Whether you rent or own your commercial property, office space is likely one of your businesses' largest investments. It can also be one of the most difficult assets for a business to manage.
The effectiveness of your office space boils down to 2 crucial elements - occupancy and utilization.
Let's put it this way - if you have a difficult time finding out how much of your office space is being used, and for what purpose, then you can't figure out if the amount of space you currently have is enough for now, or for your future needs.
In this article, we're going to cover exactly what space occupancy and space utilization are, and the roles they play (both individually and together) in making more efficient and agile decisions for your workplace.
In general, occupancy refers to the measure of individuals in a space. In the workplace, it is represented by the total number of employees physically present during a specific time.
This is important for capacity management; you want to know that your office space isn't getting too crowded, or, too empty.
How do you get a good handle on your space occupancy then?
To calculate the space occupancy rate, you simply divide occupied floor space by the total floor space (this means excluding restrooms, pantries, and other non-workable areas, but includes meeting rooms).
occupied square footage/total workspace square footage = space occupancy rate
Let's imagine that at your office, you've estimated that employees are allotted 80sqf per person. With a headcount of 20 people at the office on average, your occupied square footage is 1600sqf. If your office size is about 2400sqf, your space occupancy is about 67%. It might even be higher if you often have guests too.
What does that tell you? The pre-pandemic average space occupancy hovers at 50 to 60%, so 67% is about normal, albeit on the denser side.
If social distancing is a concern of yours, perhaps it might be a little too close for comfort at your office, and you could look into adjustments that create more usable space for work, or stagger the days employees and guests enter the office.
While space occupancy is important for workplace leaders to gain an idea of the number of people within a workplace, it doesn't fully demonstrate whether the use of your office space is fully optimized. This is where space utilization comes in.
Space utilization provides the other piece of the puzzle - it compares the static measurement of the size of your space, with how and when they're used. However, it is slightly more complicated than that, and can be broken down into many other metrics!
To start measuring space utilization, you want to measure your total space capacity first.
Here are a couple of space utilization metrics:
These (and a few other) metrics apply to different aspects of space optimization so you get to pick and choose which ones to apply depending on the situation.
Consider that you have a total space capacity of about 80 people. That includes 70 workstations or hot desks, 2 conference rooms, and 1 phone booth.
You may analyze weekly if the 70 workstations are filled most of the time. You might find out that now only 40 employees are working from their desks on average per week.
With a 57% utilization rate for these workstations, that may tell you that you can probably reduce your dedicated workstations if you don't plan on increasing headcount or changing remote work policies in the next 6 months. You might also find out that there are some days the desks are utilized more than others.
You may also see how many hours each meeting space is occupied for on average, and divide that by the number of hours they're available for every day. (E.g. A conference room is booked for 4 hours a day and is available for use for 12 hours a day. That's about a 30% utilization rate.)
40-60% utilization rate is a good benchmark to aim for when it comes to determining if the meeting spaces are utilized well.
However, you might find out that there are bottlenecks if you break down occupancy rates by hourly increments. There might be a time in the day that almost everyone tries to get a phone booth and fails to do so, so that may give you some food for thought.
To put it in the simplest of terms, you can't make educated decisions about office space without knowing both the occupancy and utilization of space. The two go hand-in-hand - occupancy tells you how many people are in a facility, utilization tells you how those people are interacting within that environment.
Together, they’re able to inform you about whether your space is being properly used and how to make tangible improvements too!
You may decide that even though you want to downsize your existing office space, you'll still have to keep, or even add more meeting rooms, but have fewer workstations or individual desks.
We highly suggest not conducting this initiative by just doing visual observations sporadically and logging data manually - you should work with your information technology team for the best results.
Badge swipes and RFID scans are the most common ways to find out how many people have entered an office. Presence-based sensors on the other hand, such as for desks, allow you to find out if certain desks are occupied. Motion sensors, such as those that operate together with lighting, can also give you time stamps on when a space is used.
Meeting room systems can also help you take a look at Outlook or Google Calendar meetings booked across your organization, and see analytics behind it.
Smart locks and access control systems that are programmed to allow access with a specific QR code or pin for a booking, also provide data around usage to its administrators, plus control access to the space itself.
When you've started collecting data, you can go into the management portals of these tools and export these data into database you can query and analyze, such as SQL server. In a pinch, even an Excel spreadsheet will do!
The difficulty comes when different sources that that label their data differently have to be combined. So, if you want to level up your workspace analytics, you can look into specialized software products.
A space management platform simplifies all of the above processes by integrating with your data collecting systems. It becomes the place where you can see your essential space utilization metrics, plus additional insights from summary statistics and visualizations.
Now you've got a better understanding of office space utilization, as well as the role of space management software in optimizing your workplace! And if you're looking for a space management tool to get started, take a look at our free Space Management Software that will allow you to:
1) Manage all your office assets like desks and meeting rooms
2) Replace clunky and manual booking systems, and
3) Start making data-driven decisions about your space.