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Mark
Golan is a thought leader in re-envisioning the
workplace. A vice president of worldwide real estate
and workplace resources for Cisco Systems, he was
recently appointed chairman of CoreNet Global, a
professional association of corporate real estate
executives. At Cisco, he manages about 160 employees
and oversees 17 million square feet around the
world. His objectives: cut costs, enhance
productivity and boost employee satisfaction.
Cisco’s renowned Building 14, in San Jose, Calif.,
functions not only as Golan’s center of operations
but a living lab for his ideas. “Network of
Space” spoke to him in early December.
Network of Space: What does Workplace Resources
do?
MG: The purpose of WPR is to acquire space,
manage the services that take place, handle the
construction, build what needs to be built. It also
entails the design of the work environment. When you
talk about the work environment, you have an impact
on worker productivity and the company’s culture.
That needs to be thought through pretty carefully.
NoS: How do you view the changing nature of work?
You’ve said elsewhere that it’s more
“collaborative” and “untethered.” Please
elaborate.
MG: The nature of work has changed over the
past 30-plus years from the typical office, where
people are heads down all day long, to where it’s
predominantly collaborative: people interacting with
people in different ways. Today, most work is
collaborative or done on the run. People spend most
of their day in meetings. They rarely have the
chance to sit down and do e-mail or voice mail. They
do it in the car, off BlackBerries, inside the
little white spaces in their schedules.
Our infrastructure [at Cisco] is our laptop and
web-enabled applications. Connectivity is everywhere
for us. We’re 100-percent wireless within the
campus. Every employee, bar none, has a wireless set
up at the house. We pay for broadband. As long as
you have that laptop and connectivity, it doesn’t
make a bit of difference if you’re sitting at your
couch at home or in the office.
NoS: How does the new style of work affect the
way you design offices?
MG: If you were an office designer 30 or 40
years ago, and you were told that 80 percent of the
time an individual would be sitting by themselves,
and to be productive they needed all these physical
things – phone lines, typewriters, copying
machines, secretaries -- it made total sense to
design offices in cubes.
The problem is the technology and nature of work
have changed but the work environment hasn’t.
Offices are very poorly utilized. I’m talking true
utilization, not seat assignment. The metric used in
corporate real estate has been the wrong one. You
can say a building was 100 percent occupied – but
you really mean it was 100 percent assigned. When
you measure utilization, the metrics are pretty
abysmal. We find that utilization runs about 40
percent in a 100-percent occupied building.
Traditional offices dedicate 70 percent of their
space to cubes. Today, the cubes are mostly empty
while people fight over conference rooms because
there’s not nearly enough collaborative space. The
work environment is very broken. For most companies
the second-largest operating expense after salaries
is real estate. Real estate is the longest long-term
asset on the balance sheet. To say it’s being
utilized at 40 percent is an amazing statement.
It’s an enormous area of waste.
Even more importantly, [outmoded offices breed]
active resistance to the kinds of behaviors you’re
trying to promote. Every company talks about the
important of collaboration and teamwork. They’ll
have big meetings to talk about this – then
everyone disperses to their offices and cubes to
make sure it never happens. Not only are you wasting
a lot of money, you’re damaging working
productivity.
NoS: If everyone has laptops, cell phones and
Virtual Private Networks – if everyone is
untethered, as you say – why have central offices
at all?
MG: Why do people come to work still?
That’s a question that needs to be asked more than
it is. When I ask that question of people, I
generally get two answers. One is, they say. “I
need to go to meetings.” There’s an underlying
assumption that interactions are best done face to
face. The other thing is, “I need to socialize.”
People don’t like to feel isolated. They want to
feel like part of the team and the company. Those
social interactions foster trust, understanding and
belongingness. They’re done best face to face. We
haven’t reached the point where social
relationships can be developed at a distance.
Ask people what their most notable experiences in a
work setting – they’ll oftentimes describe some
scenario where they were given a ridiculous task,
banded together and worked insane hours. There was
no work-life balance. It was everything you’d
think would make them miserable. But they remember
it fondly because they banded together as a group
and collectively brought this thing down. That
ultimately becomes fun.
People complain that work isn’t “fun”. We
often misconstrue what that means – more beer
parties on Friday afternoon. That can help. But a
fun job is one where you feel empowered, you’re in
a very social environment, you’re learning from
your colleagues, you’re working together to
accomplish something.
NoS: So, you think there are limits to which
technology can overcome the human instinct for
face-to-face interactions?
MG: There probably are limits but I don’t
think we’re there yet. Any time a company has
attempted to virtualize their organization, that has
led to a mercenary corporate culture. People feel no
loyalty or connection to the team. We are inherently
social beings. We were evolutionarily designed that
way. We have to think long and hard before we break
that down too much.
But norms are changing. You’re seeing changes
between the generations. People are coming of an age
today who only knew a world with computers, with
Instant Messaging. How they interact with one
another is very different from how the baby boomers
interact. They’re more used to holding three
conversations simultaneously with each other through
IM. They’ll be more able to foster concepts of
belongingness over distance. But I’m still
skeptical that we’re all the way there. We’re
programmed and conditioned as human beings to
socially interact.
We’re working at Cisco with “tele-presence”
– extremely high-end video conferencing. Picture
sitting at a circular conference table. You’re
sitting on one side of the table. On the other side
are large plasma screens with images that blend into
the table – it looks like you’re all sitting at
the same table. The people are full-size, high-def.
You can make eye contact. You hear directional
sound. They’re looking at you and vice versa. Real
motion, real time. Psychologically, if someone asked
you a day later if you were in the physical presence
of someone, what would you say? Emotionally, it was
almost like a face-to-face. That kind of technology
will help tear down some of the barriers to distance
cooperation. What you don’t get: You can’t go to
lunch with people after the meeting. There are no
spontaneous, unstructured interactions.
