Productivity and ROI Drivers in Open Offices

10/30/2019 | By Janelle Penny

Every open office design is different, but they all have one thing in common: the need to drive productivity and ROI.

Angie Lee, vice president of buildings and global workplace sector leader for Stantec, explains how to create open office spaces where people can thrive, using Stantec’s new Portland, OR, office as an example. Listen now >>

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[Start transcript]

Janelle Penny: Hi everyone. This is Janelle Penny, I’m the editor in chief of Buildings.com. And thank you so much for joining us today.

I’m here with Angie Lee, who is the vice president of buildings for Stantec, which is a global design firm with about 400 locations worldwide. We’re going to be talking about open office design, including the roles played by furnishings and layout. And also, we’ll look at how Stantec applies some of these design concepts to their own office in Portland.

Angie, thank you so much for joining us. Could you tell me a little bit more about the consolidation project for your Portland area offices at Stantec and how that relates to what you try to do for your clients?

Angie Lee: Yes, so you know, one of the key drivers that we’re seeing, and I’ll just flip the answer a little bit here, working with our workplaces and office clientele. Clearly there are two major drivers, one of which is cost reduction. Everyone wants to consider the real estate portfolio and looking at being smarter about space utilization and efficiency, as well as efficacy of how the space is being used, right?

So, after people for most of our clients at Stantec is not unique. Real estate is the second highest capital cost for most organization. And the second piece of the driver is recruitment and retention. And that’s again, no different from how we approach our own corporate real estate and workplace environment.

So, relative to Portland and many of our other locations where we consolidate into a single location for multiple locations or complete relocation, we’re very conscious of the fact that we first have to consider the facility types—Stantec being 22,000 people with 400 offices around the globe.

And we operate in four different major divisions, if you will, business units. And that alone will have a really cross-spectrum of office facility types and the way offices need to support the work that we do on a regular basis.

But with that said, one of the key items aside from quantitative measures, which we’re looking at, some of our offices range from 300-square-foot per person in the past or over 300-square-foot per person in the past, to now really trying to standardize towards a target.

I’ll use the word target for about 180-, 190-, maybe 200-square-foot per person, which is much more in line with industry standard, particularly, if we are staying with a one-to-one seat person to see the assignment. Of course, you know, when you start doing desk sharing or free address, the metric can be tightened up and densify quite a bit.

But in terms of design and style, one of the key components that we always keep in mind is that we need to be, we at Stantec, we need to be proud of the offices that we work out of. So, when a client comes to visit us, we need to showcase what we can do as an organization. Design is very much a part of the discussion relative to smarter use of real estate with the understanding of the drivers or cost and people recruitment and retention.

Janelle: Makes sense. Looking specifically at the features of the new Portland office, what are some of the things that Stantec is really proud of or that make that space special? I understand it’s got some different kinds of space types.

Angie: Yeah, so that’s a very good question, actually. When we designed for the, what I call the 21st-century office space, we consider five different categories of work modes. And it really has to do with how you organize and allocate the percentages of those two different work modes.

So, the five different categories that we always make sure that we include—that includes what we have done for Portland and other locations to by the way—is focus which is something that you and I are very familiar with, that’s private offices and workstations, or benching now in some offices.

We’re starting to migrate towards that. Portland is still workstation solution, but some of our other offices like Washington, D.C., recently and Chicago, we have gone to a benching solution.

Work Mode Solutions

  • Private offices
  • Workstations
  • Benching
  • Social/Collaboration
  • Training/Learning
  • Respite 

How we appropriate collaboration spaces is another area that is very critical. No two clients are alike. A lot of times clients come to me and say, ‘Hey Angie, what is the what is the formula to calculate if you have X number of focus, meaning private offices and workstations, how many formal conference rooms and informal gathering spaces should we provide?’

Well, there’s really no strict formula. It really has to do with the industry that you’re in. So, a tech company, for instance, will appropriate and allocate the ratio of collaboration space to focus space differently than let’s say an insurance company or a financial company. At Stantec, it also varies depending on the locations.

