Leo D'Angelo Fisher Columnist

Leo covers management and leadership issues, business trends and corporate strategy. He is a former senior business writer at The Bulletin and a former host of The Business Hour on 3AW.

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Desk wars: Will the death of the permanent desk kill corporate culture?

Published 14 March 2013 00:01, Updated 26 November 2013 18:35

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Desk wars: Will the death of the permanent desk kill corporate culture?

“Office space is fast becoming outdated. What we’re looking to create is an environment that supports our people to work more effectively and collaboratively,” says KPMG CEO Geoff Wilson. Photo: Louise Kennerley

The future of the personal desk, a staple of the modern office environment for more than a century, was the last thing on the mind of the chief executive of accounting giant KPMG , Geoff Wilson , as he contemplated the firm’s move to new premises at Sydney’s landmark Barangaroo waterfront precinct in 2016. But it is now – and Wilson looks like losing his own desk in the bargain.

Wilson is determined to usher in a new era of working for his employees at Barangaroo and has established the Workplace of the Future program, which he personally leads.

Wilson has seen the future and it is activity-based working, which KPMG will adopt when it takes up occupancy of 15 floors of premium office space in a 39-storey office tower at the $6 billion redevelopment.

Despite major shifts in mobile technology, work practices and worker demographics, today’s workplace would still be recognisable to an office worker from 1913. The activity-based model takes all these traditional elements and creates a radically transformed workspace, based not on the permanent allocation of desks, desktop computers and landline telephones for each employee but on a series of “spaces”, “hubs” and provisional desks which employees are free to choose, depending on their activity for the day.

KPMG’s adoption of activity-based working – just the latest of many big employers to do so in recent years – is limited to Australia, but the rest of the global KPMG partnership is “watching with great interest”.

“Office space is fast becoming outdated. Essentially what we’re looking to create is an environment that supports our people to work more effectively and collaboratively,” Wilson says.

Collaborative means productive

Proponents of activity-based working include Accenture, Macquarie Bank, Jones Lang LaSalle and Commonwealth Bank. The design elements of activity-based workplaces varies, but the catchwords never do: “flexibility”, “connectivity”, “collaboration”, “productivity” and “creativity”. Nor does the basic premise: that by providing a variety of spaces and amenities – meeting rooms with “telepresence” technologies, private rooms for individuals or small groups, relaxation lounges and cafe-style hubs – and mobile devices for each employee, workers will become more collaborative and productive.

In the activity-based workplace, on-the-move employees are provided with laptops with wireless functionality; location software enables managers to know where their employees are in the building; and VoIP (voice over internet protocol) softphone technology enables employees to make and receive phone calls on their computer.

Employee lockers at GPT Group in Sydney. Photo: Angus Mordant.

Purists bridle at the assumption that activity-based work is a euphemism for hot-desking – where the number of desks provided is fewer than the number of employees, creating a kind of corporate musical chairs where the main benefit is less office space.

Culture shock

The absence of permanently allocated desks is a common feature of activity-based working and for workers who have never known such a work environment this will inevitably come as a culture shock.

To minimise the impact of this transition KPMG has converted half a floor at its present Sydney CBD location to “agile working” styles – partly to convince employees that the death of the (permanent) desk will enhance, not diminish, their working experience, and also to test different design configurations and working modes.

KPMG CEO Geoff Wilson has given up his own permanent desk as part of the company’s move to activity-based working. Photo: Louise Kennerley

Seventy employees volunteered to work in the test space in the second half of 2012, at the end of which an “exit poll” gauged their attitudes.

It found that 83 per cent welcomed the freedom to work how, when and where they wanted – including the option to work remotely.

The pilot workspace will be kept until the move to Barangaroo, to refine activity-based working models that will eventually be adopted nationally.

“For me, it’s about the flexibility of the space. The behaviours they adopt in using such a flexible space is a key driver of success.

“The space encourages collaboration in a way that we don’t see in a traditional working environment,” Wilson says.

