With the new year finally here, it may be time to give your workplace a new look with a commercial fit-out. However, it can be a daunting task: what do you need to know to get the right plan? Who do you need to talk to? How much do you need to spend?
Speaking on the My Business Podcast, QVS Commercial Interiors managing director Eric Brown and DCI Partnership director Richard deVries discuss what business owners need to know about getting a commercial fit-out. They also cover how to balance what business owners want for their new layout versus what they actually need, and an easy trick to get the best possible layout before you make a costly mistake.
Plus much more!
Phil Tarrant: G’day, and welcome to the My Business Podcast. Thanks for tuning in. It's Phil Tarrant here, editor of My Business, and I've decided to mix it up a little today, and rather than having three people in the studio, I've got four people in the studio, sans Adam Zuchetti, my regular co-host. I've had to pack the studio out with a couple of people who I'm working with at the moment.
Alex Whitlock: A couple of ring-ins.
Phil Tarrant: A couple of ring-ins who I though might add a little value to the discussion that we're about to have. I have a special guest today, and that is my business partner, Alex Whitlock. How are you going, Alex?
Alex Whitlock: Hi, good to be here, Phil.
Phil Tarrant: So it's the first time you've been on the My Business Podcast.
Alex Whitlock: I think it is, yeah.
Phil Tarrant: It is.
Alex Whitlock: I've been here for a few of the other podcasts we do here, but no, first time on My Business.
Phil Tarrant: Which is good. The reason I asked Alex to come along is beacuse we're going through a bit of a process here in My Business at the moment, where we're looking to create a better work environment. And a big part of that, Alex, and Alex, this is a big part of his focus within our business, is on the HR front, and empowering our people to do what they do so well, but we've come to realise over a long period of time that-
Alex Whitlock: You're right. It's not so much a matter of "coming to realise." We, as part of the process, as part of our growth strategy, we asked our people how we could improve their working environment, and one of the things that came to light was better lines of communication, in the survey. So what that's done is that's caused myself and Phil to rethink how we're located. I don't know if you're aware, we're split across two floors, levels 12 and 13, we've got about 100 people in the business; what would you say, Phil, about 60/40 at the moment, in terms of split where we are?
Phil Tarrant: Yeah.
Alex Whitlock: So we're looking to bring people together to improve communication. What this has meant is we're going to restructure the business physically, so we're going to go through sort of a re-fit of level 12 and level 13.
Phil Tarrant: Yes. So this has been a work in progress. A lot of it is related to bigger corporate strategy, in terms of growth and how we can achieve that growth, but what this-
Alex Whitlock: It's also about keeping your team happy, and there's a significant retention issue around having a good working environment, and what people's conceptions are about the kind of office environment they want to work in. It's interesting, you ask people what they want, and sometimes they think they know what they want, but I think we're working hard to create an environment that's going to help retain some of our top talent.
Phil Tarrant: Which is good. You spend so much time at work, you want it to be a nice environment.
Alex Whitlock: You do.
Phil Tarrant: We have a corporate perspective in terms of what we're trying to achieve on a strategic level, in terms of bringing people together to work more effectively in teams, and that's been a long work in progress for us to realise that, but the practical outcome of that is that we actually want to start looking at how these people sit together and work more effectively.
Alex Whitlock: We do.
Phil Tarrant: And on that basis, we've got some experts in to help us with that, as we go on that journey. I've asked two people into the studio today. I've got Eric Brown, who is from QVS Commercial Interiors, and I've also have Richard de Vries, who is from DCI Partnership. Guys, how are you going?
Richard deVries: Very well.
Eric Brown: Good. Thanks, Phil.
Phil Tarrant: The first voice was Richard. Now, Richard is on the design side. Do you want to quickly explain what you do, Richard?
Richard deVries: Yes, thanks, Phil. I'm a corporate interior designer, and what we do, we specialise in creating workspaces that support businesses, and it doesn't have to be an office. It could be a factory, an industrial environment. Mainly we're working in offices, but it's about learning a business and fitting the workspace to the way the business works, and that supports what people do.
Phil Tarrant: That's good. And Eric, what do you do, mate?
Eric Brown: I build the dream, mate.
Phil Tarrant: Okay. That's what you do?
Eric Brown: Yeah, I make it happen.
Phil Tarrant: So that guy thinks about it, and you do it.
Eric Brown: I build it.
