09 December 2016

Alison Nimmo: Why the office environment is key to productivity

Alison Nimmo, Chief Executive Officer at The Crown Estate, reflects on the findings from The Stoddart Review and highlights the importance of the workplace as a key performance lever.

Much has been said about the UK’s productivity crisis as it continues to be in sharp focus for government and business. Raising productivity levels is essential to deliver stronger economic growth and the Chancellor placed it central to his Autumn Statement.

Of course, productivity itself is a controversial subject. As a metric it alienates industries that exist to collaborate, serve customers or innovate – the basis of many of today’s business models. Every business will have its own performance metrics, however, and in seeking greater shareholder return or higher performance, will be using various organisational performance levers.

So far the national debate on UK productivity has been silent on real estate, facilities management and workplace, yet, according to the UK and Ireland Leesman Index, only 53% of respondents agree that their workplace allows them to work productively. This is an unpalatable figure for any business leader to read, and one that cannot be ignored.

Recent research in The Stoddart Review has uncovered an explicit link between how well a workplace supports the activities that employees undertake in their role and the extent to which they say that their workplaces help them to work productively. This might sound like stating the obvious but the more tailored the infrastructure (hard, soft and virtual) to the needs of those it accommodates, the better employees perform.

When it’s so patently apparent, why is it that so few organisations place sufficient strategic importance on the physical working environment as a key driver of organisational performance? Why do so few employers place the creation of a workplace that is fit for purpose centre stage?

The Stoddart Review is a cross-industry initiative which examines these questions to help business leaders to fully understand the contribution of the workplace to organizational performance – in short to see workplace as a key performance lever.

It’s not surprising that the Review has uncovered paradox and ambiguity. Indeed, there is no silver bullet for the workplace productivity debate, and the Review does not set out to find one. But the Review did find several recurring themes.

"Rather than isolating workers, as one might assume, technology is actually bringing them together and facilitating greater levels of collaboration and innovation.”

Alison Nimmo, Chief Executive Officer at The Crown Estate

Rather than isolating workers, as one might assume, technology is actually bringing them together and facilitating greater levels of collaboration and innovation. A workforce with access to good technology now has the choice of whether to come to the office – and that office plays a vital role in facilitating community and cohesion. As companies chase a ubiquitous talent platform transferrable to any organisation, workplace brings competitive advantage as the psychological contract is shifting.

But workplace, like other performance levers, needs regular appraisal and calibration. Annual appraisal sits at the heart of all talent management programmes, and yet the Review found that measurement or appraisal of workplace is only regularly undertaken by an enlightened few. For many, workplace strategy is still dictated by lease events.

Measurement to date has largely been about utilisation of space rather than productivity of it. The Stoddart Review believes this is a misleading metric. Measuring utilisation – how many people per square foot of accommodation – has led design and occupancy strategies to support density at the expense of performance and productivity.

Overwhelmingly, the Review found a disconnect between the workplace, the industry serving it and the people it is intended to benefit. “People-first” became a mantra, whether in relation to determining its effectiveness, shaping the design or finding the right size, style and purpose. Ultimately, productivity is a human outcome, not an organisational one.

Workplace has been a hidden performance lever for too long. Let’s not leave this stone unturned any longer. Duncan Weldon's visualisation, in The Stoddart Review, of a 1% increase in productivity has profound benefits for us all. The vital work in the Review helps every business leave this stone unturned no longer.

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