Strategies for Sustainable Growth: Impact of Alternative Workplace Strategies

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Strategies for Sustainable GrowthImpact of
Alternative Workplace Strategies

• July 15, 2008

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Pressure is mounting for companies to be more
socially responsible and environmentally
sustainable
Increasing legislative pressure to disclose and
take action
Changing consumer behavior impacts purchasing
strategy
Greater investor focus on a corporate climate
change strategy
Growing peer differentiation as early adopters
increase gap
Shrinking utility capacity to support energy
demand
Growing sector of the workforce influenced by
sustainability efforts
Increasing number of NGOs monitoring company
activity
60 of global executives regard climate change as
strategically important, and a majority consider
it important to product development, investment
planning, and brand management 1
How Companies Think About Climate Change A
McKinsey Global Survey 12/2007
3
Workplace strategies generate competitive
advantage and enhanced value when employing a
collaborative, integrated approach
People
Improve recruiting and retention
Place
Optimize portfolio and workplace
Planet
Reduce environmental footprint
Performance
Increase velocity of innovation
Effective workplace strategies provide scalable,
resilient real estate portfolios that adapt to
cultural and performance needs in a sustainable
manner
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The demand for alternative workplace strategies
is being fueled by technology, workforce,
environment, and performance needs
Increasing energy costs across portfolio
18 increase for electricity (Dominion Power, VA)?
68.5 population are internet users1
36 have high speed connections1
40 70 occupied office space empty2
Increasing fuel costs are driving demand for AWS
40 of knowledge-workers will telework in the
future3
87 of Federal Government workers interested in
telework4
1 Nielson June 2005 2 Agilquest 2003 3
Corenet WSJ 2004 4 Federal Govt survey 2005 5
Texas Transportation Inst 2003
Average time in traffic jams per week5

• Minneapolis 6.6 hours

Washington DC 7.25 hours
LA 11.25 hours
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Alternative Workplace Strategies focus on
work-life balance falling into three major
categories

• Flextime, Compressed work weeks, job sharing,
  telecommuting, or reduced-time/part-time
  arrangements, sabbatical, maternity leave

Flexible Work Arrangements (FWA)?

• Employees are in different locations
• Communications and interactions are asynchronous
  or enabled by collaborative tools e.g., IM,
  email, file sharing web conferencing
• Individuals do not employees for the same
  company are not part of the same organization
  within the parent company
• Example Project based cross-functional team
  where one or more members are based in different
  locations

Distributed Work

• A work-style in which a person consistently uses
  multiple spaces/places in which to accomplish
  their work
• May interact with distributed work at varying
  degrees

Mobile Work
Workplace Strategy n.  The dynamic alignment of
an organizations work patterns with the work
environment to enable peak performance and reduce
costs. 
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Traditional strategies support an unsustainable
portfolio model
Space trajectory without mobile work
Other Businesses
Delivery Space
Consulting Space
Global Real Estate Commitment profile (occupied
space)?
Source Move to Mobility, Oct. 10, 2007
Corenet Global
Mobility is driving down office utilisation,
requiring adjustment of real estate portfolios
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70 of employees in knowledge working
environments are not using their dedicated
workspace

• Average Occupancy expense per FTE is US 8,000 1
• Average occupancy expense per workstation is US
  6,000 8,000 1
• An office space reduction of 30 is an achievable
  goal

Source Frank Duffy, DEGW

• Commercial buildings consume 71 of the
  electricity in the U.S. (USGBC)?

Alternative workplace strategies create
opportunities for significant cost savings,
performance and work-life improvement, and
environmental benefit
1) Source Real Estate Executive Board 2007
aggregate study Occupancy Expense and Space
Utilization Benchmarking Initiative
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Inefficiency highlights an opportunity to
redesign the workplace

• Convention says we must all work in the same
  place yet it doesn't
• Match the way people work today
• Optimize the real estate portfolio
• Reduce environmental footprint
• Support Lean-Agile business processes
• Convention restricts performance creating a
  roadblock increased profitability

Paradigm Shift to Lean and Agile

• Mobile strategies support work when and where it
  is most effective
• Enable mobility through technology
• provides supportive and unique workplace
  atmospheres to reinforce that flexibility

Adapts to employee

• Mobile strategies align with workforce
  demographics going beyond a traditional office
  setting or grade school model to emulate a
  university model

Leverages a university model
Source No More Cubicles! The Future of Work at
Capital One Corenet Summit Philadelphia April
2006
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Alternative workplace strategies are about
creating shared success through a collaborative
interaction model
Culture of flexibility
Technology and Environment
Alternative Workplace Strategies

• Flexible Work Arrangements
• Distributed Work
• Mobile Work
• Work/life balance
• Project teams v. formal reporting structures
• Adaptive CRE, IT, HR, and SCM services

• Mobile support and security
• Innovative workplace settings
• Choice one size does not fit all
• Collaborative and social networking tools

• Enhanced productivity and collaboration
• Greater associate satisfaction
• Lower real estate costs
• Smaller environmental footprint
• Improved Business Continuity