Phil Tarrant: Okay, that's good. So how these guys, just from a business perspective, the way that we're sitting in front of these two guys who are helping us with our office environment improvement. So, I know Eric Brown. Over the years, I've come to meet Eric, and we've worked with him before doing some stuff for us, and he actually referred Richard into the conversations. So that's a good tie-up, from a business perspective: the value of referral partnerships. The only problem that you've got now is he'd better do a good job, Eric, otherwise it's a bad referral.
Eric Brown: I'm sure he will, Phil.
Phil Tarrant: Richard, this is the second time that we've met now, and you come in and we had a good discussion around what our vision was for the business and what we're trying to achieve through looking to rethink the way in which our teams sit together and how our office looks and feels. Is the brief that we gave you, and the vision that we gave you, is that pretty standard, what you would expect from someone when it comes to "This is what I'm trying to achieve?", and so a subsequent brief that I sent you with some of the vision for it, but also some of the practical things that we thought we needed in order to achieve that. Is that pretty stock-standard?
Richard deVries: Yes, Phil, it is. There are many companies that are coming out of environments that were perhaps put together five, even ten years ago, that really don't fit the way people work today. There's a big emphasis on collaboration, teamwork, and giving staff areas where they can break out without necessarily having to leave the building to go and grab a cup of coffee. There's a whole range of things you can do that support those aims, and that can be anything from creating café spaces, and you've got some good spaces here that actually support that today, but looking at the workstations, they're perhaps a bit old. We don't work with CRT monitors anymore, so an L-shaped workstation with a monitor in the corner is not always the most appropriate way to work, and of course that style doesn't really support teamwork. So we look at the shape of the workstations, how we cluster those workstations, indeed, how many people sit in a cluster and what is around them. Where can they go to sit with a colleague and chat? Where can they break out? Maybe some soft seating areas. There's a whole bunch of things we can do. The brief itself is pretty standard. There are a lot of companies shooting for what you're looking at, as well.
Alex Whitlock: I just had a question for you. The demographic for our business, you're looking at a lot of people in their twenties. For you in your experience, do you find that there are different preferences for the companies that you work with, be it a factory kind of environment or an office environment; do you find there's different needs and wants for older demographics? What are your observations?
Richard deVries: What we find, Alex, is that there tends to be a bit of a split along the lines of the type of business. In a business like this, where you're focusing on media, it's typically a younger workforce, a bit more tech-savvy, and they are prime candidates for some of the big players in the industry. There's always hovering this perhaps implied threat that if the workplace isn't good enough, "I'll pick up and go and work for one of the big guys," and we all know who they are. So there's perhaps a more aggressive desire in the sort of business that you have, for a workspace that ticks all the boxes. As we said, breakout areas; the giving back to staff that perhaps people didn't do ten years ago. Really, ten years ago, it was about having a nice tea room, lunch room, workstations that were big enough, a couple of meeting rooms, and that was about it. But these days, people want so much more. And they expect it.
Phil Tarrant: Really, the purpose of getting you guys in the studio today to have a chat is to talk about the way we're framed, this part of our business in terms of its growth, and what our listeners can learn about our experience and how effective we've done that, but I also want our listeners to understand, you get a really good design and you can have this good vision of what a new fitted-out workplace can look like, but to actually get that into reality is a very different thing. Not every commercial fit-out business are created equal, and you've got a lot of disparity between good operators, less-good operators, the cost question. It's a very elastic thing, what you choose to pay on a fit-out.
So, really, just a conversation around that so our listeners can walk away and if they're looking at revitalising their workspace, how they can do that, and frame that, and how they can find the right people to help them on that journey, but then the realities of project-managing it, essentially. Someone needs to own that fit-out process within a business, and that requires a whole bunch of different skills in terms of cost control and the bit of vision or being able to articulate plans in reality. On that basis, Eric, you must have challenges in the work that you do, in that you essentially get a brief from a designer like Richard or some sort of interior architect that says, "Here's the vision, go and make it happen." Is there often a disconnect between the two things, of this is what they want, and this is what they're going to get?
Eric Brown: Yeah, I think a lot of the time there's a practical disconnect. Sometimes designers, not saying Richard's like this at all; he's in fact the opposite, but they'll design something that might look beautiful, but in reality it doesn't work. I think hitting the brief on the head is probably the most important thing you can get right, because once you've got that, the plan and the master plan, the builder can manipulate things in terms of cost or timing or whatever you need to do to get that up and running. But if you don't get that right from the start, I think it's a major issue.
Phil Tarrant: So it all comes down to the original plans or drawings that you get. Obviously things do change when you start building. People go, "Ah, you know what, why don't we try that?", and that's where you start to get cost-control problems and blowouts in terms of length of time, but The whole idea a plan right: what, Richard, do you think you need to have as a plan in order to get the best outcome in terms of the build and then the desired output at the end?