Maybe bandwidth will be so cheap one day that
we’ll be able to talk to each other all day like
we’re in the same room. I can envision a world
where that starts to happen.
NoS: You often speak of the 70 percent/30 percent
ratio of collaborative work to individual work.
Where do you get that number? Is that just Cisco?
MG: It’s more an aggregate of peoples’
office environments. It applies most to
office/sales/administrative workers. There are
exceptions: When you’re talking about engineers,
you’re talking about different work practices.
When you’re talking about software designers, they
sit down for hours and write code.
The more senior you get, the more you become a
manager. A culture of status has built up around
space that runs completely counter to workplace
realities. The people who are given the most
dedicated space – executives – are the ones who
need it least. At a certain level in the
organization, all you do is attend meetings.
At Building 14, I get no dedicated space of any
kind. I like to make an analogy with your home. You
don’t go home to a cube. You go to a
multi-functional environment. You move around in
that environment and use it appropriately. Sometimes
you’re with your family, sometimes you’re with
friends, sometimes you’re by yourself. Sometimes
you’re in the kitchen, sometimes in the family
room. It’s unstructured. It can be done on the
fly. Now, port that process to the workplace. The
family becomes the group of people you have to work
with. It can easily span organizational lines. It
allows a lot of flexibility. If the people you work
with change, you change the physical clustering. You
don’t have to ask anyone’s permission. You just
choose another place.
That’s how we’ve been operating for three years
now. When you do that, you eliminate all the wasted
space. You take some of the [cubicle] space and
apply it to the collaborative zones. The other thing
you do is shrink the space and save money. You get a
win-win.
NoS: How successfully have you migrated that
experience in Building 14 throughout the rest of
Cisco?
MG: It’s been a slow roll out. Our idea has
been to prove the concepts… create prototypes…
nail down the solution before we scale it. At this
point, we’ve got ten or twelve of these
environments through the [Cisco real estate]
portfolio. Some of these solutions are pretty well
baked. Now we’re looking to scale some of them. In
some areas, they’re clearly appropriate. In other
areas, they still need some work. If we’re working
with a Human Resources group, where people meet
privately and sometimes break down in tears, we
might design an environment with some hard-wall
spaces. We’d go with what’s appropriate for that
group.
We will not deploy space for status. If someone
wants to deploy space for status, we present them
with the price tag for that. If someone can make a
good enough case – the only way can get some
talent is by having a private office – we’ll do
it. But they’ll have to add the cost of office
space into their decision making.
NoS: You say that companies are wasting more than
60 percent of their space. Corporate America is
“over officed,” is it not?
MG: Most companies that have studied
utilization have found that their utilization rates
are poor. The rate will vary from place to place.
This is not a one-size-fits-all proposition. Each
company has to make its own realistic assessment.
But the metrics used in the past were the wrong
metrics. Almost everyone who comes through Building
14 smiles and nods their heads. They say the same
thing: Their offices and cubes are empty and their
conference rooms are booked.
Generically, people stopped thinking about the work
environment a long time ago. They need to rethink
it. The cost and productivity costs are pretty high.
NoS: How does Cisco measure utilization?
MG: It’s still a manual process. We’ve
looked at a lot of automated ways. We can do things
like use wireless access points to triangulate where
someone is, with resolution within 25 to 30 feet.
That tells you if they’re in a given sector. But
it doesn’t help if you want to know exactly what
they’re doing, or the technology they’re using.
If you want to know to know what people are doing
real time, you have to track them second by second.
We did a pilot [project] with ultra wide band, a
form of RFI. We deployed the sensors. People wore
the badges – they’re not small. It’s a little
trickier than people think. We had power management
problems. We got interference near metal objects,
like blinds and white boards – people would walk
into these ghost zones. I have yet to see a really
robust, scalable solution that allows you to track
folks at a high level of granularity.
Another problem with automating utilization is you
run into privacy issues. People don’t want to be
tracked at that level. You literally know, “Oh,
they just went to the rest room.” People aren’t
comfortable with that. In Europe, you’d be
violating laws.
There are other ways of measuring utilization. You
can track people going in and out of points of
entry. The problem with just using badge data is
that you run into tailgating -- 30 to 40 percent of
the people who enter the building tailgate in –
they come in at the same time. Three people get to
the door at the same time, they know each other,
they just walk in.
Is measuring utilization doable? Yeah, it’s
doable. If you put a gun to my head and gave me
enough people and money, could I get a system into
place that was working? Yeah, I think I could. Would
it be cost effective? Not with what we have today.
But there are some technologies we’re looking at
pretty hard.
One day, I can see you walking up to a desk in room
– say, an audio privacy room. The room knows
it’s you. It changes the lighting levels to how
you like it, adjust the temperature and puts
pictures of your kids on the plasma screen. When you
leave, the room automatically re-sets for the next
person. [With that kind of technology], we could
pull up a map of the floor plan and see where your
dot is. I don’t need to know what person is
associated with that dot and what group they’re
with – what we really want is the utilization
statistics. Gather the information you need without
identifying the individual.
NoS: Last question, Mark, how well have you done
in Building 14 getting your utilization under
control?
MG: Building 14 has about 25,000 square feet.
It was designed for 88 spaces. We took occupancy at
140, and the number now is roughly 160. But the
number is constantly changing – we’re not sure
exactly how many people are using it. When are you
out of space? It’s not black and white any more.
As you add more and more people, it gets tighter and
tighter. It gets harder to find the kind of
environment you need when you want it. At some point
it gets intolerable. But it’s a gradual process.
Right now we’re running at about a two-to-one
ratio compared to what the building was designed
for.
NoS: Many thanks for your time.
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February 5, 2007
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