The future of workplace environments

Workplace environment illustration

With only half of UK employees believing that their workplace environments allow them to operate productively, and tech-driven flexible working practices on the rise, are the days of ‘the office’ numbered or can the communal workspace still play a key role in closing the nation’s productivity gap with other G7 nations? Experts and business leaders share their views…

In December 2016 the British Institute of Facilities Management, in conjunction with research partners Leesman and Sheffield Hallam University, published The Stoddart Review: The Workplace Advantage – the first study of its kind examining the role working environments play in UK productivity. The report’s sobering headline figure showed only 53 per cent of workers agree that their workplace allows them to work productively. At a time when Office for National Statistics figures place Britain’s productivity behind the other G7 nations by 18 per cent in GDP per hour worked, it would seem clear that the nature of the physical workplace will be a factor in closing the divide.

Writing in the report, economist Duncan Weldon highlights that an uplift in the nation’s productivity of one per cent would add almost £20bn to UK output, reducing government’s annual deficit by around £8bn, adding £250 a year to the average pay packet and increasing annual profits across the country by almost £3.5bn. “The productivity gap between the UK and other advanced economies will not be closed overnight,” he says. “But closing it is the best, most long-lasting way to increase national prosperity. Improving the physical workspace has a role to play.”

But in a technology-fuelled era when employees demand flexible working practices and many innovative companies favour co-working hubs over buying or leasing their own permanent office, are the days of the fixed office base numbered for many businesses anyway? Indeed, a 2013 study by the University of California found that office workers are interrupted as often as every three minutes by human and digital distractions and, once distracted, it can take a worker as long as 23 minutes to return to their original task. A 2016 study by Auckland University of Technology commented that “distraction caused by overhearing irrelevant conversations is a major issue in office environments”. Would businesses be better off ditching the office model altogether?

Monica Parker, behaviourist and founder of organisational change consultancy Hatch, whose clients include Microsoft, Deloitte and the BBC, thinks not. “People always need a place to come together, and while coffee shops are great, people still like to have a place they can call a work home. I don’t think work has left the building – there is still that communal driver,” she told Director. Her view is backed by a Hatch survey of 40,000 global workers, 75 per cent of whom said they believe collaboration drives innovation, while a lesser 52 per cent felt private contemplation was a key factor to innovation in business . The balance, it seems, is still tipped towards being together. “If you haven’t sorted that property element, I’m sorry to say you’re behind the curve,” she adds. “It’s about people and how the giant lever that is property can drive their engagement, retention and higher performance.”

The problem facing many businesses, says futurist Will Higham, is that their office set-up today is barely discernible from the very first one built almost 300 years ago: “The Admiralty in London [completed in 1726, now 26 Whitehall], was the first purpose-built office building in Britain,” he says. “If you transported a businessperson from that time to today and put them into an office, they would be confused by the computers but they would be pretty familiar with everything else – the layout, where the boardroom is and so on. That can’t be right. So many other aspects of our lives have evolved, around technology, around our attitudes to life, and yet the office has not really advanced. We’re coming to a stage where that’s now a barrier to motivation, to engagement, to productivity, and ultimately to profit.”

Sky Central workplace environments

Sky Central’s state-of-the-art workspace

The imitation game

A Gallup survey from 2015 would seem to reinforce his view, with 70 per cent of office workers admitting to being disengaged and uninspired. So, if many firms are getting the workplace wrong, who’s getting it right? Jobs website Glassdoor ranks businesses with more than 1,000 employees based on feedback from staff over the previous year, and its no surprise to find its 2016 top 20 including names such as Expedia, Unilever, American Express and that perennial absorber of column inches on eye-catching workplaces, Google.

But, says Parker, other firms looking to create a work environment that invigorates their people should resist the temptation to simply replicate what they see elsewhere. “Please do not put a slide in your workplace!” she says. “What Google has done a good job of is identifying its core user and creating a work environment for that person. That person is not the person of every other business. In fact, I find that Google work environments would not be the right fit for many other businesses – they want people to stay in the space as much as possible, and to have every feasible need met by that space.”

Neil Usher, workplace director at Sky – which in 2016 opened Sky Central, the new 37,000sqm nerve centre for 3,500 workers at its west London campus – echoes Parker’s caution on imitation. “Mimicry can be a bit awkward and expensive, especially where fads are concerned,” he told The Stoddart Review. “By all means consider the approach, methodology and thought processes adopted by others, but not necessarily the outcome. The design may then last longer than the initial two-second dopamine rush you get from seeing a climbing wall in the corner.”

So where to start? “The key to the best work environments that drive the highest performance is that they are evidence based,” says Parker. “This means that the process by which the design occurs engages the users and the outcome is iterative – you don’t ‘set it and forget it’, you get an outcome and you continually test and ensure it’s flexible enough that it can change with the continually changing needs of that workforce.” She advises breaking this process into three areas: an assessment of facilities, the way space is actually used every day and staff satisfaction with it; an examination of behaviour and the organisation’s propensity towards collaboration versus individual contemplation in driving innovation; and, finally, a consideration of balance and wellbeing – including whether workers feel they have support, for both their physical and mental health, from their employer.

