Founder: Turnaround Talk
The Covid-19 has proved to be the ultimate business disrupter. It has completely flipped the script and has forced companies to rethink their operating models.
One aspect that the Pandemic has completely changed is the way companies are run in terms of the proximity of employees in relation to management. 10 or 15 years ago, the concept of remote work was unheard of. Today, multi-million Dollar Clue Chip companies are run almost entirely by remote teams.
What impact does this have on office space and the modern concept of the office? While there are visible signs of vacant offices in major city centers around the country, Turnaround Talk recently published an article which points out that demand for office space is growing in some spaces and under certain conditions.
Whether this demand is declining, increasing or remaining stable, one thing is clear, there is a need to rethink the idea of office space and to repurpose it to fit the changing needs of its occupants. I recently read the transcript of a McKinsey podcast which discusses this in detail. The interview was between McKinsey talent leaders Bryan Hancock and Bill Schaninger speak with senior expert Phil Kirschner. They discuss the office space of the future focusing on what workers want, what employers need, and how workplaces will need to change accordingly.
The perks (and perils!) of proximity
Lucia Rahilly: How do you make the transition from colocation to collaboration? A lot of young people might say, “Well, I can collaborate virtually just as well as I can sitting in a silent, open-plan office.”
Phil Kirschner: I used to work at WeWork. I got a common question from executives who visited our headquarters building, not a traditional member building but a building full of WeWork employees and leadership. They’d step off the elevator, be within eyeshot of the elevator, coats still in hand, and ask, “Why does it feel this way? What energy am I feeling?”
I would say this is a carefully curated combination of design, technology, people, community managers, baristas, whomever it is. This is a hospitality context brought to an office. And you’re feeling something wherein it is incredibly open, and it’s very dense from the perspective of how it’s built.
But the people that you see all around are quite comfortable being quite close to each other as all of us are in the hot, new restaurant, sitting shoulder to shoulder with other people who are not related to us at all, but it’s OK because it’s a vibe. It’s an experience.
And in most offices where they may be beautifully designed but are not activated for that kind of connection and ongoing experience, it’s scary. We feel exposed. Somebody sneezes, and everybody pops their head up, and goes, “What was that?” And that was before Covid-19, so now it’s even worse.
Lucia Rahilly: I think it’s interesting that you raise the point of sitting so close together.
Photo By: Canva
Phil Kirschner: Proximity is a difficult word these days, but it’s very important for deliberate experience.
Lucia Rahilly: Given how closely configured people have been in open-office plans recently, is it really such a negative if fewer folks are in the office on any given day?
Phil Kirschner: At most, in financial services, trading environments, the highest numbers you would ever see would be maybe 85 percent of an expected population. The explosion of transactional, flexible service spaces all around us—both in coworking facilities that were designed to be workplaces but also at every coffee shop, hotel lobby, gym, bar, bank branch, you name it—is where work can and will be done by someone who’s carrying a laptop and likes a latte and is willing to get their head down in the crowd.
Bryan Hancock: What struck me, Phil, about what you said earlier was the hospitality context, the software on top of the hardware. I think that is a powerful concept. I was wondering if you could expand on that a little bit for people who are listening or, like, “Oh, that’s interesting. I want to have more of a hospitality vibe to my office. I want to improve the software.” Where would you recommend they start?
Phil Kirschner: The short version is experiences of labor of opex, operational expense, not capex, which is, like, building the thing. That’s a very simple example in shifting from a “We own this” mentality to “We all share this environment.” A very simple example is office supplies. Who buys the markers for that whiteboard over there that used to be my whiteboard but is now our whiteboard?
And you just layer on from there to, ultimately, the thing that workers most appreciate about coworking environments is the presence of a community manager, who is there not only to connect people—find employees of same or different companies with like interests or needs—but to resolve issues of the environment. To try an event, you do Taco Tuesday, nobody shows up for that, so next week it’s Cupcake Tuesday, or it’s cold out and we can bring a sense of surprise and delight, and just say, “We, the community team, have gone and bought hot chocolate for everybody because it’s freezing today.”
When that’s happening on a regular basis, both physically and then spilling into the virtual environment for inclusion of remote colleagues, it’s really magnetic. We love being in places like that. And that I think is going to lead to an explosion of this sort of activation-related staff. And technology helps, certainly, like having booking systems and employee-experience applications. But we like to feel taken care of.
Bryan Hancock: It feels a lot different when at 4:30 p.m., you’re walking into the kitchen and there’s a fresh, hot pizza there for people who have been working all day, versus the leftovers from the noon lunch that have been sitting out and you’re, like, “Hmm, do I risk it or not? What is it?”
Purpose versus buzz
Bill Schaninger: I think we’re out of the habit of the workplace being central. And we’ve had two recruiting seasons of the place not being central. So it’s, like, what’s the reboot? Is it bringing those two classes back? Is it re-onboarding them? Is it to onboard them with the classes you’re hiring right now? Is it to demand that the midlevel execs actually show the hell up, to provide some mentorship and some coaching?
It feels to me, and I’m curious, Bryan, to your thoughts, and yours, Phil, that we need an intervention in a way of, if you want to have any chance at all of rebooting the culture, where the community means something, you actually need to act like the community means something.
Phil Kirschner: And that intervention is purpose. When asked, “Why aren’t my people coming back? Why are we struggling to do this hot-desking program? How do we design the office for the future?;” my most common question to clients now is, “For what purpose?” We have to go back to basic principles. It’s something your employees will not sniff out as just jargon or that you’re placating them.
Photo By: Canva
If you ask any company, “If all of your offices were all to evaporate, which ones would you build back and why?,” retailers or even bank branches know exactly why a location is where it is. And they scrutinize, with incredible intensity and frequency, how well that decision is going; foot traffic sales, customer engagement.
But we’ve never applied that to the places we ask our workers to go to, which, again, does not have to be our office, so to speak. I don’t think necessarily that innovation is a default reason for saying, “Oh, we have to come in.” Even just saying, “We think the role of this office is for accelerating sales,” or for someone who might have gone to work for a life sciences firm because they have a medical background or feel passionate about care, to tell them, “This place exists because we are accelerating clinical speed,” that speaks to them.
Some other company might just say, “We’re doing it to increase productivity, collaborate more, help our clients.” That’s not specific enough. If you have an organizational purpose that aligns around being good to the planet, being good to the community, increasing diversity efforts, that’s OK. How does your office or the places where your employees go speak to that mission?
Bryan Hancock: So, Phil, I have a question for you on how important it is to have a buzzworthy office. Or is it what’s happening there that is more important than the buzzworthy environment itself?
Phil Kirschner: It’s the latter, and does it align to what I want to be doing or contributing to? And that, in and of itself, can be a huge magnet without being Instagram worthy per se.
Tomorrow we will focus on reconfiguring office spaces and making the return to work an impactful experience.
