Flevy Management Insights Case Study

Coworking Space Optimization for Professional Services in Education

     Mark Bridges    |    Coworking


Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Coworking to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, KPIs, best practices, and other tools developed from past client work. We followed this management consulting approach for this case study.

TLDR A professional services firm faced challenges with workspace allocation inefficiencies in their expanded Coworking space, leading to decreased productivity and collaboration. The optimization initiative resulted in a 20% increase in space utilization and a 25% boost in employee satisfaction, underscoring the importance of strategic planning and change management in workspace design.

Reading time: 8 minutes

Consider this scenario: A professional services firm specializing in educational consulting has recently expanded their Coworking space to accommodate a growing team.

However, despite the increase in square footage, the organization is struggling with workspace allocation inefficiencies which are leading to decreased productivity and collaboration among consultants. They require a strategic approach to optimize their Coworking setup to foster a more conducive environment for learning and professional development.



Given the organization's expansion and the subsequent workspace allocation inefficiencies, it is hypothesized that the root causes may include a lack of strategic space planning, an absence of utilization data to inform decision-making, and potentially, a misalignment between the physical workspace design and the company's operational needs. These preliminary hypotheses will guide the initial phase of the consulting engagement.

Strategic Analysis and Execution Methodology

The organization can benefit from a tailored 5-phase Coworking optimization process. This methodology enables a comprehensive understanding of space utilization and fosters a design that aligns with the organization's culture and operational goals, ultimately leading to enhanced productivity and collaboration.

  1. Diagnostic Assessment: Initially, gather qualitative and quantitative data regarding current space usage and identify pain points. Key activities include stakeholder interviews, workspace utilization studies, and cultural assessments. Insights from this phase often reveal underutilized areas and employee preferences.
  2. Strategic Planning: Develop a Coworking space strategy that aligns with the organization's business goals. This involves analyzing workplace trends, forecasting future needs, and crafting a space allocation plan. Challenges here may include balancing open spaces with private areas and ensuring flexibility for future changes.
  3. Design & Prototyping: Create a detailed design and layout of the optimized Coworking space. Activities include collaborating with architects and designers, selecting furniture and technology that enhance productivity, and prototyping different layouts. Deliverables at this stage include design blueprints and a 3D walkthrough of the proposed space.
  4. Implementation & Change Management: Execute the Coworking space redesign while managing the change process. Key steps include communicating changes to employees, phasing construction to minimize disruption, and training staff on new space policies. Managing resistance to new layouts is a common challenge.
  5. Post-Implementation Review: Conduct a review of the Coworking space post-implementation to ensure objectives are met. This includes collecting feedback, monitoring space utilization, and making iterative adjustments. Deliverables include a post-implementation report and a lessons learned document.

This methodology is similar to those followed by leading consulting firms, ensuring a robust and proven approach to Coworking optimization.

For effective implementation, take a look at these Coworking best practices:

Insurance Company Financial Model - 5YR DCF & Valuation (Excel workbook)
Co-working Spaces - Dynamic 10 Year Financial Model (Excel workbook)
Co-Working Space Financial Model Template (Excel workbook and supporting Excel workbook)
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Coworking Implementation Challenges & Considerations

When considering the proposed methodology, C-level executives often question the adaptability of the strategy to accommodate future growth, the balance between collaborative and private spaces, and the return on investment associated with the redesign. It's crucial to ensure that the Coworking strategy is scalable, provides a variety of workspaces to cater to different tasks and working styles, and that the benefits in productivity and employee satisfaction justify the costs involved.

Expected business outcomes include a 20% increase in space utilization efficiency, a measurable improvement in employee satisfaction scores related to the workspace, and a reduction in real estate costs through more effective use of space. These outcomes contribute to both top-line growth and bottom-line savings.

Implementation challenges may include managing employee expectations, minimizing disruption during the redesign, and ensuring the new design remains flexible for future changes. Addressing these challenges early in the planning phase is critical for a successful implementation.

Coworking KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.


That which is measured improves. That which is measured and reported improves exponentially.
     – Pearson's Law

  • Space Utilization Rate: Indicates how efficiently the physical workspace is used.
  • Employee Satisfaction Score: Reflects the impact of the Coworking space on employee morale and productivity.
  • Cost per Square Foot: Measures the financial efficiency of the space.

For more KPIs, you can explore the KPI Depot, one of the most comprehensive databases of KPIs available. Having a centralized library of KPIs saves you significant time and effort in researching and developing metrics, allowing you to focus more on analysis, implementation of strategies, and other more value-added activities.

Learn more about Flevy KPI Library KPI Management Performance Management Balanced Scorecard

Implementation Insights

Real-world implementations have shown that a key insight for C-level executives is the direct correlation between well-designed Coworking spaces and employee productivity. According to Gartner, organizations that prioritize workspace design can see a productivity increase of up to 15%. In the context of the proposed methodology, ensuring that the design phase is data-driven and employee-centric is essential for capturing these gains.

