As we approach the end of another eventful year, what were the highlights for you in the world or work and workplace?
Andrew Mawson, AWA's Founder and Managing Director shares his views on the significant developments that really caught his attention - including AI, which has been through a transformative phase in 2023. This year also seems to have seen a lot of consolidation around hybrid working - leading to an excess of office space being carried by a lot of organisations. And we see an increasing need for organisations to address net zero challenges and encourage staff to get on board and do their bit.
After our look back, we look forward to 2024 and Andrew shares his thoughts about what's to come, and the things that AWA is excited about as we welcome in the New Year.
AWA Host: Karen Plum
Guests:
AWA Guest details: https://www.advanced-workplace.com/our-team/
CONTACTS & WEBSITE details:
AWA contact: Andrew Mawson
AWA Institute contact: Natalia Savitcaia
Music: Licensed by Soundstripe – Lone Canyon
Want to know more about AWA?
Thanks for listening to the DNA of work podcast
As we approach the end of another eventful year, what were the highlights for you in the world or work and workplace?
Andrew Mawson, AWA's Founder and Managing Director shares his views on the significant developments that really caught his attention - including AI, which has been through a transformative phase in 2023. This year also seems to have seen a lot of consolidation around hybrid working - leading to an excess of office space being carried by a lot of organisations. And we see an increasing need for organisations to address net zero challenges and encourage staff to get on board and do their bit.
After our look back, we look forward to 2024 and Andrew shares his thoughts about what's to come, and the things that AWA is excited about as we welcome in the New Year.
AWA Host: Karen Plum
Guests:
AWA Guest details: https://www.advanced-workplace.com/our-team/
CONTACTS & WEBSITE details:
AWA contact: Andrew Mawson
AWA Institute contact: Natalia Savitcaia
Music: Licensed by Soundstripe – Lone Canyon
Want to know more about AWA?
Thanks for listening to the DNA of work podcast
Hello there. As 2023 draws to a close, I guess it's a traditional time of year for reflection before we look forward to another busy year. My guest in this episode is AWA's Founder and Managing Director, Andrew Mawson, for a look back over the year and a few predictions and thoughts about what's coming in 2024. Let's get going. Welcome to AWA's podcast, which is all about the changing world of work and trying to figure out what's right for each organisation, because we know that every one is unique. We talk to people who have walked the walk, who've got the t-shirt and who've learned lessons that they're happy to share with us. I'm your host, Karen Plum, and this is the DNA of Work.
Karen Plum:This time last year, I reflected that 2022 was the year we really made inroads into making hybrid working work, and for those that weren't able to make it work where they were, they looked elsewhere.
Karen Plum:It was hard to tell how much movement was associated with the Great Resignation, and it seems that we've heard less about that this year. On the podcast in 23, we focused a lot on how organisations were turning their attention to consolidating skills and leadership for the new way of working. Consolidation seems to have been a bit of a theme for me, but also trying to get ahead of some of the issues that we could see coming, like the employment contract and succession planning. While these may not be top of every HR director's worry list, we are conscious that some organisations could be storing up trouble by not looking ahead. But as the end of 2023 was approaching, I talked to Andrew Mawson to get his thoughts on the year and I've added in some highlights from the podcast to expand on the things he picked out. We started off by talking about 2023 as a whole. What were the things that really stood out for him?
Andrew Mawson:Well, I think 2023 really for me and for probably many people, was the year when AI became more than a couple of initials and people started to get some appreciation of what it might look like from things like ChatGPT and Claude 2 and all the other plethora of AI apps.
Andrew Mawson:I think initially people were really quite surprised and excited and then, I think, people had a go at it and maybe in some cases they were a little bit underwhelmed. And, of course, there's a lot going on behind the scenes in the tech sector at the moment and these tools are becoming better and better and access to more and more data and are learning as we go. So 23 for me was the time when AI really raised its head as a proper thing, and I think those of us who have been around the tech sector and the world of work for a while were intrigued by that and have spent a bit of time on it and kind of understand it reasonably well. But I think a lot of people in big organisations at the top level don't. I think they still see this as another bit of technology, which is a mistake for me, because I think it's a potential game changer and there's so many different dimensions to it, so AI was a big thing for me, I think.
