The Shrinking Footprint

While decommissioning is a normal part of the life cycle for almost all facilities, the current rise in its necessity is dramatic. Downsizing, modernizing and adapting space for a fluctuating on-site workforce and meeting sustainability goals are all major factors in facility managers’ decisions to engage in the complex and multistep process of decommissioning. That process can vary widely depending on the type of facility or system, potentially involving asset disposition, dismantling technology, moving items and dealing with hazardous materials. FM executives should consider these key points when making decisions about decommissioning and how to successfully plan a safe and successful building decommission.

Trends in return-to-office and hybrid work arrangements

In this post-pandemic era, with its continued ripple effects, decommissioning is primarily being driven by the shrinking footprint that looms for offices as it becomes ever clearer that the work-from-home genie will never be returned to its bottle. As a Time magazine headline announced in May 2023, “Return-to-Office Full Time Is Losing. Hybrid Work Is On the Rise.”

The article draws some significant statistics from The Flex Report compiled by Scoop Technologies from more than 4,000 companies employing more than 100 million people globally:

• The share of people in the office full time dropped to 42 percent in the second quarter of 2023, down from 49 percent in the first quarter.
• Meanwhile, the share of offices with hybrid work arrangements hit 30 percent in the quarter, up from 20 percent the previous quarter.

Work is moving toward what Scoop Technologies’ CEO Robert Sadow called “structured hybrid,” in which there are a set number of days that people are required to come into the office. The average minimum requirement is 2.53 days, according to Sadow, with two- and three-day schedules both being popular. Tuesday wins as the most often required day, followed by Wednesday and Thursday. Few offices require a Friday presence, and only 24 percent require Monday.

CBRE’s June 2023 report focused on trends in Europe that mirror the changes impacting the U.S. market. The report found that hybrid work situations are proving preferable, with half of those companies surveyed saying they would prefer that employees split time equally between home and on-site offices. Specifically, 38 percent of companies surveyed want employees primarily in the office (three or more days a week) and only 11 percent expect to be mostly remote.

What does this mean for office vacancies and downsizing? In June 2023, the U.S. office vacancy rate reached 17.1 percent, up 180 basis points from June 2022 with more than half of the top 25 markets above the national average, according to recent data by Commercial Edge. For offices maintaining their existing presence or shifting operations to smaller square footage, the need for strategic and sensible decommissioning comes into sharp focus. The logistical challenge of structured hybrid work means companies may not be positioned to dramatically shrink their spaces but must turn their focus to efficient and effective utilization of space they are occupying and paying for.

Downsizing, resizing & right-sizing amenities for today’s workforce

The structured hybrid model seems like a strong middle ground for workers who have developed a preference for flexibility and employers who continue to beat the drum of face-to-face collaboration. As Google’s Chief People Officer Fiona Cicconi wrote in an email to employees touting its recently expanded three-day schedule (and its more aggressive enforcement), “There’s just no substitute for coming together in person.”

While Google may be ready and have the resources to go all-in on their structured hybrid model, every company must explore its own needs and expectations to define hybrid for themselves. The challenge for FMs, office planners and business owners is breaking down the implications of a permanent hybrid structure:

• If downsizing would preclude the option for everyone to be in the space at the same time, is there a smart way to shrink the footprint but maximize and utilize the smaller space?
• Should collaborative spaces and customer-facing spaces take priority over individual ones?
• From a financial standpoint, how do companies maximize their output and reduce spending to get savings year after year? There is no one-size-fits-all model.

Narrowing the concerns to employee preferences, FMs must consider how the workspace competes. For someone who has adapted to working from home, returning to an office may mean a downgrade in furniture or amenities. It may mean lack of access to a local coffee shop, good lunch spot, convenient dry cleaner or gym facilities which, in today’s landscape, have reached the level of importance that parking once dominated. Decommissions are often driven by decisions about how to meet requirements like these to get employees back or attract and retain new hires. These concerns constitute a bit of an amenity war, but they are real concerns, nonetheless. Uncomfortable employees are unhappy employees.

