GARY WATKINS, CEO, Service Works Global, shows how you can benefit from strategic space management.
Space management is far from a new concept – office and facilities managers have been managing space, and moving people around offices, for decades. But what has changed is the way many employees and visitors use space within an organisation.
Twenty years ago, the office was the only place where work was carried out. In many sectors, workers came to the office every day to do their work at ‘their’ desk. The size of a desk, or an office, was an indication of power and status. Now work is seen as an activity that can take place almost anywhere – in people’s homes, on client sites, in serviced offices, on transport.
Even within the office environment, the tradition of one person, one desk is changing. Desk ownership is increasingly becoming old-fashioned with many organisations having a small number of allocated desks, for functions such as finance and HR, and an increasing number of hot desks for other employees to use when required.
The office is also being seen more as a place to collaborate than to focus on concentrated individual work, with more collaborative space such as meeting rooms, conference rooms, break-out areas and café areas, and fewer individual desks.
Why space management is important
Over the past few years, we have seen an ongoing reduction in the amount of space per person, thanks largely to the introduction of open-plan and agile working and the creation of more space for collaboration, together with advances in information and communications technology, which allow people to work anywhere.
This also means that they rely less on the space made available by the organisation, and more on the technology itself.
Ten years ago, a typical Australian office would have had an average area per full-time equivalent (essentially the net internal area of the office divided by the number of workstations or people) of at least 50 percent more than today.
Now, under Regulation 3.14 of the Occupational Safety and Health Regulations 1996, employers are only required to provide each employee with sufficient space in which to work without risk to the employee’s safety and health. The Building Code of Australia requires a minimum floor area of 10 square metres per person.
The benefits of space management
There is much greater awareness among occupiers of the relationship between space efficiency and cost of occupation and a desire to reduce energy use, both as a cost to the business and to become more sustainable. The economic downturn has ensured that organisations use their assets (and space is a long-term asset) more efficiently.
The benefits of taking a strategic approach to space management are numerous and include:
● improved space efficiency
● reduction in vacant space better management of office expansion and reduction
● improved staff productivity
● improved communication
● operational cost savings
● improved compliance, and
● better strategic planning for the future.
The number of vacant offices, whether floors or entire buildings, has increased throughout Australia in recent years.
The January 2014 Office Market Report, published by the Property Council of Australia, shows the vacancy rate at 10.4 per cent, with an increase in vacant commercial property in all but two of Australia’s Central Business Districts.
This leaves property owners at risk of vandalism and arson, since empty properties are a target for squatters, vandals, graffiti, metal theft and fly tipping.
As part of a strategic space management plan, organisations often discover that they had responsibility for empty properties of which they weren’t even aware. This knowledge allows them to divest this property, or take advantage of lease breaks, and remove these risks.
Reducing vacant space within the portfolio also allows for considerable cost savings. When airport operator BAA, now known as Heathrow Airport Holdings, introduced a strategic space management strategy, the organisation vacated one of two buildings – Point West and Point East. It doubled the occupancy of Point West and reduced churn costs by 80 percent, saving the organisation $2.4 million per annum.
A strong understanding of how an organisation’s space is used – and where any potential expansion exists, or where a potential lease break exists, will allow an FM to plan and manage office churn more effectively – and reduce it.
The Department of the Prime Minister and Cabinet (PM&C) instigated a strategic approach to its space management at its office in Canberra, ACT. As a result, it was able to accommodate significant business expansion, increasing the number of staff workspaces from 603 to 855, without the need to lease additional office space and incur associated expenditure.
A strategic approach to space management can also help to boost employee productivity by: ensuring that the most appropriate teams are located next to each other and therefore have the opportunity to share ideas and collaborate without travelling great distances; placing senior teams in open environments so they can inspire employees and listen to their ideas; locating refreshments, stationery, printing facilities in the optimum place on a floor and creating ‘water cooler’ moments; and a whole host of other ideas.
A more attractive and well-planned working environment will increase morale and productivity.
