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Planning and Interiors > Article Dec. 2002
The
Impact of Strategic Facility Planning
"Space, the final frontier..."
or so it seems in the world of facility planning.
By Tim Springer,
Ph.D. and Steve Lockwood, CFM
Foresight Associates
This is the last
article in a three part series examining the concept
of strategic facility planning (see the August and October
issues of TFM for parts one and two, respectively).
The first two articles presented information demonstrating
the need and describing the processes of workplace strategy
development. In this final installment, Springer and
Lockwood explain the critical need for considering the
impact of strategic facility planning, describe some
of the steps for assessing such impact, and provide
case studies to demonstrate this impact.
Unlike the excitement
with which James T. Kirk first uttered this phrase,
today this sentiment unfortunately seems to be the approach
many organizations take when confronting facility planning-as
a space issue-as a way to reduce the costs associated
with the last remaining, essentially untouched, seemingly
bloated, line item on the budget. Yet, viewing facilities
as costs and reducing space as the answer misses the
fact that space is only one of many characteristics
of facilities and workplaces. Indeed, it is the combination
of all characteristics that have an impact on the people,
processes, and the profits of an organization.
Many attempts at strategic
facility planning fail because there is no attempt to
show impact or measure outcomes. It is the responsibility
of the facilities professional to provide upper management
with relevant information regarding the impact of facilities
on the organization and the importance of effective
strategic facility planning to insure the best, most
positive results.
The Impact Of Facilities
Everybody has to work
somewhere. That seems like a simple enough premise.
But as the great architect Mies van der Rohe once observed,
"God is in the details." The degree to which the facility
supports the workers, work behaviors, and organizational
goals determines the impact-and it does have one-on
its organization; the question is whether that impact
is positive or negative, and how (or even whether) one
can tell.
For those who question
the impact of place on behavior, try this brief mental
exercise. First of all, consider those public places
that elicit certain feelings or behaviors: a place of
worship; a favorite sports stadium; the "Wall" of the
Vietnam Memorial. Now consider the characteristics of
more "generic" places like playgrounds, kitchens, or
libraries. Each of these places is composed of many
elements that contribute to how well they serve their
purposes. The best examples possess an unobtrusive synergy
of elements that imbue them with properties going far
beyond the mere physical characteristics of the place.
The same holds true of
workplaces. Facilities and workplaces that are best
examples of their kind exhibit properties that support
work behaviors, reinforce culture, improve performance,
and help those who work there achieve the goals of the
organization.
In very rare instances
these places evolve, and with luck and serendipity they
manage to exist. However, as has been shown in previous
articles in this series, effective workplaces and facilities
that have a significant positive impact can be planned
and developed.
Why Ask Why?
"We do things, but we
do not know why we do them." This quote from Albert
Einstein has always seemed apropos to the workplace
and the changes organizations make to their facilities.
Unfortunately, too often things are done without understanding
why or considering their potential impact.
Another scientific genius,
Sir Isaac Newton proposed "for every action there is
an equal and opposite reaction." For purposes of facilities
planning and management, this law should be paraphrased
to read: "For every facilities decision and action there
is a measurable and significant reaction or impact on
the organization." The issue is whether the impact is
positive or negative.
From simple actions to
complex systems, facilities professionals can impact
their organizations through the decisions they make
or recommend and the actions that are taken (or avoided).
It is important to know there are repercussions and
impacts associated with inaction as well as action.
Potential outcomes of
facilities decisions and actions carry either or both
positive or negative impact. Thus, expressions of impact
should reflect both benefits and liabilities. The most
obvious areas on which decision and action regarding
facility and workplace have impact are cost reduction
and cost avoidance.
The first article in
this series showed one example where actions taken to
reduce costs had associated impact, including increased
expenditures in order to cut costs. (See Figure 3 on
"Strategic Facility Planning," page 52, August TFM.)
Another example is illustrated
in Figure 1 on the facing page. Entitled "Decision,
Action, Impact," this simplified example demonstrates
how the organization saved money in the short run by
deferring maintenance and avoiding the actions of painting
and window cleaning.
