The Journal The Authority on Global Business in Japan

The office is changing. No longer just the place we go to work, it has become much more—entwined with corporate identity and the way staff see themselves.

Indeed, an office that is designed well can be a hub for collaboration, creativity, productivity, and safety. It can also be a place for fun; a space that enhances the wellbeing of workers.

Conversely, poorly designed offices can not only taint the reputation of a company, but can lead to financial loss, low productivity, dissatisfaction, and poor health.

It comes as no surprise, then, that the office design and creation industry is experiencing change. But it is not only the space and its furnishings that are undergoing a revival. Where, how, and with whom we work are also evolving.

WORK–LIFE
The business case for a well-designed office is clear, say the experts, including US-based office furniture and architectural design company Steelcase.

“The most successful organizations are now turning their attention to employee wellbeing as a way to gain emotional, financial, and competitive advantage,” it argues in issue eight of its in-house 360 Magazine.

The company points out the wealth and healthcare issues at hand. On the rise are stress- and sedentary lifestyle-related illnesses—from obesity to diabetes to heart disease.

And while greater demands are being made on the average employee, research shows that their senses are inundated with some 11 million bits of information per second; “but the conscious brain can effectively process only 40 bits of information.”

If that level of distraction leads to a person switching from one task to another, it can reduce their productivity by 40 percent.

Steelcase’s survey of over 37,000 North American workers is even more revealing: 95 percent said they need a quiet spot for private conversations; 95 percent said a quiet place for concentrated work is important; 50 percent said they don’t have pleasing views; and 30 percent said the air quality at work is poor.

And what about a company’s bottom line? The cost to the economy due to distracted and unhealthy employees is more staggering still, research shows.

Gallup’s 2013 State of Global Workplace Report shows the cost to the economy from disengaged employees in a number of countries, including the US ($450–550 billion), Germany (€112–138 billion), and the United Kingdom (£52–70 billion).

LivePerson‘s Tokyo HQ, designed by frontofficetokyo

LivePerson‘s Tokyo HQ, designed by frontofficetokyo

IDENTITY AND BELONGING
While the cost of a poor work environment is becoming increasingly clear, the benefits are also gaining recognition: workplace satisfaction bolsters employee engagement, productivity, and wellbeing. It also boosts the company’s corporate identity and bottom line.

In an interview with The Journal, architect and frontofficetokyo co-founder Koen Klinkers said, “The office space has become a reflection of what you want your brand to be.”

Jean-Charles Touquet, project director at Midas Company, Ltd., an office environment solutions provider based in Tokyo, agrees. And the research seems to back them up.

“One common request from our clients is design that will help them attract and retain employees,” said Touquet.

A Steelcase/Ipsos poll shows that 11 percent of workers were highly satisfied with their work environment.

These workers “were also the most highly engaged,” showing high levels of concentration (98 percent), as well as the ability to express ideas fully (97 percent), choose where to work in the office (88 percent), and feel a sense of belonging to the company (97 percent).

Midas Company, Ltd.

Midas Company, Ltd.

JAPAN LAGS BEHIND
Companies in Japan lag behind those in the United States when it comes to office design. “Japanese companies do not spend as much money,” explained Hideo Sugano, president of The Design Studio, a Tokyo-based facilities consultancy and architectural design office. “That is because companies here have not noticed the importance of the office environment for the employee’s loyalty and productivity.”

Olga Vlietstra, general managing director at Servcorp, makes a similar observation, noting that the idea of serviced offices—an area in which her firm is a global player—has yet to reach its full potential.

“In the United Kingdom and the United States, the idea of a serviced office is very common; around 4 percent of every building has such offerings. In Japan, serviced buildings are less common,” she said.

Part of the reason for this, Vlietstra believes, is that there has been a tradition in Japan for companies to manage and own their property. She is bullish, however, that the services her company provides—including “virtual offices”—will continue to expand in this market.

Servcorp believes that “virtual offices” will continue to expand in the Japanese market.

Servcorp believes that “virtual offices” will continue to expand in the Japanese market.

ROAD WARRIOR
Flexible workspace provider Regus, which operates in over 977 cities in 106 countries, offers products that cover a wide range of work styles. Regus is a good option for those who need a place to work short-term as space can be reserved for five or ten days at a time. This can be especially useful for travelers, consultants, and others who occasionally need a quiet space in the city with secure Internet access and business amenities. There are also options for those with longer-term needs. “Customers can own personal desk space in a shared office environment with access to all the benefits of Regus,” explained Marketing Director for Japan Satomi Kawasaki.

