Commercial Insights - Towards phase 3 of the great global workplace experiment

Lee Elliott, Head of Global Occupier Research, talks to Neil McLocklin , EMEA Head of Consulting, about the process and practicalities of transforming the workplace in the post-COVID -19 world.
Written By:
Lee Elliott, Knight Frank
6 minutes to read
Categories: Covid-19

Office occupation

We are now firmly in Phase 2 of the greatest global workplace experiment: the phase whereby some workers are returning to offices of reduced capacity while many others are continuing to work remotely. This diverse and distributed work style will have a greater influence on the longer-term re-imagining of the workplace than the enforced working from home seen during Phase 1.

As companies adapt and rework their policies for more flexible work styles, for many, the office will become a personal choice rather than a professional obligation. This has strong implications for the office of the future.

Firstly, it heightens the flight to quality office space that has been evident in major global markets for the last few years. The office must be a compelling proposition.

Secondly, that proposition is founded on the delivery of a strong and alluring workplace experience – supported by greater services and amenities. The office of the future is much more than just the physical environment it presents.

Thirdly, the creation, curation and sustenance of this more compelling workplace environment and experience will derive from a greater partnership between occupier and landlord. The former will act to retain staff. The latter will act to retain income.

"The future is about migrating from a ‘One Size Fits Nobody’ world, where the choice was limited to the office and occasional remote working, to a ‘Workplace as a Service’ offering that provides real choice"

Lee Elliott (LE): Neil, the workplace has been through some significant transformations in the decade since the Global Financial Crisis. Is the workplace transformation post-COVID-19 really any different?

Neil McLocklin (NM): The fundamental difference between the Great Financial Crisis and COVID-19 from a workplace transformation perspective is that in 2008 company clients and employees largely read about it, whilst in 2020 everybody has experienced it. This means that as well as the fundamental driver of cost-saving for many businesses (which took precedence post-GFC), workplace transformation is also driven by a deep desire from employees to see change.

LE: What lessons from COVID-19 do you think will be most influential in shaping the future transformation of the workplace?

NM: We have learnt that people are able to work effectively from home on a mass scale, and indeed this has brought productivity improvements and work-life balance benefits for many. But for others, it has also brought a sense of isolation and/or issues related to not having the appropriate space to work effectively from home. As we emerge from this crisis, we should not be asking whether people can work from home, but rather who should work from home and for how long. The debate will extend beyond distinctions of work and home too, as other options and workplace settings will become equally important. Just because a person does not have the physical space to work from home, why should they be precluded from enjoying the benefits of less commuting and a better work-life balance? We are already seeing clients developing strategies to explore how they could provide options for people to work closer to home (WC2H).

LE: What about the actual workplace itself?

NM: Within the workplace itself, we will also see a greater variety of spaces to cope with the changing wants and needs of the employees. This will be necessary to address the fundamental question – why should I invest in my commute? It will certainly not be to do e-mail or attend virtual meetings. Rather it will be to socialise, collaborate, learn and develop. The workplace will, therefore, evolve to bring significantly less focus on workstations and much more emphasis on a variety of work settings that facilitate these types of activity.

LE: What factors or features do you think are most likely to advance rapidly in the post-COVID-19 workplace?

NM: There are two drivers that will be turbo-charged in importance from their already high BC (Before COVID-19) status. These are wellbeing and sustainability. There is a sense globally and across society that these two issues are what people want governments and businesses to focus on as the change they want to see coming out of the pain and anxiety that they have endured due to the pandemic. This will result in a lot less travel, both commuting and business, more sustainable buildings and a focus on the physical, mental, spiritual and social needs of employees.

LE: How would you distinguish between the workplace BC (before COVID) and AC (after COVID)?

NM: The future is about migrating from a ‘One Size Fits Nobody’ world, where the choice was limited to the office and occasional remote working, to a
‘Workplace as a Service’ offering that provides real choice to staff and results in a more dispersed, localised, accessible and sustainable real estate platform.

LE: Finally, what practical steps can business and real estate leaders take to deliver effective workplace transformation?

NM: Businesses need to develop transformational programmes that leverage this desire for change and realise the benefits as quickly as possible. There are a number of specific elements to focus on.

First, profiling. It is essential to develop a much more customer-centric perspective view on your workforce. This means profiling based upon insight into how they are working and what their workplace preferences are.

Second, having profiled the business, create the scenarios that can underpin a workplace as a service strategy and integrate HR, ICT and Real Estate / Workplace functions in order to deliver against that strategy.

Third, it would be a mistake to conclude that because we have worked from home for a while that we do not need to manage the change. There will be multiple changes in terms of how we use and behave in the office, management style, team dynamics and collaboration and different people start working in different ways. Change management is an essential consideration.

Finally, once the business case for workplace transformation is approved the programme needs to be delivered and the benefits realised. This is likely to mean multiple buildings being impacted in different geographies as well as many work streams, whether workplace design and delivery, real estate disposition and/or acquisition, technology and change management. The economies of scale and delivery effectiveness of this at programme level rather than project level are undoubted. Designing and managing the programme accordingly will be critical to its success, driving its performance, managing the risk and integrating the component parts, whether within the business or externally. Crucially, the programme itself needs to be a process of continuous challenge and process improvement resulting in enhanced outcomes beyond the original business case aspirations and incorporating the changing needs of the business.

Dr. Lee Elliott
Partner, Global Head of
Occupier Research

Neil McLocklin
Head of Strategic
Consultancy EMEA