Successful strategies align Lean workplace
environments with Lean business processes
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Successful alternative workplace programs improve
the four dimensions of sustainable growth through
choice, resilience, flexibility, and adaptability
Capital One Future of Work Work Styles and
Choice
associates choose work style
provisioning training streams
Mobile
Teleworker
Resident
Anchor
Executive
Work Style
Technology
Yes
Yes
Yes
Yes
Yes
Wireless Laptop, IM, LM
Yes
Yes
Yes
n/a
n/a
Cell Phone
Yes
Yes
Yes
Manager Choice
Manager Choice
Blackberry
Yes
Yes
Yes
No
No
Tethering
Yes
Yes
No
No
Yes
VPN
No
No
Yes
No
Manager Choice
Soft phone
Yes
Manager Choice
Manager Choice
Manager Choice
Manager Choice
Wireless Headset
No
Yes
No
No
Manager Choice
Wireless Router / MFD
Desk
assigned workstation
home office
unassigned
choice
Source No More Cubicles! The Future of Work at
Capital One Corenet Summit Philadelphia April
2006
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Change management and project plans need to align
with transition phases and moments that matter
to insure success
ScopeDevelopment
Marketing
Education and Preparation
Move
Reinforcement and Measurement
Phases
Trigger Events
Move Survey
Focus Groups
Technology Delivered
Team Norm Discussions Individual Management
Workshop
Pulse Survey
Move Day/ Welcome
Cascade Immersion Meetings
Business Case
Workstyle Preference Completed
Workplace Needs Assessment
Orientation
Sponsor Updates
Experience Support Groups
Coffee Breaks
Client Advisory Team Meetings
Anchor Program
SLT Check-ins
Education Training
COU Managing in a Virtual Environment
COU Information Excellence
Quick Easy Simulations
Communications
Weekly e-mail by target audience, strategic
communication advice to rollout team
Source No More Cubicles! The Future of Work at
Capital One Corenet Summit Philadelphia April
2006
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17 outcomes of an alternative workplace
Increase Speed
Increase Collaboration
Improve Economics
Performance
Remove Silos
Support Group Work
Accommodate change
Planet
Reduce energy emissions
Reduce materials waste
Reduce water effluent
Improve land-use biodiversity
Place
Scale to fit business needs
Adapt to individual group needs
Provide resilience flexibility
Support choice control
Improve Recruiting Retention
People
Align services amenties
Improve work-life balance
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Capital One Future of Work Work Styles and
Choice
Mobility is a proven winner on the four
dimensions of Sustainable Growth
People
Speed

• Provide Choice Control 25
• Workforce Satisfaction 20
• Provides Visual Aural Privacy 15
• Attracts Retains 10
• Social Engagement No Change

• Increased Decisioning 20
• Rapid Access to Information 15
• Formal Meetings - 5

Place
Performance
Quality Innovation

• 5 year NPV economics 30
• Accommodates Change 30

• Support Work Group 20
• Sense of Innovation 20
• Collaboration 10
• Ability to Concentrate 10
• Support Individual Work 8
• Silos - 10

Planet

• Employee Carbon Footprint - 20
• Campus Carbon Footprint - 14

Source No More Cubicles! The Future of Work at
Capital One Corenet Summit Philadelphia April
2006 updated to reflect environmental component
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APPENDIX
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Environmental sustainability has been promoted
for decades but the complexity of the concept has
contributed to slow adoption
Sample Inputs
Sample Outputs

• Raw material
• Energy
• Material
• Water

• Products
• Emissions
• Waste
• Effluent

Lifecycle Assessment
Greenhouse gases converted to CO2 equivalents
Undefined boundaries makes company and industry
comparisons difficult
Air travel contributes 3 of global carbon
emissions and 4 9 of total human impact Data
Centers will exceed Air Travel's impact by 2020
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Recent analysis reveals that mobility programs
can significantly reduce environmental footprints
CO2 Reductions

• Traditional campus footprint based on Scope 1 2
  emissions, 11 desk ratio, and portfolio
  expansion
• Portfolio does not reflect CO2 footprint related
  to construction and interior fit-out
• Cost avoidance is US 60 million based on a plan
  to add buildings
• Mobility generated a 14 CO2 reduction 5
  through portfolio and 9 through reduced
  commuting
• Reductions in office supply consumption and
  inter-office travel are not included
• Example represents a 1.5 million sq. ft. campus
  with a population of 5,000 people of which
  2,600 are considered mobile

