Let’s face it. With the rise of companies now realising true #WFH opportunities, there’s been a big drive for a lot of organisations and business owners saying that they don’t need offices as big as what they have now (or if they need them at all), downscaling to a potential zero office environment. David Lichtenstein and I were chatting last week about this #newwayofwork, and, more particularly, what these organisations are actually going to do with the saved money.
Completely removing an office from your monthly spend removes expense line items like the rental of the physical space of course, but also:
- parking,
- electricity,
- coffee and food/snacks (for staff and/or customers),
- cleaning staff/services,
- phone lines,
- internet,
- office maintenance
- and a bunch more.
WIN FOR THE COMPANY! WOOHOO!
However…
The extra costs are now going straight to the employee. They’re drinking and eating more at home (which, depending on the organisation’s food/drink offering, could be a good or bad thing financially), but also an increase in their possible upgrades in services like WiFi or phone lines, furniture/decor for their office space (there’s only so long you can work on a couch or at your diningroom table), increase in electricity usage, etc.
So organisations are saving, and employees are – more than likely – not.
So what to do?
I think companies have a few options and, depending on their culture, I believe they can do a few things with the money they’re no longer spending, like:
- Plough it back into the business (for growth, or sustainability during this tough time)
- Declare a bigger profit (for ego)
- Draw larger dividends (for pleasure)
- Reduce the cost of their products or services (customer benefit)
- Increase staff salaries (employee benefit)
There are probably more, and I’m sure a combination of the above could be achieved as well.
While I think the decision to save money and use it in a different way is great, I’m curious to know if organisations who have decided to go this route have told their people about what they’re doing with the money they’re no longer spending.
Note: I’m guessing most organisations would say point number 1, but when they start generating a more stable income, the next phase will have to kick in.
Is your organisation downscaling office space? And if yes, where’s the saved spend going?
Originally posted on LinkedIn.