Facilities Embrace Flexspace As A Way To Dramatically Reduce Costs ­

by Elizabeth Dukes on March 11, 2018

Companies today are faced with the mounting pressure of fulfilling their customers’ needs, while reducing their overhead costs. We are a part of a highly competitive environment in which those who don’t consistently embrace change will be forced out by those that will. With physical assets ranked one of their highest costs, organizations are seeking out innovative solutions to reinvent their workspace into one that is both inspiring and cost-saving. Technological advancements such as the cloud, mobile apps, smart phones and tablets are now providing companies with the right tools they need to become industry leaders.

What Is Changing?

Until recently, most of a company’s physical space was designed around the earlier generation’s needs. One where each employee had their own space, came to work every day and remained at their desk for the full workday. With multiple generations now working together in one space, companies must re-invent their space to meet everyone’s needs. This includes supporting mobility—something organizations were never faced with until now.

This expanding mobility has resulted in a new dilemma for companies—empty, unused space. This empty space is not only costly, it alienates the workers from each other, hindering productivity and imagination. Organizations are now recognizing the powerful impact a facility’s spatial assets can have on every aspect of the company, causing them to look at their physical location as more of a tool than just a place to go to work. It has been proven that when an employee is content, they are inspired to work harder. Turnover is reduced, resulting in lower costs for the company. But with four generations comprising our workforce today, facility managers are tasked with determining how to combine all the various generational needs into one functioning workspace. The answer, for many, is an innovative approach called “flexspace”.

What Is Flexspace?

Flexspace is a term coined by the corporation Sabre Holdings. A flexible or shared workspace is a concept developed years ago for corporations whose employees were primarily on the road. Coined “hoteling”, these companies were able to cut down on real estate costs by providing their employees with a generic desk for those times when they needed to be in the office. These desks were shared by the entire team on an as-needed basis. Sabre Holdings sought to discover how the hoteling concept would work in a setting where only some of the employees were on the road. “Sabre’s goal was to create a system that would recapture the real estate value lost on all of the days employees’ desks sat empty and to begin shifting to the concept that ‘work is something you do, not someplace you go’”.

Through careful analysis of their space utilization, this corporation was able to re-design their workspace into one, open floor plan in which even the CEO sits. Employees have the flexibility of moving around and are encouraged to collaborate with each other around the office. The results were astounding.

“By shifting to an alternative, flexible space model where only a percentage of cubicles were assigned and others remained available for “flexible use”, Sabre was able to achieve significant savings within 18-months, reducing global real estate costs by 25 percent and ultimately create a sustainable enterprise transformation for value beyond the bottom line”. The entire work culture changed, strengthening Sabre and positioning them as a leader in their industry.

What Are The Benefits?

Through the implementation of flexspace, many companies have been able to condense their real estate needs, while still meeting each individual’s spatial demands. Implementation of collaborative spaces sparks conversation and leads to innovative ideas. So businesses are seeing a reduction in overhead costs, as well as turnover numbers. While these numbers are decreasing, employee contentment and productivity is on the rise, affording companies a competitive edge over their counterparts.

Aside from the obvious real estate savings, companies and their employees face savings in several other aspects of their operations. “Based on an estimate that roughly 45 percent of US employees work remotely at least part of the time—and projections from this number that 50 million people could work at home by 2018—one study concluded that by then, businesses could achieve an annual combined savings of USD170 billion in real estate and related costs.” Businesses face savings as high as $11,000 per person per year. And that does not include employee savings, which range from $2,000 to $7,000 per year! Companies are helping their workers do their “part” ecologically by cutting down on the environmental costs associated with their commute. Furthermore, decreasing their physical space allows companies to decrease their environmental footprint, resulting in a dramatic reduction in energy and gas costs.

Careful planning through the use of relevant data regarding the functions of the company is critical for any organization considering flexspace. Since a project of this magnitude stands to affect every member of your company’s team, an open line of communication regarding expectations and progress must be kept at all times. Maintaining flexibility and an open mind is also vital, as your flexspace program is sure to evolve as your company evolves. With mobility on the rise and showing no signs of slowing down, innovative approaches such as these are necessary for companies to seek out their competition. Whether yours is a small business or a global corporation, the benefit behind flexspacing is undeniable. A space management software plays an important role to help achieve this.

Editor’s Note: This blog post was originally published in May 2014 and has been updated for accuracy and relevance


Elizabeth Dukes

Elizabeth Dukes' pieces highlight the valuable role of the real estate and facility managers play in their organizations. Prior to iOFFICE, Elizabeth was in sales for large facility and office service outsourcing firm.

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