As for the disappearance of permanent desks, Wilson acknowledges this will prove a wrench for some, but he, too, will be giving up his.

“I’m hostage to a personal desk, I acknowledge that, but I will change through the use of the space in the environment we are creating. I’m excited about it,” he says.

Territories and community

But not everyone is convinced. Organisational psychologist and principal of Brisbane management consultant NovumAVI , Robert Lake , says proponents of activity-based working underestimate the importance that employees place on “territoriality”.

“It’s a jarring thing when you walk in and you don’t sit where you’re expecting to sit,” he says.

Lake says having a desk tells employees that they are valued and have a place within the organisation, but activity-based workplaces make little or no allowance for such symbols.

“Your desk is one of those symbols that recognise you as a person rather than a human resource.

When you have to wheel in your possessions from a locker in the morning and wheel them out again at the end of the day it’s difficult to feel valued.

“When you have to wheel in your possessions from a locker in the morning and wheel them out again at the end of the day it’s difficult to feel valued,” he says.

When online insurance intermediary iSelect moved to its new headquarters in Cheltenham in Melbourne’s south-east in 2011, it adopted features of the activity-based workplace such as meeting hubs, flexible workspaces, a “sleep pod” and an on-site cafeteria – but retained permanent desks for each of its 420 employees, including a 300-strong call centre.

The human resources director of iSelect, Elise Morris , says hot-desking was never an option.

“It’s important to us to create a sense of community among our employees. In an environment in which the nature of the work can become repetitive, it’s important for staff to be able to express themselves and create a place that’s theirs,” she says.

“Hot-desking takes away any sense of ownership and identity. When people have ownership of their space they feel they are contributing to the business and that their contribution is valued.

“No matter what your role and what your level, we all want to feel that we matter and that our contribution is valued.”

Morris says a voluntary attrition rate of less than 5 per cent among iSelect’s call centre staff – against the industry average of 30 per cent to 40 per cent – more than makes up for any space savings hot-desking would provide.

Training is key

Activity-based workstations at GPT Group’s offices in Sydney.Photo: Angus Mordant

At listed property group Goodman Group, everyone from chief executive Gregory Goodman down is learning to do without their own desks. The general manager, commercial at Goodman, David Wilson, says there was resistance from staff when it surfaced that the company was considering activity-based working – partly because of the “h” word.

“When people started to hear that we were going down the ABW route, this was immediately perceived as hot-desking and everyone was concerned about losing their desk. That’s why it was important for us to take them through the journey we were undertaking and provide plenty of workshops and training,” Wilson says.

The impetus for the workplace review was the expiry of Goodman’s lease at its Castlereagh Street head office in Sydney. It was moving to two new floors in the same building and the company had decided it did not want to retain a traditional work environment.

Although activity-based workplaces are normally associated with large corporations, Goodman has just 188 employees at its head office. It occupies the same number of floors as it did previously, for a total of 2400 square metres, but Wilson says the adoption of activity-based working in 2011 has resulted in a complete transformation that is much more spacious.

In the green room: At GPT not having a permanent desk doesn’t necessarily mean you don’t get a view. Photo: Angus Mordant

“Our previous layout was cramped and tight. There were never enough meeting rooms, there was never any space and there was paper everywhere,” he says.

“It’s so refreshing now to come into work each morning and not be surrounded by all that paper.”

Paperless at last

A focus on knowledge-based systems and electronic sharing of information and documents is critical to the activity-based workplace. Armed with the technology and the introduction of a “paper independence” program, Goodman has achieved a dramatic 90 per cent cut in paper consumption.

As well as less paper clutter and storage, no one has their own desk or office and the reduction in desk numbers from around 200 to 120 has also opened up space.

“Everyone has the opportunity to sit wherever they want. If everyone at Goodman turned up there is somewhere for them to sit,” Wilson says. At any one time about 60 per cent of staff are in the office – the rest are working remotely or are attending external meetings with investors, customers and real estate agents.

