WHY YOU SHOULD ROTATE OFFICE SEATING ASSIGNMENTS SOMETIMES SEATING PLANS REALLY MATTER.
WHEN CORPORATE WORKSPACES are reorganised, many employees view the process as nothing but a nuisance. Desks are cleared, boxes are packed, daily work is disrupted – for what, exactly? Design firms have long touted the benefits of such changes, promising that when people are able to circulate more freely and to randomly encounter different sets of colleagues, they’re more communicative, collaborative, and creative. Some managers believe that too: When Steve Jobs was planning a new headquarters for Pixar, he famously located the large central bathrooms in the building’s atrium, requiring employees to walk some distance to use the facilities – but creating unplanned “collisions” meant to spark innovation. Dozens of research studies have backed up these contentions. But the financial return on investment for office reconfigurations has been hard to prove – until now.
Sunkee Lee, a professor at Carnegie Mellon University, happened upon a “natural experiment” at a large South Korean e-commerce company that was moving into new headquarters. (The company requested anonymity.) In the old building, six teams of “merchandisers,” tasked with sourcing and marketing flash deals for various product categories (electronics, baby, fashion, and so on) were seated in one area, while six other merchandiser teams sat in another one; the two groups were separated by a common entrance. Although the company wanted all the teams together in the new location, space constraints meant that nine of them were
situated in one open area and three in another, with a common entrance in between. The two spaces were identical in terms of decoration, lighting, equipment, distances between teams and workstations, and proximity to management, and they were very similar to those in the previous headquarters. Employees had no choice about where they sat.
Looking at 38,435 deals executed by 60 merchandisers over 200 days – 120 days before the move and 80 days after – Lee found that merchandisers in the area containing more teams sourced 25 per cent more deals from new suppliers, on average, than all merchandisers had sourced before the move. The deals weren’t the result of collaboration; they marked a change in the quality of people’s work. Lee characterises that change as a shift from “exploitation” (simply repeating offers that worked in the past) to “exploration”
(coming up with new ideas). Perhaps more important, the daily deal revenue of each merchandiser sitting with previously unfamiliar colleagues was, on average, 40 per cent higher ($16,510 a day) than the merchandisers’ premove average.
The increase in creativity – the shift to exploratory ideas – was statistically significant only for people whose experience sourcing deals at that organisation was above the median and who had no previous social ties to at least some of the colleagues in their new workspace. Lee offers this explanation: “Once you’ve learned enough about the area you specialise in, exposure to new people will make you more creative. In particular, physical proximity promotes trust and the exchange of valuable and novel knowledge between newly met peers. Given the ability to do so, you will recombine this new knowledge with your own to innovate.”
Examples of the new products sourced include a rice cooker that plugs into a car (a combination of the living and leisure categories), earmuffs with a builtin
Bluetooth function (fashion and electronics), and a training potty that plays music (baby and electronics). The merchandisers didn’t work directly with their newly met peers, Lee says; rather, they were inspired by overheard dialogue and informal conversations to shift from “incremental” to “radical” creativity and increased sales as a result.
Interestingly, the change to employees’ physical space seemed to boost performance even more than did another switch the company made (which Lee also studied), from individual incentives to fixed wages. In addition, the effect generated by the relocation was quick – the rise in cross-category deals occurred within a month – and it increased throughout the 80 days post-move.
Lee’s study is one of the first to use a before-andafter set-up to examine how a seating change affects individual innovation and sales performance. But it’s part of a long line of research suggesting that where colleagues sit can profoundly affect how they work together. In the 1970s, for instance, MIT professor Thomas Allen studied communication among engineers in the R&D facility of a multinational company. His finding, the Allen curve, depicts the dramatic drop in dialogue between people who sit far apart. Although most of the prior research dealt with businesses, the phenomenon holds in other arenas, too. For example, a 2015 study documented that members of the US Senate who sit in close proximity are more likely to support one another’s legislation, regardless of party affiliation.
Lee suspects that had he continued to collect data at the South Korean firm, he would have seen a maturation effect: “When you sit near a new person, there’s only a certain amount of knowledge you can absorb from him or her,” he explains. “This kind of thing can wear off in time.” He also notes that his findings shouldn’t be interpreted too broadly; the study involved a relatively small pool of employees at a technology start-up in a country with a collectivist culture.
Still, Lee sees potential for such interventions to get results at other companies and elsewhere in the world. “It depends on your organisation’s goals,” he
says. “If you want to maintain productivity, there’s certainly a case for keeping your workspaces as they are. Research shows that moves, especially to open areas, can reduce employee motivation, satisfaction, and even health. But if your organisation competes on knowledge sharing and innovation, periodic reconfigurations could be worth it” – provided previously disconnected people are brought together and those newer to their jobs are given more training and support.
Although many companies have ditched closed-door offices and even open cubicles in favour of communal, desk-to-desk workspaces in an effort to encourage unplanned interactions (and to save money), fewer go so far as to routinely shake up seating assignments. Some that do: the gaming company Valve, which has put wheels on its workstations so that employees can move wherever their interests and projects take them; the travel website Kayak, where new hires are often used as a reason to move people around; and the marketing-software firm HubSpot, which randomly reassigns desks every few months.
Whether such office reconfigurations can boost revenue in the same way as they did in the South Korean e-commerce company is a question for future research. But they are increasingly common. “The idea is to encourage people from different worlds to mix and match ideas so that you come up with the best from both,” Lee says. “That boosts both individual and collective performance.”