MAKING WAVES
More companies in Japan are beginning to add color to their offices and are shaking off the cobwebs. US-headquartered commercial real estate services company CBRE Group Inc. is an example.

When The Journal featured CBRE in 2014, the company had just rebranded their Tokyo headquarters based on the idea of Activity-based Work (ABW) styles and eye-catching color.

ABW styles are designed to create offices in which people are “efficient, collaborative, productive, and simply happier,” the company stated in 2014. Such styles offer flexibility in how and where staff work.

Over a year after the rebranding, The Journal asked CBRE for an update. “Based on our post-move survey, we have seen the following results: 90 percent feel the current environment reflects the CBRE brand and promotes a positive image of the company,” said Laurent Riteau, director of Workplace Strategy at the company.

Additionally, more staff prefer the new work environment (88 percent), say they are more productive (76 percent), and believe the new office is a great tool for recruiting talent (79 percent).

Other improvements since the revamp include a reduction in overall real estate space (18 percent), reduction in on-site paper storage (92 percent), and room to increase headcount (more than 10 percent) without a change in layout.

CBRE’s results show that concerted efforts to reform the office environment can lead to positive results.

CBRE Group Inc.

CBRE Group Inc.

SERVICED OFFERINGS
In addition to Servcorp, Midas, and The Design Studio, companies such as Regus, Mitsubishi Estate Co. Ltd., and Space Design Inc., are making their mark on the office rental, design, and serviced buildings market in Japan by offering services such as office design and project management consultancy, furnished or unfurnished offices, bilingual secretarial support staff, and information, communications, and technology services.

Which begs the question: To whom do they cater? Inbound high-end firms wishing to establish a foothold in the Japanese market and established local firms in need of professional and modern services are examples, Servcorp’s Vlietstra said.

All of them—especially new market-entry firms (many of which are established in other markets)—want to hit the ground running, and rely on serviced office providers to ensure smooth operations here, she explained.

This is not to say there are no challenges. Speaking to The Journal, Saori Fujita, service office general manager at Space Design, explained one surprise that inbound companies may face in this market.

“The amount of deposit one pays when renting an office space in Japan may surprise non-Japanese. It is usually 6–12 months. In other countries, this rule may not apply. In such cases, we have to find an alternative solution.”

That said, Fujita and her colleague Kaoru Okabayashi have noticed a recent trend in the run-up to the Tokyo 2020 Olympic and Paralympic Games: the demand for serviced apartments—something their company offers in addition to serviced offices—is rising.

Even while the concept of serviced offices takes hold in Japan, there are players to ensure needs are being met.

Space Design Inc.

Space Design Inc.

GET UP AND GO
According to Steelcase research, we spend more time at work (36 percent) than on anything else—more than on sleep (32 percent), leisure and sports (10 percent), caring for others (5 percent), or eating (4 percent).

The company has also identified six areas that, if improved, can lead to employee wellbeing: optimism, mindfulness, authenticity, belonging, meaning, and vitality.

Considering the last point—vitality—five design strategies are recommended: areas that give people choice over the level of sensory stimulation; easily adjustable furniture that promotes all-day movement; in-house cafés and healthy food choices; natural daylight, views, and ventilation; and support active lifestyles. In a nutshell, increased “get up and go” in the workplace.

MOVING PARTS
Institutions, companies, and communities, are taking note, and global players in the office design and creation sector—such as home and office furnishings suppliers IKEA Japan K.K. and Herman Miller Inc.—are leading the way.

One item that both companies are pioneering is the height-adjustable table. As Herman Miller Japan’s Marketing Manager Keiko Maezawa notes: “The average worker spends eight hours a day at their desk. [And] research shows that many of us sit more than we sleep.

“Height-adjustable furniture can reduce sitting time by up to 60 percent, giving great health benefits by a simple change of posture.”

IKEA Business Country Manager Alan Mackenzie sees similar opportunities in the market, adding: “We want people to get away from the idea that they are anchored to the desk.”

To this end, both companies have made innovations in office products that can be used, reassembled, repaired, and maintained repeatedly using standard parts, thereby making them sustainable.

Indeed, a trend originating in the US and Europe that is becoming prevalent in Japan is the open-design office. Modular and easy to reshape, such arrangements banish traditional dividers and cubicles. Instead, office desks are organized into easy-to-reassemble modular formats, white boards that allow for co-creation are installed, and lounge areas where people can relax are added.

