What is Space Utilization: Benefits, Methods, and Much More

Space utilization refers to how efficiently a building uses its physical assets. When you optimize space usage, you’re improving the efficiency of your buildings and reducing the associated costs. You’ll also increase productivity and enhance occupant satisfaction.

Optimizing space utilization requires a strategic approach. To start, you must understand space utilization and why it matters. Then, you can develop a plan to achieve your objectives. Finally, you can implement solutions to make sure your strategy works.

In this article, we explore the basics of space utilization and how space utilization analytics helps businesses in the longer run.

What is Space Utilization?

Space utilization measures the actual usage of space within a building. It’s different from space allocation or how workstations are allocated to workers. It’s also more than just the occupancy rate alone because it takes into account how much space is being used by employees across a building over time with the relevant workspace utilization tracking tools.

Best handled with space management software like Zan Compute Occupancy, space utilization focuses on tracking how space is divided up and used by people across a facility over time, including determining what areas are most popular among employees.

Real estate and facilities managers can collaborate to use space utilization tracking reports derived from this software to help make better decisions about space allocation and overall workplace design.

Why Is Space Utilization Important?

According to reports, corporate real estate costs make up about 40% of total operating expenses for many businesses.

Corporate real estate costs are typically one of the most significant expenses for most companies. It makes it critical for companies to manage their office space effectively. It gives way to a space utilization technology that can guide organizations on how to optimize such cost-efficiently.

Post-pandemic, offices are moving into hybrid modes, which leads to a lot of space waste, adding an unnecessary additional operating expense.

The best way to reduce these costs is to utilize space in the most efficient manner possible.

Fortunately, improving office space utilization doesn’t necessarily mean spending millions on new buildings. Instead, companies can take simple steps like adjusting how they use existing space to increase efficiency. These include optimizing layouts, increasing collaboration, and ensuring that everyone knows where everything is located.

1. To Reduce Carbon Footprints

In addition to reducing energy consumption, improving building efficiency by proper office space utilization can help you save money while helping the environment. Office buildings are one of the largest consumers of electricity in the world, accounting for about 10% of total global power usage. By optimizing existing workspace utilization, you can save money and improve sustainability. A recent study found that operating a commercial property costs $3,300 per square foot annually. In contrast, the average cost of running a home is just $1,600 per square foot. Even small optimization with office space utilization can translate into significant savings over time

2. Estimation Vs. Real Space Utilization

The most apparent advantage of tracking spaces is your insight into how little space you use. Companies often overestimate the space occupied by their facilities. It leads to overspending on real estate, which is why knowing where your money goes is essential.

3. Coherence among employees

The Wall Street Journal recently reported on a study by Bank of America that showed how tracking space utilization helped improve employee productivity. In the report, the bank revealed that it used space utilization sensors to track the movement of employees throughout the day. They found that workers who bonded together and worked in teams were more productive than those who didn’t.

The company had employees take breaks in groups rather than individually to encourage bonding among co-workers. This seemingly simple hack to space utilization improved productivity by 10%.

Another tech company, using space utilization tracking, determined that the size of the lunch table in its cafeteria also impacted productivity. Employees who sat closer to each other at a larger table were more likely to talk about work during lunch, which led to greater collaboration.

4. Easy Switch to Hybrid Models of Working

The pandemic has forced us to rethink our approach to the workplace. For many companies, the traditional office layout is no longer viable. There is now universal agreement that offices will continue to exist for most industries, but they will look different.

For example, we know that many employees want to telecommute and that many others prefer to work flexibly, either because of personal circumstances or because of the flexibility offered by remote working. However, many workplaces still operate under the assumption that everyone needs to come to the office every day.

In reality, this is only sometimes necessary. While most workers don’t require full-time access to a physical workspace, many benefit from having a dedicated place where they can focus on their job without distraction.

It is believed that the future of the office is likely to involve a mix of traditional and flexible workspaces rather than one being replaced by another.

Perhaps most importantly, many organizations are embracing the idea of “hybrid spaces.” These are places where people can work together face-to-face but also collaborate remotely via video conferencing or online collaboration tools.

Employees’ data-driven insights on space utilization help managers plan flexible working models and agile working spaces effectively.

5. Redesigning Work Spaces

The way people work today is changing rapidly. Employees want greater autonomy over their schedules and workloads, while employers seek ways to support remote workers and enable flexible hours. 