The third different work mode that we are always considering now in 21st century work environment is social spaces. If you think about the next generation of workers, which now is dominant in the marketplace, social gathering spaces such as a great cafeteria that are multi-use or spaces that are available for a quick fortuitous type conversation, a meeting with your colleagues, having those types of spaces woven into the planning and design is very critical.

The fourth mode of work is training spaces or learning spaces. And a lot of these types of spaces are multi-use as in Portland, for instance, that could also be converted into conference rooms and vice versa. So, a conference room with flexible furniture layout can then be converted into let’s say a training, auditorium style or classroom style type seating.

And the last one which a lot of times people don’t consider as important, but we always do consider very, very important when we’re designing for a client, is places for respite. Areas where employees can go and rejuvenate whether it’s an outdoor terrace or small quiet areas that you can go and actually take a little downtime, think or maybe even close your eyes for a few minutes. Those are the types of choices that we make sure that we provide our employees.

But having said that, one thing I want to follow up on is it really has to do with the organizational culture. As great design that we can provide our clients relative to the different workplace modes and work settings, if the organizational culture itself does not support employees having these types of choices, it’s very, very difficult to make it successful.

So, it really has to do with the behavior and the management side of whether or not they are willing to walk the talk. It’s very much a top down scenario as the way that we’ve always seen it. So, making sure that senior management or the management team or leadership team buys into the idea of giving these types of choices to employees. Does it make sense?

Janelle: Yeah, definitely. And I’m glad that you mentioned culture because I’m wondering how to tell if your own office culture can support that kind of thing. How do you know what will fit in your own office?

[More Stantec places: How This Mixed-Use Building Gained Sustainablity Certifications]

Angie: Well, I think it’s even beyond our own offices. One of the things that we work with our clients at the very beginning is to have what I call a senior leadership or executive leadership visioning session. And during that session, we have a lot of different types of activities and conversations that’s fully facilitated. But we should be able to ascertain whether or not the organization is ready for change.

And usually we get hired to help push the envelope. Otherwise, they would be saying, ‘Well, the same thing, just give us the same thing over and over again.’ But the reason why we’re hired to develop a strategy like what I was talking about relative to the different work modes and how you apply that is because someone within our organization says, ‘Hey guys, we need to think about our office environment as a tool for our employees to do better work or as a tool for us to recruit the star talent and as a tool.’

In other words, the workplace environment now very much as being looked upon as a tool to align with their business success. So, understanding how ready they are and how far I always use the term, you know how far we can push the dial, because we can push style as far as an organization will accept us coming in and pushing that dial. And sometimes working with the facilities team because the aspiration and the goal of this facility team is to be much more efficient with their real estate use, right?

They will advise us to push it as far as we can. But knowing that that dial will somewhere come back a little bit more towards the center versus all the way to the far right, if you will. So, that’s what we’ve been seeing.

Going back to Stantec, every BC and every business center will—Portland is a business center—operate a little differently. There’s local leadership involved. And so again, understanding how far that dial can be pushed within the spectrum of a corporate set of standards that we have now developed for Stantec I think is the key. No office is going to be exactly the same. And we don’t intend every office to be the same.

So, I will tell you, the Portland office looks very different than the Phoenix office. And it looks different than the Chicago office and the Chicago office looks different than the New York office and so on.

But fundamentally, our corporate real estate team have developed a set of standards that is our guideline when we roll out projects on behalf of Stantec, which is really no different than companies that we work with now on a national basis, like the Comcast and the Marriotts and the Googles of the world, where their standards are a set of guidelines and how we interpret that guideline based on how we need to roll that out with the input and strategy and aspiration of local leadership.

Janelle: Excellent. Could you tell me a little bit more about the consolidation project in Washington, D.C., with regard to some of the design strategies that you used in the open office areas, especially since you are moving to a much higher percentage of open office compared to enclosed spaces?

Angie: You mean for Gartner?

Janelle: Yeah.

Angie: Yeah. Yeah. For Gartner. Well, first of all, as I had said earlier, these types of projects need to be top down driven. And so, the CEO at the time, this was CEB. Gartner actually bought them, acquired them halfway through the project. The CEO at the time had a vision of moving-knowing that the existing space was private office intensive and people are not talking to each other and are not collaborating-primarily it’s occupied by two major groups, this is the Gartner/CEB locations, it’s really sales and research.

