by Dianne Dunnell, IIDA, NCIDQ, LEED AP
The most influential factor shaping the future of the workplace is quite simply, technology. Technology is helping to redefine workplace culture through the choices of technology available, the adoption of certain technologies over others, and the use of technology changing how and where we work.
Today we live in an always-connected, instant-access environment. Employees are working faster and more efficiently than ever and relying on mobile devices in the workplace, at home, and on the go. The next generation of workers, including Millennials and Gen Z, will be tied to their mobile phones, not their desks. To keep up, employers need to provide a workplace technology experience that matches the typical consumer technology experience with Bluetooth-driven or voice-activated devices. Forward-thinking companies are pivoting quickly and harnessing current trends to take advantage of new ways of working in the digital workplace.
The mobile revolution has inspired a giant shift in the way people communicate and access information. Communication barriers diminish and employee efficiency and innovation increase when technologies such as virtual meeting tools are integrated into the workplace. Companies should be mindful to put the technological infrastructure in place for employees to securely retrieve documents from different cloud-based platforms and mobile devices.
As productivity and collaboration tools become the norm, the volume of information hitting employees will continue to increase, and making sense of it quickly and prioritizing it effectively will be a key competitive skill. Companies are leveraging IoT, AI, and VR platforms to free employees to be more creative and efficient. These newest technologies and tools — in a dizzying array of categories — allow companies to create a smarter office environment, more focused customer service solutions, and more collaborative decision making.
Technology no longer defines the workplace but enables it. Just as many retailers are phasing out customer service email channels in favor of chatbots, companies are leveraging new web-based platforms and workplace analytics to offer employees optimized office environments. These technologies capture workspace usage, identify employees’ peak performance and productivity, and discover ways to improve processes, tools, and the workplace through employee feedback. For example, room and desk sensors are being used to promote employee wellness initiatives, offer insight into space usage, identify organizational inefficiencies, understand how much employees are collaborating and with whom, and provide data to facility managers to aid in real estate decisions. An additional benefit of workplace analytics allows for architects and designers to streamline the planning and design process while increasing satisfaction of the new workplace among teams.
The workplace is no longer just a physical space employees occupy during regular business hours. The workplace is evolving to define a company’s brand and express its culture as well as to address a changing workforce, information overload, and need for speed. The key to success, however, lies in the effective implementation of a digital workplace strategy.
New, exciting technology in three areas — real estate transactions, property ownership, and tenant/workplace occupancy — is creating a paradigm shift in workplace design and operations.
By Marc Margulies. Originally published in Building Operating Management.
September 7, 2018 – Commercial real estate has been managed more or less the same way for decades: An office building is constructed; a tenant/user occupies it; the occupant moves if more or less space is required or the lease has expired. New technologies offer opportunities to fundamentally change that paradigm. The new paradigm goes well beyond real estate. For example, we used to watch whatever channels were offered on television. Now we can select from a wide variety of entertainment sources and features (stream content, record programs, fast-forward through commercials, manage subscription costs, etc.). We interact with media and customize it to our liking, and we can do that now with the workplace too. This newfound technological interaction is disrupting every aspect of real estate finance, facility management, and tenant use.
There are three primary categories of disruptive real estate and facility management technologies:
-Real estate transactions
Each technology category provides distinct benefits that facilitate better interaction and more efficient management. Yet the ultimate market driver of them all is tenant/workplace occupancy, because it is tenant users that create demand for real estate in the marketplace. A better understanding for the implications of these disruptive technologies can help building owners and facility managers design, build, and manage more responsive and cost-effective buildings.
According to a recent survey by Herman Miller, 40 percent of workstations are occupied less than half the time, and private offices are on average occupied only 25 percent of the time. Building owners and facility managers are coming to realize what an enormous waste of resources this represents – one that feels increasingly jarring as we move toward a more shared economy. As we become more acculturated to businesses like Uber, Airbnb, Hubway, Getaround, and WeWork, among others, people are becoming more comfortable with the idea of sharing the workspace too. Many companies are shifting their workplace from fully assigned seating to “free address” space allocation for “activity-based work.” For employees who are not devoted to one focused task all day long, the free address concept allows them to choose where they want or need to sit based on their daily or hourly task, who they need to collaborate with, or what other adjacencies are important to their productivity.
