In 2017, the Associated Press (AP) announced that it would be moving to an office with 40 per cent less space than its previous headquarters. The reason? Not because the company was in trouble. AP President and CEO Gary Pruitt stated that they wanted their operations to be more efficient.
AP is not the only company that decided to implement strategic downsizing. Big names like Deltek and GlaxoSmithKline have also decided to move to smaller offices. The downsizing phenomenon is occurring in Australian companies as well. FXFM Forex Trading, the Australian Renewable Energy Agency (ARENA) and Auto Entry are some of the companies that moved to offices with less square footage.
Companies are often thought to have downsized because they aren’t doing well. On the contrary, companies that are doing well resort to strategic office downsizing for several other reasons.
An obvious reason to downsize is to save money. A huge office space entails huge expenses for rent, equipment, amenities and maintenance. Pruitt stated that by moving to a smaller space, they are able to re-allocate their savings “into something more worthwhile.”
Moving to an office with fewer square feet also improves collaboration and productivity among employees. Companies are discovering that some employees are more productive when working remotely. It’s also easier to collaborate with other people in different areas because of technology.
Should You Downsize?
Downsizing is not a viable option for all companies. If you are thinking about moving to a smaller office space, consider the amount of current space and compare it to the actual space you use on a daily basis. Look into the functions of employees and see if their work can be done remotely. Check if clients come to the office all the time, or if face-to-face meetings are a rarity. Taking these aspects into account helps you form a better decision of whether downsizing is right for your company.
Maximising Your Downsized Office Space
Once you’ve decided to downsize, there are many ways to smartly maximise the available space. Consider how to rearrange desks so that people can fit more efficiently without feeling cramped. Invest in slim-profile desktop computers, printers and other equipment that don’t require a lot of square footage.
A smaller office allows you to implement agile working policies, in which employees have the option to work where, when and how they choose, whether it’s at home, at a remote workspace or at the office’s common area. Adjust their schedules so there’s always space available to them should they decide to come to the office.
Filing cabinets take up a lot of space in the office, and so consider scanning documents onto servers instead of keeping physical copies. If the nature of your business requires physical copies, consider renting a storage space. Invest in virtual data centres, which eliminate your need for modems and physical servers. They also lower your monthly electric bills.
Strategic downsizing allows you to spend less on leasing your office space, as well as related utility costs. However, moving to a smaller office and transitioning to a remote workforce is not a guaranteed recipe for success. It requires investing in new programs, getting used to new schedules and adjusting to different ways of doing business. When done successfully, your company will enjoy a more productive and collaborative environment.