How to Use Office Hoteling to Reduce Facility Costs

In the early 1990s, global tech giant IBM was in trouble and losing money. A new product strategy helped correct the company’s course, but another concept greatly reduced costs during the recovery—office hoteling.

In this report, we explain what office hoteling is and take you through the benefits.

We also show how software can help organizations attract talent and make smarter decisions to reduce facility costs with this simple strategy.

What Is Office Hoteling?

Up to 37 percent of U.S. workers say they occasionally telecommute, working from home or from a local coffee spot.

“Mobilized technology is allowing people to work differently,” says Torrance Houlihan, vice president of product management for AgilQuest, which provides office hoteling solution OnBoard. “The demographic shifts more to the X and Y generations who have grown up working differently, and expect to be able to work in different ways.”

This shift is actually an opportunity for companies to save hundreds of thousands of dollars in real estate costs.

With office hoteling, an employee can reserve a desk (or other space) only for days they will be in the office. The company then saves money by reducing real estate space and furniture.

Office hoteling is an easy process—similar to booking a room at a resort. Next, we’ll look at the benefits this process can deliver, which involve more than simple real estate savings.

What Are the Benefits of Office Hoteling?

It’s easy to see how office hoteling reduces real estate costs, but let’s look at a real life example to show exactly how it works and explore some less obvious benefits.

Real estate cost savings.
Let’s say a company decides office hoteling is a smart move for their operations. They begin allowing workers to reserve desks for the days they are in the office, and they find that about 30 percent of workers telecommute each day.

This means, instead of wasting money and space by having a dedicated desk for each worker, the company can get rid of about 30 percent of their desk spaces. For a massive company such as IBM, this reduced office space by 78 million square feet, and in the U.S., saved the company $100 million annually.

Using your employee headcount and data on how often workers telecommute, you can determine how many workspaces you truly need. Then you can reduce wasted space and save money.

Talent attraction.
Millennials are now the majority of the workforce, and talent is in high demand. Houlihan notes that this group is changing how many organizations attract talent.

“The demand for talent has gotten extreme, and employers will do almost anything to keep the best and brightest. Employers have found themselves in the position of having to accommodate the demands of this talented workforce.”

Torrance Houlihan, vice president of product management for AgilQuest

Companies are completely changing their workplace philosophies to attract millennials by adding more collaborative spaces, open office floor plans and other non-traditional workspaces.

Office hoteling is a big factor in this shift. In the context of millennial talent, it’s not about smaller desks or even about cost savings, Houlihan says.

“It’s more about choice enablement, retention and attraction,” he says. “Hoteling fits in by being the enabling technology that connects people to things when they need them.”

Implement office hoteling as a way to show millennial talent and current employees that your company offers flexible and efficient ways to work.

More data to make improvements.
As employees and facilities professionals use software to reserve desks and other spaces, data is collected and stored. It can then be analyzed so management can make informed decisions about office space needs over time.

Questions that might be raised about an office space:

  • Do we really need more meeting rooms? Or are they not being reserved correctly?
  • Which employees worked in the office last week?
  • How many available workspaces do we need in sales?

The data collected by an office hoteling reservation system can be analyzed to answer questions about who is in the building and how to use space more efficiently.

U.S. Customs & Border Protection Saves Hundreds of Thousands With Office Hoteling

The Office of Administration at U.S. Customs and Border Protection (CBP) experienced several of these benefits, firsthand.

The office implemented a hoteling program, as part of a larger mobile workforce program, to reduce space and costs, enhance productivity, collaboration and improve the staff’s work-life balance at its Washington, D.C. headquarters.

Before the pilot, the CBP facilities contained spaces that were not conducive to collaboration or concentration.

The old CBP offices (top left) were seen as unattractive to new employees, so the agency launched a small hoteling pilot program (top right). The pilot saved thousands of dollars and boosted employee satisfaction and productivity. Renovations were then completed (bottom).

 

The pilot involved transitioning 550 employees to hoteling which led to a 46 percent reduction in overall square footage. The results were compelling; during the pilot, the CBP found:

  • A savings of $3 million in annual rent and operating costs
  • 17 percent improvement in work/life balance

After the pilot for the Office of Administration, the agency is examining how other parts of the organization can leverage mobility and hoteling to help them improve the collaboration and reduce their overall real estate footprint.

As we’ve seen, the benefits of office hoteling are significant and offer more than simply lower costs.

Next, we’ll take a look at how office hoteling software can help deliver all of these benefits.

How Can Software Assist With Office Hoteling?

Office hoteling and space reservation software works similarly to hotel reservation systems, so it’s easy for most employees to use immediately.

Doug Lucy, marketing director for AgilQuest, says these systems offer multiple ways to reserve a desk. AgilQuest’s OnBoard system, for example, gives users the ability to reserve a space using:

  • The calendar view on Microsoft Outlook
  • An iPhone or Android smartphone app
  • Any modern web browser
  • A kiosk in the office reception area
  • A digital touch screen outside the door of a room

Employees can reserve a room or desk by viewing by availability, a calendar or floor plan and see where co-workers are having meetings in OnBoard

 

Additionally, many office hoteling systems integrate with smart building technology to automatically check in employees as they scan their badge to enter the office.

As we mentioned above, every action made with the software will produce office space utilization data that can be analyzed later, for a variety of purposes.

The question of conference room availability is a universal one. Lucy says their clients use Commander BI, AgilQuest’s business intelligence (BI) software, to “identify who is misusing resources like meeting rooms and therefore artificially and unnecessarily reducing the supply of that kind of resource for others.”

Business intelligence applications, like AgilQuest’s Commander BI, visualize your hoteling data for smarter space utilization decisions

 

The resulting data can also help companies hone in on the most cost-efficient worker-to-workspace ratio.

Lucy gives an example: A company has 100 salespeople but only 75 seats, which may lead a sales VP to request more seats. However, using the BI analysis, the data shows there has never been a day with more than 62 salespeople in the building at a time.

In this case, the data saved the company thousands of dollars by showing there is no need to purchase space and furniture that would go unused most days.

Finally, Houlihan stresses that companies should educate employees on the hoteling process to be fully successful. Managers can train workers on how to use the reservation system so that it’s not abused—training can help avoid rooms being double-booked.

In sum, companies of any size can see cost-saving and efficiency benefits by using office hoteling. When choosing software to help, seek a system with an easy-to-use interface and the ability to integrate with existing systems.

Next Steps

  • Contact me at taylorshort@softwareadvice.com for any questions about office hoteling or facilities management software.
  • Call (855) 998-8505 for a free consultation with our team of software experts to narrow down your software options.

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