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Author: OpenWork Agency

Coworking and Company Culture

Marc Andreessen once famously said that ‘software is eating the world,’ and that if your business can’t be boiled down to a simple (software) solution it probably doesn’t have much of a chance. Or at least, in his world of venture investing, if your startup isn’t predicated on an elegant piece of software, then your business will be challenged. While some people took offense to Andreessen’s sweeping comment, I think it is even more profound than people might think.

Take, for example, the corporate culture consulting industry. Since the early 1980’s management consultants have made small fortunes helping large firms ‘engineer’ their cultures to be “stronger.” By stronger, we all understand that what is actually meant here is greater profitability and higher share prices. Enron had a strong culture, but that didn’t turn out so well. However, in light of the fact that some 70% of all corporate change programs actually fail, it is worth questioning what the actual value of culture consulting is and why so many existing efforts fail? And, to what extent will culture itself be boiled down to a piece of software?

However, in light of the fact that some 70% of all corporate change programs actually fail, it is worth questioning what the actual value of culture consulting is and why so many existing efforts fail?

For us at OpenWork Agency, this is where design and design thinking are so important. Typically, culture consultancies use typologies to classify companies within one type of company or another, and then help them transition to a new ‘type’ of culture. The whole process remains in the realm of values, beliefs, and behaviors, which tend not to ever change because very little else in the company changes. That is, words are cheap and easy.

Coworking as Design Intervention

In our estimation, what is needed are tangible, material interventions in the flow of peoples’s day-to-day work. By shifting people to the open and fluid mode of work that is coworking, the day to day interactions of employees themselves are changed. Without talking about culture, per se, the elements of coworking- communication, learning, etc- and thus culture itself is changed over time. But only slowly and organically. This is a critical difference.

By shifting people to the open and fluid mode of work that is coworking, the day to day interactions of employees themselves are changed. Without talking about culture, per se, the elements of coworking- communication, learning, etc- and thus culture itself is changed over time.

Thus, we have recently launched a new culture change initiative premised on coworking. We might be fifteen minutes early, but we know what impact coworking has on people, how they work, and on the social interactions between people who cowork together. Of course the proof will be in the pudding, but we are quite confident that as more companies embrace coworking (as many, such as Microsoft, IBM, HSBC, Dell, Samsung, Amazon, Merck, GE, just to name a few, have already done), those companies will in fact change, culturally, over time.

There are no magic bullets, we understand that. Company policies will have to shift accordingly, and will have to allow for the choice and flexibility that is at the heart of coworking. Without this accompanying level of change, coworking will be as ineffective an approach as previous generations of change programs. And finally, to return to Andreessen’s earlier point, the coworking-as-change-management-platform is grounded in a technology platform that allows employees to collaborate effectively and managers to monitor and understand what is going on in real time.

However, software won’t ever replace the value of human interaction and the importance of that for building community and culture. Thus, in the end, with respect to the workplace, Andreessen’s maxim was only partially true.

However, software won’t ever replace the value of human interaction and the importance of that for building community and culture.

Enterprise Coworking

WeWork + IBM

It was recently announced that WeWork, the global coworking chain, has signed a deal to manage an entire office building for IBM in Manhattan. Up to 800 employees will work in the building, which WeWork will manage as a single shared office environment.  At first glance this looks like it is just an extension of its recent strategy of providing work spaces for employees of large firms, but it might also signal something much bigger.

Concurrent with this news was the announcement of a new Enterprise division within WeWork.  While it is unclear what the specific terms of the IBM deal will be, it seems that these enterprise deals might signal the beginning of a lease-free model, wherein the value-add of the company is in the management of the space.  We are seeing lots of ‘management fee’ arrangements in lieu of straight leases, and it would make sense that this is what the company is aiming for.  It seems like only a matter of time before the weight of SO many leases becomes a heavy burden.

But that isn’t the main point here.  Rather, what is interesting (and important) about the WeWork announcement is the shift towards enterprise.  Retail coworking, which is for the most part what the world has seen thus far, is just the first iteration of a much large shift from old ways of working to ‘new ways of working.’   All of those brave pioneers who made coworking what it is today, such as Alex Hillman and Tony Bacigalupo, have opened up the floodgates for a new wave of adoption to follow the retail coworking phenomenon.

