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Experience, not Efficiency, Becoming a Preferred Workplace Metric
In the post-pandemic workplace world, rife with hybrid models and different mandates, companies continue trying to determine the best measures for real estate success and use effectiveness. One such measure has been space utilization rates.
But according to a CBRE article, “Companies Now Prefer Metrics that Measure Effectiveness, Rather than Efficiency,” space utilization isn’t all that effective. The authors indicated that 79% of CBRE clients target utilization rates of 65% or more. The reality is that “actual utilization rates lag at 38% and have increased by only three percentage points from last year,” the article said.
Additionally, while 73% of occupiers said they have an effective workplace, only 46% actively measure effectiveness. “Companies solely using space utilization are less likely to report an effective workplace compared with those also relying on interpersonal connection data like employee sentiment or retention rates,” according to the article.
Beyond Employees in Seats
So, there’s more to effective workplaces than how many employees show up at a given time. Utilization rate is an important measure, But the article said that CBRE clients also ranked employee satisfaction/sentiment at the top of the list. In fact, employee satisfaction as a measure of effectiveness has increased significantly, jumping from 8% in 2023 to 14% in 2024.
“This surge underscores the increased focus on employee morale and happiness as critical determinants of overall business success,” the article said.
Meanwhile, other traditional measures like design density and people density have declined over the past four years.
The Solution?
The article acknowledged that top CRE goals focus on optimization, cost savings and office utilization, all aligning with metrics CBRE clients track. Just as important in establishing workplace efficacy is “ensuring that the set objectives are in harmony with the disseminated policies,” the article said, adding that 96% of organizations already have such a workplace policy (like remote work versus full-time work) in place.
Correlation between objectives and policies can lead to successful implementation of the latter. Additionally, “aligning targets with communicated policies can contribute greatly toward goal achievement, but also enhance trust, transparency, consistency and productivity in the workplace,” the article added.
- ◦People
