The job was difficult enough when most employees worked in the office every day. The number of desks occupied at any given time was a key measure of real estate ROI. Today, in your agile work environment, space utilization fluctuates on a daily basis. Many employees work from home several days a week, but not always at the same times. Consultants and contractors are constantly coming and going to supplement the full-time workforce.
On top of all this, your executive team continues to stress the importance of becoming a world-class workplace with an exceptional employee experience. Your goals are no longer only centered around minimizing costs and maximizing profitability. You now need to balance that with maintaining comfortable, inspiring workplaces that are well-stocked with all the modern amenities today’s employees have come to expect.
These are complex challenges, but they all start by answering basic questions about space utilization.
Proper space utilization is one of the best opportunities workplace leaders have to control costs.
Research shows the majority of organizations have average space utilization rates of 60%-70%, according to a 2018 space utilization benchmarking report by JLL.
The physical space is also one of the three most important components that make up the employee experience, along with your technology and culture, according to Jacob Morgan, a leading researcher and author of The Employee Experience Advantage.
Your office design and how the space is used influences the kinds of interactions employees have throughout their day.
JLL Managing Director Ed Nolan calls these “accidental collisions.” In a recent WorkDesign article, he explains why they are so important:
This pays off in a big way. Jacob Morgan’s research found companies that invest heavily in the employee experience are four times as profitable as those that don’t. In other words, your space is the foundation of your workplace experience, and the way employees use it really matters.
If there are many physical barriers, employees are less likely to have casual conversations and impromptu collaboration—the kinds of encounters that can lead to breakthrough innovations. On the other hand, an entirely open concept office can stifle collaboration and productivity. When employees don’t have the quiet space and privacy they need to focus on deep work, they’ll either shut out their surroundings with headphones or avoid your office altogether.
JLL Offices of Indianapolis
- Photo courtesy of Office Snapshots
ex. 100 desks available
ex. 60 desks occupied
60% occupancy rate
For instance, it doesn’t account for the fact that most organizations allow employees to work remotely at least part of the time. Or the fact that more than half of global enterprises have moved away from assigned seats in favor of a more agile workplace.
It also ignores the reality that office space utilization varies from one industry to the next. The way a large financial institution uses its space may be vastly different than a creative agency. The new space utilization metrics you need to measure go beyond occupancy and vacancy.
However, space occupancy is still an important foundation.
Other space utilization metrics you choose to measuret may vary depending on what you want to achieve. For instance,
Minimize real estate costs......................Real estate costs per employee
Improve collaboration..............................Conference room utilization
Improve operations...................................Peak occupancy/vacancy rates
Enable agile working.................................Employee-to-desk ratios
Plan for future growth.............................Space Utilization by department
Tracking these metrics has the potential to save hundreds of thousands of dollars, depending on your real estate portfolio.
With many of its salespeople on the road instead of at their desks, one global organization wanted to see exactly how its work stations were being used. The company used VergeSense sensors to study usage patterns and discovered almost half of its spaces weren’t in use at any given time. To improve space utilization, the company moved from a fully assigned arrangement to one where work stations were free addressed, with a 1.25 to 1 seat allocation.
Troutman Sanders Offices of Atlanta - Photo courtesy of Office Snapshots
Troutman Sanders is a fast-growing law firm that now has more than 1,100 attorneys in 23 offices. When the company built its new headquarters, it was 100,000 square feet smaller than the previous building. Looking at past space utilization, the firm’s leaders decided it didn’t need as many private offices, and it didn’t need different sizes for partners versus associates. It opted for a more open concept with uniformly-sized private offices around the perimeter so the smaller space would serve their needs, no matter who was in the office. It also standardized the office furniture.
An example of phone booths to better utilize space.
- Photo courtesy of Office Snapshots
Having the right mix of collaborative and private spaces is critical to a great employee experience. Yet the conference rooms most organizations have available aren’t meeting the needs of their employees. With the goal of improving conference room utilization, a global organization used sensors to study usage patterns. It discovered 75 percent of conference room usage was for single-person meetings.
What employees really needed wasn’t more conference room space, but more privacy.
The company introduced phone booths to address this, which improved space utilization and resulted in considerable improvement to the employee experience.
There are many ways to track space utilization, depending on your data needs and your existing technology. It’s OK to start small and expand upon your space utilization strategy later.
For instance, you may only need to gather historical data at first, but as you add more employees, it becomes necessary for them to share desks. You might also find you need to improve conference room utilization because the majority of rooms appear to be booked, when in actuality half of them are sitting empty.
Real-time space utilization data becomes more important. Here’s a closer look at the most common space utilization methods.
Using ID badge systems are a common way to ensure workplace security. Badge data systems can be set up to track entry only, entry and exit, entry into secure areas or entry onto specific floors. You can use this data to identify space utilization trends.
Passive infrared (PIR) sensors detect body heat and movement around a certain parameter and can trigger an alert when someone passes the threshold. They are small, battery-powered sensors that can be affixed to seats or desks and are among the most common types of IoT sensors on the market. Examples include Relogix, CoWorkr, OccupEye and GE Current, a Daintree company.
When IoT sensors are connected to space management software, you can interact with space utilization data like never before. You can see real-time and historical occupancy data right within your digital floor plans, from a single platform.
It also integrates with mobile workplace apps employees can use to find people and places, reserve rooms, request service and receive mail or visitors.