2014-10-22 11:16:58Office and EquipmentEnglishHow cost effective are open offices really? Here are some variables to think about before you convert your office space.https://quickbooks.intuit.com/r/us_qrc/uploads/2014/10/iStock_000004232354Small.jpghttps://quickbooks.intuit.com/r/office-and-equipment/open-office-layouts-cost-effective/Are Open Office Layouts Cost Effective?

Are Open Office Layouts Cost Effective?

4 min read

Open office plans have been a growing concept in office layout design in recent years. According to the International Facility Management Association, 70 percent of offices in a 2010 survey feature an open layout. This trend is largely based on two justifications: saving money and fostering more employee collaboration. But there’s one problem. This 2013 study conducted by researchers in Australia shows that open offices could be killing productivity.

Open Office Design: Pros and Cons

It’s not that there aren’t any benefits at all to the open office layout.  An online debate between two Fast Company editors earlier this year reveals a number of pros and cons.


  • It’s more efficient to collaborate in person than to IM or web chat back and forth all day.
  • If you work on a team most of your time, as opposed to working independently most of the time, project work can be more efficient.
  • Being in close proximity to the right people facilitates better communication.
  • Employees feel happier and less isolated.
  • The right office layout design can lead to greater efficiencies.


  • Open offices produce higher noise levels.
  • A high density of people can be distracting and lead to a lack of concentration.
  • Employees lack privacy.
  • Not all work is collaborative in nature.
  • People won’t necessarily collaborate even if they’re sitting right next to each other.
  • Independent workers need more personal work space to be productive.

Of course, the primary benefit to a company is that it saves money on the maintenance of private office spaces, and you can make more efficient use of the workspace without walls and cubicles by packing more people into an area.

What Variables Affect Open Office Efficiency?

Business owners looking to follow the trend into open offices should realize that there is more to business efficiency than dollars saved. Some of the variables that affect workplace efficiency include:

  • Employee temperaments: Some employees simply aren’t geared for the collaborative work environment. In fact, more employees are working at home, and some research suggests they are more productive.
  • Office lighting: Lighting can have a significant impact on employee mood. Improper lighting can reduce productivity.
  • Reduced noise: Open offices are naturally noisier than single-office spaces. The increased noise leads to a loss of concentration and less productivity. One study found that sound masking didn’t improve office productivity, suggesting that quieter offices may be the best solution for noise management.
  • Office design: This includes furniture, movable walls, and other features of the office that create work spaces for teams, technology and equipment placement, and the overall look and feel of the space. Open offices have built-in inefficiencies depending on how these assets are managed.

What to Consider Before Deciding on an Open Layout

Before you tear down walls, throw out cubicles, and place your employees side by side, consider whether the open office format is right for your business.

  • Ask employees if they could listen to their neighbors holding conversations right next to their desks and still be productive.
  • Also consider whether collaboration is really necessary for your business. Maybe it is necessary for some employees, but not so much for others. And how much collaboration is necessary for those who do it regularly? Could there be other ways to facilitate that collaboration?
  • Speak to an office design expert about your building’s architecture. What expenses will you incur to convert your space into collaborative work stations? If the cost of conversion offsets any perceived benefits in efficiency, it might not be worth it to walk the length of that road.
  • Will managers be with their employees or keep their offices? This might create a morale problem, which will certainly affect productivity.

Some businesses are creating quiet rooms to make introverts happier and to address the privacy and noise issue.

Do Open Office Inefficiencies Offset The Real Estate Cost Savings?

Lower employee morale, frequent distractions, and other factors that cause employees to lose momentum on work tasks all cut into the overall efficiency of your business. That doesn’t necessarily mean open office layouts are not cost effective. Just like any business decision, you have to weigh the costs against the benefits. Despite some negative reactions by employees asked to work in open offices, companies aren’t giving up on the concept just yet. However, some businesses are modifying their open office layouts with innovative features. On the other hand, there’s a real cost associated with those modifications.

If you are considering an open office layout for your business, bring your accountant in on the discussion. What will be the cost of converting your private office space? Will you implement innovative furniture designs, technologically enhanced work stations, quiet rooms, and individual work spaces to accommodate the needs of your employees who will need to “escape” from time to time? If so, you’ll have to count the costs of those additional features and weigh them against your long-term productivity expectations. There is no one-size-fits-all plan that will work for every company.

Before you make any office layout modifications, create a checklist for your office layout needs. And, finally, make sure your office design will pay for itself over time.

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Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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