Organisations are under pressure like never before to drive down costs by increasing their workplace ‘static density’ – essentially the space per sq ft per workstation.
In many parts of Asia this has already reached a point where further reductions will impact productivity, performance and retention. Real estate firm CBRE, in its latest report titled ‘Space Utilization: The Next Frontier’ looked into how companies can use workplace density and utilisation data to drive efficiency and business performance.
Across the Asian region workplace static density has halved in certain Asian markets over the last decade. In Hong Kong, India and China, workplace space has shrunk from 100 sq ft per desk to between 50 sq ft and 60 sq ft per desk. This figure is nearly half that of Europe and the United States where density norms are around 150 sq ft to 200 sq ft per desk. In Australia and New Zealand standards remain more generous at around 90 sq ft to 150 sq ft per desk.
Low densities in the workplace imply reductions in shared collaborative and isolated work settings, and more generally cramped space – impacting teamwork, decision making and ability to focus.
CBRE said that it regards anything below 60 sq ft per desk as a clear productivity danger zone; reducing space below this level places staff productivity, performance and retention at risk. Tight desk space leads to lack of privacy, increase of noise and levels of distraction from neighbors, which negatively impacts employees, thus leading to decreased productivity. Even at between 60 sq ft and 100 sq ft per desk there are risks that not all aspects of work are fully supported, particularly knowledge-based work.
There are, however, alternatives that will allow firms to balance the pressures of cost and density.
Peter Andrew, Director of Workplace Strategy, CBRE Asia, said: “In order to drive space efficiency and business performance, we propose organizations to implement new and dynamic ways of working, including more focused and more collaborative settings that are easily accessible through enhanced employee mobility within the workplace. This will drive down costs per person by optimising the utilisation of work settings.”
More than simple ‘hot desking’ – where people share desks in a traditional open plan office- CBRE referred to this practice as Activity Based Working (ABW); allowing staff to work flexibly by choosing from a diversity of different places to work within the office rather than being assigned a fixed desk as the one primary place of work. ‘Dynamic density’ (space per person) therefore becomes a much more important metric than ‘static density’ (space per desk). Giving people choice enables them to work more productively.
Benchmarking Metrics Critical but Misuse a Risk
“Once workers are dynamic in the way that they use space, then it becomes quite straightforward to recapture underutilized space, generally referred to as ‘desk sharing’. However, poorly implemented desk sharing is a very real business risk created by those who are focused only on cost savings and have limited understanding of the impact on organisational performance.
“When executed well, this approach improves the real estate bottom line whilst enhancing overall employee productivity, performance and engagement, creating better quality work environments,” added Andrew.
Benchmarking metrics such as workplace density and space utilisation are becoming more critical in helping corporate occupiers make informed workplace and real estate decisions, and manage their real estate as a strategic asset, however, this needs to be approached in the right way.
Dr. Henry Chin, Head of Research, CBRE Asia Pacific, added: “CBRE has regularly observed businesses undertake utilisation studies, making misinformed decisions through poorly collected and interpreted data and undertaking strategies that are perceived to drive down costs – which often never eventuate – and in reality cause organisational chaos.
“A lack of understanding of this data may lead to companies increasing static and dynamic workplace density at the expense of productivity and the satisfaction of workers.
“Corporate occupiers must develop a complete understanding of how their people work, and what their organisational objectives and imperatives are. It is only by aligning these two fundamental perspectives that companies can implement a workplace strategy capable of achieving cost effective business transformation.”
