In less than a decade, as employees “bring their own technology” with them, the workplace will shift to wherever an employee is located, according to initial findings from CoreNet Global’s comprehensive and futuristic look at the workplace, Corporate Real Estate 2020.
The wide-ranging study sheds light on how technology is radically changing the nature of work and even transcending science fiction. It’s already happening with concepts like collaboration in your pocket, or other advances as seen in artificial intelligence, nanotechnology, biometric security, sensor-driven smart buildings, unified communications, and other breakthroughs like the ability for people to wear or even implant digital devices “as the new user interface.”
“Game changing,” “revolutionary” and “relentless” are among the ways that more than 200 executives taking part in the study are describing the ever-evolving landscape of flexible or alternative workplace strategies.
Bring your own technology, or “BYOT,” will impact the size and design of the corporate office, as fewer square feet per employee will be needed, and open, collaborative workspaces will continue to replace cubicle and personal office-based designs.
The idea of “BYOT” was improbable, even inconceivable, only five or six years ago because of integration, security and other issues. Yet today, it looms as a strong likelihood thanks to the relentless advance of technology and the continued blurring of lines between personal and business technology.
“BYOT” is one of many “bold statements” coming from corporate executives involved in Corporate Real Estate 2020, which is CoreNet Global’s new transformational research initiative.
Corporate Real Estate 2020 is bringing together thought leaders from around the world to analyze and consider the current state and the future of corporate real estate (CRE) and the workplace through eight strategic areas impacting business drivers like mobility, mergers and acquisitions, talent, innovation, productivity, speed to market and risk management.
“BYOT is happening now,” according to Corporate Real Estate 2020 Technology Team member Keith Perske of E-Business Strategies. “Corporations cannot keep up with personal technology, so the next step is already happening.”
The shift implies a change for corporate information technology (IT) departments, whose long-standing role of providing computing power for companies will migrate to the Cloud.
This is already resulting in a new emphasis on enabling mobility and other forms of flexible work, as well as increasing the IT interface with CRE executives who often manage alternative workplace strategies.
The potential impact of Cloud computing itself could be overestimated, as another Corporate Real Estate 2020 bold statement predicts, starting with the expectation that by 2020 the number of personal digital devices in the world today will double.
“Cloud computing is about to be replaced by ‘always-networked’ personal devices with near-infinite memory,” Perske also advises.
While Corporate Real Estate 2020 participants consider the BYOT concept to be ‘predictable,’ they regard Cloud replacement as a ‘revolutionary’ change to come.
Another revolutionary concept, unified communications, will enable Cloud replacement and BYOT. It’s all about the integration of voice, data, graphic and video for the first time in a single device. “It’s fast becoming collaboration in the pocket,” Perske says. “One day soon, it will take the form of wearable technology.”
Industry experts also identified several “game changing” workplace and technology forces that will pronounce themselves by 2020 and that go beyond being revolutionary.
One of them is biometric-based security. “Technology security will become biometric,” Perske relates. “Security poses real issues in the distributed work environments which many companies have adopted to increase productivity, collaboration and innovation.”
The idea that personal, biological identifiers will allow access to key information transcends science fiction and represents another breakthrough for changing the way we work: the more extensive use of artificial intelligence.
Other advances in areas like nanotechnology will help with the introduction of emotional intelligence sensors to help raise communication effectiveness. “Sensing will increase, and buildings will become better equipped to recognize and differentiate people’s preferred styles or routines,” Perske explains. “On the individual level,” he adds, “ubiquitous technology on our skin, in our clothing and as eyewear represents the new user interface.”
Smaller and Smarter
These and other outcomes, such as the use of predictive technologies to more effectively forecast future demand for office space, are also linked to intelligent infrastructure and smart buildings. They will tend to be smaller in scale yet provide a competitive advantage in terms of virtual teams and collaboration with multiple stakeholders. “Smarter and smaller” are the terms defining these changes. They are framing the concept of “globally networked enterprises.”