Three years ago, before we began working primarily with real estate developers seeking retail coworking solutions, we set out to do enterprise coworking. For us, the big opportunity has always been the potential to ‘convert’ large firms to the culture and flow of coworking.  Not only is this a big business opportunity, it would seem, but it also potentially can serve to liberate corporate employees from uninspiring spaces and rigid workplace policies.   

 

coworking together: employees and independents

Workplace Strategy: Coworking for company employees: What/Why/How

Workplace Strategy Insight: In these times of innovation, coworking is emerging as the new office.

Coworking has been the preferred office of choice for the independent worker since the community office trend began to emerge in 2006, catalyzing the disruption of the traditional workplace strategy model.  Since then, the coworking phenomenon has grown at an accelerated rate in parallel with rise of the independent workforce. Today there are 50 million+ people in the USA working independently who office from home, a coffee shop, or a coworking space. Work has truly become an anytime/anywhere affair. As the coworking industry continues to mature and the corporate environment innovates, the two worlds are forming a symbiotic, albeit experimental relationship. Companies and employees have both begun to hear the buzz around coworking and have been curious how they may ‘do coworking.’

coworking-stat2Even so, most company employers don’t know how to integrate coworking into their workplace strategy and most company employees are not aware that HR department rules on workplace flexibility are quickly evolving, making it common practice for companies to encourage mobile working.

As more companies test out coworking it’s causing the industry to evolve to support them.   In fact, as reported in the latest 2016 research by Deskmag, this is the first year on record where company employee members (51%) outnumbered independent worker members (49%) at American coworking spaces.

How companies can test out coworking as part of their workplace strategy

corporate-coworking-strategyOption One: External Coworking Strategy

Sponsor company employees to work in existing coworking spaces. Companies that have embraced ‘external coworking’ include: G.E., PwC, The Guardian, AirBnb, Pinterest, Red Hat, Automattic, PepsiCo, Microsoft, Merck, Heineken, KPMG, among others.

Picking the Right Coworking Spaces

Picking the right coworking space to match the specific needs of your mobile employees can be a challenge. Different spaces are tailored to different uses. As many cities have numerous coworking options, picking the right one can be a project in and of itself. As the awareness (and demand) for coworking has increased among large firms, it has become common for some spaces to create membership models specific to company needs. Some companies choose to send all their mobile employees to one coworking space in private offices. And some companies allow each employee to choose where they want to work.

Embracing a Culture of Experimentation

Coworking for companies should be looked at as an experiment  One of the things that makes coworking spaces so appealing is their no risk, short term obligations. All coworking spaces offer month-to-month memberships. Ask your employees if they would like to have coworking as an option and if they say yes, offer to buy them a short term membership to test it out.

Option Two: Internal Coworking Strategy

Instead of sending your employees out to external coworking spaces, some companies opt to build their own internal coworking solution. Companies that have embraced an ‘internal coworking’ strategy include: Macquarie Bank, BankWest, Rabobank, Microsoft, ERA Contour, Achme Insurance, KPMG, GLG

Start with a Pilot Coworking Space

Take between 5,000-15,000 sq ft of space and repurpose it into a coworking space.

Empower it with data-driven Key Performance Indicators (KPI)

While testing out your pilot coworking space, you must find a way to measure the impact. How do you measure an increase in employee productivity, creativity, innovation, engagement, among other things? These are the KPI’s that will dictate whether or not you should expand the pilot to an entire floor, your building, or company campus.

Why/how does coworking work?

Data demonstrate that engaged employees are more productive employees than their disengaged counterparts, and the data on employee engagement is abysmal.  According to a 2014 Gallup poll, less than one-third (31.5%) of U.S. workers were actively engaged in their work, meaning well over half of American employees were not 3ps-openworkpsychologically committed to making positive contributions to their organizations.  These figures, according to Gallup, have only declined recently.

