Space Management is a vital discipline within an organization’s tool belt with far reaching influence. Working with lateral partners from HR, IT and the board, Space Management Teams impact a company’s culture, its employees and the bottom line through the management of an organization’s space. The impact is felt through daily facility management and strategic actions delivering more effective and smarter buildings meeting not only users’ needs, but their wants, while remaining focussed on core business objectives.
Effective management of a property portfolio requires a focus on the colloquial 3 P’s – People, Places and Process. Without planning for employee’s wellbeing, catering to the basic, role specific and person specific needs that building users have, Space Managers are failing them. This failure affects focus on and delivery of the core business objectives from higher attrition rates, lower productivity, greater disengagement and absenteeism.
An organization’s second highest cost, its places, require focus from Space Managers to optimize deployment and deliver a service driving value today and tomorrow.
The final element that ensures successful Space Management is process, which concerns the horizontal and vertical integrations Space Managers need gaining buy-in and cooperation from inter-organization partners and third-party service providers. Process also pertains to the standards which enables consistency through the built environment and data.
Performance measurement across the 3 P’s are vital to maintaining optimal buildings. Many methodologies have been incorporated to capture metrics on costings, task completion and building user perception.
Built for purpose online platforms – Computer Assisted Facility Management (CAFM) and Integrated Workplace Management Systems (IWMS) – include automation, data control, centralized visibility, communication channels and process control to support Space Management Teams.
The following paper first defines the Space Management practice. Secondly, Space Management’s contribution to bottom line through improving facility efficiency, occupancy rates and supporting customers (facility users). Thirdly, the paper reviews tools used by Space Management teams for managing, planning, tracking and communication across an organization and all stakeholders.
What is Space Management?
As a broad managerial practice, Facilities Management includes both hard and soft services. Services are integrated to operate, maintain, improve and adapt facilities in support of an organization’s core business operations.
Space Management Teams, a sub-discipline in Facilities Management, are entrusted with one key goal:
- To deploy and manage efficient facilities that supports users’ requirements enabling task completion in-line with core business objectives.
There are operational and strategic activities Space Managers undertake to achieve these goals.
Operationally, Space Management Teams must maintain accurate views of space (area and volume), quality (appropriateness, visual and environmental qualities) and shape (plan and layout). Space planning and management are key activities in achieving optimized building performance.
Strategically, Space Management Teams are responsible for the planning of facilities and changes that more effectively supports core business operations.
Within this paper and through the industry the terms Space Planners, Space Managers, Facility Managers (FM’s), Corporate Real Estate (CRES) Teams are used interchangeably.
How Space Management Teams, Tools and Processes Affects Profits
Space Managers have a responsibility to the organization and to employees to deploy and manage portfolios that evoke positive responses from building users while aligning with core business objectives.
Categorically, focussing on the 3 P’s – People, Places and Processes – enables Space Management Teams to successfully balance facility deployment.
People are the greatest contributor to an organization and its bottom line. They bring breath and life to the organization, shaping its goals and culture daily. People also happen to be the single biggest cost to any organization. This fact does not change across size, industry or area of operation.
In today’s workplace, users’ needs are widely varied. Employee requirements within a Space Manager’s remit can broadly be categorized as fundamental space requirements, business group-specific space requirements and employee-specific space requirements. Fulfilling these requirements not only enables core business objectives to be successfully achieved, but strong portfolio development encourages and fosters much needed diversity and boosts user’s wellbeing.
60 years ago, in 1959, Herzberg and colleagues identified working conditions as one of the factors that most often contributes to employee satisfaction at work. If an employee considered this variable unsatisfactory, employee dissatisfaction usually resulted, leading to reduced productivity and resultant bottom line impact. Then, as now, the mantra remains, ‘take care of your people and they will take care of you.’
Fundamental Space Requirements
Through a facility’s lifecycle, it is the Space Manager’s role to plan floorplates for adequate, safe and healthful space. Further custodial tasks impacting space include maintaining current data and accurate cost allocation.