CRE departments and teams are directly influencing the formation of a new “People, Technology and Place” emphasis by integrating resources to enable flexible work and develop smarter buildings. An increasingly sophisticated tool known as Integrated Workplace Management Systems, or IWMS, is helping accomplish the two objectives, as well as providing a reliable way to inform the C-Suite and business units on key decisions revolving around market growth or contraction, as well as demand for space and employee headcount.
Using technology to better capture, format and disseminate data is a critical aspect of CRE’s current and future focus, but workplace practices and intelligent buildings are not the only reasons for it.
New international accounting standards requiring leased properties to be moved back onto the corporate balance sheet represent another factor affecting the growing need for more effective technology applications that real estate executives are helping to deliver for their companies and clients.
Corporate Real Estate 2020 participants focused on the lease accounting, or FASB 13, standard changing, however, downplay initial fears over the new rules. “The main impact is new lease accounting standards will be like a giant migraine,” rather than a total disaster, predicts Russ Howell of Jones Lang LaSalle, who is taking part in the Corporate Real Estate 2020 Portfolio Optimization Team.
As more CRE executives are realizing, FASB 13’s requirements will create an added administrative burden similar to Sarbanes Oxley that can be mitigated with effective data management.
Carbon Footprint Regulation Is Imminent
Green or sustainable practices represent another strategic area that is fast becoming more reliant on technology and data effectiveness. The Corporate Real Estate 2020 Sustainability Team foresees the inevitability of government regulation at the local and national levels. “Energy performance disclosure will be required,” cautions team member Kevin Kampschroer of the General Services Administration.
Companies that can accurately measure and report their carbon footprint reduction and energy savings to government agencies, as well as incorporating the data into Triple Bottom Line financial reporting to stakeholders, will face much lower risk in terms of taxation or over-regulation.
At the same time, companies are seeking locations that treat green regulations more as carrots to incentivize proactive corporate social responsibility, as opposed to sticks to simply tax them. “Green incentives are one reason why sustainability has become the new sweet spot for corporate location decisions,” observes Corporate Real Estate 2020 Location Strategy and Role of Place Team member Dennis Donovan of WDG Consulting.
Bricks and Mortar Take a Back Seat
On balance, at the half-way mark of a 10-month iteration on future trends and impacts, Corporate Real Estate 2020 thought leaders are proving real estate isn’t so much about bricks and mortar as it is about enabling work and finding ways to help the business stay or become more competitive in a complex, dynamic global economy.
“In tomorrow’s world, work will go to people; people won’t necessarily go to work,” says Corporate Real Estate 2020 Workplace Team member Steve Hargis of HOK. “But that won’t diminish the importance of place, because people, and companies, need human interaction to thrive.”
Does it also mean that companies will occupy more office or other business and commercial space? Not necessarily, when you factor in today’s historically-lower job creation levels along with the now-constant mandate for companies to reduce space and costs – plus, technology’s influence in allowing for mobility, telework or other forms of flexible work.
Considering the fact that most space today is designed for groups and not individuals, and that space per person will drop to below 100-square-feet by 2020, maybe it’s not so far-fetched to ponder another Corporate Real Estate 2020 bold statement: 40 percent vacancy rates in property markets outside Asia.
At a time when multiple forces are converging, such a problem can only lead to yet another opportunity: the retrofit and responsible reuse of more than 200-billion-square feet of existing commercial space globally.
It’s another reason why, as Corporate Real Estate 2020 foresees it, there will be less emphasis on developing new buildings in tomorrow’s world of corporate real estate, including fewer build-to-suit projects.
About CoreNet Global
CoreNet Global is the world’s leading professional association for corporate real estate and workplace executives, service providers, and economic developers. For more information, please visit www.corenetglobal.org.
The eight strategic domains of Corporate Real Estate 2020 are:
- Enterprise Leadership
- Portfolio Optimization and Asset Management
- Technology Tools
- Location Strategy and the Role of Place
- Service Delivery and Outsourcing
- Partnering with Key Support Functions