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Flex is not just for startups: corporates can benefit too
There’s an old adage that coworking and flexspace are only for a certain set. You know the type: young, urban, trendy, and probably sporting a few tattoos. But it’s not just entrepreneurs and startups that have discovered the benefits of flexible working – corporates have been getting in on the act too.
According to Puja Kapur, IWG’s Global Enterprise Director, Global Large Mid Cap Index and Fortune 500 companies are starting to consider the benefits of incorporating flexible office space into real-estate strategy for a number of reasons. Like she told the Allwork website, “agility is a big driver in the evolution of flex, as is speed to market and scalability, ability to recruit and retain talent, enhanced employee experience and compliance [Financial Accounting Standards Board] FASB standards of accounting”.
Customisation is an important factor. Thanks to the nature of shared office space, premises can be adapted to suit the particular demands of a company right down to dividing screens and interior walls. A group of engineers performing deep-thinking work will require a quiet space in which to contemplate – a very different environment from the open-plan buzz that a sales team might feed off, for example. A flexspace-provider like IWG, which includes Regus, SPACES and No18 in its property portfolio, can offer a multinational a variety of options to suit all business needs across divisions, markets, and even territories.
The recruitment and retention of talent is also key. Finding the right person for the job is an expensive and time-consuming affair, so it makes sense to incentivise employees to stay a while – particularly if you have a lot of them to manage. The millennial generation, which forms the vanguard of the movement for a better work/life balance, is far likelier to stick around when working conditions are commensurate with their values. As the largest cohort in today’s workforce, they’re worth paying attention to.
A third factor is the new FASB rules, which came into force earlier this year. Now public companies with a longer lease than 12 months are required to record it on balance sheets as an asset and a liability (with large private companies set to follow suit in 2020). Shorter leases, such as those typical to flexspace, are growing in popularity with bigger concerns because of this.
Agile strategic planning – the ability to adapt to changing market conditions – is also worth thinking about, and Kapur is transparent about the reality of the situation. “While there is a premium in the short-term, given the shorter contractual term of flex office compared to traditional leases,” she says, “the financial benefits far outweigh the short-term costs given the enhanced agility and utilisation of portfolios.”