Global bosses might be rowing back on plans to slash the amount of office space their companies occupy due to the after-effects of the pandemic, according to a new report from KPMG.
Just 17pc of global executives surveyed by KPMG now intend to downsize their office space as a result of the pandemic. Last summer, 69pc of CEOs surveyed intended to do so over the next three years.
KPMG noted that the reduction in those intending to reduce their office footprint could be a result of downsizing having already taken place over the past year, or a change in strategies.
Apple boss Tim Cook is among those who, while recognising that there will be increased hybrid working models, insists that physical interaction will continue to be important.
“My gut says that, for us, it's still very important to physically be in touch with one another because collaboration isn't always a planned activity,” he told People magazine last week.
KMPG’s latest Outlook Pulse survey also shows that 45pc of global executives don’t expect their businesses to return to normal operating models until sometime next year. A third expect normalisation to happen later this year.
Almost a quarter, 24pc, say their businesses have changed forever as a result of the pandemic.
Last summer, 70pc of the global CEOs that were surveyed said they expected to cut the amount of office space they used as the pandemic changed the working world.
Many companies expect to use a hybrid working model for staff, with time split between the office and home. However, others have continued to tell staff they’re pulling the shutters down on their workspaces.
IAG-owned British Airways, which is headed by Sean Doyle, said this month that it’s thinking of selling its headquarters at Heathrow Airport because of the changes in work practices. The company has also axed thousands of workers.
Reach, the publisher of the Daily Star and Daily Mirror and more than 100 regional titles said this month that it will close a slew of its offices and instead retain about 15 regional hubs where staff can avail of a desk.
Of 500 global chief executives that were asked this year by KPMG what their outlook is over the next three years, 21pc said they are planning to hire staff who will be mostly working remotely. Last year, CEOs expected that 73pc of the people they’re hire would be working remotely.
Despite the move by many firms to adopt new work practices, just 30pc of the global executives surveyed by KPMG said they are considering a hybrid working model for their staff.
The pandemic has also accelerated a push to digitalisation.
The survey found that 74pc of business leaders think the digitisation of their operations and the creation of a ‘next-generation’ operating model has been pushed forward by a matter of months.
This year, CEOs expect to spend more on digital technologies than last year, with 52pc focusing on customer-centric technologies, and 49pc committed to digital communications such as vido conferencing.