Technology Disruption & Economic Uncertainty Key Drivers Of Workplace Strategy

Technology disruption has become a major concern for multinationals and their future operations, according to CBRE’s 2017 Asia Pacific Occupier Survey.

The survey also identified other concerns, including economic uncertainty and tighter regulations or legislation, and said global economic uncertainty and a focus on cost savings is prompting multinational corporations to proactively adopt workplace strategies.

Approximately 50% of all multinationals will invest more in their workplace and space efficiency programs, ranking it as their main priority for the coming year.

CBRE Head of Research Stephen McNabb said with revenue growth still challenged across multiple industry sectors in Australia, occupiers are still very cost conscious.

"Technology disruption, while recognised as a major challenge, is something that will be embraced as a key opportunity, enabling improved business outcomes – be that optimisation and efficiency or improved productivity in the workplace.”

The survey revealed that the drive to efficiency was also seeing greater investment in the workplace as there was recognition that space consolidation needed to work in tandem with business objectives around employee attraction, retention and collaboration.

Mr McNabb said the latter remained a key driver of workplace strategy, with 69% of respondents citing “promote collaboration” as a key driver of workplace strategy followed by “talent management”.

For occupiers, this means a greater need for alignment between human resources and real estate strategy.

“Corporations across Asia Pacific are making the realignment of workplace strategy a business priority,” Global Workplace Solutions CEO Phil Rowland said.

“They are evaluating the longer-term dynamics of the workforce and thinking more holistically about the role of agile working environments in their business.

"As a result, corporations are developing workplace strategies and space efficiency initiatives to futureproof work environments, attract and retain personnel, and mitigate disruption.”

According to the survey, multinationals are stimulating flexible working by prompting employees to share desks. By 2020, 66% of respondents will have raised the sharing ratio beyond 1:1—up from the current 30%—meaning that the number of desks will be lower than the total number of employees.

The average space per employee is set to decline with multinationals implementing more aggressive desk sharing plans. Around 63% of multinationals have set a target of reaching a space of under 9.3 square metres per employee within the next three years, up from 46% currently.

The main drivers of workplace change for multinationals are enhancing collaboration amongst employees, and improving talent retention and attraction. Cost saving remains a key factor (35%) but has diminished in importance compared to last year’s survey.

The survey found that companies realised that direct cost cutting can actually be counter-productive as it can damage employee morale and negatively impact their corporate image.