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Trading Places at P&G

By Kim S. Nash Print this article Print

Savings from hot-desks, huddle rooms and other breakaway work spaces help Procter & Gamble in its fight to right sinking profits.

About one-third of Procter & Gamble's finance, sales and marketing employees have no family photos on their desks, no M&M's stashed in a drawer. Their walls have no funny-because-it's-true Dilbert cartoons.

PDF DownloadThat's because they don't have permanent offices. They work in spaces revamped to let people migrate from cube to office to team lounges, with quick and simple access to the data and servers they need. Employees can call ahead to reserve desks for a given day. Project teams can meet in bigger rooms, plugging laptops into corporate network outlets. Or people might work from home or at a client's site with a portable computer and an Internet line to headquarters.

Of course, P&G, the $39 billion consumer-products company, didn't invent these ideas. Capital One, Cigna, Ernst & Young, TWBA\Chiat\Day, Fidelity Investments—dozens of large companies have been using nontraditional work spaces for years. Sun Microsystems even runs a hotel-style reservation system to manage requests from nomadic workers who want to set up temporary shop at one of 55 sites nationwide. By 2005, predicts technology analyst firm Gartner Inc., 30% of the 2000 biggest companies in the world will have started agile-workplace projects. Huddle rooms and hoteling, which is the practice of sharing generic office space, were unheard of at P&G five years ago. But the company is aggressive about it now, especially as a way to save money.

What's unique about the P&G program, which is called Workplace Services, is how it mixes disciplines. The managers in Workplace Services come out of the real estate, information technology, and human resources departments. By all accounts the group has been doing a first-rate job: By its two-year anniversary this year, P&G expects Workplace Services to have saved the company $300 million. That's a chunk of money greedily absorbed as the company fights economic demons that have eroded profits every year since 1997.

"P&G got slammed pretty damn hard a few years ago. They're rethinking who they are," says Mike Joroff, a researcher at the Massachusetts Institute of Technology. P&G has worked closely with MIT and Gartner during an academic study started in June 2000 to examine how, and how well, companies use unconventional office spaces. P&G is one of 22 corporations participating.

At most companies—even those doing telecommuting projects—real estate and technology managers are two very different kinds of professionals who don't mingle. They may come together for a one-time project, then return to their regular work. That method of collaboration feels more secure to most people because career paths are clearer if you stay inside your familiar department, says Mike Bell, the Gartner analyst leading the project with MIT.

But because employee loyalty runs deep at P&G, people will take professional risks they wouldn't take if they worked somewhere else. P&G folks "tend to pull together to do what's best for the company," says Tim Kane, president of Kinetic Workplace, a training company in Pittsburgh that helped P&G teach early participants how to change their work habits. "They felt comfortable that by getting into flex-work, they were not signing themselves up for a pink slip," Kane says.

This article was originally published on 2002-08-09
Senior Writer
Kim has covered the business of technology for 14 years, doing investigative work and writing about legal issues in the industry, including Microsoft Corp.'s antitrust trial. She has won numerous awards and has a B.S. degree in journalism from Boston University.
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