A "house," sure enough, "is not a home ." Nor does an office or work station necessarily translate as a place of productivity, alas.
It's a lesson--like the design of the wheel--that large corporations constantly relearn despite the well-publicized fact that second only to payroll, their physical facility is their second largest out-of-pocket expense. And how well, or how poorly, employees function within that facility is spelled out in hard dollars and cents.
"The maintenance alone on a facility will run about $30 a year per square foot," according to Donn Allen Carter, director of marketing for Marina del Rey-based Computer-Aided Design Group, "or $15 million a year to support a 500,000-square-foot office or plant."
A Disruptive Move
A stiff price for "openers," and a figure that escalates rapidly if growth projections--as to the size of the work force and where they are going to be placed for maximum productivity--are wide of the mark.
"Every time an employee's work station is changed," Carter adds, "it's a disruptive 'churning,' and you can figure the cost of it at about $10 a square foot in physical renovation. And a work station of 100 square feet is considered pretty tight. This is in addition, of course, to downtime while the move is being made, which is completely nonproductive time."
And while, nationally, this "churn" rate averages about 25%--every fourth employee is moved once a year--"we've found some organizations where the churn rate hits 100%, and we even had one with an unbelievable rate of 150%."
Founded by three computer-oriented architects in 1978 as a consulting firm for architects, interior firms and major corporations, Computer-Aided Design Group (CADG) slipped out of the conventional consultation mode last year when it began emphasizing the sale of its sophisticated, multifaceted, Facility Space Management software package enabling licensees to run their own on-going analytical forecasts and design needs.
Although on the surface a baffling, interlocking, series of 15 software modules--each covering such planning factors as inventory, location and layout planning, drafting, cost accounting, maintenance and site location--the modules interface and, in the words of Carter, "talk to each other as if they were one system."
Rarely, if ever, he continues, would any client require all 15 software packages although the seminal module essential to any application of the CADG system is the Facility System Coordinator--licensing fee: $15,000.
"But from there on," Carter adds, "it's a matter of custom application. An industrial engineer would buy the coordinator and inventory software, of course, but would also probably need the space requirement programmer, the facility location software and the layout planner. In addition to the Facility System Coordinator, however, a bank would probably purchase the licenses for the 'Facility Real Estate Strategist' program, the one covering cost accounting and, possibly, the 'Facility Master Planner.' "
A typical corporate CADG client, (generally defined as any entity trying to maintain coherence in an office or plant of at least 500,000 square feet) he continues, "will probably incorporate three or four modules representing an investment of between $100,000 and $200,000, although you can really get into a facility management program for as little as $70,000 to $80,000."
Not subject to whims and upheavals in the hardware end of the computer industry, CADG's software not only runs on the mainframes produced by the giants--IBM and Digital Equipment--but also on 25 other operating systems from more than 15 major hardware vendors as well.
While installation and training are separate from the licensing fees for the software, Carter adds, full support and consultation, including a telephone "hot line," is always at hand.
As an example of the cost efficiency of the CADG facility management decision-making package, Carter cites the instance of a recent client--a large Midwest oil company--which was maintaining a 500,000 square foot facility, costing $15 million a year to operate.
"The 3,000 employees in this building," Carter adds, "were growing at the rate of about 5% a year. Roughly 750 employees had been moved in the previous year and had experienced 12,000 hours of downtime--eight hours to pack up and eight hours to unpack--which represented $180,000 in nonproductive salary. In addition, the renovation of 125,000 square feet were involved in those changes at a cost of $1,250,000.
"One more thing happened near the end of the time period we studied--25 employees were moved into the division on a rush basis. The facility management staff didn't have an automated inventory of space in which they could look up vacant space or develop a 'move strategy' that wouldn't be overly disruptive.