So, as you imagine the salespeople operate differently than the researchers, right?

Yeah, but nevertheless, the CEO had a vision that guys, you know, we need to recruit the best people. And Washington, D.C., being of a city where there is a war on talent – war for talent, if you will, not on talent. And so, they know that they need to recruit the best of the best. And to do that the work environment has to reflect the best state-of-the-art 21st-century environment.

So, it was his vision that drove the project. Without somebody at the very top of the food chain saying, ‘Guys, we really need to open our minds and think about the office environment as a tool, not just for cost cutting, but also for bringing in the next generation of workers and how do we support that?’ And because ultimately it will lead to the higher productivity, better performance, higher engagement, all the metrics that people like to collect.

So, from a design standpoint, we went from, like I said, the 70% open, 30% closed they had multiple work standards and we were able to go to 120-square-foot, private office, only one standard. And all of the open work environment are benches and they are the 30-inch by 6-foot benching solution.

The design also entails a kit of parts so that in terms of the orientation of the individual desk, they can face whichever direction they want. These are all sit-stand desks by the way, which is very much something that to some degree employees expect now, because of just the solution itself is much healthier than, you know, sitting eight hours a day is really not very good for our health.

Janelle: With that Gartner project, since what you said sales and research are so different in terms of their workloads and their needs, how were you able to maximize opportunities for productivity while also mitigating some of the aspects of open offices that people tend to complain about sometimes, like noise and distraction?

[Created by Stantec: Designing for Special Needs Students]

Angie: Yeah, so very good question. It goes back to understanding the work modes and work settings and having a variety of different choices for people to actually go to. So, imagine if you’re sitting in an open office, people need to have a place to go and have a private conversation or a confidential phone call, or one on one.

So, having those types of work settings available, and with a culture that supports that, ‘Hey, my supervisor knows that if I’m going to sit over in the quiet room, I’m still working just because I’m not sitting at my desk,’ right? It’s the whole culture and behavior piece. That was part of their internal change management program.

So, having those types of spaces available, and I will say that most organizations tend to over design the big conference rooms, too many large conference rooms are not actually being utilized properly. How many times have you walked by conference rooms that are built for like 12 people and they’re only two people in there?

As a part of analyzing and developing a strategy, CEB is one and Grant Thornton is another one that we actually did a time utilization study and found that not only was 40% of the work personal, the focus workplace was occupied, 60% of the time it’s open and not utilized.

Further, certain conference rooms are much more coveted than other conference rooms. And the ones that are more coveted generally are the ones that have windows so daylight, people being able to look outside versus a conference room that’s stuck in the middle of the core.

You shut the door and it’s dark. And then conference rooms with technology is huge differentiator in today’s work environment. Even the I would say the open informal collaboration spaces, if you have the ability for your employees to plug in and bring the laptop and plug in and share screen, it goes a long way to helping them be much more successful in collaborating. Did I answer your question?

Janelle: Yeah, this is helpful. What role do the different work zones play? You kind of touched on this a little bit with having that culture that says if I’m in the focus space, I’m still working and not at my desk. But what kinds of workloads do you try to account for in the Gartner project, or in any design for that matter? And what are the important roles that you try to account for?

Angie: Yeah, so very good question. So, I think one of the most important items is to understand how they work and what their business drivers are. So, before we even start designing one of the key elements that we do during the visioning session is really understanding their work strategy, their business strategy, where they’re at today, what is working, what is not working and where they want to go in the future.

So, with that kind of information—and usually clients are pretty open in sharing that—we can come back with a variety of different scenarios relative to their personal space allocation, the focus space as I talked about. Some organizations are just not ready to go 100% open plan. They just have not. And that’s okay. Nobody says that everyone has to have 100% open plan. And personally—and this is just a sidebar—I think that 100% open plan concept is pushed way too far to the right.

And what we’re seeing now is companies coming back a little bit more, much more centralized, but that does not mean that everyone still gets an office. What it means is that there are many more allocations or-ratio is the right word-many more ratios—I’ll just use the term huddle rooms to take over from assigning everyone a private office.

And the huddle rooms generally, when we design, we try to use the same footprint as a private office that will, let’s say the 120 that we use for Gartner and a lot of times we use 10 by 10 too, by the way, 100 square feet.

