How to Tweak the Office Floor Plan to Boost Profits

BY Kathy Crosett
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Are you looking for a way to boost your company’s profits by $1 million a year? That’s not an easy feat for any company to accomplish. Yet, the secret to this kind of success may be as simple as changing your office floor plan.

As a manager, you want to ensure that you’re providing your employees with the best possible work environment and culture. Dylan Minor, assistant professor of managerial economics and decision sciences at the Kellogg School, has studied the impact that office floor plans have on productivity. His findings put a value on what many employees innately sense.

Team members who are placed next to a “toxic worker” suffer from a drop in productivity. Instead of getting their work done, especially in the open space environment that is so popular these days, employees who are located next to a toxic worker are listening to complaints. They may be hesitant to point fingers or mention the problem to a manager. Instead, the entire organization suffers, especially in terms of productivity. Minor’s research, conducted with Michael Housman of HiQ Labs, finds that approximately 2% of employees fall into the toxic category and each individual’s “negative financial impact” on the organization amounts to $12,800 a year.

On the other hand, rock star employees can positively influence the output of co-​workers who are seated in the immediate area. In measuring performance, the researchers considered both quality and speed. Workers who excelled in either one of these areas were apt to positively influence, by work habit alone, the output of others seated within a 25-​foot radius. It’s also important to know that lower performers did not negatively impact the work of high performers in these tests.

As part of your commitment to providing an engaging work culture, you want to establish an atmosphere where employees can succeed. Researchers recommend pairing people “with similar or complementary skills near each other.” They also point out that some businesses are assigning "nomad" workers to set up at different physical locations on a daily or weekly basis, to see if their presence impacts work quality and output. At large technology firms, researchers estimated that the "positive spillover" from the right kind of floor plan could be traced to a $1 million increase in profits.