Karen Plum:On the podcast we talked about advances in AI during the summer. Here's our expert, Dr Mike Jackson, talking about how the term is often misunderstood or misinterpreted.
Mike Jackson:People often overestimate the capabilities of AI because, although AI has made incredible advancements, in the last few months particularly, it still lacks the comprehensive understanding and common sense reasoning that humans possess. It excels in specific domains and specialised tasks, but it struggles with generalisation and context awareness. There's also a misconception that AI systems like robots or computers have autonomous intelligence similar to human intelligence. However, AI systems are only as good as the data they are trained on. As I already said, they lack consciousness, self-awareness and independent decision making. Those are the main reasons why it's misunderstood.
Mike Jackson:I then think that people misunderstand when they see these people writing one-sided, biased processes that says everybody's going to lose their jobs. That creates a concern that AI will replace people on a massive scale. I also think that people don't understand that robots can be as biased and unethical as we are and that there's still a lot of work to be done to un-bias and un-flaw the data that they're using. And that can perpetuate biases and discriminate in humans. And then lastly, people use science fiction, particularly things like the Terminator, to worry about malevolent or super intelligent entities that can take over the world. I don't think that that is universal. I think there is a small body of people who think that because they think it's coming very, very quickly. Most people are not worrying about that day-to-day, in my opinion.
Karen Plum:We talked on that episode about the need for organisations and leadership teams in particular to really get on the AI journey so that they're able to judge the right time for things to ramp up for them. Here's what Andrew said in that episode.
Andrew Mawson:I do think that senior leaders should not be leaving the exploration of this kind of technology to their technology department. They need to be learning much more about what this technology can do, how it can work, and I think that right now they should be looking at their organisations and trying to pre-empt what these technologies may do in the context of their own business strategy, and they should also look at what the competition may do with these technologies in order to maintain their competitiveness. So I think I'd be doing that and then I think, finally, I'd just make sure I'd take a look at every job and then start thinking about how I prepare for the evolution, because this shouldn't be a kind of a jerk. It should be a smooth evolution, really, and the danger is that senior leaders don't really take it seriously and, as a consequence, they don't prepare properly for the taking advantage of it and make it into a powerful tool.
Karen Plum:The key message really is don't get left behind. Keep abreast of what's going on, even if you then decide to keep things on the back burner. Moving on from AI, what else has Andrew had his eye on during 2023? Here he turns to hybrid working and the challenges of the amount of space that many organisations are finding themselves occupying, which they now don't need.
Andrew Mawson:I think it depends where you are in the world as to what was then interesting. I mean, I think some of the work we've been doing in India demonstrates very clearly that there's a huge growth in a number of cities, particularly around the tech sectors and the engineering sector. But on the other side of the coin, what I think we're also seeing is that in the UK and maybe in the US, in different parts of the US, leases - a lot of organisations are sitting on leases. People are still not returning to a pre-pandemic work model and I don't think they ever will, but organisations have been working it out. Some leadership teams are still desperately trying to get everybody back into the office every day because that's the way they like to run the business, and other organisations I think have just and most organisations I think have recognised that this is the way things are going to be in the future and they're beginning to get their heads around how they manage it and deal with it.
Andrew Mawson:I think there are still plenty of organisations that have not really addressed it in terms of how you manage an organisation that is not physically all together all the time, but by and large, I think that's beginning to move in the right direction. People are learning, organisations are learning, some people are actually doing more hybrid, some are doing less, but I think it's becoming pretty clear that physical connection has huge value at the right times for the right purposes, but there's no need to do it every day, kind of thing. So we're kind of working that way out. I think the other thing I see is that a lot of organisations particularly the UK, US really just sitting on their space. I mean most organisations, if you look at our Index data, are sitting on probably I don't know maybe 40% more space than they really need at the moment, and in some cases it's going to be more than that.
Karen Plum:We looked at the conundrum of what organisations should do with the excess space that they find themselves carrying as a result of the move to hybrid working. For Mark Gilbreath, Founder and CEO of Liquid Space, companies are at the stage where they need to be lopping off large pieces of their portfolios - what he calls the 'big chisel moment'.
