Date
July 2024
Author
Peggie Rothe, PhD
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The metrics of success
How do you measure the success – or otherwise – of your workplace strategy? It is, not surprisingly, a question that we often reflect on at Leesman. It was also a question asked in our most recent Corporate Real Estate (CRE) Leaders poll, carried out in the first quarter of 2024.
The responses were illuminating.
Tapping directly into employee experience, feedback surveys inevitably came out on top, chosen by 85% of respondents.
Next, with 80%, was real estate utilisation metrics, both how often people are in the office, and different types of utilisation within the office. Attendance has become a major discussion point post-pandemic, as companies look to balance the needs of their business, long-established workplace strategies and real estate portfolios with the explosive popularity of hybrid working. Back-to-work mandates have seen employees ordered back to the office, either part or full-time, albeit not always with the full backing of all staff.
But while it may be easy to count feet under desks, is attendance really the best measure of workplace success? Can a workplace strategy be deemed successful based solely on how many people are in the office at any given time? Our Purposeful Presence research has long shown that just because people are in an office, it doesn’t mean they have a good experience while there. Indeed, the popularity of hybrid working post-pandemic is in part due to so many offices long proving less suitable for work than homes.
The best organisations balance profit and purpose.
So the ultimate measures of a company’s success provide a comprehensive view of both the financial performance and the impact it’s making.
Yet when it comes to judging if a workplace strategy is working, only 32% said they used business outcomes; the gap between this, the fourth-ranked answer, and real estate utilisation metrics is a staggering 48 percentage points. Even less (30%) cited employee retention and turnover, while 29% used financial metrics, such as cost-benefit analysis or return on investment.
Of course, many organisations do not use business outcomes or financial metrics to measure the relative successes of workplace strategies because, put simply, it’s hard. It is difficult to show what exact impact any given workplace change will have on business outcomes because there are so many other things that also affect the bottom line. Nor can businesses control all the external variables that will also have an impact.
But just because it is difficult to link workplace strategies to business outcomes, it does not mean such a potentially insightful measure should be written off. Indeed, if CRE wants to be seen as a strategic part of an organisation, then recognising the link between workplace strategy and organisational performance is vital.
The first step is understanding the purpose of an organisation, as we discuss at length in The Workplace Reset. Only once a company’s purpose is established can a workplace strategy be developed to enable it. What is it that you need to support to achieve the outcomes you want? It starts from there.
The next step is to link that back to measuring. Tracking business outcomes in parallel to changes to workplace strategies will allow senior leaders to see if any patterns are forming. Nor is it just about whether turnover has gone up or down: have innovation rates increased, time to market decreased, customer satisfaction improved, for example, or employee attraction and retention strengthened?
Finally, companies need to balance opinion and fact, or risk confirmation bias. During the pandemic, for instance, when everyone was working from home, the general consensus was that it was working well and that people were enjoying it. And generally, Leesman data showed this from the start: on average, the experience was great.
Yet while a majority liked working at home, our data consistently showed that more than one in five home workers had a poor experience, especially among younger employees or those who did not have a dedicated space to work from at home. Despite this, in many cases, it was easy to focus on how great the average employee’s experience was.
In our study on hybrid working, we’ve found that senior leaders – the very people making decisions about workplace strategy – often have a different experience compared to individual contributors. Without data, this puts them at risk of making decisions based on their own experiences, which might not at all be the best solution for the entire organisation.
Ultimately, there are many ways to measure the success of a workplace strategy.
Some provide immediate, direct and insightful data on staff experience, such as employee feedback surveys. Others, like real estate utilisation metrics, provide figures on attendance and usage, but need to be complemented with other data to say something about how a workplace strategy is fairing. Business outcomes are perhaps the most important metric for any business, yet they will always be affected by a swathe of often changing factors, some outside of a company’s control.
No one measure is the best one. Therefore, the best way to measure the success or otherwise of a workplace strategy is to combine multiple measures, thereby covering different perspectives and enabling leaders to rely less on anecdote and opinion and more on valued insight and measurable data.
After all, as William Edwards Deming, the famed business theorist and economist, said: “Without data, you’re just another person with an opinion.”