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Improving Team Performance through Workspace
Arrangements and Manager Styles
Melissa J. Dawson
Southern New Hampshire University
Employee
retention and performance is not a one-size-fits-all garment. As companies
become more global in scope and aware of the different cultural differences of
their sites and employees it would serve them well to also consider the
physical arrangements of their offices as well as how direct managers work
with, and relate to, their teams. Just as a parenting book instructs you to
consider that each child is an individual and that what works well for one
child may not work at all on another – so too do companies need to remove the
blinders that lets them believe that because they are working with adults that
those differences in style are no longer applicable. By not recognizing these
differences, or suppressing any allowance for difference, a management team can
be creating their own negative consequence in the form of high turnover and
employee dissatisfaction.
During
the past 10-15 years corporations have looked at the physical layout of office
space as a factor in increasing team building and fostering innovation.
Consultants presented the idea to management teams that by removing physical
walls between co-workers, as well as between managers and teams, that there
would be a flourishing of creativity and innovation which would lead to
increased profit for the business (Waber, B.
Magnolfi, J. & Lindsay, G., 2014 October). This has proven to not be
the case for a large number of workers however. A study published in April 2018
reports the findings of a six-month research project into how workers react to
both open office floor plans, along with the concept of the flexible office,
where there are no assigned desks or work-stations (Babapour, M., Karlsson, M.
& Osvalder, A-L.) This Norwegian group found that in fact productivity and
job satisfaction fell with only a small percentage of workers seemingly using
the open space as it was conceived. At least half of the employees did not
embrace the concept of no set work space and despite company guidelines they
claimed a set location for themselves. For those employees the researchers
found that there was more stress for them in having no stable work area, and
that stress was reflected in their behavior and output. Similar findings have
been reported in studies carried out in the United States (Stillman. J, 2018, July
08 and the United Kingdom (Bernstein, E. S. & Turban, S., 2018 July 02).
There are several other components to the physical arrangement of the open
office plans that have been found to not foster the productivity and teamwork
that upper management had hoped for. Lighting and temperature are very
individual preferences that can cause employees to lose focus on their work due
to feeling physically uncomfortable. Noises and sounds rank among the top five
reasons for an employee’s dissatisfaction with a workplace (Bernstein, E. S.
& Turban, S., 2018 Jul 02). W. Belk’s article for Hacker Noon (2017 May 02)
gives specific findings on a company’s High-Performance Employees (HPEs). After
surveying several thousand employees he found that 58% need more private space
for focused work and that 62% say their offices are too distracting. HPEs tend
to be those who do come up with better processes, efficiency changes or cost
cutting measures that retain quality. It would seem that companies should adapt
their office plans to five their valuable HPEs the physical space they require.
When
upper managers visit an open concept office with either no cubicle walls, or
minimal four-foot tall sides, there is usually not lively discussion occurring
at a designated meeting space, finance teams are not brainstorming with those
from packaging. Most employees are working on their computers wearing earbuds
or headsets as they listen to music while doing their own tasks. They use these
devices to filter out all the background noise in order to be able to focus on
their work and deadlines. It would seem that a better way to increase
productivity overall would be to consider the different optimal conditions for
different teams For example, departments that create results through
interaction with people such as Marketing and Sales, do benefit from being able
to be more in touch through an open concept plan, whereas groups requiring more
focus and concentration such as Human Resources or Accounting are less likely
to benefit from being structured in an open plan and not have dedicated quiet
work areas (Belk, W, 2017).
Something
that many companies are not doing well is training and mentoring good managers.
Managers who arrive at their position merely on the basis of time served with a
business, but who have not had any training in being an effective manager, tend
to not have the most productive teams. A manager’s understanding of, and
interaction with, their team is a component of success that is often
overlooked. Recently promoted managers must make the shift between being a
member of the team to now leading and potentially disciplining former peers.
Without guidance or mentoring this can leave them stressed, overwhelmed and
feeling isolated which will not lead to positive outcomes in efficiency or
innovation with their team. In her 2004 article outlining the benefits of
training on managers and their organization the author summed up the current
challenge quite well when she noted: “In this hypercompetitive world, balancing
the tradeoffs between managing for current financial performance versus
longer-term leadership development is a battle too rarely won” (Hill, L.A.)
