Business

[TOP STORY] Offices are sitting empty all over the world

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SIMON BROWN: I’m chatting with Jon Cherry – you’ll find him at Cherryflava. Talking [about] the office: we see the data coming out of Reits locally, in the US and in Europe. Office vacancies remain 25%, sometimes even north of that. It doesn’t seem to be getting better in any hurry whatsoever.

Jon, I appreciate the time today. You put out a note just recently around the future of the office, and the one point you [made] is that it’s actually become deeply divisive at this point.

JONATHAN CHERRY: Yes, I just saw on The Economist this morning that apparently especially CEOs in North America are tearing their hair out as to how they can attract people back to the office. They’re thinking about things like holding pop concerts, and they want to do wine tasting, and there are all sorts of tricks to try and lure people back.

But I think what’s interesting is that the way that we see the office is kind of a proxy for the way that we see work. And how that has changed – and I think the real accelerator there has obviously been the pandemic. Now that people have sort of proven that you can be productive at home, we are starting to question why we need to go back to the old framework if the new test was so great? You need to really convince me as to why it’s important that I need to come and fill a desk after having commuted for hours to get to that desk.

So understandably questions are being asked and at this stage there aren’t necessarily a lot of great answers.

SIMON BROWN: Part of the trick, as you’re alluding to it there, [is that the] offices that we use today weren’t designed to be fun places. They were designed to get as many people in and be as low cost as possible – and have the corner glass office for the boss.

JONATHAN CHERRY: I think that’s the point, exactly as you say. The office was kind of a central place where you could house everybody and, yes, you packed them in. I’m sure there was some kind of a metric of productivity per square metre – how much money are we making out of the people that we stack in here?

But things have changed so radically since then and I think now the world of work has really evolved. Yes, it’s still around productivity. That’s obviously important.

But more and more the soft skills of creativity and innovation and creating new value in organisations is really key. In addition to that, brands and businesses need to attract talent that is really going to be able to do that.

So in order to attract that kind of talent you need to be super flexible in how you harness the productivity that [these people] bring. Plus you can’t stifle the creativity and the innovation that you’re hoping to get from those people.

So in many ways offices now need to perform these two functions – which is how do I leverage productivity to the best of the ability that I can, because these are knowledge workers, they’re not factory workers? And how do I inspire creativity through collaboration and through having a space where people want to spend time in that space and think of new, interesting, innovative ideas [from which] I’m going to be able to create products and sell those products into a changing marketplace into the future?

So that’s what the new office is meant to do. It’s meant to really create the conditions under which those behaviours emerge, and I don’t necessarily think that people have framed it in that way as yet.

SIMON BROWN: Yes. You mentioned pop concerts earlier. That sounds like fun, but how many pop concerts can I go to in a week at work? It’s going to be around design. I’ve been to some of the sort of newer corporate offices in in Rosebank – this was pre-pandemic – and you could see that they were trying design. I don’t think they were quite getting it there yet. But this is almost, as anything, a design challenge.

JONATHAN CHERRY: Yes, exactly. And to your point, Simon, you don’t want to go to a pop concert with people who are work colleagues. With work colleagues you go and you do amazing work with those people. If I want to go and have a jol, I’ll go with my friends and we’ll go to a stadium and all that kind of stuff. So I think it’s disingenuous the way that they’re kind of thinking of those things.

And exactly to your point, I don’t think the office has really been designed with the intention of what you’re trying to create this space to do. It’s not necessarily about space. It’s about the experience and it’s about what you inspire in that space.

So even things like desks and meeting rooms and all of these concepts need to be rethought, because research shows that people have their best ideas when they go out for a walk or when they’re on the beach, or when they’re climbing a mountain.

If that is the case, then why is the office not on top of a mountain? Why are there not structures in place to try to inspire different ways of working?

I think that’s the thing – the thinking needs to actually break out of the physical space and redesign what kind of behaviour you are trying to create, and then create the conditions under which that behaviour comes forth.

It sounds like I’m talking like a real designer now, which potentially I am because I’m a futurist and I design strategies for the future, but I really think that’s what needs to happen. It’s to start with a blank slate, and then build from there, depending on what you’re trying to create.

SIMON BROWN: I like that. A blank slate and less top-down, all these bosses thinking that they know how to solve the problem. In good old fashion, go and speak to your staff, see what works for them. Is it a mountain? For me it’s a beach. It’s going to be different for everyone, but speak to your staff.

JONATHAN CHERRY: Exactly. I think the thing is that there are no answers here as yet. So there’s a lot of uncertainty in the space.

And when presented with uncertainty, the trick is to explore and be creative and use your imagination, and to design.

I think that’s potentially what’s not happening. As you say, if people think they have answers, they don’t. Just accept that there are no answers as yet, and it needs to be designed from scratch.

SIMON BROWN: Someone’s going to get it right; lots of people are going to get it right in time. We’ll chat in five or 10 years and look back and there certainly will be some level of innovation. I would imagine it becomes a competitive advantage?

JONATHAN CHERRY: A hundred percent. I think that’s the thing. In the world today one of the key drivers of future success is how successful you are at attracting talent. We know now that as we move into an age where business is becoming more and more digital, and technology is becoming a huge part of the value chain of a business, you have to attract the kind of people who understand technology and can be creative with adaptive technologies. And that’s about how I piece together technologies to create something brand new.

Those kind of people are very, very rare and they’re very, very highly skilled.

Nowadays with remote working you’re not just competing with other businesses in the Johannesburg or Cape Town area, you’re competing with people around the world. So you’ve got to be better [for] a guy who’s sitting in Sandton and potentially could be working remotely for Google.

So the challenge is that you’ve now got to attract that kind of talent, and the benchmark is world-leading organisations, not just the company next door.

So I think again, with that kind of lens on the problem, you’re really going to have to hit it out of the park to get these people to want to work for your organisation.

SIMON BROWN: We’ll watch with interest. As I said in the intro, offices are lying empty all over the world, truthfully. And the solution so far doesn’t seem to be working. Folks aren’t keen to go back.

We’ll leave it there. Jon Cherry of Cherryflava, I always appreciate the insight.

Listen to the full MoneywebNOW podcast every weekday morning here.

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