As more international companies move toward the global management of real estate portfolios, HOK’s Kay Sargent shares lessons from her years as a workplace strategist, designer, and road warrior.
We live in an interconnected world. With unprecedented rates of global transit — whether for business, pleasure, or immigration — culture is crossing boundaries at an astounding pace, impacting the way we live and work. In the U.S., especially, we are becoming a “minority of majorities” with a heightened awareness of the cultural aspects of various countries. This cognizance is having a ripple effect on how we design.
As recently as 10 years ago, most corporate real estate companies followed a decentralized model in which decisions were made regionally. Some used private offices to reward individuals, while others chose to maintain an open environment that was uniform and equitable. European and Asian locations leaned toward more open, dense environments. North American locations generally allotted more space per person and provided additional private, enclosed spaces.
In recent years, as companies have been expanding globally and centralizing the management of their real estate holdings, the commercial real estate (CRE) model is being viewed through a global lens. Many companies are establishing templates for standardizing their offices around the world.
I recently used Zoomerang to conduct an informal survey of 50 corporate real estate managers worldwide about their workplace solutions. In this article, you’ll find the results — and what they mean for how we implement workplace solutions around the globe.
According to the survey, 68 percent of the companies had global standards or guidelines, 16 percent had regional standards, and 16 percent had none. The responses revealed that many companies have put in place standards to help them streamline delivery processes by leveraging the best resources at hand — regardless of location — and providing a consistent experience and brand for global staff.
Though this centralized model enabled the rapid deployment that many emerging companies wanted to achieve, it had a downside. With a centralized approach that specified a single, standardized model of space delivery around the globe, few companies were able to conquer the challenge of responding to cultural nuances from region to region. Strictly enforced, standardized programs failed in some regions.
Guidelines vs. standards
The challenge facing many companies is determining how to strike a balance between enforcing global standards and addressing regional influences. The survey revealed that 90 percent of companies see work styles differing from country to country, making standardization problematic. Many companies have realized that cultural, legislative, and style issues vary by region and understand that it’s important for the businesses to be good local citizens. To give regional offices more flexibility to respond to the local context, savvy companies have shifted their focus to creating guidelines instead of standards.
Global workspace challenges
The responses of international survey participants regarding how global standards and design issues relate to real estate and the workplace confirmed some assumptions while exposing new challenges. The difficulties facing CRE executives looking to deliver space globally include:
- Supporting flexible work
- Driving down occupancy costs
- Providing consistency
- Adapting to the culture
- Balancing local requirements and global brand strategy
- Breaking through traditional notions of space entitlement
- Overcoming reluctance to change
International success requires a deeper understanding of the different regions of the world, as well as the challenges and opportunities associated with each. Specifically, CRE managers must recognize how different cultures accept or reject trends. Challenges and constraints in many regions include:
- Pre-existing density
- Infrastructure readiness
- Access to natural elements
- Legislation and regulations
- Demographics and talent limitations
- Availability and cost of land
- Land use and zoning
- Cultural nuances
- Economic and political stability
Using local culture to inform global strategy
Seventy percent of respondents indicated that culture plays a major role in determining the design direction and workplace solution. It was noted as a pivotal factor 25 percent of the time, and was excluded in only five percent of the responses.
There is a difference between working globally and internationally. A global approach is one where a company based primarily in one location exports services to other regions or countries. Companies that are truly embedded in multiple countries and understand the nuances of these countries are working internationally. This is a distinction worth noting, as it’s difficult to comprehend and embrace the nuances of a place without having a deeper understanding of the region’s culture.
An example of that challenge is organizational structure. Every company has a corporate structure, whether it’s an adhocracy, clan-based, market-driven, or hierarchical. Though many industries have shifted to a flatter organizational structure, hierarchy still exists in many companies and cultures. In some countries, a hierarchical structure embedded in the cultural fiber permeates into business environments. In India, the Middle East, and South America, the class or caste system ingrained in society often affects the office’s organizational make-up.
When there is a fundamental and deep cultural history of structural difference in status, you cannot remove offices and create a completely open environment. Even in the U.S., we can be more hierarchal than we like to think. In many cases, this hierarchy exists for a reason. The recent rise of adhocracies is a reflection of the rapid growth of many startup companies and the need to create a platform that enables quick, seamless development. Having a structure in which no one is responsible for everything and everyone is responsible for something is a way to empower people by spreading the responsibility and growing as a unit. But not all companies can function in that manner. This model would not be accepted in regions of the world where societal structure is inherent. Australia, for example, tends to be an egalitarian society and thus has been able to easily adapt to activity-based workplaces (ABW) and team/activity-based workplaces (TBW) environments.
Another example of regional attributes and societal norms impacting work is the viability of teleworking in different regions. In cities where commuters can get to the office without major traffic delays, the need to provide telecommuting options may not be as important as it is in New York City, where the average commute can be well over an hour. The same company that might consider a mobility program in the U.S. or Europe due to density and commuting issues could see the same factors in Asia and decide that teleworking would be a viable strategy there. But a deeper understanding of the societal issues in Asia would reveal that many people are living in smaller units with multi-generations. Going to the office and having a place that they can call their own is preferred over working from home.
CRE managers and strategists need to be acutely aware of how these cultural nuances can impact real estate strategy and workplace solutions.
Sense of place
Creating a workspace that staff can relate to is important for attracting and retaining top talent. It’s imperative for global companies to accommodate local influences rather than build all of their offices exactly the same across the globe. Though branding is important, it must be balanced with a sense of place that reflects the community. Color choices, material selection, space allocation, privacy levels, and sustainability are influencing how real estate and space solutions are implemented on a regional level.
Using colors and finishes that are customary to certain regions is key. In India, bright colors are expected. In other regions, however, those palettes could be offensive and more neutral colors may be preferred. Incorporating local finishes and materials rather than importing them supports the local economy and culture while raising sustainability efforts and reinforcing regional pride. These details likely will be important to your next recruit.
There are commonalities across the globe. To create a sense of place and community that is human-centric, regardless of regional influences, the workspace should be:
- Close to adequate transportation
- A blend of social and professional experiences
- Culturally rich
For up-and-coming “next-use” communities, there is a global preference for accommodations that include:
- Ability to walk to work
Though there are regional nuances, some common themes are emerging in work environments. Key elements to successful spaces include:
- A shift from all-closed or all-open spaces to environments in which a balance is achieved to accommodate all work styles.
- Sustainability is embraced (essential in most projects).
- Occupant health and well-being as a major driver of design.
- Blending of spaces to create areas and communities to work, live and play.
- Addressing the basics (light, noise, comfort) to create a sense of grounding.
- Understanding and designing for organizational DNA and culture.
- Creating a strong sense of place, identity and connection to the community.
- Increasing opportunities for information sharing via multiple means.
- Integration of technology.
- Need for flexibility to accommodate rapid technological advances.
- Creating vibrant, engaging places.
- Ensuring an underlying sense of security and safety.
Even when CRE groups follow these suggestions, implementing global guidelines and delivering next-generation spaces can be a challenge. Each region has obstacles specific to its locale (see infographic).
As more international companies move toward managing their real estate globally, developing a better understanding of international dynamics and cultural nuances is essential. The most important thing to do when visiting a city or company is to look and listen. It’s not enough to understand each company’s unique set of business attributes. We also need to understand the cultural influences of who they are and where they work, as well as the challenges and opportunities of each location. A successful strategy depends on creating spaces and guidelines that are flexible enough to accommodate cultural attributes, work styles, and the needs of each region.[/cointent_lockedcontent]