Mike Gilbreath:At the risk of over-generalising, I think the vast majority of companies are in a big chisel moment. Reach for that biggest chisel, because every one of you, with few exceptions, should be lopping off large pieces with that chisel of your portfolio. You probably don't need more sensors to monitor the fine elements of it. You probably have substantially more estate, that need for gathering and or concentrating is gonna call for. By default, you should be presuming yeah, on that lease renewal, I'm gonna be downsizing or not extending, right? That then leads to the follow on discussion of okay, what do I do if it's not an end of lease and I wanna downsize that portfolio? What other options do I have? Everybody should probably be embracing the current reality that your portfolio is too large.
Karen Plum:I guess the question that organisations have been grappling with, is will the pattern of working change? Will more people want to come into the office in the future? And therefore, if they get rid of space, will they be in trouble? AWA's Hybrid Working Index this year reported on results covering 150,000 people across 15 sectors and 22 countries and found that there's been a steady increase in office attendance. Here's AWA's Workplace Strategist, Josh Sumner.
Josh Sumner:So we're seeing that kind of coming up to three years after the pandemic, on average, office workers are still spending less time in the office than out of it. So on average, office attendance is about 35%, so around one and three-quarter days spent in the office per week. A nd that employees would prefer to be in the office midweek, with nearly 80% of people working from home on a Friday. But underlying this, and perhaps the most interesting takeaway, is how attendance and desk use have developed over the past year.
Josh Sumner:So we've seen a steady incremental increase in both attendance and desk use over the three index cycles. In June 2022, attendance was around 26% on average. It's now at 35%, as I mentioned, and this increase can be seen in every major geography in our dataset. Desk use has increased even further, from 33% to 48%, so a 15% increase, and one of the key reasons for this is that organisations are reducing their desk numbers in relation to reduced demand, resulting in a higher desk use percentage. And then, on the topic of reduced demand, a new question which we added into this third iteration of the index was whether organisations were planning on consolidating or releasing office space as a reaction to the reduced attendance that they were seeing post, Covid and 37%, so well over a third of organisations, said that they were going to either reduce or consolidate space. Of those that are, only 11% are repurposing space with their own use, and the rest are trying to release the office space, either by marketing for sublet or waiting for a lease break in order to move to a new premises and right size.
Karen Plum:So it's clear from our data that organisations are planning on reducing the amount of space that they have, with only a small proportion repurposing it for their own use. But of course, many don't yet have the opportunity to dispose of the surplus space. Here's Andrew again.
Andrew Mawson:I think many of them have just decided well, we're just gonna sit on it. It's within the books already, so we'll just sit on it, and when the lease has expired, that's when we'll hand the keys back to the landlord and we'll do some work to work out what we need and where we need it and how much we need and what style it needs to be, and that's, I think, what we're seeing. So, of course, those leases don't expire in one year. I mean a UK lease is probably, I guess, an average lease now is about 10 years or something. In the US it's probably a bit less. But those leases are expiring every year and that's what gives rise to the opportunity to do something different, and a lot of companies are just being quite sort of benign in their desire to try and monetise space although there are some notable exceptions.
Karen Plum:Of course this one will run and run during 2024 and beyond, and AWA will be keeping in tune with developments and, of course, continuing to run the Hybrid Working Index. So what other standout topics have there been for Andrew in 23?
Andrew Mawson:I think the other thing that has loomed largely this year particularly is that 2030 is not that far away, when the government is insisting on buildings becoming more energy efficient, and of course, there's a political debate in most countries about that. But I think that also is giving rise to some concern and a realisation that landlords and to some degree tenants are going to have to do something to get themselves in order for that. What are the things they can do?
Karen Plum:This is something that the AWA Institute tackled in September. It was all about making net zero part of organisational culture, and we covered this on the podcast too. Here's a clip from the episode where I talked to Richard Lupo, Managing Director of SHIFT Environment, about an organisation that had decided to put solar panels on all of their office buildings in the UK.
Richard Lupo:You can do lots to reduce your electricity and we had some great case study there that the solar panel roll out on all their properties and my takeaway from that one is a three year payback on the solar panels. They've done really well there. I'd normally bank on a six year, but three year payback just goes to show what's possible on the electricity.
Karen Plum:I'm just wondering whether the ability to install solar panels on your building is restricted in terms of whether you own the building or whether you lease the building.
