In the fifth and possibly most challenging dimension of JLL’s Future of Work Model to successfully navigate, Financial Performance is positioned as a growth lever, not just an opportunity to minimize capital costs. While securing the lowest cost when negotiating a real estate transaction is a valid standard to measure success, JLL encourages stakeholders to employ real estate as a human-centered workplace to drive high performance, productivity and maximum return on investment (ROI).
A key instrument of change in today’s business world is the advancement of more meaningful metrics to ensure desired financial performance. For example, what effect does the work environment have on employee recruitment and retention? In turn, how does the realization of a stable workforce impact long-term business performance?
Areas to consider when incorporating financial performance into the Future of Work include:
Investment in the workplace to maximize value and ROI. This is particularly true today, when fiscal pressure, technology innovation and the need to attract and retain a high-caliber workforce have caused fundamental changes in the nature of work and employee interaction. Collectively, these changes demand new concepts for the workplace that enhance organizational performance and reduce costs.
Holistic approach to financial management. Achieving defined financial goals will be supported by balancing ongoing cost with strategic, high-value investments. For instance, an emphasis on capital costs for a renovation might drive decisions around materials or energy expenditures that ultimately lead to higher operating costs. Combining capital and operating cost projections provides a better balance of short- and long-term priorities and supports optimum occupancy decision making.
Metrics that matter to ensure desired business performance. According to a survey of real estate executives by JLL, 52 percent of real estate executives said that lack of data and analytics to measure value and generate insights holds them back from identifying and incorporating strategic, value-add initiatives into their business plans. In addition, using any single measurement in isolation is unlikely to determine if a company’s real estate team is driving results. Emerging trends, such as co-working spaces or smart building technology, are new factors to consider when addressing the needs and wants of today’s workforce.