This week I read about two very distinct approaches to employee productivity. First, from an article in the Wall Street Journal:
The office cubicle is shrinking, along with workers' sense of privacy.
Many employers are trimming the space allotted for each worker. The
trend has accelerated during the recession as employers seek to cut
costs and boost productivity.
He says new workstations designed by HOK average 48 square feet, down
from 64 square feet about five years ago. Partitions between cubicles
also are shrinking, to 4 feet high or less, from 5 feet high.
Now, here's another approach, from the About Us page of Fog Creek Software:
To recruit the best programmers, we’ve invested in the
nicest work environment we can get.
In 2003, we
moved into a new office that was custom-designed by a top architect to be the
ideal programming workspace, with private offices, windows everywhere, a lounge
with a big plasma TV, and every feature a programmer could ever want. We even
have twenty power outlets at each desk, at desk height, four with UPS power.
That’s how fanatical we are about catering to programmers. Oh, and really
comfortable chairs. We never hesitate to buy the tools we need to get our work
done (standard issue: two large LCD monitors, one 30”, the other 21”).
This is a little apples-to-oranges, with Fog Creek employing programmers and the general office worker significantly lower paid. But look at the office workers. Average total compensation runs $21.99 an hour nationally, or $45,739 per year. What does the old cubicle space, 64 square feet, cost? It depends a lot on location, but the median office rental rate is in the neighborhood of $25 per square foot. So the old, "big" cube costs $1,600 a year. Going to the new, small cube saves $400 on rent, plus some more for hallways and furniture. That is about one percent of the labor cost.
Is there a chance that the office environment can affect employee productivity by more than one percent? If so, then slow down your cube downsizing. Instead, ask yourself, what environment would lead to the greatest productivity of your workers? Whatever that environment might be, the office space cost is trivial compared to the labor cost.
Why do otherwise smart business leaders make stupid decisions? They are probably not measuring productivity, so they don't know how badly they are messing up. Also, the managers rewarded for cutting occupancy expense may not be the managers responsible for getting the work done.