Richard Lupo:Now - I don't think there's any hard an d fast rules and then they'll be based on the tenancies and what the agreement is and how it goes back. But there was some really good, interesting example about a way to negotiate yourself between the landlord and tenants so both parties benefit from that installation of the solar panel or any other investment kit. And I thought I was really innovative myself, because you've got the tenant they want to reduce their bills. You've got the landlord who doesn't want to touch their building for fear of it being broken. Yeah, so I thought that was quite an innovative way to share the cost and benefits as well.
Karen Plum:I think that's such a great win-win, and I do hope we'll see more of these sorts of initiatives in the coming years. So, having looked back on this year, I next asked Andrew what he thought organisations ought to be focused on, or at least keeping an eye on, next year.
Andrew Mawson:Well for sure, I think senior leaders in most organisations need to get themselves educated on AI. They need to not regard it as a technology. They should regard it as a business tool. They should start thinking now about what capabilities it has and what will it have and how that might affect their business, both in terms of, on a positive note, how can they deploy it and, on a negative note, what impact it will it have on them from a competitive situation. What will their competitors be doing with these technologies? And you know does that create for them a competitive threat. So I think that is for sure, if you're in the world of work and you're thinking about that. I think there's also another component to it, which is that.
Andrew Mawson:What is the shape of, what are we gonna see the shape of organisations being, going forward, as this stuff takes off? And also what's the footprint we're gonna need? I mean it depends on who you listen to in the AI debate, as to the impact that AI will have. I'm particularly clear that there will be some jobs I think will just completely disappear.
Andrew Mawson:I think there will be some jobs where capacity is released and the question will be whether that capacity can be used. You know, I think somebody could end up with half a job or have the ability to do twice as many things in their job if there are twice as many things to do, if you see what I mean. So they are gonna be those capacity type opportunities. And then I think there are technology, some of these tools just gonna make Make people way more effective. They'll be able to do things way better than they've - they'll have better information, they'll have better ideas, they'll be able to make things happen faster, and they won't be doing all the dross type activities. And then I think they are gonna be some complete game changing technologies where people put different components of AI technology together to create brand new capabilities, that nobody's ever thought of. Getting your head around some of that, I think is for sure
Andrew Mawson:Some companies should be well, all companies should be doing this year. I think also there are plenty of companies out there that haven't yet really got themselves in a place where they can be highly successful in a hybrid model. I mean, you know, there's a lot of things that we've been doing with our clients over the last couple of years which is really just getting, first of all, getting clarity on the principles, clarity on the guidelines, and that doesn't mean telling everybody how many days they're gonna be in the office. It's more about, you know, how are we now going to build relationships and maintain relationships when we are all dispersed? You know, how are we gonna deal with difficult problems? How are we gonna make sure everybody's got access to the right information? How are we gonna make sure everybody keeps on top of what's going on? How are we gonna make sure we're productive?
Andrew Mawson:So there are a lot of things. This gives you a brilliant opportunity to take a blank sheet of paper on a team by team basis, within a structure, to work out exactly what it is that you want your working arrangements to be in the future. And getting that clarity and upskilling leaders, making sure your leaders understand the things that now are more important when you're working in this kind of way, and learning proactively and kind of consciously. I think that is what a lot of companies are gonna need to be doing, because if you don't do those things, you will see things getting a bit more difficult. You'll see a bit of confusion here and there, maybe a bit of unfairness, because manager A thinks it's okay to do things one way. Manager B, who's doing the same things you know in the team, is offering different opportunities for whatever. Twas ever thus before the pandemic, but I think a lot of companies weren't really doing this stuff and so they didn't really understand that it was ".
Karen Plum:Yeah, but it's given us an opportunity to set those sorts of guidelines in place, even though you know we could have done with them before. People just never got around to it, did they?
Andrew Mawson:No, and you know, I think you know the thing that the pandemic did for me and post pandemic working does for me. If your leadership community are pretty good, then you're probably in a good place. If there's some fragility around that, then it shows up the cracks fairly quickly and I think those, those are sorts of things I mean, I don't know, obviously. I mean I think we've certainly seen this in the last 12 months and I'm sure we'll see in the next 12 months. You know the expiring of a lease can often be the catalyst for getting a lot of other things sorted out, you know. So if you've got a lease expiring 2, 3, 4 years from now, you've got to start thinking about well what is the world going to be then? What are we going to need? And if you do decide you're going to maintain or go beyond today's hybrid model, you've got to be starting to think well, how do I create an organisational capability that allows the entity to flourish in this more dispersed model? And, of course, the other thing I think we're all seeing probably more of, is that organisations probably like us, and maybe not huge organisations are beginning to operate much more globally. So the need to build in a capability to operate successfully on a global basis. We're not just talking about working from home now, is I think, going to become a bigger deal issue as well.
