Technology disruption has become a major concern for multinationals and their future operations according to CBRE’s 2017 Asia Pacific Occupier Survey.
While respondents identified economic uncertainty as their peak concern, followed by tighter regulations or legislation, technology disruption is now in the top 3 list.
CBRE’s survey also identified that global economic uncertainty and a focus on cost savings is prompting multinational corporations to proactively adopt workplace strategies. Approximately 50% of all multinationals will invest more in their workplace and space efficiency programs, ranking it as their main priority for the coming year.
CBRE’s Head of Research, Australia, Stephen McNabb, said; “With revenue growth still challenged across multiple industry sectors in Australia, occupiers are still very cost conscious. Technology disruption, while recognised as a major challenge, is something that will be embraced as a key opportunity, enabling improved business outcomes – be that optimisation and efficiency or improved productivity in the workplace.”
Mr McNabb noted that a good example in the past has been the ability for businesses to outsource and offshore processes for efficiency gain, particularly those processes that could be automated.
The drive to efficiency is also seeing greater investment in the workplace as there is recognition that space consolidation needs to work in tandem with business objectives around employee attraction, retention and collaboration.
Mr McNabb said the latter remained a key driver of workplace strategy, with 69% of respondents citing “promote collaboration” as a key driver of workplace strategy followed by “talent management”.
For occupiers, this means a greater need for alignment between human resources and real estate strategy.
“Corporations across Asia Pacific are making the realignment of workplace strategy a business priority,” said Phil Rowland, CEO of Global Workplace Solutions, CBRE Asia Pacific. “They are evaluating the longer-term dynamics of the workforce and thinking more holistically about the role of agile working environments in their business. As a result, corporations are developing workplace strategies and space efficiency initiatives to futureproof work environments, attract and retain personnel, and mitigate disruption.”
The survey findings reveal that multinationals are stimulating flexible working by prompting employees to share desks. By 2020, 66% of respondents will have raised the sharing ratio beyond 1:1—up from the current 30%—meaning that the number of desks will be lower than the total number of employees. Additionally, the average space per employee is set to decline with multinationals implementing more aggressive desk sharing plans. While this will not necessarily involve reducing desk sizes, a higher desk sharing ratio will naturally result in a decrease in space per capita. Around 63% of multinationals have set a target of reaching a space of under 9.3 square metres per employee within the next three years, up from 46% currently.
The main drivers of workplace change for multinationals are enhancing collaboration amongst employees, and improving talent retention and attraction. Cost saving remains a key factor (35%) but has diminished in importance compared to last year’s survey (53%). Companies increasingly realise that direct cost cutting can actually be counter-productive as it can damage employee morale and negatively impact their corporate image.
While respondents identified economic uncertainty as their peak concern, followed by tighter regulations or legislation, technology disruption is now in the top 3 list.
CBRE’s survey also identified that global economic uncertainty and a focus on cost savings is prompting multinational corporations to proactively adopt workplace strategies. Approximately 50% of all multinationals will invest more in their workplace and space efficiency programs, ranking it as their main priority for the coming year.
CBRE’s Head of Research, Australia, Stephen McNabb, said; “With revenue growth still challenged across multiple industry sectors in Australia, occupiers are still very cost conscious. Technology disruption, while recognised as a major challenge, is something that will be embraced as a key opportunity, enabling improved business outcomes – be that optimisation and efficiency or improved productivity in the workplace.”
Mr McNabb noted that a good example in the past has been the ability for businesses to outsource and offshore processes for efficiency gain, particularly those processes that could be automated.
The drive to efficiency is also seeing greater investment in the workplace as there is recognition that space consolidation needs to work in tandem with business objectives around employee attraction, retention and collaboration.
Mr McNabb said the latter remained a key driver of workplace strategy, with 69% of respondents citing “promote collaboration” as a key driver of workplace strategy followed by “talent management”.
For occupiers, this means a greater need for alignment between human resources and real estate strategy.
“Corporations across Asia Pacific are making the realignment of workplace strategy a business priority,” said Phil Rowland, CEO of Global Workplace Solutions, CBRE Asia Pacific. “They are evaluating the longer-term dynamics of the workforce and thinking more holistically about the role of agile working environments in their business. As a result, corporations are developing workplace strategies and space efficiency initiatives to futureproof work environments, attract and retain personnel, and mitigate disruption.”
The survey findings reveal that multinationals are stimulating flexible working by prompting employees to share desks. By 2020, 66% of respondents will have raised the sharing ratio beyond 1:1—up from the current 30%—meaning that the number of desks will be lower than the total number of employees. Additionally, the average space per employee is set to decline with multinationals implementing more aggressive desk sharing plans. While this will not necessarily involve reducing desk sizes, a higher desk sharing ratio will naturally result in a decrease in space per capita. Around 63% of multinationals have set a target of reaching a space of under 9.3 square metres per employee within the next three years, up from 46% currently.
The main drivers of workplace change for multinationals are enhancing collaboration amongst employees, and improving talent retention and attraction. Cost saving remains a key factor (35%) but has diminished in importance compared to last year’s survey (53%). Companies increasingly realise that direct cost cutting can actually be counter-productive as it can damage employee morale and negatively impact their corporate image.
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About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through more than 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through more than 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