To the contrary, data from coworking spaces underscore that engagement, productivity, and energy are ‘through the roof.’  Two recent Harvard Business Review articles speak directly to this.  Coworking spaces bring together the 3 P’s of the ‘Open Organization’- people, place, and purpose– where employees work according to their own rhythms on work that is meaningful to them.

It’s all about culture.

coworking-stat1

The coworking ethos has become the workplace culture of choice in the sharing economy. Yet, the culture of most large firms does not reflect the culture that Millennials are co-creating and want to be part of. Workplace strategies and HR policies are evolving, though, as innovative company leaders embrace the modern workforce and the future ahead.

Interested in digging in further?
Read our white paper, Why Companies Need Coworking.

Ready to get started?
Get in Touch to learn how the transition can work for your company.

OpenWork Partner, David Walker, Featured Panelist at Bisnow’s Workplace of the Future (Event): How Tech is Disrupting Houston’s Traditional Office Scene

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Topics

While some may still aspire to work in a “corner office”, many others are embracing the Workplace of the Future. All over Houston, employers are redefining the term “office”.

What are architects, interior designers, general contractors and project managers being asked to include in their future buildings and corporate campuses? And what will building owners and developers need to provide in order to entice new tenants to move in? Also, what new technologies will companies need to consider adding?

Join us at another top-notch Bisnow event, and enjoy breakfast and networking with your friends and colleagues in the business!

OpenWork attends EcoDistricts Summit in Denver, CO- Introduces ‘Civic Coworking’ Initiative to help economic development strategy introduce the coworking model

Our experienced coworking leaders have worked with cities, economic development groups, and non-profits that want to better their communities through coworking and collaboration. The team comes from all over the US and can relate and develop plans for small towns that are struggling to keep young people to cities that need to capture the entrepreneurial energy.

Learn more & download our civic coworking brochure

About EcoDistricts Summit:

The world’s only conference dedicated to neighborhood- and district-scale sustainability. This September 13-15, urban leaders worldwide convened in Denver CO to explore the role of district-scale innovation to address some of most critical issues facing city makers today

Making the Connections: Coworking & CRE

In the July 13 issue of the Wall Street Journal, two articles sit side by side with no reference to one another. That they are presented as separate stories is both ironic and alarming.

The first article, “WeWork’s Top Rival: Anyone and Everyone,” talks about how WeWork is and will continue to face stiff competition from numerous players, big and small, in the now burgeoning coworking industry. This is simple enough. The article quotes a commercial real estate executive in New York, who says that for now they do not plan to enter the coworking market, but that they are mindful of it.

The second article, “Service Firms Feel a Chill,” discusses the flagging performance of the world’s largest real estate services firms- CBRE, JLL, Cushman & Wakefield, Colliers International, and Savills. The article pins the blame for this poor performance on both the changing nature of the industry and on the macro-economic impact of Brexit. While surely Brexit will impact the CRE industry, particularly in Britain and Europe, that is really only part of the larger picture. For some reason, whether it is a lack of peripheral vision or simply willful ignorance, few participants in the mainstream CRE industry quite manage to make the necessary connections to have a truly holistic view of their own industry.

The first article about WeWork, it might seem, is entirely unrelated to the second article about CRE, but of course it isn’t.
The massive growth of coworking reflects fundamental changes in how people are officing- in small startups as well as in medium and large firms. It decreasingly makes sense for large firms to lease based on the ‘one fixed work station per employee’ model on which the traditional CRE leasing model is based. That is, like individuals in the coworking world, many corporate employees now work ‘in the cloud.’ Sometimes they go into the office, sometimes they work at their kitchen tables, and sometimes they work at their local Starbucks. That such mobility-of which the coworking industry is a huge part- is unrelated to the decline in revenue among the largest CRE firms, is simply not a tenable notion.

Note that 51% of coworkers in the US are company employees, not freelancers, an important and telling change in the industry.

Where are these folks coming from? They are coming from companies that are, in a variety of ways, changing the way they use and lease work space. It is a leakage problem for CRE. There are, though, internal solutions. When, we ask ourselves at OpenWork, will large firms (CRE and their clients) put their fingers in the dike and build coworking-like environments where their employees actually want to be?


Author: Drew Jones, OpenWork Partner