Long-term leases, that have been the foundation of the commercial office market for decades, are gradually losing its advantageous position. This option might make sense for companies who do not plan to hire more staff or launch new products or expand their operations in at least a decade. Unfortunately, the pool of companies that fit the criteria is very few.
With the motive to change, grow and innovate, companies are moving in favour of flexible business goals that may change every year, or even more often. Subsequently, they are flocking toward workspace solutions that are as flexible as they are. The need for workspace options that can evolve and adapt to their occupants is driving the rise of both co-working and flexible office space.
The Shifting Focus
According to GCUC 2019, there are over 35,000 flexible workspaces in the world, representing 521 million square feet of flexible space. Moreover, the global market value of flexible workspaces is estimated at around $26 billion, according to COLATAM 2019, the co-working conference in Latin America.
As we see a global shift towards easily adaptive and innovative workspace solutions, the office space requirements of companies are drastically changing. Considering the ongoing crisis, reducing capital expenditure cost has become the topmost priority for almost every organisation; hence, implementing flexibility in real estate is essential. While the pandemic has accelerated the shift to remote working, a lot of organisations are adopting a hub-and-spoke structure considering safety and cost concerns.
Working away from the company headquarters does not necessarily mean working from home as there could be too many distractions at home that affect productivity. Flexible workspaces are the optimal solution for companies that wish to implement remote working policies. It provisions employees to work and collaborate at “spoke locations” with the benefit of not having to commute long distances across the city.
Due to the pandemic, people are more concerned than ever about hygiene and safety at public places and many may avoid using shared facilities. As a result, flexible workspaces are becoming popular. Many MNCs are turning to A/B teams’ model, whereby they divide their teams into smaller groups and assign them to work in multiple flexible workspaces to minimise costs and ensure employee safety.
The Current Exit Strategy Vs Optimal Strategy
According to Qdesq’s analysis of the current situation considering that there are 3 pillars of business – productivity, economics and employees and also, assuming that 30% of the workforce is going to the office and 70% working is working from home, a company saves 20% cost in WFH set up and 14% in office + WFH set up. However, what a company saves on operational expenditure in completely work from home set-up, it loses on control, productivity, innovation and employee retention.
The Qdesq’s market survey puts forward the optimal team categorisation whereby it suggests 60% of the workforce including sales team, growth team, innovation team, third party projects team, high communication projects and templatised work team should be shifted to flex offices; 25% workforce including leadership and management team and data sensitive team should be placed at strategic corporate office (SCO); and 15% workforce composing of lean teams, templatised work team, and senior colleagues (above 50 years) shall do productive remote working.
This optimal strategy would save approximately 20% across salary & monetary bonus, infrastructure & IT, employee welfare activities, office rent and also, result in enhanced productivity and low carbon footprint.
A flexible workspace set up offers numerous advantages – private, full-floor spaces customised to each company’s unique needs and working styles, data sensitivity, productivity enhancement, emotional and mental stability, sanitisation and hygienic environment, and Hawthorne effect. Moreover, there is an advantage to scale Pan India across Tier 1 to Tier 4 cities.
Summing It All Up
In these challenging times and constantly changing circumstances, it is the delicate balance between ever-evolving workspaces and increasing push towards compliance that ensure transparency and credibility. The concept of office as a static space is changing as remote and flexible working becomes a new normal. Undoubtedly, the future of work is part of an evolutionary process that aims to make us more creative, more efficient, and more connected.