However, the decision
and resulting inaction had the long-term impact of costing
more to catch up on maintenance. In the intervening
timeframe, image, identity, worker performance, and
recruiting and retention suffered. So, as this example
illustrates, there is a cost for doing nothing.
Measuring Impact
Measures of impact extend
far beyond traditional cost based expressions. The potential
areas of facility impact range from human resources,
worker performance, technology, and culture, to finance,
space, and time. Examples of variables and measures
are shown in Table 1. Facilities can influence and impact
each of these areas in distinct ways-and the expressions
of impact can be equally unique. The challenge for facilities
professionals is to identify appropriate measures and
assess the impact of their decisions and actions in
terms of those metrics. Table 2 (on page 16) illustrates
several ways in which business goals can be affected
by decisions and actions taken with regard to facilities.
From these examples,
facility professionals can see the range of settings
and array of measures with which to show impact on workplace
and facilities.
This article, taken in
concert with the two preceding articles in the series,
provides the justification, process, measures, and tools
of strategic facilities planning.
The goal is to show facilities
professionals the importance of aligning and linking
the significant assets of an organization's facilities
and workplaces with the business goals and outcomes.
The power of the approach and the significance of the
impact demonstrate the importance of facilities and
facilities professionals to overall business success.
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Case
Studies
The following case
studies illustrate, with real world examples,
the variety of ways in which workplaces can have
an impact on organizations and the value of strategic
facility planning.
Case Study #1: You
CAN Be Both Thin And Rich
The client: a large
investment firm
The Engagement:
The engagement involved
analysis and design of new workplaces for a security
trading division of a large financial services
firm. The initial scope was aimed at renovating
and remodeling an existing building. As the work
progressed, the scope of change undertaken by
the division expanded significantly to include:
- merging two geographically
dispersed, traditionally functionally separate
elements of the division;
- redesigning the work
flow and work processes;
- creating a new organizational
structure;
- streamlining and redesigning
the technological infrastructure;
- purchasing land and
existing buildings to house a high tech campus
where the client organization would be the first
and primary tenant; and
- planning and designing
workplaces to support the new organization,
new technology, and new ways of working.
Brief:
Beginning with the request
to explore new workplaces, the engagement led
to the modification of the practices, technology,
tools, organization, and environment of work within
the division. One of several key challenges was
the need to provide optimal support for both visual
and auditory communication among traders on the
trading floor. This requirement, along with careful
analysis of work behaviors of traders, drove the
design of a radically different size, shape, and
configuration for the trading desk.
The best design that
minimized distance among team members and maximized
their individual workspace and their ability to
communicate with one another involved changes
to three key technologies:
- Consolidating three
separate computer systems into one large networked
system of servers;
- Moving from large,
push-button, telephone consoles to touch screen,
flat panel consoles; and
- Replacing 21" CRT
computer displays with flat panel displays.
At the time the business
case was presented, flat panel computer displays
were in their infancy. Initially, flat panels
were smaller than traditional monitors, were only
available from one or two manufacturers, and were
exorbitantly expensive.
The business case showed
the most probable evolution of the technology,
including the entry of major manufacturers, increased
size of displays, and orders of magnitude reduction
in cost. The case also included an analysis of
benefits such as reduced energy and heat load.
But the principal advantage of thinner profile
displays was narrower desks leading to significant
reduction in distance between traders, thus eliminating
visual barriers and encouraging better support
of work behaviors.
Another key change was
a move from status based definition of office
size to functional based standards of workplace.
The trading desk was the heart of the operation.
An element of the new team approach was the need
to provide as many people as possible with visual
access to the trading desk. To accommodate this
need, a workplace plan evolved to maximize the
number of individuals situated around the perimeter
of the trading floor. To do this, the new plan
reduced the traditional management office size
in favor of small private offices supported by
shared meeting and team spaces off the trading
floor perimeter.