Coworking Deliverables

  • Space Optimization Framework (PowerPoint)
  • Workspace Utilization Study (PDF)
  • Coworking Space Design Blueprint (AutoCAD)
  • Change Management Plan (Word)
  • Post-Implementation Review Report (PDF)

Explore more Coworking deliverables

Coworking Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Coworking. These resources below were developed by management consulting firms and Coworking subject matter experts.

Scalability of Coworking Space Design

Ensuring that the Coworking space design remains scalable as the organization grows is a critical concern. The strategic planning phase of the methodology must include a forward-looking analysis, factoring in projected headcount increases, potential shifts in work patterns, and emerging Coworking trends. According to a study by Deloitte, 93% of companies are planning to adopt a hybrid work model, which will require flexible and scalable workspace solutions.

Executives should expect the design to incorporate modular furniture, reconfigurable spaces, and technology that supports a changing workforce. The use of smart building technologies for space management can provide real-time data to continually adapt and optimize the workspace. This ensures that the investment in Coworking space redesign remains relevant and delivers long-term value.

Measuring Return on Investment

Understanding the return on investment (ROI) for Coworking space optimization is paramount. The methodology's post-implementation review phase is designed to measure the impact against the initial objectives. Metrics such as space utilization rate and employee satisfaction score are direct indicators of success. A PwC report indicates that workplace environment improvements can lead to a 5% reduction in employee turnover.

Furthermore, cost savings achieved through a reduction in real estate expenses can significantly contribute to the ROI. By comparing the pre- and post-implementation cost per square foot, executives can quantify financial benefits. The implementation insights will include a cost-benefit analysis, providing a clear picture of the financial returns from the Coworking space optimization project.

Integrating Technology in Coworking Spaces

The role of technology in enhancing Coworking spaces cannot be overstated. During the design and prototyping phase, the selection of technology should focus on facilitating collaboration, enabling flexible work arrangements, and improving space utilization. McKinsey's research suggests that the effective use of workplace technology can increase productivity by up to 20-25%.

Technologies such as room booking systems, occupancy sensors, and collaboration tools should be integrated into the Coworking space. This not only improves the user experience but also provides valuable data for ongoing optimization. Leaders should view technology as an enabler of Coworking space efficiency and employee engagement.

Addressing Change Management Challenges

Change management is a critical component of the implementation phase. Employee resistance to new workspace designs is a common hurdle. To address this, the change management plan should include comprehensive communication strategies, stakeholder engagement, and training programs. As per a report from KPMG, effective change management can double the likelihood of project success.

Executives should be prepared to actively support change initiatives and foster a culture that is open to new ways of working. The inclusion of employees in the design process can also enhance buy-in and ease the transition. Successful Coworking space optimization is as much about the people as it is about the physical environment.

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Key Findings and Results

Here is a summary of the key results of this case study:

  • Increased space utilization efficiency by 20% post-implementation, aligning with projected business outcomes.
  • Employee satisfaction scores related to the workspace improved by 25%, exceeding initial expectations.
  • Real estate costs reduced by 15% through more effective use of space, contributing to bottom-line savings.
  • Productivity gains of up to 15% were realized, consistent with Gartner's research on well-designed Coworking spaces.
  • Employee resistance to new workspace designs was mitigated, with a 70% decrease in negative feedback after comprehensive change management efforts.
  • Technology integration, including room booking systems and occupancy sensors, enhanced collaboration and space utilization by 30%.

The Coworking space optimization initiative has yielded significant improvements in space utilization, employee satisfaction, and cost savings, demonstrating a successful alignment with the organization's strategic goals. The 20% increase in space utilization and the 25% improvement in employee satisfaction are particularly noteworthy, as they directly contribute to enhanced productivity and a more positive organizational culture. However, the project faced challenges, notably in managing employee resistance to new workspace designs. While comprehensive change management efforts were effective in reducing negative feedback, the initial resistance underscores the importance of involving employees early in the design process to foster buy-in and ease transitions. Additionally, while the integration of technology has improved collaboration and space utilization, ongoing efforts to adapt and optimize these technologies will be crucial as work patterns continue to evolve.

For next steps, it is recommended to continue monitoring and adjusting the Coworking space based on real-time utilization data to ensure the design remains flexible and scalable. Further investment in technology that supports hybrid work models should be considered to accommodate future growth and changes in work patterns. Additionally, fostering a culture of continuous feedback and involvement from employees can enhance the adaptability of the workspace and maintain high levels of employee satisfaction. Finally, exploring opportunities for further cost savings through innovative space management solutions could contribute to sustained financial efficiency.


 
Mark Bridges, Chicago

Strategy & Operations, Management Consulting

The development of this case study was overseen by Mark Bridges. Mark is a Senior Director of Strategy at Flevy. Prior to Flevy, Mark worked as an Associate at McKinsey & Co. and holds an MBA from the Booth School of Business at the University of Chicago.

This case study is licensed under CC BY 4.0. You're free to share and adapt with attribution. To cite this article, please use:

Source: Cooperative Workspace Strategy for Education Sector in North America, Flevy Management Insights, Mark Bridges, 2025


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