What’s the Purpose of an Office and When Should a Company get One?

As a co-founder of a startup company that employed many remote workers, I used to constantly debate with my partners about the need for physical office space.

So, what is the purpose of an office?

The main purpose of physical office space is to create a special work-focused environment that helps its occupants to get their jobs done easily. An office has the tools and the resources needed to perform job tasks. It gives a designated place to work, often surrounded by coworkers that foster easy collaboration and effective communication when needed.

While the purpose of an office has remained to be the same for a long period, there are ongoing debates about the need for physical office space when discussing the future of work. More and more companies are allowing remote workers who perform their jobs in a fully virtual environment, eliminating the need to be present at an office physically. However, we can see that many leading tech companies in the world such as Amazon, Google and Facebook spending generous amounts of money to creating new office spaces for their employees.

Reasons to have an office space

With the recently booming startup culture that promotes more freedom and excitement in working places, the term “office” has caught a negative connotation. This is due to the image of dreary enclosed spaces with small cubicles that many traditional offices used to have in the past.

Owing to the changing nature of work which allows many tech-based businesses to perform almost all the needed job responsibilities on a laptop that is connected to the internet, there is an ongoing debate whether office spaces are in any way necessary. However, many benefits come with having a dedicated work-friendly space for a business. Following are some of the reasons that having an office space is essential even if all the employees can perform their work remotely.

–       Building effective teamwork among employees

–       Accountability for work

–       Building motivation

–       Professional development

–       Easy Collaboration

–       Better Communication

–       Creating an experience

–       Competitive advantage

The success of any company largely depends on how well its employees work together. Even the most skilled employees fail when their work is not well integrated with the rest of the team that they work with. Building strong and effective teamwork capabilities among employees is essential to motivate them to work well with each other. It also helps them perform their tasks to the best of their ability as they work towards a common goal.

Another critical reason to have a dedicated office space is to maintain accountability for their assigned responsibilities. Working remotely on their own time requires a healthy level of discipline and work ethic which may not be shared equally by everybody in a team. When everyone is working together in an office, however, it is easier to help keep each other accountable for the work responsibilities that they have.

With the rapid development of information and communication technology, there are many effective ways of communication right now. Nevertheless, the level of convenience to collaborate within a team is undeniably higher when they can work face to face alongside each other. Working together in a common space dedicated to work helps employees to get inspired by each other, and to explore their creativity and skills with each other better than working remotely.

Dedicated office spaces also help foster mentorships that lead to better professional development for the employees. It is easier for employers to conduct workshops and other training programs when the entire team is working together. Such programs also motivate employees seeing that their employer is willing to invest in their professional development.

Looking at modern workspaces where they have given a significant level of effort ensure the comfort of employees, the purpose of having an office space has expanded to creating a uniquely exciting experience as well. For example, many modern workspaces are aesthetically pleasing and practically fun to work in with features such as creative recreational areas. Having an exciting office space to work in is a selling point for businesses, giving them a competitive advantage to attract the best talent over their competitors.

How have offices changed over the years?

The history of offices or professional workspaces goes way beyond the time they started having separate cubicles for employees and a computer in every table. The origin of offices goes back to the High Middle Ages when there were dedicated working spaces in palaces and religious establishments.

When the industrial revolution swept across Europe and the US in the 18th and 19th centuries, office spaces for a variety of industries including banking, retail, insurance and more grew exponentially. From the 18th century to the 21st century that we are in right now, offices have gone through massive changes from their design, the layout, culture, the technologies used and also the overall personality of office spaces in general.

One of the biggest differences in modern workspaces when compared to traditional offices is the blurring of the hierarchical prestige. This can be seen as a reflection of the larger society itself. Nowadays especially in the startup culture, open offices have become the norm when even the owner and the C level employees of the company tend to sit in the same table and work alongside the other employees. In more traditional office settings, having a spacious corner office conveyed power and prestige, while regular employees shared smaller cubicles.

In the 50s, an average office consisted of plenty of large tables and filing cabinets with people often sharing the desks. Work cubicles were introduced to the offices in the 60s, and the design of the offices became more aesthetically pleasing with the use of colors and decorations. The 70s were a revolutionary decade with the use of personal workstations and infusion of technology into loads of manual paperwork.

In the 80s the employees were encouraged to create pleasant personal spaces within the office mostly with the use of photos of their families and loved ones. The bulky desktop computers brought a lot of wires and other electric tools to the office as well. 90s were not much different, only with slightly less bulky personal computers and more diverse work environments. The 2000s and 2010s brought the trend of creating more casual, interactive, comfortable and inspiring open office spaces where employees could be more collaborative and engaging.

Different types of offices

As the nature of work changed over the years, office spaces have also grown in variety to suit the way people work. The main two categories of offices are;

– Corporate offices

– Non-corporate offices

Corporate offices have largely stayed the same when it comes to layouts, but the modern corporate offices have more creative space and freedom for the employees than the traditional corporate spaces. Most of the corporate offices still have separate office spaces for managers and the higher level administrators, while the regular employees usually have an open space with desks or cubicles. They have designated conference rooms where meetings are held, and a very structured architecture and interior design.

With the recent flourishing of startups and small businesses, non-corporate offices are the ones that have gone through the most vivid and noticeable changes. Following are some of the different types of non-corporate office spaces that can be widely seen at present.

Co-working spaces

These affordable and flexible working spaces are mostly used by startups and small businesses to have a professional working environment. They are also used for networking purposes since the occupants get to work alongside many other similar businesses. Coworking spaces are also used by individual freelancers for the community aspect, and also to keep themselves motivated and accountable with the help of like-minded peers who use these spaces for the same reason.

