By: AJ Magner, Executive Vice President, Jones Lang LaSalle
When considering a relocation or consolidation, Jones Lang LaSalle emphasizes business driven occupancy solutions. Here, I’d like to share three simple steps I use with my clients for optimizing an occupancy strategy.
1. Assess the Big-Picture Opportunities in Relation to Business Goals
The first step is to analyze your current real estate situation, but from a slightly different perspective. Set aside square footage, offices and cubicles, as well as your initial expectations or impressions and view your space from a broader, business perspective.
The key is to uncover the needs specific to your business. Explore underlying concerns that correlate with the current and desired real estate setting.
Some key questions to ask are:
- What does our real estate portfolio look like today and where do we see it shifting in the next 5-10 years?
- What corporate technological changes are we considering?
- What customer service or retention initiatives are planned and how do these drive our real estate needs?
- How would a change affect our bottom line?
- What factors or key improvements are most important to our business, employee satisfaction and retention?
Questions like these will tie your business goals to your relocation or restoration objectives. Overarching business goals will drive the occupancy strategy.
2. Perform a Business Diagnostic to Identify Your Problem Statement
After performing the aforementioned assessment, craft a fully developed problem statement. With a narrow problem statement in hand, you can focus the search and identify customized solutions.
Diagnosing your business requires an honest assessment by key members of your management team. Together, you take a close look at all sectors of your business and pinpoint areas of strength and areas of weakness. The New York Times’ model – How To Diagnose What’s Wrong With Your Business provides an excellent checklist to follow in developing your organization’s base line conditions and problem statement.
Following this diagnostic, identify three key variables. These variables will focus your occupancy strategy, and will outline what matters most to your business. Below are sample variables:
- Ability to reach a certain market
- Space for ongoing growth
Note that variables are unique to each business.
A quality problem statement will address long-term goals, as well as short-term goals and provide laser-focused direction as you move forward in identifying your real estate needs.
What should your problem statement look like? Here are a couple examples from past JLL clients.
- Manufacturing Client: How do we accommodate highly seasonal variability in our business demand cycle and warehouse requirements to avoid paying for 12 months of rent to accommodate a 3 month inventory peak?
- Global Manufacturing Client: What is the business case for consolidating multiple sites in major markets across business units?
With this, you are ready to move forward with the real estate search.
3. Evaluate Options to Select an Optimal Solution
With a problem statement in hand, you’ll know exactly what you are looking for, and thus be able to identify spaces that will fit your most important needs. In addition, once a selection of spaces has been initially vetted through the problem statement, find the best solution through a more thorough analysis of each location and its potential.
JLL employs a conceptual framework to effectively form this comprehensive solution. The framework includes the following:
- Forecasting – Make predictions based on data, costs, uncertainties, and other factors.
- Utilization strategy –Deep dive into space efficiency, standards, etc.
- Talent Impact – Evaluate current and target employee needs, desires, and more.
- Occupancy Configuration – Evaluate possible uses of the space for your needs.
- Portfolio Composition – Examine currently held real estate, ensure a logical and strong portfolio is maintained.
- Business Case –Analyze the financial and operating impact of a possible change or move.
Above all else, seek a solution that is focused on business metrics. Then, strive to find a cross-functional, integrated business solution. The comprehensive solution will function to alleviate key problems and reach key goals, as well as result in cost savings.
If you’d like to develop a strategy for your business, we invite you to reach out to a JLL professional for advice and assistance. Send inquires to: Spaces@am.jll.com.
For more information, download JLL’s full report on Business Driven Occupancy Solutions.
About the Author
As Executive Vice President, AJ is responsible for the management of corporate account teams and relationships in Cleveland and throughout the Midwest. He specializes in industrial and logistics, supply chain, and corporate solutions. View AJ’s full bio to read up on his experience.