Properly understanding the space an organisation has, will ensure that all the properties in the portfolio are professionally managed and comply with all relevant legislation. It is not uncommon for an organisation with a poor approach to its property and space management to fail to know about certain properties, or floors. These are then at risk of causing reputational, or financial, damage to an organisation if they do not comply with regulations.
What is strategic space management?
Whether corporate office space is owned or rented, effective management of that space is vital to every organisation. It allows the facilities management team to: help the company to meet its business and operational needs; attract and retain staff; create and maintain its brand and culture; achieve its sustainability objectives through reducing its carbon footprint; and drive the strategic direction of the organisation through efficient facilities management.
But in order to effectively manage space, it must be:
● measured in a consistent way within the organisation to ensure the facilities manager is comparing like with like across the property portfolio
● categorised in a consistent and detailed way so the organisation understands how it uses the space, and
● allocated consistently and that information recorded accurately and in real-time.
A major part of the issue when it comes to space management is understanding the space available. The FMs or property teams within some major organisations simply do not know how many buildings they have in their property portfolio, let alone how many floors or desks, and how many people those buildings support.
Many organisations use space management software to enable them to enable them to keep track of, and monitor, their space.
Organisations need to understand their use of, and requirements for, space before acquisition or disposal and many astute companies are looking at their space use on a monthly basis.
The management team needs to be able to answer the question, ‘Do I really need 200,000 square metres’ to ensure that they’re not wasting it or, conversely, have insufficient space for future plans.
Change is the new normal, and research from the International Facility Management Association (IFMA) found that its members had an average churn rate (the number of office moves during a year, expressed as a percentage of the total number of offices occupied) of 30 percent.
This currently sits at around 41 percent, indicating that FMs spend a great deal of their time moving people and objects from one location to another.
Taking a strategic approach to move management can be the difference between a meticulously executed relocation, where downtime is almost zero, and a chaotic move that negatively impacts upon business productivity.
The complexity of office churn can be reduced by adopting universal space planning standards, standardising on furniture layouts (so that you move people, not desks) and adopting IT systems that allow people to log in to phones and servers from any location.
A key factor in the success of any move is having up-to- date occupancy data. Ensuring that the FM team knows there are x people in the accountancy team on x floor, will avoid surprises on the day of the move.
With real-time, current occupancy data, an organisation can use a move to adopt a more flexible or agile working pattern, allowing employees to work flexibly by time or location.
Software has a key role to play throughout the move process. It can be used to assess the suitability of a new building or the feasibility of a particular move and can produce blocking and stacking plans to help to determine the most efficient ‘fit’ for teams or departments with the space available.
Users can also carry out scenario planning across different floors and buildings, as well as run audits to see how much space is available.
FMs can also set up business rules on software systems when planning a move. So, for example, if there’s a requirement to have a minimum number of first aiders or fire wardens on one floor, the software will alert you if you try to move one of them.
Benefits of using space management software
FM software is traditionally thought of as a tool for managing assets and services, but move management is now an integral part of many FM systems.
For example, QFM Space from Service Works Global (SWG), which allows the user to view both space management data and building floor plans through a web interface, is being used by many of SWG’s blue chip, public sector and service provider clients to manage moves within buildings and to new facilities.
Space planning and move management applications can play an important part in the control of occupancy costs.
At a more granular level, cross-charging for space utilisation drives incentives to make better use of space and the true ‘cost of space’ can be allocated. By taking ‘snapshots’ over time, organisations can show how departmental occupancy has changed.
Space management software allows contractors and engineers to have a real-time picture of assets, desks and equipment ensuring that they can respond to any changes.
Strategic planning for the future
Strategic space management guarantees that the facilities management or real estate team has an in-depth understanding of the space occupied by the organisation. This, combined with a strong relationship with the senior management team that sets business strategy, gives the FM team the ability to ensure that the space the organisation needs keeps pace with and supports the current and future business requirement. ●
This article is based on a new guide from Service Works Global, ‘How Strategic Space Management Can Benefit your Business’. To receive your complimentary copy, or for further information on QFM Space, please email email@example.com or call 03 8676 0380.