It is the Space Manager’s role to ensure that an employee or business group has the required space and assets for them to fulfil their work requirements in-line with core business objectives. Space distribution is defined through the space standards (BOMA, IPD) an organization references to define their space standards and types. Space allocation and utilization costs are allocated in-line with an organization’s Business Hierarchy. Space planners build out consistent portfolios by referencing these standards as well as their own, internally created, Workplace Design Principles (WDP). Space Planning encapsulates the space used immediately by that individual/ team in addition to adjacent spaces such as meeting rooms, W/C’s and breakout space.
Data management is a critically imperative task for Space Managers. Not only for accurate visibility of their space informing planning, but, more fundamentally, enabling safe floorplate distribution in accordance with local health and safety/ fire code.
Business Group-Specific Space Requirements
Not all role functions are the same and deploying the same cookie-cutter space saves money through economies of scale and makes achieving brand standards easy, but the same strategy also fails the space user.
An accounting team will have very different needs to a customer service team and they definitely don’t want to be adjacent to each other without sufficient sound protection! Space Managers must plan for a team’s objectives and the activities they undertake, planning space for that team – whether incorporating acoustic panelling for a customer service team or providing more and smaller private meeting spaces for Human Resources. This practice of deploying role and function specific space is called Activity Based Working. Activity Based Working is based on the principle that one space type will not fully support a user for the diversity of requirements their role includes. Therefore, purpose-built spaces are being planned for modern offices. This emergent strategy is iterative and allows for valuable user feedback.
Passive and observational utilization studies can indicate whether there are cost savings or other benefits that can be achieved by rolling out flexible, unassigned work spaces (hotdesking or hotelling). Deploying conscientious spaces also enables Space Planners to support users to avoid significant health issues associated with not moving for long periods of time – called binge-sitting.
Employee-Specific Space Requirements
Workforces are diverse with individuals and groups having unique workplace requirements.
There are five decades of employees (from 18-60’s) working alongside each other. The retirement age is extending in many countries, where soon, workplaces will have six decades of employees! Libya is leading the way with a mandatory retirement age of 70. Within this wide group, there are many different orientations – the young are keen on developing their careers, those in their 30’s are focussed on young families, personnel in their 40’s and 50’s are maturing in their careers through to senior and other impactful roles, while those in their 60’s and 70’s may be focussed on getting their personal houses in order preparing for retirement. Outside of these generic goal orientations, there are also lifestyle choices and religious beliefs impacting employee needs.
According to a study from Leesman, those aged 35-44 consistently record the lowest workplace effectiveness scores while those aged 45-54 show the highest work complexity. Additionally, employees in the upper age ranges have age related needs (natural and artificial lighting etc.) progressively increase in importance.
Data shows those employees with the highest activity complexity have the most multi-faceted workplace infrastructure needs. This is also the group that benefits the most from environments that provide a variety of work settings supporting their work complexity.
Broadly, employees are now looking for a convergent workplace experience, one that blends personal needs and wants– on-site daycare, café’s and restaurants, gyms/ health centers, multi-faith facilities – with professional obligations.
Tackling presenteeism and meeting users and strategic demand for flexible workspace enables Space Managers to build space better catering to role objectives and providing a healthier work/life balance for facility customers.
Facilitating all of these demands makes positive impacts. Employee wellbeing increases, as does pride, productivity and overall organizational reputation. However, space deployment and operational costs can increase through providing greater space per average workstation, losing economies of scale and customizing spaces. But, weighing the added cost of deployment against improved wellbeing (reducing absenteeism), productivity and retention/ attraction of strong employees – and the positive impact this has on financials – has to be taken into consideration when considering strategic changes.
Employees are heterogeneous. And this diversity has been proven to make a significant impact improving an organization’s core business operations. Diversifying is too strong to not encourage and in-line with policies encouraging employee diversity, Space Managers must similarly deploy facilities that supports a diversified workforce.