The greater space means that there is room to accommodate any growth in staff numbers, whereas previously growth would have meant the need to lease more floor space.

The head of asset management at listed property group GPT, Matthew Faddy, believes a “collaborative work environment will one day be the norm”.

GPT introduced its new workplace at its MLC Centre head office in Sydney in 2011, but not before a change-management team supervised 2400 hours of training and workshops over 12 months, or an average of 8.35 hours an employee, including workshops on house rules and protocols for the new work environment.

GPT Group head of asset management Matthew Faddy says buy-in from employees is crucial to any workspace change. Photo: Angus Mordant

The shift to activity-based working has resulted in benefits such as a 90 per cent reduction in the use of paper compared with 2009 use and a 50 per cent reduction in energy consumption.

The most striking outcome has been the huge space reduction – GPT has reduced the number of floors it occupies at MLC Centre from five to three.

Faddy warns that activity-based working is “a challenge to behavioural norms” – no GPT employee has a desk or office – and such benefits cannot be realised without achieving cultural buy-in from employees.

“For us, transforming our workplace was not just about the physical space. If you look at [reductions in] physical space without any reference to your cultural objectives you won’t succeed,” Faddy says.

After 12 months, employees were surveyed about their new working arrangements: 88 per cent said they would not want to work in another work environment.

Bankwest has experienced similar success with its move to activity-based working at its new Bankwest Place headquarters in Perth. The chief executive of enterprise services at Bankwest, Andy Weir , says the transition to the new working environment was the largest change-management program ever undertaken by the bank.

An engagement survey by the bank found 98 per cent of staff would not return to their previous work model.

“As more and more people see the value of activity-based working, we will see more organisations going down this path. Most organisations will be providing some form of activity-based working in the next five to 10 years,” Weir predicts.

A hybrid approach

A partner at workplace designer and consultant Geyer, Laurie Aznavoorian , says the interest in activity-based working is understandable, as companies that adopt the concept are able to reduce their real estate requirements by up to 30 per cent and achieve even greater savings in energy and paper costs.

However, she is concerned that companies will be encouraged to pursue activity-based working on the basis of cost savings alone and that the removal of permanent desk space will be an easy route to such savings.

She says it is true that some companies are able to successfully adopt “free address” workplaces in which no worker is provided with dedicated workspaces.

But a more realistic scenario is that companies need to implement a “hybrid” of free space and traditional work environments – as companies such as American Express, Citigroup and Rio Tinto have done.

Geyer partner Laurie Aznavoorian says office probably need a mixture of permanent and activity-based workstations. Photo: Angus Mordant

Aznavoorian suspects some companies that claim to have a no-permanent-desk policy are either exaggerating, or in their zeal, have unnecessarily insisted that everyone give up their desks – only to find that some people in “anchor” positions, such as administrators, human resources staff and personal assistants eventually get their desks back.

“Every organisation is comprised of people who play different roles and require unique approaches to how their job and personal working preferences should be supported,” she says. “I don’t think it’s necessary for everyone to have to move every day.”

An important factor in the reinvention of the workplace is the growing presence of Generation Y in that workplace and their impact on work cultures. Social researcher Mark McCrindle says Gen Ys (born between 1980 and 1994) constitute 21 per cent of the workforce and the proportion will peak at 42 per cent next decade.

Gen Zs will constitute 12 per cent of the workforce by 2020.

The workplace is changing and with it the central role of the permanent desk, McCrindle says, because Gen Ys are “not interested in the signs and trophies of the hierarchical organisation”. However he adds that, contrary to the promise of teleworking, the office will not disappear any time soon. Some employers – as recently demonstrated by directives from Google and Yahoo! to their employees – believe that the office, not the home, is the cradle of innovation and collaboration. But also, McCrindle says, it is simply not true that younger workers consider the office an anachronism.

“The workplace is here to stay because there is a timeless human need for interaction,” he says.

As for the desk, that may be another matter.

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