So, let’s just say 100 square feet is the footprint for private offices. Our huddle rooms are also 100 square feet. That will allow the facilities team to have some agility and flexibility to make changes in the future without having to start swinging hammers and converting fixed partitions and changing footprints out.

[Related: Smart Design for Shared Spaces]

So, taking that into consideration, day one, assigning the right proportion and making sure the sizes are the right size. And it’s almost like a template, if you will, that could stand the test of time and provide the facilities team the ability to make changes in the future. So, huddle rooms are not fit out like an office. But an office could be fit out like a huddle room. That’s the conversation that we have with senior executives whereby it allows them the opportunity to make people adjustments or changes and allocations at a later date.

Janelle: Great. This might seem like a silly question, but what are the consequences of not accommodating some of the work modes or zone types that we’ve talked about? Or not building in that flexibility that you were just talking about?

Angie: Yeah, so then you’re going to get a lot of complaints from people that ‘I don’t have a place to go and make a private phone call’ or ‘we don’t have enough spaces for us to gather and collaborate as a team.’

The other key to not having enough is proximity. So, you know, one of my personal measurement is collaboration spaces, let’s say huddle rooms or phone rooms or quiet rooms, whatever you want to call them, they need to be within your sight line. In other words, it can’t be tucked around in a corner that you don’t see.

Generally, these are just in time rooms that are not reservable, especially the phone rooms are not reserved. Huddle rooms, oftentimes, our clients like that those can be reserved on Outlook. But it needs to be within 25 to 30 feet, no more than 40 feet away. Otherwise, it’s just not going to be used if it’s too far away. So, there’s a proximity equation as well.

Janelle: Absolutely. If someone’s listening to this, and then looks at their own office space and sees that it’s lacking in some way, like, for example, maybe it doesn’t have very good support for private calls. how would someone go about implementing a new space type or support for a different work mode in a space that they already have? Are there rules of thumb that you can share or a process that you like to go through with clients on that?

Angie: Yeah, so that’s a silver bullet that people always ask me what is that ratio, what is the right magic number? You think that it has to go by case-by-case basis, and you also need to take a look at the bricks and mortar, the footprint of the space that you’re talking about as well. What is the core window dimension? How big is the footprint? Are you talking about a 12, 15,000-square-foot footprint, a floor meaning versus a 50,000-square-foot footprint floor?

That in and of itself requires some attention and path of travel, travel distance, how do you circulate all of that needs to be taken into consideration, so there isn’t one good quick answer.

However, I do know that there are products out there, not that I’m a furniture vendor, but there are products out there that is plug and play that’s available on the market that resembles like a telephone booth, like in London they used to have those telephone booths that are red, something like that, that’s available in the market now that you can easily plug it in, it’s being looked upon as furniture.

So, nobody has to worry about having to bring in light or in certain cities, ‘now we have to sprinkler the thing because it’s a closed environment.’ So, there are products out there that if push comes to shove, they need to bring in one or two phone rooms without literally redesigning, replanning, there are solutions out there in the marketplace.

But my advice is that’s really a short-term Band-Aid kind of fix. But needing to take a look holistically, not just from the planning standpoint, but I would suggest that you actually take a couple of steps back and really understand your organizational culture and behavior and what the business vision is before you even start to do layouts and planning.

Janelle: Definitely. Stepping back to your comments on furnishings for a second, are there design strategies or even types of furnishings that you rely on to make sure that plans have that flexibility built in Like, for example, do you ever use movable furnishings or movable partitions for that reason?

Angie: Yeah, quite a bit. In fact, we... first of all, it’s much more sustainable, as opposed to always doing hard wall construction. There’s certain components within the work modes like conference rooms, definitely you wouldn’t want to have hard wall constructions, but oftentimes for huddle rooms and private offices, we are migrating towards the furniture portion of demountable partitions. And only because the, you know, even 5-10 years ago, there were concerns about sound attenuation and acoustics concerns, but there’s so many products out there that are much better engineered.