In a seminar at Cornell University earlier this year, Christian Bigsby, senior vice president of worldwide real estate and facilities at GSK (GlaxoSmithKline), described how the company made this shift in workplace design. He said that “85 percent of the [office] footprint was dedicated to 35 percent of the work activities. We studied it in time and motion studies, and it is a classic misallocation of resources in a company. You cannot have one third of your activities supported by 85 percent of your resources. It’s a complete squandering of resources.” GSK changed its model to increase the variety of work settings. There are now seven different options, from a telephone booth to a 16-person conference room, to a simple adjustable, four-foot long ergonomic desk for answering emails or making a quick call. “Offering a variety of work settings shrunk our footprint by almost half in the office settings, and it changed how people used the space,” Bigsby said. “Our data shows that 95 percent of employees that use those spaces would never go back to the way they were.”
Managing such a dynamic office environment — one that must be highly flexible and responsive — is only possible through a software support platform that is both simple to use and portable, and those technology systems now exist.
An opportunity to increase productivity through collaboration lies in the ability to schedule gathering spaces appropriate to the size and needs of the team and then use the data to fine-tune facility efficiency. Boston-based technology firm Salsify uses the data from its scheduling system to verify that meeting room ratios function as they were designed and ensure that the quantity of rooms per size are aligned with utilization. “Since the system offers historical data, we can look back and compare what usage used to look like when we first moved in and what it has changed to now,” says Stephanie Peters, who manages culture, employee, and office experience at Salsify. Not only does the company maximize the use of meeting spaces, but by analyzing the database, the facility management team can identify trends and patterns in utilization, which allows them to know how and when they should reconfigure their space to assure maximum responsiveness. As Salsify prepares to move to new headquarters in August 2018, the company knows that the new space will fit their work patterns with precision, eliminating waste and promoting full-throttled collaboration.
The world of the Building IoT (Building Internet of Things) has enabled an increasingly robust interaction between the interior environment and its occupants. Sensors installed in office spaces, light fixtures, workstations, HVAC equipment, hardware, and audiovisual equipment facilitate the ability to gather data on activity, light levels, vacancy, temperature, security, and media interface. With the data comes the ability to understand patterns. The next step is then to use that data to improve outcomes. For example:
-Some systems gather data that allows users to track and understand patterns of interaction. Technologies like Rifiniti and Humanyze are “people analytics programs” that track how and where workers engage each other, with the goal of providing information on how best to plan for the most effective strategic adjacencies.
-We’ve all looked up at office towers at night, seen the lights blazing on empty floors, and wondered why all that energy is being wasted. Often the answer is that they need to be illuminated for the cleaning crew. The more fundamental answer is that the building does not have a sufficiently sophisticated lighting control system to dynamically modify the light fixtures. According to National Grid, 35 to 45 percent of an office building’s energy cost is due to lighting; the potential to save energy and money by turning off unnecessary lights is enormous. Companies are moving beyond just code-mandated occupancy sensors in offices in favor of control systems for open office areas too. As systems become even more refined, applications like Comfy, which was recently acquired by Siemens, allow users to adjust light levels to their individual preference. The Comfy app, which started out as a way to reduce hot and cold complaints, now also allows users to find and book available rooms and desks, and share immediate feedback with workplace teams.
-User comfort has always been of great concern to building managers. One person’s hot is another person’s cold. Not only do new energy management technologies allow for more efficient heating and cooling, but customized area controls are becoming more available. CrowdComfort, for example, allows individuals to use their smartphones to communicate with building management directly, facilitating micro-adjustment of systems to user preference, as well as smooth dialogue with building engineers.
-Security is of ubiquitous concern, for reasons related not only to life and physical property safety but also protection of intellectual property. Immediately post-9/11, reception desk greeters became security guards and front doors became entry gates. Nearly everyone now has a smartphone, which can be readily programmed with owner identification. Mobile access control has the advantage of simplified and centralized credential management, and offers the benefit of full data gathering and analysis. Knowing who enters and leaves a building — and when — can tie directly into a better understanding of how much space is really needed. An increasingly mobile workforce does not operate according to the more traditional 9-5 schedule; thus, the amount and location of required space must be more deeply scrutinized.
