8 minute read
Adapting to Agility Leveraging a “Hub and Spoke” Model
As a company’s workforce becomes more dispersed, they need to rethink not only how they support those employees but also the physical footprint of their business.
As businesses navigate a new world following the global pandemic, most will need to adapt to a more agile workplace. An overarching result of the pandemic was the population diffusion of city centers. As COVID cases continue to affect our society, a return to downtown metro areas has been slow and methodical. This shift is leading many companies to reconsider and evaluate the hub and spoke model across their business footprint.
The “Hub and Spoke” Model
As population shifts away from major “hub” markets, businesses and real estate developers are reimagining how to help people work. A hub and spoke model of centralized offices (hubs) downtown and satellite offices (spokes) in the surrounding areas is not a new concept. What’s changed is the demand for “spoke” offices and the definition of what a “spoke” can be.
The availability of affordable technology for every person to own and use within their home has made high-level, productive remote work possible. As remote workers now enjoy a similar
HUB AND SPOKE OFFICE MODEL Satellite
Office
Satellite Office Home Office
Centralized Office
Shared Service Office Satellite Office
By David Hickey and Guy Douetil, Managing Directors,
Hickey and Associates
degree of “business infrastructure” historically only available at company offices, an opportunity to innovate where and how we work has arrived.
The New Hybrid Work Model
A dispersed workforce and the resulting demand for agility has created an immediate need for businesses to rethink how they support their workers. Working from home or the office is no longer a binary decision. Now, remote work can mean from home, a shared service office (spoke), a company provided satellite office (spoke), or a combination of the like.
Shared Benefits
Businesses and employees are both reaping the rewards of a more agile, dispersed workforce and workplace. Individuals have enjoyed significant work/ life balance improvements. Commute times have decreased on average by one and a half hours a day, which means significant cost savings on transportation, food, maintenance, and other related expenses. More importantly, as stated, the ability for people to choose where and how they work has provided a better work/life balance.
Businesses that have embraced agility are realizing the benefits as well. Reduced real estate cost, improved staff retention/attraction, and additional flexibility allow for a more sustainable business model. Let’s not overlook the importance of staff retention and attraction. Cost of real estate is nothing compared to the cost of high turnover or the need to outsource recruiters and staffing agencies to fill jobs.
Nontraditional Workspaces and the Service Office Boom
Smart companies are those that are open and able to adapt as markets and times change. One trend that early adopters of the hybrid hub and spoke model are moving toward is the use of defunct shopping centers. The trend of re-adapting shopping malls and strip centers as offices is driven by developers because people exist in those areas who can support the economic needs of the business, including having the demographics surrounding these areas to provide workers.
Repurposing desolate shopping centers as shared service offices and “last mile” fulfillment centers allows businesses to go where people already live, utilize existing real estate in a tight market, and better position themselves in a dynamic and difficult supply chain logistics environment.
Feasibility
Not all markets are suitable for hub and spoke models. Hickey and Associates, in conjunction with Instant Group,1 has developed a propensity model to determine which mega cities around the world are most hospitable for satellite offices.
The following attributes were found to be the main determinants: • Commute time – 30% • Share of population age 35+ – 20% • Median household income – 20% • Total employment by selected occupation – 15% • Concentration of employment by selected occupation – 15%
A hub and spoke model is not the right answer for all markets, but large markets that experienced drastic, “overnight” changes in population density due to the pandemic are prime candidates for adopting a workplace model that mirrors the how and why of the new workforce.
Top 5 Priorities According to Corporate Real Estate Executives
As workforce trends change, so do real estate portfolios. Prioritizing location strategy that can meet labor demands now, and in the future, has led corporate real estate executives to focus on the following: 1. Align CRE outcomes with corporate strategy —
Increase agility, decrease cost, increase employee engagement and productivity. 2. Understand your demographics — What demographics and roles already exist within your workforce? 3. Review the geographical footprint of your workforce — How might this change in the future?