This is achieved through an appropriation of Maslow’s hierarch of needs – firstly, providing fundamental space requirements and progressing to business group and employee specific space requirements.
Space Managers are responsible for the planning and management of their portfolios. This includes the fixed infrastructure (elevators, stairs, corridors) down to space design including furnishings, interior walls and environmental conditioning.
Again, the sweet spot for Space Managers is to deploy space that’s positively perceived and encourages core business objectives to be met. Places affect productivity and poorly balanced portfolios haemorrhage capital.
Workflow is affected by the environment (place) in which the activity (
work) takes place. Researchers have found that small factors rather than grand architectural statements have an increased difference on work levels/ quality.
Productivity is affected by lighting (natural and artificial), temperature (heating and cooling), indoor air quality (carbon dioxide, smells, humidity), acoustics and noise control, the physical condition of facilities (ceilings, floors, walls, windows and doors) and the size or configuration of space types. Size and configuration impacts perceptions of crowdedness, a lack of privacy and noise in relation to stress.
Recognizing the impact facilities has on employees, Space Management Teams are seeking more human-focused performance metrics. These metrics include measuring performance based on a user’s perception of the built environment or its effect on their wellbeing. However, human-focused metrics adoption is slow. In 2012, 95% of Space Managers believed that the workplace impacts employee productivity, yet only 30% measured its impact.
Employees are engaged at work for an average of 2,080 hours per year (almost 25% of the total hours in a year). It is crucial to feel a sense of belonging. ‘To cultivate more social interactions, employers should create social gathering places at work, such as break rooms with lots of food options, seating options, music and so on,’ explains psychologist Wyatt Fisher. ‘The more inviting the space the more likely it will be used.’ A study released through Ernest and Young reported 40 percent of employees feel isolated in their role, driving higher disengagement and lower productivity. Research suggests that companies with high disengagement and loneliness experience almost 37% higher absenteeism, 49% more accidents and 16% lower profitability.
Rapoport argued that the built environment also influences building user’s behavior through the messages it sends. Its fixed-feature elements such as the physical structure and layout of facilities and semi fixed-feature elements such as type and arrangement of furniture, plants, signage and decoration communicate meaning. Leesman found that only 53% of employees are proud to host visitors on-site.
Space Managers are not only beholden to their customers (the building user), they must also work in partnership with lateral teams and support the organization to meet core business objectives. When planning facility occupancy strategies, Space Managers must move through a series of choices to arrive at the solution providing the greatest ROI as defined by the organization. Choices regarding the building (purchased or leased), construction materials and the technical facilities influence the operational costs and investments can tie up capital in the longer term.
During occupancy, Space Managers must optimize space, delivering the right balance. Industry averages indicate that workspaces are vacant 45% of the time. Let’s take a 10k sqft floorplate and drop it into New York City where the average cost per square foot for office space is $6.16/ month. Rough operational costs for the total space equals $61k/ month. Again, with 45% of that space not being utilized, the underutilization equates to $27k every month. Money that could have been more effectively invested driving greater values and return. Not proactively looking for new strategies to optimize space usage or consolidation opportunities results in significant amounts of wasted resources.
The final leg propping up a strong Space Management strategy is process. Effectively, how the road from Point A to B, or (hopefully) beyond is navigated. Global organizations have operations in multiple regions with dozens of internal and third-party teams contributing to both operational and strategic management requiring visibility, accountability and joined-up communications.
Is was Barrett who, in 2015, points to the importance of building strong intra-organizational relationships through improved data flow and greater communications. Again, lateral partnerships between Space Managers and HR, IT, Security, Maintenance, Grounds and the board must be built and managed. Downstream stakeholders include other FM specific teams such as moves companies. There are a lot of spinning plates to keep facilities running. Effective Space Management practices wield a major influence on organizational success factors such as profit determination, productivity, management of energy and waste, employee welfare and public perception. Therefore, the aim of Facility Teams should be not just to optimize running costs of property, but to raise the efficiency and suitability of the management of space and other related assets for people and processes.
