The nimble organization ensures that it has maximum flexibility throughout its real estate holdings?even if that means paying more up front in some instances. Flexibility can be financial (leasing instead of owning), physical (designing modular space), and organizational (redistributing work).
Financial.
Companies that prize flexibility tend to own less and lease more. Pfizer, for example, traditionally owned most of its facilities to ensure control and believed that owning was less costly over time than leasing. However, as industry changes led the company to dispose of facilities rather than undertake expensive retrofits, Pfizer found that divesting specialized R&D facilities was exceptionally difficult. The company plans to examine leasing and flexible-use options when it needs new R&D space in the future.Lease terms themselves offer a way to maximize flexibility. Shorter terms, with more frequent and earlier termination dates, expansion and exit clauses, and renewal options, can help a company adapt to changing circumstances. Coordinating the end dates of leases, subleases, and exit clauses in adjacent spaces also allows organizations to shift or disband operations. Savvy managers negotiate leases as they do equipment purchases: They establish a base price and define an array of options for which the company is willing to pay a premium, depending on the flexibility it needs?for example, exit rights after one year (instead of the typical five) for a unit that is up for sale or modular options on new space for a fast-growing start-up. Corporate real estate managers can make intelligent decisions about how much to pay when they understand the variability of business needs. In volatile times, up-front costs may be low relative to the hidden operational costs of having too little or too much space, or the wrong type of space in the wrong place.
Physical.
The simplest form of physical flexibility is space that is easy to subdivide or sublease. In buildings that offer such space, companies can take advantage of less-expensive long-term leases while adapting to changing circumstances by subleasing some of their space to others.
Entire buildings can be designed for flexibility. For instance, modular buildings can be quickly erected and converted from one use to another. ?Shrink-wrapped? facilities, designed from the inside out, can be smaller because they do not have the pockets of surplus space that typically exist inside a one-size-fits-all box. This reduced footprint increases the number of potential uses on a parcel of land. In China, short-lived ?disposable factories? offer flexibility in land use and capital deployment. The disposable building is not always suitable?both employee comfort and environmental impacts must be considered. But such structures are one-fourth the cost of a permanent plant, take only one-sixth of the time to build, are simple to operate and maintain, and can be quickly and inexpensively dismantled.
More-permanent buildings can be designed with future uses in mind, making it easier for organizations to trade a costly, complex, or obsolete use for a new, more marketable one. These fungible designs have simple, generic common areas, standardized space modules, movable walls, and accessible electric and HVAC infrastructure, all of which make the space easy to reconfigure when anticipated uses or operating expenses change. Building in flexibility at the beginning is an order of magnitude cheaper than tearing down walls to create new configurations.
Organizational.
Companies can maintain their real estate flexibility if they are willing to consider alternative workplace arrangements for employees. Working from home is the most obvious example of an alternative workplace. Indeed, ?telecommuting? has been in our lexicon for years, but it was limited until recently to select senior employees and workers in self-directed functions. Today, however, some companies routinely offer telecommuting options to many kinds of employees and, as a result, are finding opportunities to decrease their real estate costs and increase employee satisfaction.