These changes were accomplished
in partnership with the business unit leadership
and membership. Throughout the engagement, the
process was collaborative and involved as many
individuals as possible within the business unit
in discussing, developing, prototyping, and testing
of ideas and preliminary solutions.
Outcomes:
1. The business unit
members view the new workplace as effective, supportive,
and a major contributor to their success. Two
years after occupying the new workplace, the business
unit has not felt the need to change anything
significantly. Only minor improvements have been
made to the work environment.
2. Because of the mission
critical need for an uninterrupted, seamless transition
from the old workplaces to the new workplace,the
company invested in two months of testing and
"burn-in" that involved technology systems testing
and employee orientation and training at the new
facility prior to full occupancy. As a result,
the business unit closed normal operations at
the old workplaces on Friday and began operations
at the new workplaces the following Monday without
incident. The estimated benefit from avoiding
disruption of the trading function was in the
tens of millions of dollars.
3. The second performance
related outcome is a tribute to the vision of
the business unit leadership and the scope and
scale of all the changes they were willing to
champion. They had established very aggressive
business growth and performance goals for the
unit following the move into the new workplace.
They were able to meet those goals nearly one
full quarter early and surpass them by almost
20% by the end of the first year. They were able
to realize this impressive performance with 20%
fewer employees than originally projected.
4. Finally, the business
operation division has realized one more benefit
from its new workplace. It has produced materials
highlighting the unique, successful nature of
its work practices, work tools, and work environment.
The new workplace has become a very effective
tool to attract, recruit, and retain the best
talent.
Both the business unit
and the larger organization recognize the success
of the new workplace as a corporate asset with
considerable long-term value-thus proving it is
possible to be both thin and rich!
Case Study #2:
Employer Of Choice
The client: A Fortune
500 company founded in the 1940s, with $5.8 billion
annual sales and a global workforce of 20,000
employees located in 15 countries. The company's
upper midwest regional headquarter building is
2.5 million gross square feet and houses 4,500
employees.
The Engagement:
The existing facilities
were doing a good job when considering space utilization
as a cost center. But the CEO stated that controlling
costs wasn't the only goal. He wanted the space
and its design to convey the organization's fast-paced,
collaborative corporate vision. And he reasoned
that topflight talent would be more likely to
come and stay if the physical environment was
attractive as well as efficient.
The client wanted to
avoid adding real estate during a period of double-digit
growth and to reduce the employee turnover rate.
Consequently, this project focused on both helping
support revenue growth and cutting costs. The
employee groups in this project were systems analysts,
data programmers, project managers, content experts,
and software developers. They are considered the
"value generators" within this organization.
Brief:
The client is the global
leader in providing information products and solutions
(content, narrative, and the associated software)
to a wide range of diverse customers in the private,
public, and government sectors. The organization
continually enhances its position as the preeminent
provider of information and knowledge within its
industry segment through new product and service
development, innovation, and acquisitions of targeted
information-providing organizations. The company's
core competencies are information technology and
information transfer. Cultural integration, growth,
speed to market, quality, and cost containment
are the organization's key drivers.
Outcomes:
Working in collaboration
with corporate and business unit leaders, planners
identified the following Key Success Factors (KSF):
The Corporate Vision.
The goal was to become the leading provider of
information products and solutions to an expanding
global market.
Business Goals.
The key success factors shaping the corporation's
business direction are:
- Retain, attract, and
develop the best and brightest staff;
- Continually share
knowledge;
- Develop and sustain
an unparalleled spirit of innovation, teamwork,
measured risk-taking, fun, respect, and the
will to win;
- Maintain the highest
levels of integrity;
- Develop and sustain
a customer-centric focus;
- Develop and sustain
a "technol-ogy company" approach;
- Sustain an appropriate
level of investment in quality new products
and services; and
- Consistently optimize
all resources.
Work Environment.
