Ever since coronavirus forced large parts of the working population to work from home (WFH), with corporates following Dutch Government guidelines to WFH as much as possible, there is a debate on the virtues of working in the office vs WFH. The debate is in fact a global one, as most countries have or had, one way or another, specific guidelines for WFH as a result of coronavirus.
The debate up to now includes expert opinions, plenty of highly biased views, anecdotal evidence, results from quality surveys like Leesman (www.leesmanindex.com), corporate employee surveys, and individual corporate and personal experiences. The debate will probably continue for years to come and will really only become more meaningful when it starts to include an analysis of the meta effects of shifts in the balance office vs WFH on corporate identity and culture, the ability to innovate and long-term employee health and well-being.
WFH – Dutch context
The Netherlands is not an ‘everyone in the office, from 9 to 5, five days a week, in 6 sqm cubicles’ office market. It is already one of the more flexible markets in Europe, with just under half of employees (48%) working less than 35 hours a week and 32% working less than 28 hours a week. The average work week equates to 31 hours. Meanwhile, in 2019 already about 25% of employees worked incidentally from home.
Most occupiers have been increasing office ‘density’ for years, reducing their space requirements, as an office is generally seen as a cost to the business that needs to be minimised. The average ratio of office desks to employees in The Netherlands is circa 70-80%, whilst at the same time the average office space per desk is down to circa 13 sqm (Amsterdam: circa 11 sqm), from nearer 20 sqm in 2001.
The Dutch model of part-time working, flexible hours, incidental home working and high desk efficiency could perhaps suggest that a further shift in the balance of WFH and office may well have a relatively modest impact on the space requirement of corporates
The jobs to be done
The evidence so far from employee surveys such as Leesman is that some activities are better done at home, achieving higher productivity. This includes in particular individual focus work, standardised process work, planned meetings with a clear agenda and video conferencing. In contrast, collaboration, sharing knowledge, creative thinking, training new employees, informal meetings and social interaction work better in an office environment.
The conclusion therefore must be that most office set ups currently do not work for everyone or, to be specific, not for every task. This leaves corporates with a clear choice. Should corporates accept that certain things are better done at home and facilitate this? Or should corporates improve the office set up so that what is now better done at home can be done as well (or even better) in the office? We expect corporates to try and take ownership of the issue and do both.
Coincidentally, this situation occurred at the same time NSI was extensively exploring customer needs, which clearly confirmed the trend now being accelerated by Covid-19; for an office to work properly there need to be different ‘zones’ to facilitate the ‘jobs to be done’, such as a ‘quiet space’ zone, much like a library, a zone for social interaction, including catering, a zone for collaboration, including scrum rooms, meeting rooms, and presentation space, but also a zone with normal workstations for employees that cannot effectively WFH. The sort and mix of zones will be different for every corporate and will shift over time.
Addressing changing needs
We reshaped our strategy last year and clearly spoke out to put the customer at the centre of everything we do. Office real estate has over the years become a much more service-oriented, operational, business. We are at the forefront of this, starting our flexible HNK office concept already back in 2012. In 2020, we explored our customer needs in detail through multiple in-depth interviews and started to pilot new concepts to be able to offer the workplace of the future (see page 16).
WORKING FROM HOME VERSUS THE OFFICE
We have collected several observations and anecdotal evidence from the many conversations we have had with tenants, prospects, agents and other partners. The observations below should not be considered as a complete set of firm conclusions, but will be included in the mix in further optimizing our propositions going forward.
Balance WFH versus office
- Most corporates recognise that WFH is actually working well and in more parts of the business better than initially
- WFH will be a way for corporates to attract and retain
- Corporates are seeing that senior employees generally seem to cope well with WFH, but that younger employees that WFH are largely disconnected, are ‘standing still’ in their careers and are proving less loyal.
- Corporates recognise that the cultural and social capital that has been built up by working together in proximity for years is being used up as a result of WFH and are looking for ways to replenish this, with a (partial) return to the office as one of the
- Corporates have mixed experiences with productivity levels. Some corporates now recognise they need to better understand/measure/monitor employee
- Health and well-being is actively being monitored, with a focus on signs of psychological stress, fatigue and burn-out.
- Multinational mega corporates are actively studying the body of evidence of WFH experiments to understand lessons learned and see what the right balance is in the office vs WFH Smaller corporates with few employees (<100) just get on with business.
- Senior management ultimately sets the tone, employees If management favours office working, the organisation will follow.
Future space requirements
- Corporates do want more flexibility, but will not go entirely flex as there is still a need for a long term ‘home base’ to showcase their brand and identity. Flex space will end up supplementing this.
- Many of the larger corporates are uncertain how things will evolve and are for now delaying decisions on future office usage. Smaller corporates (<1,000 sqm) are operating as usual.
- Larger corporates expect that they may need less space going forward, but they worry how they should manage load distribution, so that the office is being used efficiently, and not just on Tuesday to Thursday.
- Employees that want to WFH part of the week will probably not be able to claim a full time personal desk in the office in the future.
- Subletting is back. Especially in Amsterdam Zuidas. Most of this space is available for periods of up to three years, which is not considered a long enough period for other tenants to step in.
- Many corporates located in Amsterdam recognise that their locally resident employees are living in smaller apartments and are often co-habiting, which is not helpful to achieve productive WFH, and so may longer term not be able to economise much on space.