to Gartner, organisations have increased their wellness initiatives, in an effort to support mental and emotional wellbeing. 

There are many ways to create a productive, vibrant and exciting workplace, and you may already have a vision of the direction you want to go, but what you need is the data to support your hypothesis and drive you in the right direction. 

“Data will help you to understand the ‘complexities,” says Xenofontos. "It will inform you on who is using space and how they are using it." 

Workplace data will allow you to make informed real estate and space management decisions - to pull the right levers and enable you to strategically plan for a safe workplace, maximise usable space, and minimise costs. 

The data mix 

There isn’t a single data point which is going to give you all the information you need. Xenofontos says, "You can't just isolate one section of data because it'll give you a sliver of insight, but not the whole picture." 

1. Incorporate past, present and future measures
To look to the future of work, you must first understand where you've been and where you're at now. Historical data around office size, lease terms, utilisation, headcount and running costs will help you paint a picture and create a foundation to work from. And work pattern studies, cross-section company workshops, interviews with employees and occupation studies will give you a snapshot of what’s happening at the moment. But don't rely on the past and the present for a full and accurate picture; also include forward-looking, anticipatory, predictive measures. 

2. Continuous, real-time data collection
While historical data is great and snapshot data like an occupancy study is helpful, accessible, real-time, ‘as it’s happening’ data is key to making quick adjustments and picking up trends as they happen. This data could come from desk check in systems, secure access points or from sensors throughout your space. 

3. Data that supports strategic aims and objectives
As with most things, the data you're collecting needs to be aligned with the broader goals of your business. For example, perhaps your company wants to improve ESG reporting to attract better investors or improve bottom line performance. What role does the workplace play in supporting a better ESG position? It could look like moving to a place with more public transport, a flexible approach to people working in the office (less driving) and choosing to use natural materials instead of plastics. From here decide on the measures you need to be watching to report on these things: this is the data you’ll want to be collecting. Note: Include data that encompasses a range of financial and non-financial measures. 

The physical workplace isn't going anywhere. However, its purpose has shifted as the needs of employers and employees have transformed. The workplace remains an important place for collaboration, teamwork and culture-building to occur. But recent research has found that globally the overall corporate footprint is expected to be smaller two years from now for 54% of the companies surveyed. On the flip side, 18% said their footprint would be increasing, and the remainder has said they forecast neither an increase nor decrease over the coming years. 

So whether you're accommodating for growth, downsizing thanks to a change in circumstance, or simply changing the workplace mix to reflect new ways of working - real estate rationalisation is probably on your agenda. 

Xenofontos says, “what that rationalisation looks like will boil down to the purpose of the workplace.” 

She also mentions that growth plans don't always mean an increase in square meterage: "Many companies are planning to grow without physically needing growth in the office environment. Some organisations are growing offshore, or they're growing by automating certain functions, leaving the opportunity for onshore positions to be more creative and fulfilling." 

There are a few different ways to rationalise your real estate commitment while still accommodating for future growth. Let's explore the different approaches. 

Initiating a sale-and-leaseback transaction

A sale-and-leaseback transaction is when the owner and occupier of a commercial building sells it but remains a tenant. This might be an entire building or a floor in a building. 

Some advantages include: 

1. Reduce debt while keeping possession and practical control of the property without tying up finances. 
2. The potential to benefit from tax considerations. 
3. Reduce risk by exiting the real estate market. 

It's not all good news, though; there are cons to this type of transaction, including: 

• At the end of the lease, you will no longer have interest in the property or the right to receive any appreciation in the property's value. 
• You may be obligated to pay higher-than-fair-market rent if the commercial rental market depreciates, particularly if you’ve entered into an extended rental agreement for a contractual amount. 

The way we work is evolving and outside forces have amplified many of our ways of working over the last three years. It’s never been more important to know your workplace planning options, have access to the data and analytics to back up your hypotheses and create a workplace which fosters productivity and aligns with your business’ strategy. 

You can measure the effectiveness of your workplace's design and its impact on your people through our wrkx Thrive Index™ metric. Visit this link for more information and book a consultation.