A
study published in 2017 shows the correlation between manager training on a
company’s Total Factor Productivity (TFP) while also noting that these results
are seen best in larger organizations and that spending time over training with
decrease the wanted result over time. On average an investment into off-the-job
formal training of 1 percentage point results in an increase of 0.46 percent to
TFP (Fleltrinelli, E., Gabriele, R. & Trento, S.).
Employee
surveys have shown that employees are more likely to develop loyalty to a
manager before the corporation itself. Many
employees are drawn to work for organizations whose values they feel mirror
their own values (Ostroff, C., Shin, Y., & Kinicki, A. J. (2005). And those who feel heard,
appreciated and encouraged by their manager tend to perform better and remain
with the business longer (Fan, P. 2018). Fan’s research shows a directly
linkage to effective management and employee satisfaction which in turn
benefits the company overall. Factors such as being sensitive to family
obligations and working with the employee, not against them, in finding a
balance that fits both parties has a wide-spread positive effect on an
organization.
Businesses are also seeing the benefits of
allowing employees more autonomy in their schedules and work locations. As
noted in a Washington Post article on December 23, 2015 companies that move towards
a Results-Only Work Environment can see employee satisfaction and productivity
rise and the manager’s position as attendance taker removed, leaving them time
to innovate processes and support their teams. Empowering employees can be a
powerful tool to a company’s increased success. One clear example of this is
Shree Cement, a company that has seen their bottom line increase year over year
by freeing their employees from the fear of failing and to think as an
owner:
“At Shree, we believe that
management is a combination of the rationality of
science, imagination of art, and
execution of craft. It can never be rigid and static. It has to be dynamic and
free flowing. It cannot conform to a single style…Empowering people to work as
owners and allowing calculated risk-taking without being afraid of penalization
for failures, ignites the entrepreneurial spirit amongst all. We at Shree,
however, allow our people to be practical, understand each situation as
different and deviate from set procedures, if required” (Kanti, A. 2018).
However, there are companies that are choosing to remove that option for their
employees as they once
again seek to improve their bottom lines by trying to increase innovation. Organizations
such as IBM, Facebook and Reddit are also involved in this trend, which is not
making workers happy which results in them either being let go or quitting (The
Washington Post, 22017 March 24).
Employee
retention can be a big part of a company’s profit or loss. While there will
naturally be a cycle of those who leave for better opportunities, are let go
for poor performance or retire from working there can be systemic issues within
a business that cause a high turnover rate that leads to a reduction in
productivity and profits.
Companies
can be quick to say that an employee leaving is no big loss for the
organization, either to save face at losing a high value asset or to avoid
admitting that there was not quality management in charge of a team. However, the
lost momentum of having to replace and train a new team member is higher than
most managers realize.
Ten
years ago, the average cost to replace an employee was $14,000 according to the
Bureau of Labor Statistics, a group within the United States Department of
Labor. Currently there are varying estimates of 30%-70% of an employee’s base
salary is spent by businesses to fill an opening. Yet this is just an
approximate number as factors such as specialized experience, availability of
talent pool and the pressure on a team to cover the work gap are much more
difficult to calculate. A recent publication from a business research group listed
the current average costs:
|
Position
Type
|
Average
Replacement Cost
|
|
Entry-level /
non-skilled
|
30-50% of employee’s
annual salary
|
|
Service / Production
|
40-70% of employee’s
annual salary
|
|
Clerical /
Administrative
|
50-80% of employee’s
annual salary
|
|
Skilled Hourly
|
75-100% of employee’s
annual salary
|
|
Professional
|
75-125% of employee’s
annual salary
|
|
Technical
|
100-150% of
employee’s annual salary
|
|
Supervisor
|
100-150% of
employee’s annual salary
|
An
additional cost factor that is much harder to quantify is the time it takes a
new hire to come “up to speed” with a company’s procedures, products and
policies. This process tends to not happen in a vacuum and current staff
naturally will see their work time redirected to onboarding a new employee
which can leave their projects lagging. While these softer metrics are much
harder to calculate they still have an effect on specific teams, and often supporting
teams as well (O’Connell, M & Kung M-C, 2007).
The
physical arrangement of a company workspace and how managers relate to, and
empower, the workforce is not a one-size fits all solution. In order for
companies to be profitable in the new global economy managers and management
teams will need to adjust some of the paradigms they have lived with for
decades in order to ensure the success of their business going forward. Taking
into consideration the training of management, the empowering of employees and arranging
their physical spaces to allow for optimal output may go against current
trends, but in the long term a work force that is more stable and satisfied
with a business’ commitment will benefit both.
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