The corporate real estate industry will be transformed by the pandemic. In What is the Difference Between an Office and a Coffin? I wrote that “The process of producing a typical office is unlike any other production environment and one that I believe is now seriously out of touch with the reality that we are facing. The future of work is changing and so is the office that is needed to support it and the needs of its users. However, the fundamentals of how the average office is conceived, designed, built, and who is considered the customer remain unaltered. This process contains tectonic fault lines that have the potential to undermine the whole industry”. The reality that the corporate real estate industry needs to face is that it is based on an outdated product that is now facing an emboldened and empowered customer that desperately wants services and amenities.
The world has changed and so should the modern workplace. There are many things to consider, but one of them is that a revolution is underway that will completely transform not only the CRE industry but the roles and players that traditionally have been slow to change.
More companies had been adapting to remote working before the pandemic and many people were working less than five days a week in the office. However, that changed when the pandemic swept across the globe. Where we were all confined to our homes due to national lockdowns. With the waning of the virus and our need to reconnect, the common trend is now to return to the office mixed with some kind of hybrid working environment where some employees are in the office and some are not.
However, this is not an iteration of the previous trend or evolution, it is a fundamental shift in how we work and conduct business. New technology is powering this revolution which is generally regarded as an opportunity for individuals to take on additional responsibilities or have more flexibility over their time.
For many companies, there had been talk about remote working, before the pandemic but sadly our infrastructure in Africa slowed the uptake in all but the most advanced organisations typically within the financial services sector.
This slow uptake was fuelled by a national affliction for a command and control type management ethos where inept middle managers take the view that if you are not at your desk you’re not working!
This has all changed over the last two years when we had to set up camp in our dining room, bedroom or set a corner aside in our bachelor flat. Where ever we laid our laptop was our office. In most respects, we were deployed in the same location and were generally easily contactable. It was relatively easy to function “remotely” because we have just swapped one fixed location for another.
This will not be the same when we return to the office, many of us will not be working from home but working remotely from a third location and so consequently our whereabouts may not be known. This is likely to send shivers through the corridors of power and will be met with varying degrees of resistance.
You’ll have to find the individual at their home, a coffee shop, a local flex space, a hotel or a client’s office or wherever they are when we return. This cannot happen without major disruptive change and this will likely cause mayhem and chaos.
When we all work the same way in an office, it’s bearable. But have you considered what happens to that type of schedule when it is no longer the norm? These are consequences that we will all need to face.
The revolution will involve the need to change how we operate, both individually and as companies. We’ll have to decide when it is best to be in the office and figure out who will induct and mentor new employees. When it comes to working culture, people used to learn through tacit knowledge which comes from just being around, but with distance and the lack of trust that has ensued, this will need rethinking.
To be an office-centric company while not having an office is going to give us the worst of all possible worlds. No serendipitous meetings, no water cooler meetings, no overhearing valuable information. During the pandemic, it was fine because we knew where everyone was and could get hold of them immediately. Even if this meant longer days, no separation of work and personal time, that’s what we did.
The peculiar downside was that we scheduled everything. I had several occasions during lockdown where somebody sent me an email to see if they could schedule a phone call. Whatever happened to picking up the phone and calling somebody? This desire to schedule everything is partly what led to our longer and longer days with endless Zoom meetings which could easily have been dealt with around the water cooler or a five-minute phone call. The prevalence of headphones in the noisy open-plan office has led us to a culture where we can’t act synchronously to disturb people for a few minutes; tap them on their shoulder, talk too loudly, or ruin their concentration while they were typing out their thoughts.
One of the major negatives to the post-pandemic hybrid workplace is its impact on office workflow. To prepare for this, companies need to rethink their workflows and find more efficient ways of working. If one thinks further afield then the effects on city centre businesses built around the lunchtime break from the office as well as public transport will also face tectonic changes in the way they operate.
It is important to take into consideration the needs of the employees when setting about the reconfiguration of the office. This does not require a Google size budget with sleep pods, ball pits and slides but it will require a detailed understanding of how employees’ work has changed and an understanding of where and when work is carried out.
In the retail sector, we are used to being courted with the retail experience. This is now a pre-requisite for our employees in the workplace as well. Without understanding their needs and a deliberate design of the desired workplace experience, the future office will be an expensive failure.
Clayton Christensen in his book The Innovators Dilemma introduced us to the idea of the ‘Job To Be Done‘. Tony Ulwick has taken this idea further and codified it. This type of attention to detail in our understanding of individuals’ work activities and their functional, environmental and cultural dynamics that either hinder or enhance the work process will be critical.
Sadly the Internet is awash with pictures of what appear to be fantastic workplaces that are aesthetically pleasing but probably little better than a frat house or a detention centre.
At Workplacefundi we do a deep dive into the workplace experience to fully comprehend how the workplace (and their homes) helps or hinders employees.
Where we look at
This data is important, as you will be able to answer all your questions about who needs to be where and when and why. From this data, you will know what systems you need, or jobs that need to be done synchronously.
To think as a company that operates, or can operate, in the hybrid space, you need to get all of your data analysed for optimum productivity. This will allow you to have a better idea of what space and size your business needs. It may also lead to decisions about location preferences and terms.
“Space as a service”, where you only rent what you need and when you need it. Your needs might be the same 5 days a week or just 1 day a week. Your goal is to make your employees happy and productive so that they don’t have to think about where they work.
The way it’s been for decades is that the customer of developers isn’t the occupier, but the investment community. Buildings are funded by long-term investors and they want steady income streams. They don’t want risk, they want to buy a bond, and this is what the industry has delivered. Based on these results, the overall business model of the real estate industry will change.
The coming revolution from knowledge companies will be their ability to run away from their offices. This shift is a result of many office-based companies realizing that their office may not be crucial for productivity. It’s very likely that most organisations still want an office, but want is different than need.
With the development of modern technology, work can now be done in any location with an internet connection. Therefore, it’s no longer necessary to be located in a metropolitan area with expensive housing prices.
There is a reality that the real estate leasing industry does not seem to acknowledge. The pandemic post-apocalyptic realities for which people are preparing are not adequately considered in their spaces.
There is a circle that needs to be squared. We are not structurally prepared to meet the demands of the technology-driven customer. However, if we open our eyes and realize trends in the market will soon change, we can prepare for the impending revolution in the office technology industry.
With the evolution of automation and AI, we don’t need to be inmates of white-collar factories ( if indeed anyone wears collars anymore?). The employees want better jobs and will get them as more automation presents itself in our workplace.
The revolution will happen when we start going to the office again and we soon discover that this place is no longer fit for purpose.