By Dave Clifton
Most facility managers track space utilization—often, through a variety of metrics. They rely on space utilization software to provide insight into how well they’re capitalizing on the square footage available to them. This, in turn, informs a broad range of critical decisions—everything from desking policies to lease administration. In short, space utilization is at the core of many policies and decisions that impact how a workplace looks and runs.
While it’s important to track and monitor space utilization, even more essential is familiarity with the space utilization principal. The goal isn’t to fill every square foot of space and maximize utilization every second of every day. Rather, it’s to create a balance between the cost of the space and its revenue potential based on an optimal level of utilization. Here’s what facility managers need to know about the space utilization principle.
What is space utilization principle?
The space utilization principle isn’t a law or rule—rather, it’s a guideline that’s flexible and adaptable to every workspace. The space utilization principle “encourages effective utilization of all the space available.” The operative word in that definition is effective. In simpler terms, the space utilization principle encourages facility managers to figure out the best way to purpose space, to attract frequent use by employees.
The space utilization principle has roots in materials handling, where it’s one of many principles for effective space governance alongside the likes of the layout principle and the system flow principle. The objective is to ensure the safe, efficient, effective flow of materials within a value stream. Commercial facility managers can rely on many of the same principles to govern the way employees interact with the workplace and assets within it.
What is space utilization vs. other metrics?
Space utilization metrics are some of the most prevalent and important KPIs to track in a workplace. They lend insight into how efficient a space is and to what degree employees use it. Alone, it’s a powerful benchmark; however, it’s best used in tandem with other metrics, including occupancy, adoption, and more targeted figures like peak rates.
Space utilization is the measure of how efficient a space is, based on how frequently employees use it. To better-contextualize this, it’s also important to have data for:
- Occupancy, or the total number of people within a workplace
- Availability, or the total number of workspaces within a workplace
- Target ratio, or the ideal ratio of people to workspaces (occupancy to availability)
- Actual ratio, or the current ratio of people to workspaces
- Cost per square foot, or the value per square foot of space based on total lease cost
- Peak rates, or the maximum rate of workspace utilization within a given window
There are dozens of other metrics to track, and each yield breadcrumbs of information against a backdrop of utilization. The more pieces of the puzzle facility managers have about their workplace, the clearer the picture of that utilization becomes. Each metric acts as a stepping stone toward the space utilization principle: using space more effectively.
How to measure space utilization
There are several ways to measure space utilization itself, depending on the context. The broadest measure is at the macro level: number of employees divided by total workplace capacity. For example, 125 employees in a space meant for 150 puts you at an 83% utilization rate.
Often, a more valuable measure of utilization focuses on a particular workspace or group of spaces. For example, you might measure the rate at which employees reserve standing desks and calculate utilization by occupied time divided by total available time. For example, if you have 10 standing desks available for 10 hours each day five days a week, that’s 500 hours. If collective occupancy over the course of the week is 420 hours, the utilization rate of standing desks is 84%.
It’s also important to consider peaks. If a hotel desk is occupied an average of four hours each day, but spikes to 10 hours on Thursdays, that’s the peak utilization rate during the week. Put time on a sliding scale and it’s possible to measure peak utilization by the month, week, day, or even hour. Each data point is important within the context of pushing toward more efficient space utilization.
Utilization needs to create harmony
The purpose of the space utilization principle is to create harmony in the workplace. It’s not about finding a way to reach 100% utilization—if you do, there’s no room for flexibility. Facility managers need to find the right coefficient for efficiency and utilization, to justify the cost of the workplace and enable the workforce within it.
Good space utilization will create flexibility and harmony in even the most active workplace. And while it’s important to collect and track utilization metrics in all their various forms, it’s most important to match them up against the space utilization principle to make sure you’re using that data in a proactive, positive way.
Keep reading: What is Space Utilization and How Can You Measure it?