By Debra Dailey; Rebecca Schwartz
Edition 1 – August 2012 Pages 19-22
Tags: real estate • facilities management • productivity • health
Today’s business environment is rapidly becoming more global, information-based, and technologically-advanced in support of the emerging knowledge economy, and companies must also evolve if they are to keep up with these trends.1 Employers are beginning to understand that one of the key components for maintaining their competitive advantage is the acquisition and retention of a healthy, productive, and highly-engaged workforce. To ensure corporate survival in the knowledge and information age, however, the workforce – unquestionably a company’s most valuable asset – must also be provided with the resources necessary to drive innovation and creativity, as well as foster teamwork and collaboration.
Organizations cannot neglect the fundamental need to focus on core business; however, as business needs have evolved, so too have the needs of employees. With four generations in the workforce – each with different workstyle and lifestyle demands – organizations must learn to view their employees as multi-dimensional and respond to their preferences accordingly in order to remain successful.
The shifting dynamics of the workplace are motivating employers to seek out new ways to maximize their employees’ health and productivity, and many have identified the current work environment as being inhibitive of the realization of these goals. As a result, a new type of work environment is increasingly being demanded: one that effectively supports the convergence of employees’ workstyle and lifestyle needs in order to promote better well-being, improved job performance, greater pride in the company, and ultimately organizational success.2
The role of the workplace professional is being elevated to a new level of importance
In response to changing organizational needs and employee demands, the role of the workplace professional – including the corporate real estate (CRE) executive, the facility manager (FM), and the entire industry focused on delivering value to corporations through the strategic management of corporate real estate and workplace resources – has expanded to include a much broader scope of responsibilities and an entirely new set of priorities. In fact, a 2012 poll of nearly 200 corporate real estate and workplace executives revealed that the most urgent issue facing their industry is the “quality of working environments and work experiences,” closely followed by “energy conservation and alternative industries.” 3 Likewise, a study conducted by Today’s Facility Manager confirmed the widening role of the facility manager, and found that many FMs indicated “a strong shift towards more flexible office design, the shrinking footprint of the traditional workstation, and more space being allocated to teaming and common areas that support open communication and collaboration as well as learning spaces.”4
No longer restricted to the typical domain of their occupations, both the CRE executive and the FM increasingly find themselves called upon to help pave the way in the conceptualization and creation of this new type of work environment.
These professionals have been given the task and opportunity to contribute to an organization’s strategic operations, business success, and competitive advantage.5 Furthermore, CRE executives and FMs increasingly play a vital role in bringing together key cross-disciplinary resources and teams to address the requirements of the new work environment.
This paper will discuss the importance of the built environment in cultivating employee engagement and the emerging demand for a workplace that supports both the workstyle and lifestyle needs of employees. The role of the workplace professional in the delivery of solutions that address these needs will be examined; and the essential requirement of a unified, multi-disciplinary approach to the realization of an integrated system of workplace solutions will also be explored. Two companies that have recognized the value of strategic improvements to the work environment – and have subsequently successfully leveraged the workplace to their advantage – will be used as case studies to bring home several key points.