-Audiovisual systems have become the mainstay of collaboration. Few meetings in the knowledge economy are conducted without technology support, and screen sharing has become universal. Confirmation that the right AV is available for the meeting size and purpose is one of the functions of companies like TEEM, a software that not only schedules rooms and equipment, but simplifies the sharing and display of information.
Finally, there are applications that interface with services and vendors inside and outside the office building itself. Corporate cafeterias often now support the ability to order food via an app, either for individuals or catered groups, in advance of the rush-hour pickup. Many new dining facilities offer state-of-the-art software capabilities for viewing and ordering customized selections from any of the variety of their culinary options. Other services ready to ride this technology wave may include dry cleaning, health and wellness services, day care scheduling, and access to other amenities.
PTC, a global provider of technology that transforms how companies design, manufacture, operate, and service things in a smart connected world, is re-locating its global headquarters to a new 250,000-square-foot workplace in Boston’s Seaport District. As part of the design of a new physical work environment, PTC recognized the opportunity to meld its role as an innovator in software for product design, IoT, and augmented reality to make its headquarters a global model for excellence in the use of workplace technology. The task? Evaluating the most appropriate workplace management technology in an industry known for lightning-speed evolution.
“At PTC’s transformational and technology-rich new workplace, employees will be able to use Steelcase’s Room Wizard, coupled with Workplace Advisor, to maximize productivity, collaboration, and space utilization,” says John Civello, vice president of corporate real estate and workplace at PTC. “With sensors installed in all workstations and conference rooms, our facility managers will be able to identify areas of heavy utilization, and communicate with users how to change meeting schedules to avoid congestion or modify facilities to meet the need.” Another way to leverage the software is to measure heavy-use patterns in real-time, in order to anticipate pressure on the space before it becomes critical. “Since the workspace is 100 percent free address,” Civello says, “I don’t see how we could have done this without the tools that show us what is and isn’t working. We’d be at a major disadvantage [without them].”
Because PTC partners with a wide variety of building management systems and manufacturers, the company will ultimately use augmented reality modeling to assist with preventive maintenance of HVAC and other building equipment. Real estate and facility management executives will know that their building systems are being well-managed, running efficiently and cost-effectively.
Just as these disruptive technologies are transforming the workplace, augmented reality apps are starting to emerge to help visualize “smart city” activity such as entertainment events, traffic, retailer and restaurant offerings, harbor activity, and commuter options. The use of augmented reality as a real estate technology disruptor is just beginning to be explored, and is at least as exciting as when the cameraphone idea was first introduced. We will soon be able to see in virtual reality greater possibilities for our environment, and those possibilities will be linked to data that will allow us to fully customize what we see and feel around us. Buildings are moving from being simple bricks and mortar to living, breathing machines for human habitation.
Marc Margulies (firstname.lastname@example.org), FAIA, LEED AP, is a principal and senior partner at Margulies Perruzzi, an architectural and interior design firm that designs workplace, health+science, and real estate projects
-by Paul Donhauser, CEM, CPMM, Boston Scientific, and Marc Margulies, FAIA, LEED AP, Margulies Perruzzi
A global facilities master plan informs the company’s real estate decisions.
Corporate Real Estate planning is both a science and an art, an endeavor made more complicated by a large organization’s size and scope. Boston Scientific Corp., a worldwide developer, manufacturer and marketer of medical technology, has made a commitment to adopting a master planning approach to its global real estate, facility management and sustainability initiatives. A $9 billion company headquartered in Marlborough, Massachusetts, Boston Scientific has 27,000 employees and a global real estate portfolio spanning more than 150 properties and 9 million square feet of owned and leased property.
Boston Scientific’s global real estate and facilities (GREFAC) team manages all construction, design, lease renewal and relocation projects in more than 40 countries. In 2012, the company tasked this team with developing a master plan and global design guidelines to align with the vision of the new CEO and executive leadership team. The GREFAC team engaged Boston-based Margulies Perruzzi Architects (MPA) to help evaluate its real estate choices, develop global workplace guidelines and design key facilities.
