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How can REFM steer change as we grow into the workplace of the future?

The "aHead of REFM" roundtable brought together 25 Swedish leaders in a discussion on the role REFM must play in the workplace of the future.


In brief

  • The Real Estate and Facility Management (REFM) industry has been heavily impacted by major changes during and after the pandemic.
  • The workplace dynamics are changing, as employees’ and organizations’ perspectives on the function of a physical workplace evolve rapidly.
  • The roundtable discussion highlighted the changing workplace dynamics, the growing focus on workplace sustainability and the need for Vested partnership models.

What happens when you bring REFM leaders from some of the biggest organizations together for 24 hours? Fresh dialogues are inspired, transformative ideas are born and new connections are formed. This is exactly what happened at the annual aHead of REFM Roundtable in Sweden arranged by EY teams. The 21st in its series, the roundtable event was attended by REFM leaders from 25 of the biggest companies in Sweden.

The first physical roundtable since the pandemic, the event was conducted off-site, with the leaders invited to a beautiful castle situated north of Stockholm. A platform for knowledge exchange, inspiration and networking, the event offered the REFM leaders a pleasant and relaxed environment to share experiences with each other and be inspired by the latest trends in the market.

With the change in the future of work and the advent of an era where flexibility is currency, it has become obvious that there is a need for REFM leaders to innovate and align with what organizations and employees need. The event provided a springboard for REFM leaders to stay ahead of the curve in their industry, by engaging in immersive discussions on the following topics:

  • The pulse of the real estate (RE) and facility management (FM) industry: what’s happening in the workplace?
  • How is the role of sustainability in the workplace changing?
  • Why is there an urgent need to adopt the Vested partnership model?
  • How can REFM leaders steer growth while preparing for the future of work?

The article explores these key aspects against a backdrop of insights from the roundtable discussion.

The pulse of the REFM industry: what’s happening in the workplace?

The REFM industry has, perhaps more than other sectors, been impacted by significant changes during and after the pandemic. REFM leaders believe that the role of the head of REFM in the workplace is changing. With the employees showing no intention to return to the office to the same extent as prior to the pandemic, REFM organizations are planning to redesign the office for a much lower office presence — significantly reducing office space and unlocking cost-reduction opportunities.

Here are a few of the most critical figures and insights from the roundtable discussion:

  • Eighty percent of REFM leaders say that the top management’s interest in REFM increased in 2022, while 20% see no change in interest. This means that an increase in attention, discussions, needs and solutions can be expected in the coming years.
  • Forty-four percent of REFM leaders have been working to integrate REFM, HR and IT in their organization this year, indicating that organizations have matured and started to realize the value of cross-collaboration.
  • Sixty-six percent of REFM leaders plan to decrease their office space per employee by greater than 20%, while 16% do not plan to do this at all. By executing innovative solutions and designing office spaces based on business needs, organizations can stay ahead of the curve.
  • Forty-eight percent of REFM leaders already leverage workplace analytics data to improve their understanding of how employees work and optimize their physical space. This indicates that early adopters have shifted toward becoming more data-driven, while there is still room for the remaining 52% to adopt and include better data in their decision-making approach.
  • Sixty-four percent plan to use technology and data to optimize their FM services, but only 24% are confident in their ability to do this. This suggests a perceived capability gap and a market opportunity.
Top areas where REFM leaders plan to invest in 2023 are sustainability, workplaces, change management, and people and workplace tech, with 84% of leaders planning on redesigning their physical office(s) soon.

How is the role of sustainability in the workplace changing?

During the roundtable discussion, sustainability and ESG reporting emerged as important focus areas. Most REFM organizations see impactful sustainability and ESG as the big challenges facing the industry in the coming years, receiving increased leadership attention. Companies need to adopt Science-Based Targets (SBT) to reduce their greenhouse gas (GHG) emissions to prevent the worst impacts of climate change while also ensuring trustworthiness.

To successfully deliver on their sustainability goals, organizations should strive for transparency and track goal coherence and progression. This can be accomplished by adopting new technology solutions that allow for automated sustainability reporting and real-time sustainability performance — giving organizations that strive to stay ahead of the curve, a great opportunity to do so.

Across the Nordics, there is a strong ambition to innovate within REFM across sustainability and energy. There is also an increased focus on reducing travel (to work, between offices, to suppliers or clients, etc.), reducing space (the new EY office in Stockholm reduced the number of square meters by 50% while increasing the number of work stations by 7%), and energy consumption (for heating, cooling, devices, lights, etc.). Cross-collaboration has been identified as a contributor to achieving these results, hence it is important for organizations to actively leverage collaborations, as integrated functional areas enable greater potential and unlock greater impact. Sustainability has already become part of corporate strategy and business models, with Sweden ranking first.

How can the Vested partnership model help REFM organizations?

Traditional outsourcing deals have been successful in the past, but as the market matures, expectations are increasing, and new challenges and opportunities are emerging. Traditional contracts carry a buyer and supplier mindset, where the supplier is incentivized to deliver for hours, services, etc., but not proactivity, innovation, technology and collaboration. REFM leaders recognize the need to move toward innovative models, with the Vested partnership model being seen in the market as a sought-after alternative.



Vested® is a business model, methodology, mindset and movement for creating highly collaborative business relationships that enable true win-win relationships in which both parties are equally committed to each other’s success.



The Vested approach fosters an environment that sparks innovation, resulting in improved service, reduced costs and value that didn’t exist before — for both parties. By sharing the value generated and saved, the service provider is monetarily incentivized to also reduce the customer’s costs in return for a higher margin. The following are the most important changes expected from stakeholders for Vested contracts:

  • Procurement needs to understand that certain deals require a different sourcing business model, away from standardized processes.
  • Legal teams must learn co-creation processes and build competencies that help handle other contract models.
  • Business customers need to develop the organization toward a more strategic output, with less micromanagement.
  • Suppliers must understand that certain deals require different competencies, and that standardization or economies of scale are not always the key to achieving outcomes.
Vested contracts have shown the capability to help build partnerships through a joint vision, clear guiding principles and incentivized outcomes.

How can REFM leaders steer growth while preparing for the future of work?

REFM leaders recognize that the workplace still has a role to play in our working lives, but the way we work has changed forever. To create sustainable workplaces for the future, organizations should work across functional areas such as real estate, human resources (HR) and information technology (IT). We call them Bricks, Bytes and Behaviours.

Views on the future of the workplace vary, but it is clear we are not returning to the office — at least not to the same extent, or in the exact manner as pre-pandemic. While envisioning REFM in tandem with the future of work, the following are key questions that must be considered from a REFM perspective:

  1. What physical workplace experiences should we deliver?
  2. What is the purpose of “corporate space” and how much space do we need?
  3. How should the “corporate space” look and feel, and what should the specific ratios for different spaces be?
  4. How do we enhance the experience with workplace technology?
  5. What services to deliver, and what is the best way to provide or source them? 
  6. How do we support and influence employees to make good workplace decisions?

The lessons we’ve learned from our pilot at the EY office in Stockholm can help REFM leaders steer the future of work with confidence. Organizations must set a clear vision, gather the right data, put humans at the center, assume today’s technology for tomorrow’s needs, get top management support, and lean on Vested partnerships and transformed FM services to lead the change with confidence.


Summary

REFM leaders have a key role to play in designing new, innovative workspaces that can cater to employee and organizational needs. From sustainability to partnership models, renewed focus is required in many business areas for REFM leaders to drive positive change.

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