When defining space types, organizations have a range of widely accepted space standards to choose from – Global Estate Measurement Code for Occupiers by MSCI, BOMA, IPD – as well as defining their own standards.
Business hierarchies are generally defined by the organization, but typically have 5-6 layers starting with defining cost centres. In addition to Space Standards and Business Hierarchies for managing property and driving data quality organizations define their own Workplace Design Principles (WDP). A WDP is, effectively, the physical manifestation of an organization’s Corporate Identity, enabling Space Teams to maintain approved branding touchpoints according to space type (board room vs. a workstation) and personnel (level of seniority or clearance for assets based on individual or role-specific need). Typically, a space’s functional suitability relates to the provision of sufficient space in the facility and effective space management as managed through Space Management platforms.
Additionally, clients define tasks’ expected delivery/ completion date through Service Level Agreements (SLA’s) to ensure everyone involved in a raised task has visibility and awareness of expectations.
Breakdowns in what’s delivered to customers through the 3 P’s results in many organizations simply not getting what they could from their workspace. In too many spaces, opportunities are being routinely overlooked and the toxic impact on employees of poor physical and virtual infrastructure is grossly being underestimated.
Incorporate Effective Space Management Tools and Practices
Alongside the knowledge and processes Space Managers have developed, there are purpose-built platforms Space Management Teams utilize to streamline roles, automating laborious tasks and increasing communications and visibility.
Typically, Computer Assisted Facility Management (CAFM) and Integrated Workplace Management Systems (IWMS) platforms are hosted platforms with bolt-on modules that organizations choose based on need. Platform providers enable tool customization, meaning core capabilities are enhanced driving further value for users. A Space Management platform should be a part of a bigger space management strategy, not the entire strategy.
CAFM and IWMS platforms are comprehensive in their capabilities and purpose-built with the Space Manager always in mind. Many platforms started simply from need, with Space Planners not being able to move through a part of their role or finding a task too laborious. The Space Planner switched hats to become CEO. These platforms have evolved the industry, encouraging practitioners to move away from spreadsheets and the difficulties commonly experienced with their use. Generally, spreadsheets are poor tools for living data management and complex analyses, especially where a portfolio is multi-regional and managed by multiple stakeholders. Limitations or issues resulting from spreadsheet use when managing global property portfolios includes:
- Data quality suffers
- Errors go unnoticed… until they don’t
- Capturing data complexity is challenging
- Advanced analyses are not supported
- Duelling spreadsheets create data face-offs
- Limited governance with spreadsheets
- Inefficient use of company time
Because of the orientation of the company building the Space Management platform, there are many, many advantages to their use. A typical Space Management platform features automated in-bound and out-bound data feeds collating and pushing data from across a portfolio. Inbound data sources include HR (employee ID, Business Group allocation), security (building or floor access). Outbound feeds collate data around space usage for a period and who used the space, pushing chargeback to the appropriate Business Group/ cost center.
Space Management’s User Interfaces are generally visually driven (helpful for easy and fast performance comprehension and for easing interpretation and communication within multi-language teams). Cross-facility data is fed into the platform and tethered and anchored in controllable layers to a digital floorplan. Users benefit from the ease this creates when viewing a floor or building to understand occupancy rates by floor, agile zone (or neighborhood) or business groups. Operationally and strategically this layered floorplan view is beneficial for Space Managers, especially where ‘as-it’s-being-used’ data comes into play. Utilization reports can be overlaid outlining building-user movement.