Andrew Mawson:And then the other one, I think, is, you know this one comes and goes and sometimes we see disappointment in the way our politicians operate and all the rest of it.
Andrew Mawson:But the net zero initiatives. We see, you know, at the moment that we've had the recent COP conference, you know. Y ou can understand why those countries that are heavily dependent on fossil fuels for their economic success, like Saudi Arabia, and so if you can see absolutely why they don't want to give it up. But the world can't allow too much of that. I mean, maybe there is a role for fossil fuels, but it can't be on the same scale that it is now unless those fossil fuels can be organised in such a way that they don't generate the carbon they generate now. Even inside organisations I mean there's quite a lot we can do. We know that buildings are a big contributor to carbon, as is commuting, but you know they pale into insignificance in terms of the bigger, the bigger story. But that doesn't mean we shouldn't be doing something about it, and I think you know that's consistent with the government's 2030 strategy, but I think that has to become much more a conscious movement by companies to help their people live greener lives.
Karen Plum:C lock's ticking, isn't it?
Andrew Mawson:It is ticking. I mean there are only a these few little all I mean I think should companies be stronger- should in educating their people about how they, about all these matters? Should they support them in insulating their homes, you know? Should they encourage them to eat things which are going to create less methane, for instance? You know, we should. You know all of those sorts of things. And there's a big question in my mind - should companies become more influential in that, whereas at the moment I think companies, you know, do the things that they're kind of required to do, but they don't, kind of don't go a lot further, in a sense.
Karen Plum:Looking forward to 2024 again, what's AWA going to be focused on? What are we getting excited about for next year?
Andrew Mawson:Well, there are a number of things that are new initiatives that we're involved in this year. Of course, we'll be continuing to do our consulting work around the world. You know on workplace strategy work and change management. You know there's plenty of that going on. We'll you know we'll continue to try to support the globalisation of what we're doing and, as you know, we opened up a company in India this year. We've got a number of contracts there helping organisations to transition to new models of working within their real estate, and you know we've been doing a lot of work in the States on that as well and in Europe. So you know we're going to continue to do that.
Andrew Mawson:We will start to introduce some new things into our workplace strategy. Certainly, we've now built out some tools to assess organisations in relation to AI and the impact on jobs and numbers and things. So that'll be an important focus for us. We're just about to launch the 2024-25 AWI Institute Program, which is quite exciting and brings into place a whole pile of new things. We have three training programs, we have a health check that comes as part of the membership and we're running studying groups, which are going to focus on very specific things groups of eight or 10 companies working together through a sort of a guided learning program on topics that are in the area of exploration.
Andrew Mawson:So AI will be one. Probably carbon will be another one. You know, there'll be a number of these things and we'll start them when we've got organisations interested in doing them. But those will be fun and they're going to be working through some stuff that people haven't worked through, so that's fun. And then, of course, we've got a number of face-to-face events that we're going to be doing as well to help people share their knowledge, as well as a series of webinars that will be globally accessible. So, yeah, quite a lot going on from that standpoint. We might look at one or two new services, but at the moment we'll just stick with what we're really good at, and that is helping organisations really to navigate the journey to new ways of thinking, new ways of working, and that's kind of what we've been doing and we'll keep doing it as long as we can.
Karen Plum:So, on that note, we come to the end of 2023 and look forward to the opportunities and challenges that await us all in 2024. My thanks to Andrew for sharing his thoughts about this year and next, and also I'd like to thank all the guests that came onto the DNA of Work podcast this year. All of them helped us make the show a place where people can hear thought-provoking ideas and insights. And my final thanks go to you for listening and, if you shared the show with someone else, thank you for doing that too. Recommendation continues to be the best way to grow a podcast audience. I look forward to your company in 2024 as we continue to explore the changing world of work. It's in our DNA. If you'd like to hear future episodes of the DNA of Work, just follow or like the show. You can contact us on our website, advanced-workplace. com. Thank you so much for listening. See you next time. Goodbye.