Drilling down to a specific example, the workstation is a frequent star player in the decommissioning sphere. The modern workstation is agile. It may offer sit-to-stand capability. It may offer “beltline” power and data, creating easy access from the surface rather than at floor level. It may offer flexible reconfiguration. Decommissioning outdated furniture or components can lead to space-saving, improved employee satisfaction and better cost-effectiveness in the long term.

Global law firm Jones Day provides an excellent example of an investment in service upgrades for employee comfort and satisfaction. Mid-pandemic, before hybrid even entered the workforce vernacular, Jones Day embarked on a long-term project that involved a meticulous process of upgrading furniture, paint, carpet, HVAC systems and more. The goal was to allow its partners and staff an outstanding level of daily comfort along with the reassurance that future impacts like the pandemic would not impede their ability to get their jobs done safely and effectively.

Putting this all together, the big picture reveals that a smaller footprint with more or better amenities may be the winning formula. The moving and storage industry has certainly taken some wild swings as the trend toward downsizing, resizing and decommissioning evolves, and the momentum behind structured hybrid work models indicates that flexibility and upgrades will continue to be the key drivers for FM.

How to determine decommissioning needs

Decommissioning can encompass a wide range of needs, from a full office move to a remodel in place to a batch upgrade of furniture throughout a facility. Under the umbrella of decommissioning is a diverse list of processes and services that may come into play, including:

• Asset inventories and value assessment
• Furniture/equipment disassembly and removal
• IT asset disposal
• Cable abatement
• Eco-friendly asset disposal, recycling and reuse
• Hazardous waste disposal
• Storage and warehousing
• Space restoration and/or facility cleanup

The decision to undertake decommissioning can be a daunting one, understandably. But handled systematically, and with a focus on an organization’s core values, the process can be an energizing one. Moving into a new space, refreshing an existing one or meeting the needs of staff with upgraded amenities and technology are all paths to positive change.

Given the realities of post-pandemic corporate life, it is not too surprising to find that there is a new intersection between HR, IT and FM personnel. Decommissioning is a prime example of where that intersection lies as each of these departments has its own unique and vital perspective on space utilization, corporate culture, and what is needed to ensure safety, connectivity, collaboration, ease of use and job satisfaction for all. A great place to start the decision-making process is to tap representatives from these three important groups to begin a collaborative overview of the organization’s wants and needs, within the shared workspace as well as in staff’s off-site spaces.

Looking back and looking forward are equally important ways to help determine a decommissioning plan. Consider how space, furniture and equipment have been used and identify where those needs are changing now. Cast an eye to the future to consider how needs will continue to evolve. Consider the scramble that ensued in 2020, for example, to get everyone onto laptops to allow work-from-home flexibility. Evaluate the investment in video conferencing capabilities and how that usage is likely to change within a particular industry if staff are returning to the office or traveling to clients again.

It is an inescapable fact that furniture becomes dated, and technology is prone to rapid obsolescence. Decommissioning assets like these, and having a plan for effectively managing electronic waste, on an ongoing basis must be factored into the cost of doing business. The strength of decommissioning with an eye toward sustainability is that it can cushion the financial and environmental impacts of that inevitability. Investing in materials that lend themselves to recycling or reuse is one important consideration. Partnering with services that can help with resale or donation, or responsible recycling, is another.

Finding the right formula

The return-to-office battle is sure to continue informing decisions for the near future, so it is best to push for and facilitate transparency and open communication between management and staff. CBRE’s recent Live-Work-Shop report shows that only 41 percent of European workers wanted to be in the office more than half of the working week. That may not align perfectly with what corporate leaders want, but having a solid grasp on what is practical and achievable is what matters most right now for companies.

The key thing to focus on is flexibility. If downsizing or resizing is the right thing to ensure continued financial stability and achieve business objectives, decommissioning will be necessary. Start by devising a plan that will result in a safe and successful process. Seek out expert guidance to minimize waste, meet employees’ and stakeholders’ needs, and maximize the use of current or newly acquired space, regardless of size. Shift perspectives on the financial impact of downsizing or resizing by converting the savings reaped from space reduction into investments in improvement: kick up the finish level on new purchases, go bigger and better on technology, and upgrade chairs or other furniture to improve their longevity and resale value. Find the opportunity within the challenges, creating a win for everyone.