Employee engagement is critical for company success
Employee engagement – encompassing an employee’s motivation, morale, and enthusiasm for the job – is already top of mind for many companies. In a 2010 Towers Watson survey of 700 global companies, “level of disengagement among workers” was listed as one of the top four workforce areas of concern.6 This is not entirely surprising, as the research has clearly shown that employee engagement is critical for employee satisfaction, productivity, and company success. A study conducted by Gallup found that companies with engaged employees are 56% more likely to have better than average customer loyalty, 38% more likely to have higher than average productivity, 27% more likely to have higher profitability and 50% more likely to have lower turnover.7
The built environment directly affects employee engagement and productivity
It is widely acknowledged that well-managed buildings, services and facilities enable an organization to function more efficiently and effectively, and contribute toward the provision of the optimal work and business environment.8 However, many employers have been slow to recognize just how powerful the built environment can be in augmenting employee engagement and productivity. Often, the design and layout of the indoor workspace are viewed as relatively inconsequential compared with other organizational variables designed to motivate employees…namely pay scales and promotions. While these incentives certainly have their place, research in organizational behaviour has clearly shown that the physical setting can significantly influence employee satisfaction, productivity, and motivation, thereby either aiding or hindering the accomplishment of organizational goals.9 In fact, research conducted in office buildings provides compelling evidence on productivity gains (or losses) of up to 15% due to indoor environmental conditions.10
To a large degree, facility managers control many aspects of the work environment and, therefore, can significantly influence employee engagement and ultimately company success. Tim Parker, MSBA, emphasizes that “employees bring to the workplace an individually developed and unwritten set of expectations, setting a benchmark of how they want to be treated and cared for by the company.”11 One of the basic job duties of the FM is to oversee daily operations, and the FM should be mindful that when buildings appear run-down or outdated, employees may form a negative attitude toward the company. This problem is often further exacerbated by excessive workplace distractions, poor service from support staff, or a lack of basic amenities such as onsite cafeteria options. “Employees perceive the lack of attention in these areas as a direct reflection on senior leadership,” Tim notes, “and their engagement and performance suffer as a result.”
Employee health and well-being can be enhanced (or harmed) by our environment
Low engagement and lost productivity often manifest themselves as increased presenteeism, which occurs when employees go to work in spite of physical or mental illness.12 Despite the progress being made toward the more universal implementation of healthier building design concepts, occupational ill-health – both physiological and psychological – remains a serious problem. According to the American Institute of Stress, U.S. industries lose nearly $300 billion a year – or $7,500 per worker – in employee absenteeism; diminished productivity; employee turnover; and direct medical, legal, and insurance fees related to workplace stress.13 Work-related illness stems from a myriad of sources and stressors, some of which pertain to the work process and culture and are, therefore, outside of the workplace professional’s control. However, many studies have found significant associations between the work environment and employee health risks and medical conditions, and the CRE executive and FM do have the ability to alleviate health-related problems that originate from attributes of a substandard built environment.14
In addressing these issues, an integrated approach that promotes the physical as well as the psychological well-being of the occupants should be implemented. FMs can directly improve the physical well-being of employees by changing aspects of the ambient environment – specifically air quality, ventilation, thermal comfort, lighting, and acoustics. Psychological well-being is also affected by these modifications and can be further enhanced by: better quality of artificial and natural light, the provision of views of the outdoors, proper use of color and furnishings, adequate workspace, and ergonomic work stations.15 When aggregated, these changes have a synergistic, far-reaching impact on the working environment that ultimately leads to increased employee engagement, well-being, and productivity.
Of additional consideration for the CRE executive and the FM is the emerging push for footprint consolidation and sustainable practices, which are increasingly being embraced by companies that recognize the impact these changes can have, not only on the environment, but also on the company’s employees. In fact, environmentally responsible building design is gradually being recognized as an answer to many of the health and economic challenges facing organizations.16 “Going green” creates a healthier and more comfortable indoor environment that results in better engagement and higher productivity among building users, as well as an enhanced ability to attract and retain employees. Within organizations that have been slow to adopt sustainable practices, the CRE executive and the FM can undoubtedly lead the way in the movement toward more eco-friendly buildings and facilities.
The built environment should support the lifestyle needs of today’s workforce
The needs of today’s workforce encompass more than just a desire for a health-promoting environment, however; employees are increasingly seeking more substantive solutions and services to address lifestyle improvement and behaviour change.
Employee wellness programs – once considered exceptional – are slowly becoming the norm as employees have come to expect them and employers have come to recognize the value and cost reduction these programs are capable of generating
Employee wellness programs can include a wide range of amenities and services, including: fitness centers, onsite coaches/nutritionists, disease management clinics, and ongoing health promotion initiatives. In addition to meeting these health-related needs, many organizations have also realized the importance of creating an environment that encourages better work-life balance for employees.
