How Does Office Space Affect Company Culture?

SAN FRANCISCO—Whether there are three to four people in a room or open space offices or large amounts of square footage, these characteristics affect the way employees socialize around one another, and how they engage with the overall company. Unfortunately, many companies focus on the perks of an office that look flashy, but ultimately can hurt overall employee productivity and satisfaction.

Christina Clark, managing principal of Cresa’s global portfolio solutions group, has been working with clients such as Twitter, Palo Alto Networks and Headspace to identify the correct office space that meets ideal company culture while keeping hidden factors such as financial impact, mobility and supply/demand of space at top of mind. In this exclusive, she shares some insights into how executives, particularly those in a growing company, reinforce company culture without breaking the bank or creating negative backlash from employees.

GlobeSt.com: Do employees really want more space?

Clark: Executives often associate office square footage with an enhancement in company culture. However, research has found that today’s Millennial employees often value amenities over additional personal space. Instead, money is best spent on spaces that create energy, collaboration and unity within the office with a variety of spaces for employees to utilize such as a great coffee bar, outdoor or lounge space, music or game rooms and quiet rooms.

GlobeSt.com: Please share more insight into “neighborhooding”.

Clark: One of real estate’s challenges it that it is inherently inflexible. Even with lots of options, a lease is a lease–of a specified size, for a specific duration of time. However, research shows it’s not the quantity of space being occupied, but rather the utilization of the space that is important. Alternative ways of working, such as neighborhooding, can create more flexibility. Neighborhooding, the latest twist on hot desking, eliminates individually assigned employee desks in favor of designated spaces or neighborhoods for a specified department. Many employees, especially sales teams, spend a majority of their work day away from their desks. Instead of allotting 20 desks to a sales team, perhaps a company provides 12 to 15 desks, a conference room and a lounge area which act as that team’s neighborhood. This frees up additional office space, allowing a company to utilize less of its footprint–thereby leasing less space and reducing expenses. While an individual’s desk may vary each day, they still maintain a connection to their manager, team and its unique culture.

While neighborhooding has proven to promote team culture, it does not eliminate an employee’s need for personal space. Quiet spaces to make phone calls, technology ports to charge electronics and a means of secure storage for bags or jackets are still necessary.

GlobeSt.com: How important is office space for the company’s community, including employees and clients?

Clark: Every square foot matters and careful consideration must be given to how a space can be used to engage both employees and clients. From the seating arrangements to the walls, how can your company make a connection? Incorporating community art in the main reception or hiring a local nonprofit to provide art is a great option. Rotating the art regularly and inviting clients it to see and hear from the artist generates conversation and connection while also keeping the space fresh. Unlike expensive items that are infrequently used–think the office ping-pong table–artwork is a cost-effective way to showcase company culture to potential clients. Another way to inject energy into your space is to provide continuing education opportunities from award-winning authors or outside speakers. Inviting these thought leaders into your space to tell a story will foster an environment of creativity.

As with any real estate decision, a company’s executives must communicate openly–and transparently– with employees before making any major shifts. This is critical in order to avoid miscommunications about the company’s intentions. Often, employees support concepts like neighborhooding and are willing to part with their personal space so long as they are active participants in how the transition is made and, even more so, when executives are participating too. Office space impacts and enhances culture, but will not create it. By communicating openly, leadership and company employees can create a culture of collaboration, teamwork, and innovation. And isn’t that what all companies want?