The new work environment solution developed to
support the critical business success factors
included the following:
- Consolidate staff
into one main campus (increase density);
- Support the cultural
change (employer of choice efforts to attract
and retain the best staff and support the business
units' needs);
- Transform a traditional
company into an information service provider
organization;
- Grow the organization,
contain costs, and maximize the investment;
- Become a global player
in the company's industry segment;
- Improve space utilization;
and
- Meet the needs of
the changing organization.
Elements of the new workplace
environment include:
- Teaming spaces;
- Soft seating areas
(such as armchairs and other comfortable seats);
- Computer labs;
- New individual workstations
redesigned to balance the need for privacy with
the ability to move a chair into a team environment
or into a soft seating area for an impromptu
meeting;
- Whiteboards everywhere;
- Creation of a "Main
Street" by drawing workers from throughout the
building to a centralized hub. Workers from
all departments cross paths as they exit the
elevators, walking and talking past glassed-in
offices of the top executives-which were relocated
from the remote corners of top floors (where
they were out of sight); and
- Along with a traditional
cafeteria, the "downtown" features a coffee
hangout called CafZ.Com, where people can conduct
business in private nooks or in the open while
sipping coffee. News junkies watch CNN; at the
employee store, workers can get almost anything-anything
from candy and food to greeting cards. There
are also dry cleaning services, a florist, a
travel agency, and a credit union.
Key results of the new
workplace included:
- 20% increase in population
density;
- 5% increase in organizational
performance (flexibility and adaptability);
- 6.9% reduction in
employee turnover;
- 12% reduction in cost
to attract and retain employees;
- 62% reported worker
satisfaction response;
- 20% reduction in cost
to enable and support changing needs and business
requirements (churn rate and technology integration
effort);
- 60% reduction in cycle
time; and
- #1 ranking on regional
"Best places to work."
Case Study #3:
Form Follows Function
The client: A Fortune
500 com-pany, founded in the 1930s, with $3 million
annual sales and a global staff of 22,000 employees
in 30 countries.
The Engagement:
To reflect and support
the newly re-invented organization and culture,
the client embarked on the development of a new
corporate headquarters office complex. The challenge
was interpreting and translating the leader's
vision, getting input from employees, accommodating
changes in work processes and work behaviors,
and incorporating other
information into implications for workplace design
in the new corporate facility.
Brief:
In the early 1990s, the
company fought off a radical takeover attempt
by a rival competitor. The board of directors
decided to re-invent the organization through
growth, new products, and innovation. The company
went through the traditional restructuring, process
reengineering, and change management efforts.
The goal was to re-invent
the organization including: human resources, technology,
work process activities, culture, products, and
business unit deliverables. The new vision for
the organization included defining a new culture.
Other goals were: increasing the efficiency and
effectiveness with which the company served its
clients; attracting and retaining top talent;
and continuing to be a leader and innovator in
the industry.
Outcomes:
Working in collaboration
with corporate and business unit leaders several
Critical Business Success Factors were identified.
Corporate vision was targeted.
This included:
- Shareholder value;
- Customer satisfaction;
and
- Individual dignity.
These were further defined
in detail and linked to the key factors shaping
the corporation's business direction, including:
- Customer focus;
- Teaming;
- Sharing of information;
- Speed to market;
- Learning;
- Mobile/global workforce;
and
- Cost reduction effort.
The work environment solution
developed to support the critical business success
factors included:
- Work settings based
on work functions and activities-not status
and rank;
- A wide range of work
settings supporting a variety of work behaviors
and activities employees engage in during the
course of a typical day;
- Group and team space
able to support more sharing and the new, more
participative work process; o Recognition that
many workers periodically need a certain level
of privacy during the course of the day;
- Flexibility that accommodates
access to technology anywhere in the facility;
- Appropriately adaptive
work environments that support user control
and frequent changes; and
- Support of the reduction
of cost effort. Key results.
The key results that
emerged in response to the exercise included:
- 53% reduction in individual
workspace;
- 60% of the employees
reported that their work performance improved;
- 80% of the employees
reported that they were more customer focused;
- 75% of the employees
reported that meetings were more efficient;
and
- 88% of the employees
reported that higher levels of teaming occurred.
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