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Research: Contrasting forces shaping office plans make the case for hybrid working

It is a time of change for the office. Over the past year, some have sat empty while some have been dramatically redesigned for a socially-distanced age. Many have been sorely missed by the people who rely upon them. 

As our towns and cities continue to reopen, organisations must decide what long-term change will look like, what role and relevance the office has and what its relationship will be with their organisation and society. 

The decisions may not be easy. Finding a solution that works for everybody will be complicated by contrasting factors, from personal preferences and perceptions to differing roles and responsibilities, as well as intricate connections between every part of an organisation that must be considered in parallel.

The need for a hybrid approach

Research from PwC has revealed the extent to which organisations and individuals are divided. 

For example, our research found 55% of respondents said their organisation had been more productive due to remote and virtual working through the pandemic, while 44% believed productivity had been negatively impacted. 

Similarly, it must be considered that not all people will view increased productivity in a universally positive light. In some instances that increased productivity may have been at the expense of a healthy work-life balance for employees. It may also be unsustainable outside of lockdown. 

As such, offices must be used appropriately, to support activities and individuals that may be less productive when working remotely, while organisations embed the productivity gains of remote working, where preferred and relevant. There is unlikely to ever be one answer to questions such as ‘where do you work best?’ or ‘where do you want to work?’.

This highlights the need for organisations to find a ‘hybrid’ approach

Angus Johnston, Real Estate Leader, PwC UK, says: “The past year has forced organisations to look at their property and question the relevance of the office. This reflection will lead to significant change. But there will remain a need for offices. In fact, that need may be even more considerable as the pandemic has created a greater appreciation of how valuable it is to collaborate and come together as a team. 

“Every organisation must look to its people, understand their needs, and map those against the objectives of the business to discern the right hybrid model, and the best use of offices.”

44% of respondents expect people to work two to three days per week remotely

8% expect people to be in the office four or five days per week

2% expect people to be working remotely four or five days per week

Source: PwC Future of the Office Survey

The role of the office in creating a healthy, motivated workforce

We must also remember productivity isn’t the only measure of a successful organisation. 

On top of the troubling health concerns raised by a pandemic, lockdowns and disruption to our personal and professional lives have put issues such as wellbeing and equality into a starker spotlight. 

Organisations must respond to the way the past year has affected such things and factor them into their hybrid planning - ensuring the office can play a role in bringing people together and giving them a greater sense of support and belonging, while empowering them to work more flexibly as needs and personal preferences shift.

More than a third of respondents to our survey (37%) expressed concern that remote working had taken a toll on diversity and inclusion within their workforce.

Victoria Robinson, Workforce Strategy & Culture Leader at PwC UK, says: “Everybody has responded differently to remote working. Some have flourished, some have struggled. But those contrasting outcomes have often exacerbated pre-existing inequalities. Remote working has reduced the access to opportunity for many employees. It has been difficult for people whose homes aren’t well set up for work or who have challenging caring commitments.” 

“As we emerge from lockdowns and think about the role of the office, there is also a danger of inequalities widening further as senior decision-makers shape plans that are disproportionately weighted to their own preferences, experiences and subconscious biases. Organisations must think about the individual needs of their people and plan a hybrid strategy that supports the objectives of the organisation and its people in the most relevant ways possible.”

Asked for the top three most important purposes an office will serve:

79% chose team bonding and relationship building

78% chose collaboration

41% chose supporting employee wellbeing

Source: PwC Future of the Office Survey

Reduce or reconfigure: What to do with your office space?

To achieve a hybrid model that works for your organisation and your people, changes will need to be made to existing office space.

In some instances that may mean reducing the space you have, freeing up capital to invest in your wider hybrid transformation. It may mean turning surplus floor space into new facilities for employees, such as improved dining and socialising spaces, or creating on-site services such as gyms, doctors and dentists, to improve employee experience. 

50% of respondents think they will reduce the size of their office portfolio. This expectation is highest in London (64%)

77% think they will reconfigure their office space as a result of the pandemic

Source: PwC Future of the Office Survey

According to our research, the most popular reason for reconfiguring office spaces is to create more facilities for collaboration, cited by 80% of respondents. Nearly half of the respondents (47%) expect to reconfigure their offices to provide agility in the event of future pandemic disruption and 36% even expect to keep social distancing as a permanent feature.

Our survey shows the majority of respondents (64%) believe their portfolio will shrink by up to 30%. Only 9% think it might be halved, or more. The most common expectation, among 35% of respondents is a reduction of between 21% and 30%. Overall, 50% of organisations say they have reviewed their leases. And of those who have done so, 49% report having less than three years remaining on a current lease.

Johnston says: “You need to approach this issue with an open mind and it makes sense for organisations to look at every option available to them, from reducing to reconfiguring their space. This should be based on a detailed understanding of their current leases and an analysis of their changing property needs and the costs and consequences of all potential changes.

“If organisations think about the issue creatively, they will realise there are a great many options to consider, from sub-letting spaces to third parties such as strategic partners or social enterprises to turning spaces into facilities to support employee wellbeing.”

Whatever direction you decide to take your hybrid strategy in, it will be critical to act now, and act quickly. 

First, you must fully understand your options. Then you will need to deliver on the strategy you set, taking into account the many moving parts of this issue, from your existing property portfolio to the best way to support the short and long-term needs of your people and your organisation.

To discuss any aspect of managing your real estate, or establishing your hybrid strategy, please get in touch.

Contact us

Angus Johnston

Angus Johnston

UK and EMEA Real Estate Leader, PwC United Kingdom

Tel: +44 (0)7710 344040

Victoria Robinson

Victoria Robinson

Hybrid Workforce Strategy & Culture, PwC United Kingdom

Tel: +44 (0)7843 368488

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