We live in an era of constant transformation, with organisations worldwide facing complex and ever-changing circumstances amid geopolitical and economic uncertainty.
Faced with such challenges, companies will often seek flexibility, but in truth, adaptability is crucial. Dealing with the unexpected means being willing to pivot and change course when needed – and this means cultivating resilience and an innovative mindset among both the leadership and the workforce.
Real estate has a significant role to play here. It’s often said that real estate is the second highest cost on the balance sheet after people. Still, it’s also at the core of how businesses get work done, influencing corporate culture, encouraging collaboration and promoting health and well-being.
Buildings have become a critical enabler of successful organisations, especially in attracting and retaining talent. In a recent survey, we found 50 per cent of office workers have left their job since the start of the pandemic. People working remotely three to four days a week are the most volatile; 74 per cent have left their job in the past two-and-a-half years, and 79 per cent said they could do so in the coming months.
While your workforce is hugely important, your real estate can improve business resilience in the following three ways:
Hybrid working has changed the way we use office spaces. Evaluating your real estate portfolio and lease commitments to ensure it has the right spaces in the right location and with the right services and amenities can help identify operational inefficiencies and reduce running costs. This doesn’t necessarily mean less overall square footage, but rather using spaces differently and increasing the quality of the space. Of the 1,000 corporate real estates (CRE) decision-makers we surveyed, 77 per cent agreed that investing in quality is a greater priority than expanding the total footprint.
Lease renegotiations and sale-and-lease-back strategies can help diversify and increase portfolio flexibility.
In some cases, short-term leases, mostly likely through co-working and flexible space providers, can provide the agility required to adapt to and withstand short-term economic shocks.
Energy bills are another big issue at present. Combining existing and new data sources with built environment knowledge helps dial down unnecessary energy use.
We’ve seen that 46 per cent of companies plan to expedite investment in operating facilities in a carbon-efficient manner over the next three years, and another 41 per cent will keep this investment steady.
The pandemic demonstrated our extreme reliance on technological infrastructure in and out of the workplace and how fragile business continuity can be if technology fails to deliver.
Establishing good metrics and embedding technologies to measure building data points are vital to dynamic decision-making in the new world of work.
Yet, our research suggests that only 13 per cent of organisations currently make use of real-time analytics for business decision-making. However, 56 per cent of companies plan to adopt technology for predictive facility management in the near future to improve performance and the overall lifecycle of their assets.
Adopting these technologies can have significant benefits.
In a total economic impact study undertaken by Forrester Consulting, one intelligence-driven facilities management platform has been shown to deliver 238 per cent return on investments (ROI) by uniting operations, asset and work order management, maintenance and analytics for smarter facilities management.
As the use of space becomes more dynamic and portfolio composition more complex, firms are turning to data and AI to help reduce costs, optimise portfolio decisions and enable work from anywhere.
There’s no going back to the way things were. Research shows 60 per cent of office workers want to work in a “hybrid style”, and 55 per cent are already doing so, meaning companies need to have strategies in place that will help retain employees while keeping them happy and productive.
Quality of life is now ranked as the number one employee priority, with health and well-being a close second, according to JLL research. In fact, 59 per cent of employees now expect to work for a company that takes care of the health of their people.
By creating a safe, supportive environment, your people can better adapt to adverse situations, retain motivation and maintain high performance.
What’s more, improving workforce resilience by enhancing physical and mental health and well-being is the number one strategic priority for the real estate function between now and 2025, with almost half of the decision-makers in our global Future of Work survey saying they plan to expedite investment to support this.
In short, business resilience relies on a resilient workforce and a robust physical infrastructure combined with rugged technological platforms: a fusion of people, place and technology.
It also means successfully navigating emerging dynamic working patterns against a backdrop of constant change - which is easier said than done. But when we embrace change, we find new ways of doing things.
Building a diversified and flexible portfolio enables organisations to future-proof their real estate and respond to significant disruptions. The imperative now is to shift from survival mode and find ways to adapt and transform our buildings to support resilience better, now and in future, so we can handle whatever comes our way.