One of the questions posed to participants in the World Economic Forum’s Annual Meeting of the New Champions was: “How are leading enterprises reinventing the workplace for the future?” This is an increasingly important consideration for today’s employers.
Effective workplaces are becoming a necessity as businesses find themselves under mounting pressure to increase productivity while still maintaining cost control. Critical to successful workplace transformation efforts, and being able to demonstrate results, are understanding what productivity means for your business, what behaviours drive it and how the workplace can empower it. Getting these right is not easy and presents challenges for companies operating in Asia, where a deep understanding of local customs and cultures is required to engage employees at all levels of the organization.
Recent industry research, Global Corporate Real Estate Trends, reveals that 46% of global companies plan to expand operations in China and 42% India in the next three years. Why? Despite recent slowdown, Asia’s overall economy has an above-average outlook, and these companies see growth potential to capitalize on. Although regional attitudes towards changes in work style are evolving due to the accelerating globalization of Asian multinational companies, workplace policies still need to be adapted to suit diverse workforces.
In China, for example, the workforce population is shrinking: over one third of businesses struggle to fill positions and a high proportion of employees are below the age of 35. In response, many Chinese companies are looking at how they can create an employee experience that will attract a young, dynamic workforce, which is critical if they are to compete on the global stage and expand both domestically and globally.
In India, accommodating the broad spectrum of religions, languages and cultures poses tough challenges for both Western and Indian companies. In fact, 22% of India-based corporate real estate executives cite cultural diversity as a major hurdle to overcome when driving workplace transformation, as opposed to the 7% global average.
A company’s real estate plays a key part in workplace transformation and can contribute to its success more than many firms realize. It is no longer a simple question of cost: what you are spending; what is on your balance sheet (owning as opposed to leasing property); and where you can make cost-savings. Economic uncertainty, emerging technologies, talent shortages and the pursuit of increased business productivity force companies to consider how real estate can contribute business value beyond traditional cost savings.
Research reveals that 72% of companies hold high expectations for real estate to improve productivity of their workplaces. Yet, workplace productivity is oftentimes miscalculated in cost-per-square-foot when in fact, it is more accurately characterised by contribution to business performance. The truth is, achieving greater density is not the same as improving productivity. That said, companies must begin exploring ways to measure results in alternative areas, such as how the workplace can enable more efficient and effective workstyles; position employees and the business for growth; improve talent attraction and retention; enhance customer experience; or reinforce the company’s culture and brand.
These metrics will shape workplaces of the future and contribute to the ultimate success of a company as they expand both locally and globally.
Jeremy Sheldon is Managing Director, Markets, Asia Pacific at Jones Lang LaSalle. He participated in the World Economic Forum’s Annual Meeting of the New Champions in Dalian, China.
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