The Boston Scientific Global Facilities Master Plan is an enterprisewide initiative that brings the company’s real estate and workplace portfolio in line with its global business strategy through 2020. The plan offers sufficient flexibility to accommodate anticipated change; creates a work environment that promotes productivity, innovation and collaboration; and provides for continuous improvement in a cost-effective manner.
The strategy behind the plan is to “fund the journey to fuel the growth,” namely by reducing the company’s real estate footprint and by improving the use of space across its global portfolio to reduce operating expenses and to finance facility investments that attract and retain key talent. The strategy involves three phases: prune, invest, and sustain and maintain.
1) The prune phase focuses on eliminating poorly utilized real estate assets and reducing global energy consumption.
2) The invest phase uses the proceeds from the sale of excess real estate to invest in the remaining core assets that support global workplace strategy. It also provides a comprehensive set of global design guidelines for workplace design standards, branding, LEED and working remotely.
3) The sustain and maintain phase involves meeting annually with site, business and regional leaders at strategic global locations to understand what investments are needed to position them to support business goals in the future.
After developing the global design guidelines with Boston Scientific in 2012, MPA completed the design of a new 110,000-square-foot global headquarters on the company’s existing campus in Marlborough. Boston Scientific tapped MPA again to bring its second-largest Massachusetts facility – in Quincy – up to the company’s current global standard.
From Warehouse to Fulfillment Center
Renovating and repurposing a building can involve several factors: preserving existing features, updating building infrastructure and energizing spaces for new uses. Warehouses offer their own challenges, especially “legacy” buildings that have long been obsolete. An outdated warehouse in a high-profile location in Quincy has been transformed into a new 694,000-square-foot global customer fulfillment center for Boston Scientific. Completed in September 2017, this state-of-the-art energy-efficient facility expands and modernizes the company’s logistics and distribution functions and aligns with the Global Facilities Master Plan.
In 1998, Boston Scientific purchased the roughly 1.2 million-square-foot two-building warehouse complex on Quincy’s Squantum Point. Located on the Neponset River and visible from Interstate 93 on approach to Boston, the buildings served from 1970 to 1997 as warehouses for department store Jordan Marsh & Co. Since 1998, Boston Scientific has occupied both buildings on the site.
The GREFAC team recognized that the Quincy site had about 450,000 square feet of excess real estate, mostly in the north building, which cost $2.1 million annually to operate and would require an additional $13 million in deferred maintenance and upgrades. As part of the Global Facilities Master Plan, the company sought to consolidate its operational and distribution functions into a new customer fulfillment facility in the south building of the complex. More than 75 percent of the total units for global products, including medical devices such as life-saving stents, will move annually through the 24-hour fulfillment facility, which employs 450 people.
The Global Real Estate team developed a plan to sell off the underutilized real estate in the north building to help finance the new fulfillment facility in the south building. The sale required the complete separation of the north and south buildings, which were two interconnected properties. The buildings were decoupled by severing all common structural and utility systems between them and by dividing the land lots, thereby creating two separate parcels, with approval by the municipality.
In 2016, Boston Scientific sold the north building to Scannell Properties for $31 million, retaining ownership of the south building. As part of the transaction, Boston Scientific executed a 21-month lease in the north building, occupying it as swing space during renovation of the south building. The sale lease-back saved Boston Scientific $7.2 million in operating expenses and $13 million in deferred maintenance costs. The proceeds from the sale of the north building enabled Boston Scientific to stay cash neutral and reinvest in distribution technology and workplace strategy for the new facility in the south building that will save $2.1 million in annual operating expenses.
Designing for New Uses
MPA inherited legacy warehouse conditions that guided the repositioning of the south building. The existing loading docks were retained, while the adjacent area’s flow was reconfigured to accommodate a new employee entrance. The building’s precast facade was completely replaced with an energy-efficient, metal-panel rain screen system and new high-efficiency ribbon windows. The corner of the building was removed and updated with a multistory curtain wall glass facade with blue exterior LED accent lighting to create a dramatic canopied main entry.