4. Map out the function locations your current portfolio supports — Where do the gaps exist? 5. Build out your future portfolio — Focus on your people and the business needs. Upskilling
Contrary to popular belief, enhanced unemployment is not the main reason businesses are finding it difficult to fill low-level positions. Many people used quarantine to their advantage by training for better jobs and taking the “leap” into new professions that time and money constraints would have made riskier in the past.
Automation is the future, and the future is here. Physically tedious positions such as warehouse sorters, grocery packers for delivery, and even flipping French fries at a fast-food restaurant have already or will soon be replaced with AI-enabled robotics. Companies need workers that have skills for the future, now. Developing an agile, upskilled workforce for the jobs of today and “tomorrow” is the next great challenge for businesses.
Moving Forward
As of now, businesses are still working to navigate the future of their workplace coming out of the pandemic. Some expect workers back to the city center office. Some have fully embraced work-from-home and remote work. Some are offering a truly hybrid option of all the above.
No one knows just yet how to perfectly adapt with our new normal of agile, dispersed labor markets. What we do know is embracing what works, where it works, and how it works can be supported with detailed data, indexing, and analytics. By leveraging strategic tools and innovative thinking, smart companies will discover the optimal solutions that are the best fit for the business, along with its workforce. ~
1 https://www.hickeyandassociates.com/hickey-and-the-instant-group-released-jointreport-on-the-future-of-the-office/
MISSOURI
TAKES WORKFORCE DEVELOPMENT SERIOUSLY
OTC’s Plaster Center for Advanced Manufacturing in Springfield, MO, will serve as a regional hub for advanced manufacturing and technology-related education and training.
Kristie Davis,
Director
Missouri One Start
P.O. Box 478 301 W. High Street Jefferson City, MO 65102
573-526-9239 MissouriOneStart.com
Missouri One Start, the state’s workforce recruitment, training, and upskilling division, continues to gain in popularity among companies looking to build or maintain their workforce. A well-established program, it has trained more than 815,000 workers and assisted over 7,000 companies to date. In spite of the disruptions of the COVID-19 pandemic, it trained 47,000 employees across 234 companies in 2020.
One Start’s programs are highly flexible and are designed to work in lock-step with eligible companies to address their unique workforce challenges. Companies within the program can choose to utilize training funds via One Start’s network of community colleges and tech schools, or they can utilize industry or in-house experts, either at their facility or via an industry-recognized training facility.
Recruitment services are understandably popular. One Start’s branded recruitment is now one of the program’s most requested offerings. Since the spring of 2020, they’ve been providing services similar to an ad agency. One Start develops a custom microsite branded to each company, and then promotes the job openings with paid social media, reaching potential employees within a radius of the business’s location. These microsites create a two-click path that knocks down barriers that might otherwise frustrate applicants or prevent them from applying. Graphics, copy, media plan, and an analytics report are provided free-ofcharge to eligible companies in One Start’s program.
The fact that Missouri takes workforce development seriously can be seen in the expansions of One Start’s partner community colleges and tech schools’ centers of excellence across the state. Ozarks Technical Community College’s 120,000-square-foot Robert W. Plaster Center for Advanced Manufacturing, Kansas City’s Metropolitan Community College renovation of its 101,108-square-foot Advanced Skills Institute, and State Fair Community College’s 38,500-square-foot Olen Howard Workforce Innovation Center in Sedalia all speak to the commitment of the state in creating a future-forward pipeline of talent.
Rounding out that pipeline is Apprenticeship Missouri, ranked #2 in the nation for completed apprenticeships. Missouri Apprentice Connect provides a free portal to match Missourians with opportunities and businesses with the apprenticeship program. Since launch, the Missouri Chamber Foundation was awarded a $6 million grant from the U.S. Department of Labor to create nearly 5,300 tech industry apprenticeships.
The Show-Me State continues to demonstrate its commitment to a skilled workforce. With a myriad of programs and opportunities available, it’s easy to see why businesses in Missouri continue to be recognized on Fortune’s list of best companies to work for and why the state continues to see hundreds of millions of dollars in investments.
