Opportunity for Great HR Pros: Making Remote Work Recommendations Post-Covid While Cutting Rent...
April 07, 2020
It's all going to change! Once people have worked from home for this long of stretch, they're never coming back to the office!
If I could short the stock of every expert who has made these proclamations in the COVID-19 lockdown era, I would. That being said, the world of work IS likely to change based on what we've learned. But offices aren't going away. They'll change.
In white collar America, the trend has long been leaning towards more remote work. Some companies have taken the full plunge, some have barely dipped their toe in the true "remote workforce" water.
The most likely outcome in a post-COVID world? Companies with large white collar workforces are likely to ask the following questions after we're through this crisis:
What did we learn about our people's ability to work 100% remote?
What adjustments do we want to make to our previous assumptions about using remote workers?
What positive financial implications can this have for our business?
Ding! Ding! Ding! Hey HR leaders and HR pros! Some of the your companies will be late to ask these questions because everyone is in survival mode, even after people return to the office. That's why thinking about the future of work at your company should be something you own. So let's work through what your game plan should be. Ready? Here we go.
1--Get the number of white collar professional FTEs at any location in your company. For sake of this exercise, I'm going to use "200 FTEs"
2--Get lease info - the amount of rent you pay to a landlord to support those FTEs with office space. For our exercise, I'll use this calculator that says on average, a 25 person company with average space requirements would need an estimated 6,250 square feet (25 people x 250 sf/employee). Do the math for 200, and you arrive at 50,000 feet of space for a company/location with 200 white collar workers.
3--Calculate your current cost - I'll use an average of $24 bucks per square foot for decent space in Atlanta, which means the annual cost for 50,000 feet is $1,200,000 (note this is an effective per square foot rate after rebates, free rent and T&I).
4--Now you - the HR/Talent Pro - make a recommendation to you leadership team on that we learned a lot about working remote during COVID, and your company should take advantage of more remote work as not only a recruiting advantage, but a financial advantage.
Run the numbers based on your current state/future state. If your company was almost 100% work in the office, you make the recommendation that we're going to drop the number of days worked in the office by your workforce by 40% (moving from 5 days a week in the office to 3), and the impact is clear. If you already had some remote days, do your own math but make the cuts related to time in the office significant.
5--Calculate the savings and make your recommendation. If your annual cost for rent is $1,200,000, and you propose to drop days in the office by 40% - and you state that over time, that equates into an opportunity not just offer remote work as a recruiting advantage, but as a financial advantage that could deliver $480,000 in savings.
Some of you will say your lease has 5 years to run. That's what subleases are for, Sparky. Some of you will say the owner/founder of your business owns the building. Sounds like a sweet deal for Tommy. You can still sublease, my friend. If you sublease the space you don't need at $12 per square foot, you're looking at $240,000 in annual savings in the example above.
And of course, if your lease and your agreement is up for renewal or will be in the next year, you should do this math quickly and make your recommendation.
THE WORLD OF WORK WILL CHANGE due to the Shelter in Place lockdown we experienced via COVID-19. It just won't go 100% remote.
Grab this opportunity as an HR Leader and make your recommendation for remote work. Regardless of your current position as a company, more remote work is a recruiting advantage - and a financial one as well.