The 630,000-square-foot customer fulfillment center includes 2.5 miles of high-efficiency, “smart technology” conveyor systems and Boston Scientific’s first installation of an enterprise warehouse management system to optimize inventory management and distribution operations. The project team designed a sophisticated logistics facility that will provide operational cost savings through increased productivity and energy efficiency. For the installed utility upgrades, Boston Scientific received one of the largest energy rebates in New England: $1.1 million. The sustainably designed building is expected to achieve LEED Gold certification for existing buildings, and the company is pursuing a WELL Building Design certification to ensure employee health and wellness in the Quincy facility.
The building’s 64,000 square feet of office space were designed to meet global workplace strategy standards that Boston Scientific is deploying around the world. As part of its change management efforts, the company has shifted to smaller workstations and more open and collaborative workspaces. The open office space features a mix of workstations and glass-fronted offices supported by town squares, breakout cafes, training spaces and a variety of meeting rooms. The workplace environment was designed to attract and retain employees by providing natural light, increased collaboration space, custom artwork, and upgraded furniture and finishes. It also offers employees modern amenities such as a corporate cafe, a rooftop terrace, a full service fitness center and an impressive new entrance, which opens into a light-filled lobby.
The design team’s primary challenges involved space constraints, workflow and stretching the $31 million budget. The design needed to mesh 64,000 square feet of high-performance office space with 630,000 square feet of warehouse and distribution space. This connection was critical to ensure optimal flows of goods and people as well full system compliance in an FDA-regulated facility. Completing the construction on time was critical as delivery of the building needed to align with termination of Boston Scientific’s 21-month leaseback in the north building. Additionally, delivery needed to correspond with a product migration schedule to ensure seamless logistical operations.
Additional construction challenges included renovating the facility on an occupied, functional campus affected by winter weather. The construction team was also required to work within the insurer’s stringent environmental, health and safety regulations, which were more demanding than those required by the local building code.
The design team also addressed numerous other issues associated with a large multiuse building by doing the following: 1) examining where employees park and how they enter the building, 2) providing security for a building with dual industrial and office uses, 3) incorporating a fitness center while minimizing noise and impact vibrations and 4) safely and efficiently integrating a huge volume of truck traffic with passenger cars.
Creating a Regional Hub
Converting an aging warehouse into a combined office and logistics facility is a complex undertaking. The design team studied the building’s structural weight and flooring capacities, as the retrofit had to accommodate more than $4 billion of medical device products shipped through the Quincy facility each year. The space with higher slab capacity was clearly designated for fulfillment activities. Adjacency and acoustical issues were addressed to merge office functions with two levels of warehouse and logistics operations, separating office workers from forklifts that operated just 5 feet away.
Wherever possible, the design kept and incorporated elements of the existing building, such as the roof, steel and floors. The team took advantage of the existing building geometry to create a new rooftop deck with spectacular views of Boston. The design of the outside space required careful planning to ensure that the existing structure would support the weight of the deck. For the new corner entry, the design team cut out the floor slab of the existing structure to accommodate a two-story lobby. Raw warehouse space and a mezzanine were converted into new office space, and MPA was able to insert windows where there hadn’t been any before.
Boston Scientific was sensitive to the building’s history and sought to retain distinctive building characteristics. Rather than hiding them, the design team incorporated the existing structural cross-bracings into the design by exposing, painting and making them a feature. Although modern in design, these legacy features celebrate the building’s industrial past.
The Boston Scientific Global Customer Fulfillment Center was intended to do two things well: 1) provide a modern, state-of-the-art and energy-efficient logistics and distribution center and 2) offer a high-performance workspace in line with the company’s global workplace strategy standards. With its close proximity to Boston’s Logan Airport, ease of commute and ample parking, as well as extensive amenities for employees and visitors, the Quincy office has become an appealing location for Boston Scientific executives. The facility, which was completed on time and on budget, has evolved – in the minds of the company’s employees – into Boston Scientific’s regional hub.
Paul Donhauser, CEM, CPMM, is vice president of global real estate, facilities operations and environment, health and safety at Boston Scientific Corp. Marc Margulies, FAIA, LEED AP, is a principal and senior partner at Margulies Perruzzi Architects.