In fact, according to a recent report from Deloitte, “the majority of organizations now offer some form of flexi-time,” and nearly half of those surveyed say that offering flexible options improves retention rates among their workforce.

This shift creates opportunities for companies to redesign offices and workplaces to accommodate individual and team productivity.

How Can I Measure Space Utilization?

There are several ways to measure space utilization:

1. Observation

This method involves watching how spaces are being occupied in real time. For example, you might watch video footage of a conference room during meetings to see if there’s enough seating available. Or you could observe how often a particular desk is used to determine whether it should be moved to make room for new hires.

2. Survey

You can ask your employees what they think about the amount of space they have at work. You can also conduct surveys to find out how much time they spend at their desks versus when they’re away from them. Information can then be compared with data collected from other locations, such as cafeterias or break rooms.

3. Data Analytics

You can use data analytics to analyze how people move around your building. For example, you can track with IoT and AI space utilization technology how frequently people walk between two points or how long they stay at each location. This information can be combined with survey results to create an accurate picture of how your employees’ movements impact space usage.

Among all the suggested ways, data analytics is the most valuable and accurate way to achieve ideal space utilization.

What are the benefits of procuring Space Utilization Data?

Space utilization data helps you understand how your space is utilized so you can make informed decisions about allocating resources. It can also help you identify areas where improvements can be made.

For instance, if you notice that certain meeting rooms are rarely used, consider moving them to a more central location. Similarly, if you see that a common area has been over-utilized, consider adding additional tables or chairs to encourage more social interaction.

Procurement of this data type can also help you better manage your space inventory. By analyzing current space utilization patterns, you can anticipate future demand and ensure that you always have sufficient space available.

1. Execute Practical Office Space Decisions

Space utilization data helps companies decide how to use office space. By collecting information about where people spend most of their time, what activities they perform, and how much space each activity requires, organizations can gain insights into how best to utilize existing spaces. It allows them to make smarter decisions about allocating resources, whether those resources include real estate, furniture, equipment, or anything else.

The benefits of space utilization data go beyond just making better decisions about space allocation; it also enables companies to build more robust cases for creating new offices, expanding current ones, or even moving to different locations altogether. In fact, according to a study, nearly half of respondents cited “space utilization data” as one of the three reasons they chose a particular location.

2. Optimizing the Existing Workspace

The problem with most office spaces is that they’re designed around individual workstations, which leads to inefficient use of space. It is especially true in larger offices with little flexibility to reconfigure the layout. Many companies still need to learn how much square footage they have because it’s hard to track down.

But what if you had access to detailed information about every single employee’s workspace? What if you knew exactly how much space each person takes up, whether working alone or with others and how often they use certain areas? By doing this, you could make better decisions about how to optimize the entire workplace.

For example, you could change the layout of meeting rooms based on the types of meetings employees have. You could break up large conference rooms into smaller ones or combine multiple small rooms. Or you could add additional breakout rooms for collaborative projects.

Making these changes will free up more space for everyone else while increasing productivity. And since you already have the data, you won’t have to spend money building new facilities.

3. Understanding ROI on the IoT Implementation

The question of whether to invest in new technologies or use existing ones is one that many companies face. While upfront costs are always involved, such as installing advanced sensors to generate data, the benefits of implementing new technology can be substantial. In fact, according to research, organizations that adopt new technology see a return on investment within three to six months.

In addition to the financial benefits, there are intangible benefits such as improved employee morale and productivity.

Who primarily benefited from Space optimization?

Space optimization is one of those things that sounds good in theory, but it sometimes translates into real dollars saved. But there are some organizations out there that have successfully implemented space optimization programs and seen significant returns.

The largest organizations tend to have the most significant footprint, which makes them prime candidates for wasting space. These types of businesses, including retail stores, hotels, restaurants, hospitals, schools, government buildings, etc., need to implement space utilization technology to minimize operational expenses.

With skyrocketing inflation, wastefulness adds up quickly. If you take action soon, you could avoid spending tens of thousands of dollars over the next few years on space mismanagement.

Key Takeaway:

Space Optimization is beneficial from an ROI perspective and helps improve employee morale and productivity. Zen Compute is a one-stop solution to optimize your space utilization if you want to implement a space utilization technology. Zan Wave Occupancy Sensor is a revolutionary technology that gives you accurate space utilization tracking in all the common areas of your building.