Both the CRE executive and the FM clearly play an integral role in the design, construction, and management of amenities such as onsite fitness centres and clinics. However, these professionals can also contribute to the promotion of a healthier workforce by creating opportunities and spaces that foster better employee well-being and cultivate a more exemplary workplace experience. For instance, together the CRE executive and FM can advocate for and design vitality, relaxation, and innovation zones for employees, and work toward the provision of healthier dining and vending options. Furthermore, the addition of amenities such as concierge services, onsite stores, personal and home services, or onsite IT help desks – all of which allow employees to better balance their work and home lives – undeniably falls within the expertise and domain of the workplace professional.
Employees have different workstyles that need to be accommodated – CRE & FM can help
In concurrence with their evolving lifestyle needs, employees in today’s knowledge economy are also progressively demanding that organizations support an entirely new workstyle – one that fosters innovation, learning, and creativity, and requires flexibility, multiple places to work, and the ability to connect and socialize with peers. A 2008 U.S. Workplace Survey conducted by Gensler revealed that there are four work modes regarded as essential for optimizing employee productivity – those that encourage employee focus, collaboration, learning, and socialization – and that workspaces designed to support these modes can yield significant improvements in several key organizational indicators of success. Specifically, survey respondents who incorporated the concepts critical to a better designed workplace indicated an overall improvement in job performance of 22%, and levels of employee engagement and job satisfaction three times higher than average companies.17
The CRE executive and the FM play a pivotal role in adapting a company’s physical workplace to the changing workstyle needs of its employees. The FM can directly affect employee focus by reducing distractions and interruptions in the work environment, while the CRE executive is often charged with finding creative solutions for building design and usage so that more space can be allocated to teaming and common areas that support open communication and collaboration, as well as learning spaces.18 Today’s knowledge economy depends upon innovation and the effective communication of ideas, and only when the workspace encourages these outcomes can an organization truly expect to thrive.
One company that understands the importance of innovation for success is Google. It is, therefore, not surprising that George Salah, Google’s Director of Real Estate and Workplace Services, espouses a forward-thinking approach to the company’s workplace design. Salah’s philosophy for the workplace is that it should reflect the organization’s principles, values, and culture, and be driven by the company’s specific work processes. As such, Google’s key workplace design principles include: designing for collaboration, interaction, and knowledge sharing; enabling flexibility and adaptability; and using the building to accelerate learning.19
Creating the optimal work environment requires a customized approach, the unification of cross-disciplinary teams, and the integration of workplace solutions
One of the challenges in restructuring the work environment is that the optimal design for one company may not be the optimal design for others.20 This indicates a need for the tailoring of workplace modifications to the specific needs of the organization and its workforce – an unquestionably complex and challenging task. Of additional importance for employers is the ability to provide multiple and diverse solutions that are not only harmonious with each other, but also uphold and advance the company’s brand and image. When workplace solutions form an integrated system – and especially when they are delivered and managed by a single source – the optimal synergistic impact can be achieved.
While the CRE and the FM executives are often entrusted with many responsibilities pertaining to workplace improvements, these professionals cannot fully address the built environment without the support and resources of other cross-disciplinary teams within the organization.
The CRE and the FM executives, therefore, must continuously collaborate with human resources staff, service architecture professionals, wellness consultants, and business managers who are all committed to the development of the “new” optimal workplace. In bringing these teams together – and often leading the movement
for workplace improvement – today’s workplace professionals can truly influence the well-being of employees and the success of the organization in a very significant way. W&P
Debra Dailey is the Vice President of Human Capital Solutions of toLive by Sodexo.
Rebecca Schwartz is a graduate student at the George Washington University and toLive Research Intern with Sodexo.
