Welcome to this week’s blog. If you’d prefer to listen to an audio version, click here to listen.click here to listen.
In case you’ve been on another planet for the past year, the quick catch up is as follows. Having spent more or less a year working from home, both office workers and their employers have had cause to reflect on their future work model. In this new model, few people will work entirely remotely, and equally few will return to working 5-days per week in the office. Instead, most will adopt a more flexible schedule of intervening shades of grey, with workers spending their remote time on focussed tasks, and spending their office time on interactive, collaborate activities which support their culture. Does that sound about right?
There are two challenges to this. Firstly, hybrid working is not going to be the easy fix that some believe it might be; (I’ll write more on that subject in my next blog). Secondly, the concept of universally exciting, fun–filled days of camaraderie in the office is unlikely to materialise; partly due to the nature of our existing real estate, but mainly because far too many businesses have become stale, boring organisations, that wouldn’t know ‘exciting’ if it hit them between the eyes.
In this week’s blog I explore how work has become progressively more boring; how this has manifested in the workplace, and the steps that corporates and real estate investors will now need to take to entice employees away from their home office.
There are three vehicles through which office workers will return to the office over the coming months. The first is through direction, ‘You must come back, because we say so’. The second is through FOMO. ‘Of course you can work at home. But seeing as you weren’t in the office today, I gave this exciting new project to Amy’. The third is because people want to come back. ‘My workplace is much more exciting than my home office; so count me in.’ For many extraverts, who have been cursing WFH for the past year, the final reason is a no-brainer. For an equal number (perhaps introverts with long commutes) who might have counted the last year as a blessing, they could probably think of nothing worse. The minds of both groups are likely to be set and unlikely to be changed. However, it is the large number of ‘floating workers’ in the middle that need to be convinced. And they do need to be convinced, because in the long run the only sustainable reason is the last one. In a competitive market, if talent feels forced or coerced it will make its own decisions.
No problem. Let’s put in a coffee machine and some bright graphics. Job well done! …no?
No. It needs to start with culture. Studies suggest that 30-90% of people feel bored during their workday. For young people this rises to a more consistent 91-98%. Furthermore, more than half of people state that ‘dull work’ is a reason that they are looking for a new job. For 8% of people ‘working alone’ is a reason for feeling bored, and we might expect these people to want to be back in the office as soon as possible. However, what is the point of coming into the office to still be working alone? And is working remotely as part of a global team ‘working alone’? The bigger reasons for boredom are around work variety and task definition. Conversely, the things that are shown to keep people motivated are: being able to see an outcome, variety and autonomy.
Wasn’t the whole automation thing meant to relieve us of the tedious tasks, so that we could focus on more exciting work? Well, yes; at least at an aggregate level. Technology has created process efficiencies; however, these seem to have been filled with new processes. The evidence suggests that the challenge is getting worse. JP Morgan’s Jamie Dimon once described bureaucracy as ‘a disease’, and he is in good company. And yet the growth of administration roles in business has been double that of other roles over the past 40 years. This issue particularly affects the large businesses which dominate our economy. In large businesses, specialisation and standardisation are necessary to drive value. Outsourcing particularly relies on these at the expense of work variety. However, this tends to result in multiple chains of hierarchy, each putting its own requests, approvals and forms into the system.
Meanwhile, work autonomy has been steadily falling. A study by the University of Birmingham found that professionals have much lower work autonomy than senior managers over matters such as working hours, pace of work, work tasks and work scheduling. The study found that informal work flexibility, the ability to work from home occasionally and other ways to control one’s schedule had significant impacts on perceived autonomy and job satisfaction. In particular, schedule and location flexibility were most relevant to female employees, whereas men preferred greater control over pace of work and task order. Interestingly, there are huge cultural differences across Europe, with Eastern Europeans feeling less in control of their agenda, and more predictably there are variations by job type and grade.