Check out Coworking option on Open Sourced WorkplaceOpens in a new tab.

Serviced offices

These are fully equipped offices offered for small to medium businesses in business centers. The occupants can get the experience of a corporate style environment with receptionists and office administrators, without having to assign employees for those positions. These services offices have a wide range of spaces that are also used by large companies who require a dedicated working space for their employees who work in locations away from corporate offices.

Shared offices

These offices are mostly rented out by companies which have extra office space. A small business or a company with a limited amount of employees can rent these spaces and use as a shared office with shared space and resources. It is often a good way of networking and having an affordable community aspect as well.

Day offices

This is a temporary office space that is rented out on an hourly or a daily basis. They are mostly used by companies with employees that require frequent traveling for work and small businesses that require a temporary professional environment for a short time for conferences or meetings with clients. These are extremely cost-effective and often used by freelancers and startup companies as well.

Home offices

This is a dedicated workspace in someone’s residence, often used by freelancers and startups in their early stages. They help enhance productivity in a setting that is not generally intended as a professional space. Having a home office also helps have a clear distinction between work and regular life when someone works from home.

When is the right time for a company to get an office?

Getting a dedicated office space to work is a huge step for a startup or a small business. However, especially for the companies with employees who are used to work from home or places like co-working space or cafes, it can be tricky to decide when exactly it is justifiable to spend a substantial amount of money for a physical office. One of the rules of thumbs when considering the size of the office you will be renting is assigning a set amount of square feet for each employee. You also need to consider the cost for furniture, utilities, moving and repairs that are not covered by the landlord.

The rent and the overhead costs of maintaining an office are some of the highest expenses for any business regardless of its size. Therefore, one of the first signs that show you can consider getting an office is when you have a steady client base and a revenue stream that will cover the costs of an office. When your client portfolio gets bigger, and your client meetings get more frequent, having a designated space where you can meet your clients will not only give your company a better first impression but also will save you money on having to rent temporary meeting spaces often.

As you grow as a company and your brand becomes more recognizable, it is likely that potential clients want to meet you at the office, rather than you having to reach out to clients and visiting them at their offices which happen in the beginning stages of your business.

When your client list grows larger, you will be hiring new employees as well. Even though you can expect the same level of enthusiasm and work ethic from the founding members of your business no matter where they work from, it is not practical to assume that discipline from every employee. This is another sign that shows that you need to have space where your entire team can work together.

A growing business needs a growing set of employees who are trained and updated on the new comings of the industry, which is easier to do when you have face to face communication rather than having only to communicate virtually.

Businesses without physical office spaces

With all the benefits that come from having dedicated office space for your business, it is also important to know that there are a good few companies out there which fully operate online, with remote workers from all across the world handling all the responsibilities. With the “digital nomad” culture of skilled individuals working online while traveling, more and more companies are increasingly adding more flexibility to the nature of work for their employees.

One of the most commonly used arguments by businesses without physical office spaces is that if you cannot trust an employee to have a good work ethic and work responsibly without physically being in an office, then you should not hire that person at all. Following are two successful businesses which are 80% or more run remotely without a set office space.

This is a successful social media platform with over $16 million in annual revenue coming from close to 5 million registered users. It allows users to schedule posts to almost all the leading social media networks including Facebook, Twitter, Instagram, and LinkedIn. It was founded in 2010 by Joel Gascoigne and Leo Widrich and a team of European expats working in San Francisco, US. In 2015, Buffer started being a fully virtual company with employees working from 50 different countries across the world.

Founded in 2005, Automattic is the parent company of WordPress, an open source software that eventually became one of the biggest blogging platforms in the world. The company is valued over a billion dollars. Automattic currently has over 550 people working remotely.

Matt Mullenweg, the CEO of Automattic is a huge advocate of the use of virtual offices and working from home. According to him, having the flexibility to work wherever you are in the world increases the diversity, creativity, and productivity of employees. Automattic does not have geographical restrictions when hiring employees, and currently, have a workforce of over 700 spread across 40 countries around the world.

Related Questions

Do you need an office to succeed in business?

It is not necessarily a requirement to have a physical office space to gain success especially for small businesses, but having a dedicated office space bring plenty of benefits to the table such as effective communication and easy collaboration. There are many success stories for business which operate fully online. It is all about having a team with a high level of professionalism and a great work ethic.

What should you consider before getting an office space for your business?

The location of the office is important when renting an office space. It should be convenient for the employees to commute daily, and it should be easily accessible to your clients. Keep a strict budget and do not go over it simply for aesthetic purposes. It is also important to hire a professional to handle all the legal documents, and be clear about the provisions in your lease and have a good understanding with the landlord about repairs and renovations.

What is the function of office management?

Functions in office management include daily monitoring and reviewing of all the active systems of the office, keeping track of turnover, output, and performances in each department and also working with the human resources department to recruit employees when needed. 

Steve Todd

Steve Todd, founder of Open Sourced Workplace and is a recognized thought leader in workplace strategy and the future of work. With a passion for work from anywhere, Steve has successfully implemented transformative strategies that enhance productivity and employee satisfaction. Through Open Sourced Workplace, he fosters collaboration among HR, facilities management, technology, and real estate professionals, providing valuable insights and resources. As a speaker and contributor to various publications, Steve remains dedicated to staying at the forefront of workplace innovation, helping organizations thrive in today's dynamic work environment.

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