L Rebecca: http://www.linkedin.com/pub/rebecca-schwartz/43/459/658
L Debra: http://www.linkedin.com/pub/debra-dailey/b/780/136
1 Houghton, J & Sheehan, P. (2000). A Primer on the Knowledge Economy. Retrieved from http://www.cfses.com/documents/knowledgeeconprimer.pdf
2 Gutnick, L. (2007). A Workplace Design That Reduces Employee Stress and Increases Employee Productivity Using Environmentally Responsible Materials. Retrieved from http://commons.emich.edu/cgi/viewcontent.cgi?article=1150&context=theses
3 CoreNet Global. (2012). Corporate real estate and workplace leaders rate most important issues facing corporate real estate. Retrieved from http://www.corenetglobal.org/files/home/info_center/global_press_releases/pdf/pr120530_advocacy_issues.pdf
4 Today’s Facility Manager. (2003). The Changing Role of the Facility Executive. Retrieved from http://18.104.22.168/tfm_03_12_news3.asp
5 The Facilities Society. (2012). Strategies for facilities management. Retrieved from http://www.facilities.ac.uk/j/cpd/62-facility-management/118-strategies-for-facility-management
5 Towers Watson. (2010). Strategies for Growth. Retrieved from http://www.towerswatson.com/assets/pdf/3371/Towers-Watson-Strategies-Growth.pdf
7 Gallup. (2006). Engaged Employees Inspire Company Innovation. Retrieved from http://businessjournal.gallup.com/content/24880/gallup-study-engaged-employees-inspire-company.aspx
8 The Facilities Society. (2012). Strategies for facilities management. Retrieved from http://www.facilities.ac.uk/j/cpd/62-facility-management/118-strategies-for-facility-management
9 Bitner, M. (1992). Servicescapes: The impact of physical surroundings on customers and employees. Journal of Marketing, Vol 56, 57-71.
10 Wheeler, G & Almeida, A. (2006) These Four Walls: The Real British Office. Chapter 22, Creating The Productive Workplace. London: Taylor & Francis.
11 Parker, Tim. (2012). Employee Engagement and the Role of Facilities Management.
12 Musich, S, Hook, D, Baaner, S, Spooner, M & Edington, D. (2006). The Association of Corporate Work Environment Factors, Health Risks, and Medical Conditions with Presenteeism Among Australian Employees. The Science of Health Promotion, Vol 21(2), 127-136.
13 Stambor, Z. (2006). Employees: A company’s best asset. Monitor on Psychology, 37(3). Retrieved from http://www.apa.org/monitor/mar06/employees.html
14 Musich, S, Hook, D, Baaner, S, Spooner, M & Edington, D. (2006). The Association of Corporate Work Environment Factors, Health Risks, and Medical Conditions with Presenteeism Among Australian Employees. The Science of Health Promotion, Vol 21(2), 127-136.
15 Proper, E. (1998). Surroundings affect worker productivity; office design is more than cosmetics. Industry Week, 247(11), 14. Retrieved from WilsonSelectPlus database.
16 RSMeans. (2002). Green building: Project planning and cost estimating. Kingston, MA: Construction Publishers & Consultants.
17 Gensler. (2008). The 2008 U.S. Workplace Survey. Retrieved from http://www.gensler.com/#viewpoint/features/17
18 Today’s Facility Manager. (2003). The Changing Role of the Facility Executive. Retrieved from http://22.214.171.124/tfm_03_12_news3.asp
19 CoreNet Global Summit. (2009). The Google Philosophy: PowerPoint Presentation.
20 Bitner, M. (1992). Servicescapes: The impact of physical surroundings on customers and employees. Journal of Marketing, Vol 56, 57-71.
Once again, we feel that this paper is another great example of ‘real science’ being applied to elements of the workplace. There are many issues to consider, and perhaps common design practices to be re-worked as a result, in Linda’s article. Also, again psychology is being shown to be one of the most important bodies of knowledge to be applied to ‘work and place’. We are fortunate to have Linda as a member of the Occupiers Journal Regional Partners network, and we will hear more from her in future issues. Do please join this discussion with Rebecca, Debra and others on our Work&Place Linkedin Group.
No longer restricted to the typical domain of their occupations, the CRE executive and the FM find themselves called upon to help pave the way in the conceptualization and creation of this new type of work environment.
Facility managers control many aspects of the work environment and can significantly influence employee engagement.
Of additional consideration for the CRE executive and the FM is the emerging push for footprint consolidation and sustainable practices.