“The easy bit, the one that’s most quantifiable and isn’t as squishy or, quite frankly, scary is the facilities piece, and too many businesses stop there,” says Parker. “A leader might say, ‘I know what my [space] utilisation is and I know they don’t like desk sharing, so now I’m going to change that.’ And they change it and then wonder why they still don’t have a happier, better-performing workforce or retain more people. The scary bit for most people is getting into that human bit, but that’s where the opportunity exists.” Focusing only on office facilities can also lead to organisations putting the wrong person in control, she says: “It will tend to fall to somebody who has a job title such as head of facilities or office manager – but really you should see this as a direct responsibility of the C-suite, the people kept awake at night thinking, ‘How do I get my people to be the highest performing?’”

A treehouse in the Moneypenny office to illustrate workplace environments

Moneypenny took into account employee views

Employee influence

One company to have taken this holistic, people-focused approach to reinventing its workplace is Moneypenny, a provider of outsourced telephony services based in Wrexham, north Wales. When the firm looked to bring together staff spread across different locations onto one site and add space for an expanding workforce, founders Ed Reeves and Rachel Clacher decided to survey all 500 employees and ask what their ideal office would be like. The result, a new purpose-built 91,000sqft complex on the edge of the town, inspired the Mirror to pose the headline question: “The most perfect office building ever?”

But while the village-style pub, sun terrace and treehouse meeting room got top billing, there is much more to the development than its quirkier features. From walkways and eating areas designed to encourage socialising, to desk lighting each employee can control separately, natural ventilation for every workstation, subsidised healthy food, sound-absorbing surfaces, rainwater recycling for non-drinking water, an orchard, picnic tables, the best window views reserved for staff rather than management and an endless list of other staff-designed features, every aspect comes back to the wellbeing and happiness of employees.

“We felt very strongly that everybody likes to influence their own destiny,” Reeves told Director. “And our staff know from experience that when we ask them, they are able to influence. If you just pay lip service to people they will see through it straight away – but if you get people to shape the workplace, they’ll buy into the end result. I sent out emails to everyone and invited feedback directly to me and I held a series of lunchtime meetings where people would come, eat their lunch and dump their ideas on me one to one. And then, through the entire build, I kept a regular communiqué with everyone, saying, ‘This is what we’re doing… you said you wanted natural ventilation, that’s what we’re building in.’ We even sent out our brief for the architects to everyone and said, ‘Do you agree with it?’ People value seeing progress happening from their input.”

It would be natural to assume such tailoring to staff requirements would come at a higher cost but, says Reeves, the investment stayed within Moneypenny’s strict £15m budget and cost the same as the company would have paid to occupy a building in the town centre instead. But what of the results? “It’s a reality – productivity has improved,” he says. “And in the time since we’ve opened the building we’ve had over 1,000 applicants for new positions – we haven’t been advertising and we can cherry pick the very best people. Staff churn – which wasn’t high anyway – has now gone completely. In terms of the value of that building and the value of Moneypenny’s ethos, it’s paid off many times over.”

Looking to the future

While some forward-thinking companies are engaging with staff to create more productive workplace environments, others are casting the net wider. When cloud-based communications company Fuze embarked on a refurbishment of its head office in Reading, a 7,500sqft space for 70 employees, it conducted research with 5,000 young people across Britain and Europe – half aged between 15 and 18 – to learn what the ‘app generation’ expects from office space and its equipment. With 72 per cent saying the latest tech is a must, the company placed an emphasis on state-of-the-art equipment to help it attract talent.

Higham agrees that staying in touch with wider social trends should form a pillar of any reassessment of a workplace, to ensure it is fit for the future and – while he echoes Parker and Usher over the perils of imitating others – he urges business leaders to reach outside of their companies to glean other perspectives. “Every employee today wants a little bit more autonomy, a bit more flexibility, a bit more freedom,” he says. “But the delivery of that will differ by sector – some approaches will work better in some industries than others. Read about what other people have done, visit other businesses if you can, bring in academics to find out what motivates people environmentally and so on. Because this stuff really matters – the space that you work in is hugely important to the productivity of your organisation.”

One such recent examination of wider trends has revealed that tech-driven practices, including flexible working and hot-desking – disruptive developments once seen as heralding the death knell of the office as we then knew it – may be decreasing in popularity. The What Workers Want study, published last summer by the British Council for Offices, found that 28 per cent of employees would like to work from home, down from 45 per cent in 2013. Hot-desking, meanwhile, was a preferred choice for only four per cent of people, with 60 per cent preferring a dedicated desk, up from 41 per cent three years previously. The fixed workplace, it seems, is here to stay for the foreseeable future – how productive a place that becomes, however, is up to you.

Watch Monica Parker discuss the impact of workplace environments

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About author

Chris Maxwell

Chris Maxwell

Director’s editor spent nine years interviewing TV and film stars for Sky before joining the IoD in 2011 and turning the microphone on Britain’s business leaders. Since then he’s grilled everyone from Boris to Branson and, away from work, maintains an unhealthy obsession with lower league football.

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