The idea is to “reduce barriers to communication and mobility at work and promote camaraderie among staff.” The rest, as research shows, will follow.

Herman Miller Inc.

Herman Miller Inc.

THIRD PLACE
The mobile and decentralized office environment has given rise to a relatively new concept known as “the third place,” says The Design Studio’s Sugano.

He distinguishes this from the first place (home) and second place (traditional offices). The third place encompasses in-house business lounges, zoned spaces, cafeterias, coffee shops, cafés, shared offices, and co-working spaces.

Some of the top-end third place providers in Tokyo are Servcorp and The Design Studio, as well as real estate companies such as Mitsubishi Estate and Mori Building Co. Ltd.

Mori’s Academyhills, for instance, is a co-working space that attracts businesspeople—mainly from the fields of finance, IT, and consulting—who seek spaces to work, network, and study, said Manager Hiromi Arasawa.

The mixed-use space—of which the company has three in Tokyo—offers meeting rooms, library, work stations, and café-style lounge.

Seeing opportunity for growth in this area, Mitsubishi Estate has created five co-working spaces in the Marunouchi area, Manager Yoshio Sakai told The Journal.

The location in one of Tokyo’s key business districts attracts many tech, creative, and media companies from Silicon Valley, Sakai’s colleague Asuka Kitagawa added.

Mori’s Academyhills

Mori’s Academyhills

NOMADIC CREATIVES
But high-end co-working spaces are just the tip of the iceberg. When Robert Millar looked into starting a co-working space in Tokyo in 2014, his research showed that there were at least 70 such places in the city. Millar is an entrepreneur catalyst who runs Ginza Hub, a shared office space that holds about 12 people from various industries.

It was access to such a community that attracted Alex Fazel, CEO of marketing consultancy Chameleons Customer Service Eigo, who joined the hub more than a year ago.

“I’ve come to realize that it’s not just the place; it’s the people. I get free consultancy from sharp individuals on a daily basis!” Fazel told The Journal.

Along similar lines, the Impact Hub Network brings creatives, founders, venture capitalists, and consultants from a number of sectors together via co-working spaces around the world, said Misaki Iwai, events and community and entrepreneurship program manager at the initiative’s Tokyo branch.

The community, Iwai explained, acts as an accelerator for startups and outsourced company projects, and has more than 15,000 members in five regions around the world.

Spacee Inc., a startup based in Impact Hub Tokyo, aims to become “the AirBnB of workplaces” according to the company’s co-founder Takuya Umeda.

Via Spacee’s platform, any unused office space in the city—such as a meeting room—can be located and used (for a fee) by anyone who happens to be in need of such a space.

Impact Hub Tokyo

Impact Hub Tokyo

COOL AND CREATIVE
A niche player in the co-working market is Lowp, a community-driven company catering to the digital arts and crafts community. “We are a worker–maker space with a focus on monozukuri, making things,” explained the company’s Social and Creative Director Guy Totaro.

“All of our residents have access to our micro-factory, which has tools such as 3D printers, laser cutters, and saws. This means designers working upstairs in the space can realize their ideas in the basement of the same building instead of outsourcing it.”

Lowp—which stands for “low impact, high profile”—has a fully functional gourmet kitchen that can be rented.

“The idea of the kitchen is to reimagine networking,” Totaro explained. “Rather than taking a client or family and friends to an izakaya (traditional Japanese tavern), you can cook and wine and dine with them here.”

The prospect of gourmet dining with clients and like-minded peers was one of the reasons that Andrew Peters joined the co-working space. Founder and president of Best IT, an executive search company based in Japan that serves the Asia–Pacific region, Peters was also attracted by Lowp’s “cool creative vibe, unique facilities, and convenient central location.”

Among its future offerings, the company is planning “hacker events” at which residents can repurpose everyday items such as furniture.

Lowp

Lowp

MIRROR OFFICE
While the digital arts and crafts movement in Japan may be in its infancy, the idea has gained a strong reputation elsewhere in the world.

Referring to the modern Maker Movement, issue 70 of Steelcase’s 360 Magazine notes: “Modern craft is becoming an antidote to uninspired workspaces, not only heightening functionality and aesthetics but also humanizing the workplace experience.”

From serviced offices to high-end co-working spaces, and from founder hangouts to maker–hacker communities, the modern office looks increasingly less like its predecessors and more like the creatives who manage and occupy it.

John Amari is a writer and editor from the UK who specializes in articles on startups, entrepreneurs, science, tech, and business.