VideoThe goal is to augment the savings on real estate with enhanced productivity. Measuring productivity is never easy; as Cisco's Golan notes, "It's hard to isolate the effect that any one variable has on worker output." But he says that a pilot project in the company's call centers resulted in "very significant" improvements. Capital One attempts to crack the productivity code through worker surveys, and says that three-quarters of employees surveyed say they are now working as productively as possible, while just over half say that group productivity is up. The company also found a 24 to 31 percent reduction in the time needed to get input from managers and peers, which it says leads to faster decisions.
Making It Work
The good news is that alternative workplaces are much easier to set up than in years past. For many knowledge workers, work is almost synonymous with Internet access, and with laptop computers now powerful and inexpensive, wireless networks proliferating, and various conferencing technologies maturing, "office space" can be created virtually by using the tools that workers would be supplied with anyway.
Full-service real estate providers have geared up to help companies make the transition. Such firms as Jones Lang LaSalle and Trammell Crow Co. now guide companies through the process, from space planning to implementation. Even furniture makers have gotten into the act. "A decade ago, if you wanted a mobile furniture system, you had to have it custom-built," says Knight. Now, most components are available out of the box.
Building the new space is only half the effort, though — companies also need to persuade employees to embrace it. An office still conveys status for many, and some managers are uncomfortable with direct reports working at home or in ever-changing corners of the office. Employees may simply wonder where they are supposed to stash all their stuff.
Capital One addresses those and similar issues by launching a needs assessment that examines how work gets done in each unit. (To date, eight units of the company totaling about 2,000 employees have moved to the new system, with some of the biggest groups slated to make the move next year.) The design of each space varies depending on the needs of the people who use it. For example, in IT much of the work is done on a project basis, with teams forming and then disbanding once projects are completed. So the company created "agile project rooms," with movable walls, electronic whiteboards, and even careful control over the thermostat, because with all that gear and people in one place, the temperature can climb to uncomfortable levels.
Employees are given the option of "going mobile," and about 80 percent choose to do so. They receive six to eight weeks of training on everything from how to be productive while working in virtual teams to how to use new equipment to how to manage their own piles of paperwork when they no longer have dedicated desks. (Hint: forget hard copies and instead embrace the "paperless office.")
Flexibility is essential. There are big differences between what suits the sales staff, who travel a lot, and the engineers, who are more office-bound and have more gear. Companies may also discover that some seemingly good ideas don't work. Hewlett-Packard, for example, which is in the midst of a four-year overhaul of its hundreds of buildings worldwide, found that newly created small project rooms, enclosed by low partitions, were too noisy. It has since added glass walls that extend to the ceiling.
Executives at companies that have made the move to alternative workplaces agree that the change-management issues require a lot of attention. One financial services firm in New York jump-started its process by giving managers a reduced amount of office space and leaving it to them to decide whether to stick with the traditional office layout, which would result in a cramped cubicle hell, or adopt a more inviting, open plan that allowed for some growth possibilities — assuming employees shared the space. As Chris Howe of BCG notes, "It doesn't force anyone to do things a certain way, but it does make the trade-offs very clear."
Don Durfee is research editor at CFO.
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