Cross-facility automated data feeds makes life easier for everyone. Instead of spending time chasing up on data, data delivery to the platform is timely, current and accurate. Additionally, data standardization is baked into Space Management tools– requiring a certain piece of information or requiring in a specific format before being able to move on. Where multiple personnel and teams are running facilities in different regions, these hard requirements baked-in make a significant impact maintaining data quality over the long-term. A single platform with strong baked-in process and integrated feeds maintaining current data promotes a single source of truth amongst all property stakeholders. Having this tool buy-in and regular use eliminates data siloing which severely affects data quality and points towards a breakdown in communication – essential for joined-up operational activities and strategic planning.
Poor quality space data has a significant impact on the overall management and performance of facilities resulting in:
- Loss of trust: Business Groups and cost centers will pushback on charge-back. Senior management will question outputs from the Space Management team and move away from metrics during strategic planning
- Missed opportunities: poor space data impacts identifying space consolidation opportunities
- Lost revenue: inefficient space occupancy/ utilization and the employee-s9de of lost revenue which includes greater absenteeism, lower productivity and higher attrition rates losing valuable knowledge
In a world of big data, bad data is becoming more and more prevalent. The increased prevalence of bad data is fuelled by the technology used to manage and organize data. In the rush to be more – more on-demand and more personalized – organizations have responded by embracing cloud computing and enhanced analytics. Every scrap of every shred of customer data is valuable. But, this rapid shift in technology and information has resulted in a data quality control lapse for many organizations. Poor quality data costs organization $9.7 million per year.
Capturing Utilization & Environmental Data Facility Wide
While a shift towards measuring building user perception is on the increase, Facilities Teams are still concerned about financials. Utilization metrics link a space’s usage and targets to financials. These metrics are captured through passive and active methodologies.
Passive building usage metric collection is commonly captured from sensors deployed through buildings from lobbies to corridors to workstations. Typical data points include the time a person entered and left a space and directional information – where they were moving to. Sensors through facilities also capture environmental conditions including temperature, lighting and air quality.
Space usage and environmental condition metrics can be captured through active means – engaging with building users to understand their experience and observation.
Usage and satisfaction metrics are aggregated with space and costings metrics to outline a space’s success supporting employees and alignment with strategic business objectives. Organizations use this deep and rich data to design the right mixture of spaces, define optimized seat-sharing ratios, and successfully identify business adjacencies.
As new methods of working are being discovered and invented, supporting technology is coming into play that makes use possible and easier. Activity-based Working and agile are heavily reliant on sensors and employee/ space-user side apps. Space utilization (software/ hardware for capturing and other important metrics) will be covered in another paper.
If Performance Is Not Measured, How Can Performance be Improved?
The delicate balance of deploying supportive, encouraging workplaces that continuously aligns with core business objectives on a global scale is hard to achieve.
Achievement requires experience, processes and tools to deliver. Yet, in a study conducted by Leesman, ‘organizations are not getting what they should from their corporate workplaces.’ Again, the right distribution of space and associated costs are out of balance and employees are being negatively impacted by their workplaces.
On-boarding purpose-built tools and training personnel clearly can only go so far. Introducing a framework in-tool, or otherwise, to measure multiple hard (agile workstation ratios) and soft (user facility feedback) metrics providing indicators of overall facility health and management team performance is crucial to understand a team’s success.
Facilities Teams traditionally measured facility performance solely by financial indicators (i.e. cost of sqft/ sqm and workstation deployment). But, with the growing awareness that facilities impact employees and their wellbeing – a broader range of metrics are now being incorporated to measure facility user experience, which has driven the need for more robust measurement frameworks to be incorporated into performance review.
Common Portfolio Performance Measuring Frameworks
There are a range of commonly used performance measuring frameworks used in-industry to understand portfolio performance, health and alignment with longer-term strategic goals.
To name a few; the Balanced Scorecard (BSC), industry benchmarking, Key Performance Indicators (KPI) and Post-occupancy Evaluation (POE).
The Balanced Scorecard (BSC) has emerged as CRES Teams have grown more aware of the impact that facilities have on users. FM’s recognized focussing purely on financial metrics for planning and managing space was only outlining half the story for facility performance.