And technology has really improved significantly where an SDC rating can be as high as 45, even with glass fronts. Some of the products out there are double and triple paned glass. So, yeah, it is a little bit more costly to do demountable partitions when you look at first costs, but there’s a whole lifecycle cost that needs to be taking into consideration as well.

So, the long answer to your quick question is yes, we take all of that into consideration as we design budgets with our clients.

Janelle: Great. How can you make sure that people are actually engaging with the different zones and furnishings that you’re putting in? You mentioned getting that buy-in at the top and making sure that your culture can support different work modes and different zones.

Are there any other recommendations that you can share for encouraging people to use your new spaces and kind of letting them know that it’s okay to move throughout the office throughout the day?

Angie: Yeah, so that’s quite a change management, right? So, whether we’re hired to do help with change management—which is a parallel process to the design process, by the way—oftentimes, before they move in, during the change management process, we have a series of town halls with the employees to make sure that people understand what the new space is going to look like, how it will affect them, because it’s a different process, know what’s in it for me?

Everyone needs to know how it will that affect them. And then more importantly, we need to share the reasons why. You know, they’re going through these changes.

And then lastly, oftentimes at either right before move in or during move in, we help our clients develop an etiquette package that explains how each of the spaces are expected to be used so that people understand that yes, the phone rooms for instance, the phone rooms are not reservable. It’s first come, first serve and you can’t just camp there all day kind of a thing. There’s a two-hour limit, for instance. I’m making that up.

But there’s certain etiquette programs that we can help our clients put together before the move in. It’s partly education. And partly making sure that people follow the rules and partly for the facilities team to have something to go by when the space is being occupied.

Janelle: Sure. Everyone’s kind of starting on the same foot that way.

Angie: Right. Right. It’s like just because you build it doesn’t mean that they know how to use it.

Janelle: Right. You mentioned—I don’t remember now if it was the Portland Stantec office or the Gartner space in Washington, D.C.—but about the meeting spaces with windows and natural light being more popular. And I’m wondering what some of the other things are that can impact whether an open office is functional and supporting productivity? What impact is had by not just natural light, but other sort of environmental factors like lighting or making sure that HVAC is zoned correctly, for example?

Angie: Oh, yeah. Yeah, that is so important. The comfort factor is, if you ask any facilities manager, they will tell you that one of the biggest complaints they get are ‘Oh, I’m too hot’ or ‘I’m too cold.’

So, you know balancing the place out properly with the right temperature, you will not please people 100% of the time-100% of people 100% of the time. But there is a methodology that can be put in place to ensure comfort level.

As far as daylight is concerned, we have been I would say 95% of the projects that we do now, we take into consideration daylighting and making sure that the majority of the open plan are along the perimeter. And we always advise our clients that private offices generally are more appropriate when you put them on the interior spaces. However, there’s glass fronts that you can include so that daylight still penetrates into the private offices.

And frankly, there’s still some hierarchy in terms of placement and allocation, that the more senior folks tend to be in offices. And they’re the ones who are generally not in the office as frequently as the people who are in open plan.

And I know that there have been a lot of studies done already relative to employee happiness and engagement having daylight exposure and be able to just see outside and see if it’s raining? Is it snowing? Is it a cloudy day? A beautiful, sunny day?

So, employee happiness is an area that we are very cognizant of how you track that. It’s hard. It’s very, very challenging to track performance of productivity in workplace environment.

However, the other thing that we’ve done with clients is at the beginning of a workplace strategy program, we generally along with our clients, we design an employee survey. And the way that we designed the survey the questions that we ask and how we ask the questions will then be repeated six to eight months after they move in. That becomes the post occupancy evaluation.

Then we can start to compare how did things go? What the metrics are relative to how satisfied this department employees are with the existing meaning the former situation versus the new office space. So, there’s a way that we can track it. You know, is it perfect? No, it’s not perfect, but this is one way to track how successful we have been with the new office design.

Janelle: Great. What else should be reflected in getting people’s feedback? Are there certain other things that you should be asking about?

Angie: One area that we have not touched on, Janelle, is integration of technology. I am not an expert in technology, I’ll be the first to tell you. But what I do know is as a part of this changing work design and strategy and environment, technology integration is first and foremost that we will bring up with our clients.

