PROPERTY JOURNAL

How workplace design impacts performance

Tech giants have changed the way modern working environments are designed but other sectors are now following their lead

Author: Mike Gedye

16 May 2020

When Silicon Valley's tech giants decided around ten years ago to stop allowing employees to work from home, it not only triggered the realisation that effective workplace design could be a catalyst for growth and collaboration, but also marked a significant shift towards user-centred design. This was a break from a decade of workplace practices that had targeted efficiency, globalisation and standardisation, to the detriment of productivity, user experience and personalisation.

The quiet revolution in workplace design began with the aim of engaging young tech talent in the working environment. It encouraged the use of multiple work settings and introduced so-called third spaces, outside more traditional desks and meeting rooms, to enable the serendipitous collisions between colleagues associated with more collaborative cultures.

A smaller number of property developers also identified that people who enjoy the environment in which they work were more productive and loyal, and those companies started to design workspaces with this in mind. As a result, new placemaking schemes that promoted enjoying rather than dreading work have shaped their entire asset management philosophy around supporting and engaging individuals, helping their tenants attract and retain more productive and engaged employees.

Critics would argue that the big tech companies were designing environments that captivated their employees to the point where they never wanted to leave. Offering free food, table football, gymnasiums and domestic features encouraged homing from work and seemed to remove the need ever to work from home. More positively, however, by exploring more organic and biophilic design concepts that brought the outside into the office, they also introduced, perhaps by luck more than design, the formative principles of more healthful offices and well-being at work.

Gimmicks or meaningful change?

They say that imitation is the sincerest form of flattery, and as the war for talent intensified, so the use of gimmicks escalated exponentially. Slides and swings, free beer and pizza, basketball courts, pets at work and more were all on offer as tech companies fought to attract and retain the best talent from a limited pool.

Outside the tech sector the adoption of these new workplace trends was challenging. Beyond more conservative corporate cultures which come with branding limitations and a cost-conscious mindset, there were other notable barriers. These included more limited capital budgets, significant legacy estates that made retrofitting impractical, increasing scrutiny of evidence for a positive return from all investment decisions, and an intolerance of failure or risk-taking, which for tech companies are essential to innovation. Then there are the added burdens of compliance and regulation, notable in the banking and life-sciences sectors in particular.

However, progressive organisations have always managed to separate gimmicks from more worthwhile innovation, and in some cases have refined the tech sector's modernisations. Australia's banking sector, for instance, has for many years pushed boundaries in design from the adoption of internal staircases to encourage connectivity to offering concierge-grade user experiences ,such as IT support hubs and dry-cleaning services, high-quality services and amenities, and sustainability measures. Professional services companies globally have also led the way in adopting unassigned seating and more agile working practices, as well as digitally enabling workplaces  something surprisingly overlooked by many tech companies.

"The quiet revolution in workplace design began with the aim of engaging young tech talent in the working environment"
Flexible spaces

Another more recent motivation for change has been the exponential growth of the co-working sector that, in targeting both tech start-ups and the flexible needs of large more mature organisations, has further pushed the boundaries in workplace design, building on many of the principles championed by the tech giants. Co-working offers a combined model in which space and amenities are a service, promising the mobile workforce access to ready-made communities and networks.

As with earlier tech-led innovations, the market has been quick to spot the emerging trends and identify the innovation, and in some cases improve product quality, acoustics and user experience. The underlying culture of innovation and a continued war for talent which now extends far beyond the tech sector as digitisation has taken hold more widely  has ensured the continued evolution of workplace trends. It is notable that the tech giants that led the initial disruption of the traditional workplace are themselves maturing and looking beyond gimmicks and physical accoutrements to shape their workplace strategies.

Key reasons for doing so include the reinforcement of corporate purpose and culture, and the search for greater productivity and workforce well-being  ultimately to optimise performance. There is a growing recognition that, with more of the workforce preferring contingent working or portfolio careers, a workplace can significantly influence an emotional response to a company. This increases engagement and drives greater loyalty to an employer, and is underpinned by the idea that physical amenities such as comfort, light and views are more preferable than service-driven amenities such as yoga classes and bike repair services

"The tech giants that led the initial disruption of the traditional workplace are themselves maturing and looking beyond gimmicks"

We have seen technology companies rapidly develop their workplace provision from generic employee workstations to more agile, personalised and service-rich environments. Some have moved to the next level where the employee is seen as a corporate athlete, and the focus is on providing high-performance environments supporting their health, well-being and cognitive output.

So whats next for the workplace and what are the signs from the tech sector?

  • Innovation and collaboration

    This will become increasingly open and transparent. A workplace with sharing co-creation and knowledge transfer the so-called office collaboratory will form the bedrock of modern design principles from both a physical and digital perspective.

  • Authentic purpose-driven design

    There is a growing sense that climate recovery and the built environments carbon emissions will dominate future workplace design. Coupled with social responsibility and the need for more inclusive community-led initiatives this means we can anticipate more accessible workplaces that promote purpose as much as profit.

  • Hi tech hi touch

    Mixed-use adaptable and multi-functional spaces will become more commonplace supporting traditional work but also providing leisure learning demonstration and community-oriented spaces enabled by an increasingly intelligent digital infrastructure. Technology will allow a far more personalised experience resulting in environments that promote well-being as much as productivity to optimise human performance and engagement.

  • Communities and placemaking

    With work becoming more of a balance between what you do and where you go locating workplaces in dynamic communities that offer access to talent research and development potential business partners entrepreneurial cultures investment capital and services and amenities will be critical for the next decade and beyond.

While the tech sector has undoubtedly been the workplace pioneer, by 2030 we may see other industries begin to challenge this, particularly consumer-facing brands which will have to take a lead on the climate agenda and more purpose-driven design. Change is inevitable and those who look only to the past or the present are certain to miss the future.

Mike Gedye is an executive director in the advisory and transaction services team at CBRE mike.gedye@cbre.com

Related competencies include: Business alignment

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