With a deeper and broader perspective, the BSC captures key metrics from across the major business drivers including, financials, customers (all facility users) and internal business processes. This richer perspective enables teams to balance facilities more successfully and provides the information needed for planning change as trends and business objectives evolve.
Benchmarking is a comparative framework. Users look externally to industry standards to understand if their facilities are above, in-line or below typical performance levels. Additionally, identifying the best performer in a certain category gives Space Managers a goal to match or beat performance.
Where organizations span multiple regions and have internal and third-party service providers managing their portfolio, the benchmarking framework can be successfully built and deployed internally.
In addition to identifying strategies for port
folio performance improvement, when done right, inter-portfolio benchmarking encourages discovery, communication and, hopefully, friendly competition amongst the teams that are supposed to be working towards the same goal delivering optimized portfolios. Intra-portfolio benchmarking not only drives performance, but breaks down silos and encourages communication for better joined-up strategy achievement.
Key Performance Indicators
Key Performance Indicators (KPI’s) are developed to track and monitor the success of a specific activity as the activity is being rolled out.
The first step when developing KPI’s is to identify relevant indicators that are not only measurable but also quantifiable. The formulation of individual and clusters of performance indicators depends primarily on who is creating the KPI (e.g. facility managers, executive level management), the nature of the organization (private vs public), performance assessment focus (e.g. financial, functional, physical) and current trends and demands currently being seen in-industry.
Therefore, KPI’s are flexible and can be linked to both operational and strategic goals. Key Performance Indicators provide a link between hard data and business strategy. Examples of operational KPI’s include tracking move jobs – ensuring jobs are restacked in-line with Service Level Agreements. Examples of strategic KPI’s include redeploying a new agile strategy creating an occupancy ratio of 1 workstation for every 1.3 occupiers with a financial goal of 0.5% cost reduction and improvement to wellbeing of 2%.
KPI’s contextualize big data in a meaningful way to outline how well operations are in alignment with business goals. When it comes to fine-tuning business strategy, KPI’s offer vital insight avoiding missed rightsizing opportunities.
Once a new space is occupied and employees have settled in, a Post-occupancy Evaluation (POE) is a very useful framework for understanding the new or refurbished space’s success in meeting user’s workflow requirements and their personal expectations.
A robust POE will probe the new/ refurbished space across the following three categories:
- Health and safety and security aspects
- The functionality and efficiency of space
- Psychological, aesthetic and socio-cultural aspects
Provided the right steps were taken when planning and making changes, the feedback will be positive and employees will find their new space accessible and supportive. However, referring back to the Leesman study, 36% of employees responded negatively to a post-occupancy study reporting their newly deployed workspace did not support their needs. At face value this appears to be an inexcusable waste; that relocation or refurbishment does not necessarily deliver significant operational benefit, especially since most come at weighty operational expense. Ultimately, failing to deliver and having a negative impact on key entities points evermore towards the important of experience and informed decision-making taking into account user feedback as well.
One of the most important things that these frameworks do is to start conversations. By simply having measurable goals and knowing they are being tracked helps promote an attitude of more informed decision-making across an organization.
All of these frameworks have been developed and are implemented by teams to encourage cost savings, improve revenues and create a stronger competitive edge.
Organizations operating at their fullest potential are those that allow their people to be their best at work. Successful facilities promotes healthfulness, productivity which also drives core business objective achievement.
An excellent employee experience doesn’t happen through luck or by accident. Instead, it is the result of a thoughtful approach putting the Building User, their role in the organization and person specific requirements at the centre of leadership attention.
The role of a Space Manager is not just to meet service level agreements in a cost-effective manner. Space Management now contributes at a strategic level to the planning of goals with teams challenging current ways of doing things, looking constantly for better ways to deliver value. Today’s Space Managers are catalysts for change.
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