There is no doubt that the conventional notion of the workplace has changed drastically in the last 40 years. Following the ascendance of the Googleplex, offices are taking on a more dynamic, worker-friendly and informal structure. Not only old chestnuts like ergonomics and proper ventilation but the entire office landscape (the organization of furniture, workplace culture and social environment, the incorporation of technologies and the provision of communicative spaces and amenities) has changed directions. The increasing prevalence of ‘working from home’ also denotes a shift in the way we think about work. For business owners, two styles of office arrangement are vying for attention: the serviced environment and the virtual office.

The Traditional Office: Serviced Environment

The serviced office space, following the more conventional notion of a public workspace, is one that is contracted out by a building’s owner, is fully equipped for use and managed by a facility management firm.

The benefits of this setup are still enough to secure its place as the most prominent arrangement and its clear why. The serviced environment allows for active employee management, facilitating direct interaction between employer and employees. Also, proximity of workers is conducive to creating strong relationships that begin and continue in the workplace; a characteristic that is so important that there is a massive and growing body of literature on developing a strong workplace culture. However, the serviced environment does have its pitfalls. Just as important as it is to foster a strong office culture, a negative environment can lead to stifled productivity, dissatisfaction and general disinterest in one’s job.

Office 2.0: The Virtual Environment

A virtual office is one that has a fixed address that is not attached to a dedicated office space. This allows owners to obtain a mailing address and telephone number that is distinct from their personal line and to manage employees from a distance.

A virtual office can have numerous benefits for a company. Aside from the authentic workplace environment and employee freedom, a virtual office can be hugely beneficial for companies. They can be managed for a fraction of the cost of a serviced workplace – there are no rental fees, no management and no upkeep. They encourage mobility – businesses can focus on expansion without worrying about stretching themselves thin financially, advertising in multiple regions while operating from another. However, employers are often skeptical about the productivity of workers who have no oversight.  The aptly named ‘shirking from home’ is a possible consequence of the laxity of management inherent in a virtual office.

Conclusion

Like everything else, the decision between the serviced and virtual office environments is situation-dependent. The traditional environment, though it may be characterized as a stale corporate nightmare, still has many benefits. Of course, the serviced environment doesn’t run into technical issues half as much. Not only that, but the traditional office environment is great for promoting an image of company solidarity and, in truth, it sort of does. Bersin and Associates found that a strong learning culture (one that fosters learning, empowerment and, yes, directly sharing knowledge) is 37% more productive. Say what you want, a strong office culture can have some great benefits that are missed by the detachment of the virtual office.

On the other hand, some jobs benefit from the flexibility and tranquility that can only be achieved at home. A study conducted by Bloom et al. found that there was a 13% increase in productivity and higher ratings of work satisfaction for participants performing call-center jobs from home than their on-location counterparts. Jobs in the creative field also benefit highly from employees working from home. Lomonaco and Miller found that productivity increases by 15% when workers are in a comfortable environment. What environment is more comfortable than one’s own home (except when the kids are on holidays)?

In the end, the correct workplace environment will be decided by the employer. Both the traditional serviced environment and the virtual office are viable for productive, fulfilling and happy workers but each also has an exclusive set of benefits that are aligned toward specific goals. What’s most important is choosing the right one for the job.