What Is The Impact Of WFH On The Traditional Office Model?

There has always been an incentive to reduce expense. Companies have explored ways to “disrupt” the traditional office model looking for cheaper alternatives.

What a year. Even the most predictable outcomes have been derailed.

Some people are already planning New Year’s parties to welcome the end of this challenging year, but for me, reaching the end of 2020 delivers no real closure. Neither preventions nor treatments related to Covid-19 offer anything concrete.

We have an election season leaving us with more questions than answers. And now, many are questioning if we will ever return to a physical work environment.

In a recent blog post, I focused on the motives behind those in favor of work from home (WFH), concluding that the concept has been tried, repeatedly, with underwhelming results. As the most conclusive sign of a healthy organization, profit is the ultimate goal, but that presupposes operating in a safe environment.

During a crisis, short-term focus may shift toward survival, until threats are eliminated or mitigated. Forecasting trends during that timeframe can be dangerous since the organization’s goals may have shifted. A classic example is the 9/11 commentary: “air travel is over” and “no one will ever lease space on the upper floors of a high-rise again.” Extrapolated trends during that timeframe proved to be more myopic than masterful.

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A social experiment

As parts of the country have taken steps toward reopening, we are beginning to see how this social experiment will unfold. Early returns indicate that in 2020, we haven’t deviated from our ancestors in our desire for social interaction. Many recently reopened restaurants have waiting lists, despite (most) people being capable of “cooking from home.” One presumes that “drinking from home” (DFH) would be an emerging trend. DFH is safer and cheaper, but the surge in demand at bars, in many cases, is so strong that state and local officials have had to intervene to curtail occupancy.

As colleges and universities shift to remote learning, reactions from students and parents, have not been enthusiastic. Many are demanding reductions in tuition if remote learning goes beyond a specified time period. One could question if there is a real difference between listening to a lecture in-person or online, but given consumer reactions, few are debating whether those concerns are valid. This implies a diminution in the value of learning remotely. There are countless examples where our desire for social stimulation exceeds its practical utility; coffee shops, sporting events, etc.

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This innate trend also applies to offices, but being social in the office world carries a cost.

Cost-benefit analysis

For traditional office tenants, real estate costs are generally second only to personnel costs. There has always been an incentive to reduce this expense. Companies have explored ways to “disrupt” the traditional office model – looking for cheaper alternatives. Up to this point, those explorations have largely been futile. The pandemic has forced us to reconsider WFH as a permanent viable option. Ironically, I enjoy these conversations and find them to be constructive for our industry.

There has been ample time to dissect the pros and cons of all working environments during the pandemic. When operating together in a physical environment, the primary elements allowing our organizations to flourish are: (1) collaboration, (2) culture, (3) networking and (4) mentorship.

Social animals

There is a reason why loyalty and time spent together are inextricably interconnected. There is a reason behind fleeting Zoom happy hours. At sporting events, why does it matter if fans are in the stands – or if the network “pump-in” crowd noise for TV audiences? These things are all directly correlated. Thought leader, author and motivational speaker, Simon Sinek, said it best: “People are social animals. We need human interaction…We need to be in the company of others, we need to be able to interrupt each other and write things on the walls and have that magical energy and then go for lunch together to build the relationship.”

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The primary point? We all are now able to better define what constitutes an optimal work environment. Companies will have greater clarity in providing environments for their employees to thrive. Cost will continue to be a factor, but more will ask how their space can reinforce their brand and culture.

Better work environments will yield greater engagement. A virtuous cycle is then created – promoting better retention and recruiting. Shifting the conversation of office space over to the asset side of the column is a win for everyone. If this exercise allows employees to achieve their maximum potential, then that is a debate worth having.

Originally published at biz journals

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