COMMENT: Looking back through history to the ancient Romans and beyond, it is clear that cities have played an important role in the story of mankind. Indeed, the word ‘civilisation’ is derived from the Latin word ‘civitas’, or city. But what is the function of the city?
Throughout history, cities have served three principal functions. Firstly, they are seats of power, a central location where the masses are governed from. Secondly, they are marketplaces, where people come together to exchange physical goods and services. Thirdly, they are forums for the exchange of knowledge and ideas. The word ‘forum’ comes from the Roman Forum, the open-air site in ancient Rome where people assembled from as early as 500 BC to discuss and debate the affairs of the day. In today’s knowledge-based economy, it is this third reason that is the raison d’etre for the modern city, with the office providing the location for these in-person interactions to take place from a commercial perspective.
That is at least, up until now.
Conduit for collaboration
Like many other aspects of society we took for granted before the pandemic, the prospect of remote working has opened up a debate about the future of the city and the role of the office within it. Some are convinced that the office will be consigned to be a relic of the past, representing an outdated way of working demonstrated by the great working from home experiment of the past year.
Call me a sceptic, but I firmly expect that cities will continue to get bigger and offices will remain an integral component of them.
Notwithstanding the social and cultural benefits that cities bring, cities are primarily an economic construct. Cities create large pools of talent for companies to draw from, allowing specialisation of expertise which fosters innovation and thus productivity growth. For workers, this specialisation allows them to earn higher wages than they otherwise would outside of cities. Within this dynamic, the office plays a critical role by providing the physical infrastructure that allows people to come together to solve problems, innovate and work towards a common goal. Without the office acting as a conduit for this collaboration, cities lose their value, lose their purpose.
We have been here before of course. The rise of communication technology, such as the fax machine in the 1980s and email in the 1990s, led many to predict that we would see a move away from the city as the requirement for being present in person would become redundant. What we have seen, however, is that electronic communication is a complement to, rather than a replacement for, in-person communication. In fact, the more people communicate via electronic means, the more frequently they are likely to meet in person. We are simply interacting more across all levels of society and, ironically, it is tech companies that are the biggest proponents of the city and the office.
Change of tack
Digital working platform Slack’s leasing of a new city centre office in the heart of Dublin city centre in Q1 last year is the perfect example of this. Slack’s share price benefited through the pandemic from being identified as a ‘working from home’ stock, but it is telling that Slack itself opted for best-in-class office space as an integral component of its company strategy.
It is also noteworthy that a number of prominent tech companies have said in recent weeks that they now expect employees to come back to the office following the pandemic, seemingly reversing the accommodative working from home policies they announced at the start of the pandemic.
This reversal is a recognition that, while working from home has worked as an emergency measure during the pandemic, it is a poor substitute for in-person collaboration and not a long-term solution. Video conferencing is just not the same as interacting in person. The time delay, even if only a split second, is fatal to open and effective communication.
This pivot back to the office also makes sense when one considers that a company could gain a competitive advantage over its rivals by simply employing an office-based working policy over a remote one. The productivity and innovation gains to a knowledge-based organisation would be too great to compete with.
That is not to say we won’t see more flexible work arrangements following the pandemic. A Harvard Business Review article in 2016 argued that, while collaboration is key to organisational success, businesses may be pushing it too far and creating collaborative overload for employees. Where quiet time is needed for concentration on tasks that require a deep focus, increased flexibility to allow greater working from home is likely to be part of the way we work going forward.
John Ring is director of research at Savills Ireland