And again, depending on their appetite and how much they want to push that envelope, a smart building, a smart workplace, intelligent building, a smart workplace technology is starting to become much more ubiquitous as a part of our workplace strategy development program.

Janelle: Great. One thing I wanted to touch on too was whether you had any recommendations for wayfinding in open offices? Are there techniques that you use to set the different spaces apart to help people navigate? Like flooring with different patterns or textures or maybe other strategies that you use to kind of help people orient themselves?

Angie: Yeah, absolutely. One of the things that, I mean you already touched on flooring, colors, lighting, materials on vertical surfaces. But one of the strategies that we use is actually in planning, so that there are always viewpoints of sight lines and key landmarks, if you will, if I can use that word, interior landmarks that will orientate one from understanding where they’re going.

Janelle: When you say landmarks, do you mean like, a piece of wall art or what are some of the things that you’ve used as landmarks before?

Angie: It could be wall art, it could be sculpture, it could be your sight line towards a huddle room that is different from this side of the floor from that side of the floor or sight line towards the “out” door.

So, taking advantage of views, perhaps at the end of this particular circulation path, you see the woods behind and on the other side of the circulation path, you look towards the lake side, or the city side, something like that.

Janelle: We talked about a lot of different aspects of office design today. But are there any takeaways that you really wish that facility managers and building owners would take away from this podcast when they’re looking at their own offices, whether that’s an open office design or a more traditional design with more closed space?

Angie: Good question. I guess the initial reaction I have from your question is it depends on where they’re coming from. So, if it’s a very dated office environment that has not been touched for 20 years, there’s a lot of improvement that you can do immediately without making big changes.

[Read also: Hot Desking: Convert to a Flexible Co-working Office Space]

Let me just rephrase this. When you think about office design, there is so much talk about open plan and benching. And I would just say to our facilities managers that one size doesn’t fit all, and benching may or may not be the right solution for your organization. And also keeping in mind that if it’s a big corporation, you have various departments that work differently. So, take into consideration the functional aspect of those departments.

For instance, your HR and your legal department may never be able to go 100% open plans. However, your sales and marketing team might be the perfect exact fit for 100% open plan.

Your IT team, for instance, is another good example. So, it’s not a ubiquitous solution that the industry a lot of chatter out there that ‘Oh, 100% open plan and we need to do that because it’s going to save us money and yada, yada, yada.’ That is not the case.

So, I would be just be very careful about looking at what is the right mix for the enterprise level, and what is the right mix for the individual departmental level?

So, there might be a variety of different standards, you may have some consistency in the overall macro standard that you develop, but they might be tweaks and modifications that are unique to each of the departments and that stuff needs to be taking into consideration.

Not only that, I would say that policies and governance are really important part of workplace strategy and design. Generally, we still think about one to one, plus the seat ratio. But there are certain instances where you can start to look at a desk sharing, a hoteling or in some cases of free address sort of application, whereby it’s really a win-win.

You save on real estate, and then—but yet on the other hand, you give your employees more flexibility and the ability to control their daily work hours, if you will. They may decide to work from home one day a week or a couple days a week and desk share with somebody else within the department. So, those are the types of policies that really should be a part of this conversation. And not just bricks and mortar, design and planning.

Janelle: Great. And is there anything that I haven’t asked about? I know we’ve covered seemingly every aspect of office design, but is there anything that I haven’t asked about that you think I should have or anything else you’d like to add or make sure people know?

Angie: We touched on change management a little bit and any organization that’s embarking on a new workplace design, whether it’s slight modification or an enterprise-level workplace strategy, like the one that we’re working with a major client right now outside Boston, change management needs to be woven into the conversation, whether you do it internally within their own organization, or you hire Stantec to help with change management.

Just be sure that we don’t forget that because designing spaces, you’re getting the space ready for the people. The change management is getting your people ready for the space and the two need to go hand in hand.

Janelle: Definitely. Awesome. Well, Angie, thank you so much for joining me today. This has been really illuminating, and I appreciate you joining us to talk about office design.

Angie: No problem. Happy to. It’s my favorite subject.

Janelle: Great. Glad to hear it. Thanks again to Angie Lee from Stantec for joining me today and all of you for listening. We’ll see you next time.

[End transcript]

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