Space Avoidance
Commuting
CO2 (Metric Tons
Energy
Alternative workplace strategies can be scaled at
little or no cost to increase environmental
benefits while improving performance and
work-life balance
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AWE process integrates methods and learnings from
New Product Development methodology
ScopeDevelopment
Marketing
Education and Preparation
Move
Reinforcement and Measurement
Phases
Workplace assessment
Select appropriate assessment tools to create a
client profile defining People, Place, and
Performance needs and recommendation
Business Case
Integrates project and change management plans
and performance targets including conditions of
satisfaction into client's business case model
Change Management
Develops communications, education, training, and
feedback mechanisms based on market segment
profiles
Supply Chain
Assesses and modifies polices and processes
affecting the provisioning, support, and
decommissioning of services and tools
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Marketing is the first step in the change
management process improving understanding and
acceptance
ScopeDevelopment
Marketing
Education and Preparation
Move
Reinforcement and Measurement
Phases
Immersion Meetings
Cascading, top-down client meeting designed to
create awareness, set expectations, and gather
feedback
Living Lab
Workplace solution mock-up focused continuous
improvement through client experience supports
change management process
Pre-event survey
Measures performance of existing workplace
environment establishing a baseline for future
post-event measurements
Feedback
Communication channels and venues established to
evaluate client state-of-mind and fine tune
change management process
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Change management paces the project based on the
client's readiness for change
ScopeDevelopment
Marketing
Education and Preparation
Move
Reinforcement and Measurement
Phases
Workstyle Assessments
Survey determining individual workstyle and
workstyle preferences informs provisioning and
education process and workplace design
Team Norm Discussions
Series of facilitated group discussions to assist
teams in defining behavior, etiquette, and
expectations in a distributed work environment
Individual Team Education
Focuses on preparing individuals, teams, and
managers for working as a distributed team in a
mobile environment includes technology and
collaborative tool training
Provisioning
Gear, mobile technology, and collaborative tools
distributed based on workstyle assessment
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Client experience defines a successful move and
determines if the patient survived a successful
operation
ScopeDevelopment
Marketing
Education and Preparation
Move
Reinforcement and Measurement
Phases
Two weeks
Orientation Targeted communications and training
based on feedback coordinate infrastructure
groups to identify and target missing people
One week
Targeted communications and training based on
feedback coordinate infrastructure groups to
target missing people implement plan for
one-to-one follow-up with missing people
Go-Live
Focus on client experience and Day One
productivity leveraging Welcome packets and
Manager's kit, on-site command center, and Rovers
Move Survey
Short follow-up survey within one week of Go-Live
to assess state-of-mind and quality of Go-Live
experience
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Successful AWE programs are determined by
permanent behavioral modification requiring
measurement throughout the first year
ScopeDevelopment
Marketing
Education and Preparation
Move
Reinforcement and Measurement
Phases
Continuing Education
Courses integrated into corporate education
program AWS program information and FAQs
available through corporate portal Etiquette
campaign to reinforce behavior manager check-in
Feedback
Focus groups for client and POCs continue on a
bi-weekly basis up to two months to assist in
transition
Pulse Survey
Pre-event survey is administered one month after
Go-Live in order to assess transition, inform
ongoing optimization, and predict progress
against business case targets
Health Assessment
Administered six months after Go-Live measures
outcome against business case targets informs
continuing education and workplace optimization
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National Flexible Work Arrangements trends
indicate widespread corporate acceptance

• Men and women use flexible schedules at
  comparable rates
• 28 of men and 27 of women
• 39 of people working flexible hours do so as
  part of a formal employer-sponsored flex-time
  program (11 of the total)
• 45 of people in management, business, and
  financial operations occupations have flexible
  schedules, with a higher percentage of men having
  a flexible schedule (47) than women (42)?
• Source Bureau of Labor Statistics, Workers on
  Flexible and Shift Schedules in 2004 Summary and
  Tables, http//www.bls.gov/news.release/flex.nr0.
  htm
• 82 of employees at Ernst Young and gt50 of
  employees at Principal Financial Group utilized
  flex-time in 2005
• Source Working Mother Media, 2006 100 Best
  Companies, http//www.workingmother.com/web?servi
  cevpage/109
• At Citigroup in 2005, 3,000 requests for flexible
  arrangements were approved 60 for non-exempt,
  or hourly, employees
• Source Chicago Tribune, Flexibility Gains
  Ground, Feb 5, 2007
• IBM has tracked FWA through a work/life survey
  for approximately 20 years findings include
  that FWA positively impacts performance and
  retention for 3 groups high performers, women
  and employees age 40
• Source Conversation with Ted Childs, Vice
  President, Global Workforce Diversity, IBM,
  September 10, 2003

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Tips for Working and Managing in a Flexible Work
Environment

• Focus on performance
• Consider that associates who work on FWAs are
  frequently more productive than before and more
  committed to the organization
• Recognize that FWAs are not an entitlement
• Recognize that different team members may have
  different working styles and hours
• Focus on the quality and timeliness of the work
  product not where and when it was done
• Do not ask the reason for seeking a FWA
  decisions are based on business need
• Be accessible
• Openly communicate with teams, managers,
  colleagues about where/when youre working
• Establish accessibility plans
• Establish individual and team guidelines
  regarding checking voicemail and e-mail
• Plan to effectively work off-site
• Plan ahead
• Utilize technology teleconference, video
  conference, web-based applications
• Be inclusive and considerate of people working
  flexibly and in the traditional work setting

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Tips for making FWAs work

• Be authentic know yourself and ask for what you
  need
• Expect there to be an adjustment period for you
  and your team and plan for it
• Be non-judgmental about how/when/where others
  work everyone is different
• Continually observe, re-evaluate and make changes
  based on what works for you, your team and the
  business
• Know whats important to you Live your
  priorities