Those who say that work shouldn’t be fun have got it all wrong. Those who find fun and flow in their work activities are much more likely to be productive. But generally, workers have been having less fun over the past 10 years. The financial crisis set in play a series of additional (some might say overdue) regulations, both government-led and corporate, that have stifled some of the fun of work. The lavish entertainment budgets of the noughties have disappeared in many industries and an increased focus on compliance and risk management, has resulted in an inoffensive, but perhaps less exciting corporate environment, particularly again in bigger, more heavily governed businesses.
All of these come together in a business culture that is not in many cases quite what it was, and collides with an increasing request from younger workers for their work to have ‘a purpose’ (‘meaning is the new money’), which evidence suggests is largely unmet. In this context, the prospect of being marched back to the office – ‘because culture’ – is likely to fall flat. However, the opportunity now presented to address this in the form of a cultural and workplace revolution is incredibly exciting – if businesses chose the more challenging path of delivering change.
For corporate occupiers, don’t demand that your employees come back to the office to sit at desks in isolation. It will just breed resentment, and in the long run you will lose talent. Instead, entice your employees back by focussing on a new value proposition that makes it worth their while (and yours).
The mindset needs to be zero-based rather than incremental. Before you think about the real estate, think about what you actually want your teams to do whilst they are in the office. Days in the office should be the exciting part of the week. If people come into the office to fill in forms, read reports, and be micromanaged, then you as a manager have failed. You have failed your employees, who will soon get bored and drift away, and you have failed your CFO, who didn’t need to pay for the space. Instead, this is your chance to embed a reinvigorated culture, to bond teams, and to deliver the elements of the role that benefit from combinational activity. Leave the bureaucracy at home.
Think also about what your units of culture are. There are some issues which need to be addressed at corporate level – policy, brand value, funding decisions. However, most of the culture of a business is incubated in much smaller units; typically in groups of less than 10 people. An employee might sit in a team to which they feel hugely loyal and not interact too much with the wider business. A problem? Not really, provided that they are engaged and aligned to the business objectives. It is the bonding of these smaller units that is more important that the inevitably looser connections to the wider corporate, and your strategy should reflect this. You don’t need to have huge groups together at the same time.
Only once you have reached your decisions about what you want to be as business and what your employee value proposition should be, should you think about how you are going to wrap your real estate around this. However, if you agree with the points I make above, then I struggle to see how anyone could reach the conclusion that endless rows of desks with computer screens perched on them is the way to go. Desks reinforce distance and solitary working, and monitors reinforce task based work. Collectively, they are one step down from cubicles in that regard. Instead, put in bleachers, put in cafés, and importantly provide connected screens everywhere, so that you don’t need to be sat in front of a monitor to access information. And then encourage people to use them! Decades of muscle memory will attract people back to their desks. Don’t let that happen.
It’s perhaps not surprising that exciting businesses tend to have more exciting workplaces and the two are reinforcing. Notably the tech companies have been pioneers of workplace, because this manifested their culture and spoke to their brand. But for the vast majority: bean bags, slides, basketball courts, massage suites, indoor parks and meditation rooms are sci-fi. Instead, stale, vapid receptions hung with uninspiring, unrelatable artwork lead to corporate prisons or neatly ordered Taylorist factories, where sensory engagement is limited to the smell coming from the microwave. Would this make you want to brave the commute?
I’m often asked which businesses are doing things right in this new era for real estate. I’m going to call one out: BrewDog. In the past year they opened 102 virtual bars for homebrewing masterclasses, 22% of their shares are owned by beer enthusiasts (‘Equity Punks’), they regularly trial new real estate concepts such as Deskdog in Brixton (co-working space in a pub, with bundled refreshments), The DogHouse, a ‘craft beer hotel’ hotel in Ohio with beer taps in every room, the DogTap bar including beer museum and library, they procured three wind turbines to power their HQ, they give new dog-owners 1 week’s paid ‘pawternity leave’, they continued opening new bars during the pandemic, they acquired 2,000 acres of land to plant a million trees and a sustainable campsite in Scotland, and they just signed the lease of a roof above a mall in Las Vegas to deliver ‘an urban forest, brewery, swimming pool, gaming zone and secret events space’. Their message to customers: ‘We don’t want to scramble back to business as usual. We want to change everything’. Do you think they will have any issues tempting their colleagues back into the office?