By Steven Bandolik and Katherine Loscalzo
In our 2018 Real Estate & Construction Outlook, we looked at why it’s important for companies to focus on talent and culture. While there are many workforce dynamics impacting the CRE industry today, this month’s column specifically explores how the preferences of young professionals can help real estate companies get an edge in today’s business landscape.
Young professionals are increasingly rebelling against companies hyper-focused on uniformity and cost-cutting in their real estate footprints. Opinions about corporate motivation are heading south, according to Deloitte’s seventh annual Millennial survey, which found that over 80 percent of Millennial employees feel business success should be measured by more than just financial performance.
Ironically, to boost their bottom lines, companies may want to focus more on workplace culture and purposeful design. Why? Both can have an enormous impact on engendering loyalty, propelling innovation and boosting performance.
As employee preferences continue to shift, executives should keep the following considerations in mind when reimaging their talent and design strategies:
Where and how work happens has changed – it’s not all about physical real estate anymore
With advances in technology and the rise of work happening everywhere, the corporate office as we know it is changing. The young workforce is increasingly on the go, and desire for flexibility is more prevalent than ever. As such, it’s important that companies create an enhanced mobile user experience for employees to keep them connected and plugged into the culture.
Thoughtful workplace culture and design can engender loyalty
Competition for talent has become fiercer. Forty-three percent of Millennials plan to leave their current position within two years, and that figure increases to 61 percent for Gen Z. Loyalty must be earned, and many young professionals are prepared to move for a better workplace experience. By creating flexibility and choice for how people work, engagement and trust can increase, along with desired cultural outcomes. Senior management teams that are most aligned with this demographic as it relates to purpose, culture, professional development and an engaging design experience are likely to attract and retain the best talent, and in turn, potentially achieve better financial performance.
Millennials and Gen Z care more about positive culture than the pursuit of profit
Today’s workforce is more socially conscious than previous generations. In fact, there is a direct correlation between employee loyalty and a company’s focus on societal improvement and innovation. Young professionals have greater loyalty to companies that prioritize these items compared to those that prioritize the pursuit of profit. To increase loyalty, companies must deliver a unique experience that is both human-centric and in line with employee values.
The distinct and dynamic preferences of younger professionals will likely have a significant impact on how real estate companies approach everything, including talent, organizational culture, the employee experience and workplace design. In order to remain competitive in this shifting landscape, it will be imperative that CRE firms recalibrate how they view corporate real estate—from a cost to a business opportunity—to attract the next generation of talent.
Steven Bandolik is a managing director with Deloitte Services LP and a senior leader in Deloitte¹s real estate and construction practice. Bandolik provides advisory services in capital markets (debt and equity), co;rporate finance, mergers and acquisitions, investments, strategy, restructuring and reorganization, and asset recovery. Bandolik brings more than 30 years of effective, hands-on real estate investment, finance, development, and asset/property management experience, both as a leader and as a strategic advisor.
Katherine Loscalzo is a senior manager leading workplace strategy and design for US and global real estate within Deloitte Services LP. Loscalzo brings more than 19 years of experience delivering innovative real estate solutions focused on strategy, workplace design and experience to support the business, brand and culture. Loscalzo develops industry thought leadership through engagement in research, ongoing measurement, and benchmarking regularly with 35+ companies across industries.
You’ll find more on this topic in the CPE-MHN Mid-Year Update 2018.