Richard deVries: There's the planning concept, and that has to be right. And that's the big picture. But the more detailed stuff is critical. The specifications, the compliance; the big things we comply with are the Building Code of Australia, and the Disabled Access Codes. Now, it's critical that we get that planning right so that they're compliant, because if it's not compliant, we won't get an approval from the certifying authorities and you can't build it. So the more detail I put into it, the easier Eric's job becomes. He then has a much more defined scope with which to work. So we can't afford to be nebulous at all. We can't. There's no ifs, buts, or maybe. We plan it, we draw it, we cover our bases. Everything from furniture, electrical, data, air conditioning, fire service, all those little bits. Eric makes it happen. And if that information is correct and well put-together, Eric's job is one heck of a lot easier.
Phil Tarrant: From our planning perspective - and obviously we're using ourselves as a case study - how many people within a business need to be involved, do you think, in helping to create that plan? You don't want too many chiefs and Indians of that analogy.
Richard deVries: That's a great question, because very often we have so many opinions and almost dictates coming through that it become unworkable. Typically, we like to work with what we would call an executive committee. It's usually senior management with representatives of the key departments, and we listen and take down their prime concerns. It's not so much about what people want; it's about what they need, and what's going to support their ability to function well as a business.
Phil Tarrant: Wants and needs are a classic thing, right? I need to have this in order for us to be able to do this. Or, I would like to have this.
Alex Whitlock: This is all very interesting, but it just brings me back to the decision-making process we came about because we knew that we wanted to make some changes. We knew there would be some benefits, but then you get to the issue of how much do you invest into a fit-out? And I'm just interested, Richard, I know these were discussions that myself and Phil went through, but from your perspective is there any science, and I know no two fit-outs are the same, but is there a science to the way you work? What percentage of your turnover do you invest? How do you go about doing that?
Richard deVries: It's a really tricky one, the amount one puts in. We can work with all sorts of amounts to get similar results, and a lot of it comes down to the level of finishes that you put into a project, whether we do real marble, man-made stone, plastic laminate-
Alex Whitlock: Are we getting real marble, Phil?
Phil Tarrant: We're not getting real marble.
Richard deVries: We've got the truck downstairs as we speak. No, but there's a lot of different ways to achieve a very similar result, and I sometimes equate it to cars. Not everybody's a Bentley, and not everybody's a Kia. A lot of our clients in the corporate world are good-quality Toyotas.
Alex Whitlock: Yeah.
Richard deVries: I know what they want. It's got a function, it's got a-
Alex Whitlock: That's how you framed it, wasn't it?
Phil Tarrant: It's funny you say that. We had a good discussion around this, and I said. I was talking about the elasticity, because I speak to Eric quite a lot, and I know a lot of the work that you do, Eric, and you do some really high-end stuff. You might fit out a hundred-square-meter space, which is tiny, but people spend so much money that it blows my mind. But my position is that you can get that same look with half the cost, a quarter of the cost, a third of the cost. The elasticity in fit-outs is ridiculous. If you get the design right, you can do that quite cheap, but you can still get the same output as spending four or five times as much. What's your thoughts on this, Eric?
Eric Brown: I think that's where flexibility is really important, with your designer and with your builder. You have to have someone who listens to your brief and understands what you want, but can give you alternatives to, "Okay, you want this, but we can get you there by a different method."
Phil Tarrant: Is there sometimes vanity around the perception of a value of a fit-out or what a fit-out looks like? For me, I want it to be functional, it needs to look good, it's got to be functional and work well-
Alex Whitlock: Because we have a lot of our clients come to the business, and because we're in the media, we've got people coming to be interviewed, and fairly important people, so we've got to get a bit of a happy balance of having something that looks good for client-facing purposes and something that feels good for the people who work here.
Phil Tarrant: I spent a lot of time, one of our big platforms in the media is the legal industry, so I spend a lot of time down and meet managing partners at law firms. You get all these law firms, it just blows your mind the amount of money that they spend on fit-outs. I guess it's a partial positioning of wealth or expertise.
Alex Whitlock: You ought to look at what they charge their clients.
Phil Tarrant: You look at a table, and go, "That's a $50,000 table," and you go, "Well, why would you spend fifty grand on a table?" But you look at what they charge their clients.
Alex Whitlock: Look at what they bill.
Phil Tarrant: So, for someone to come into our business and go, "Well, they've got a $50,000 marble table, do they really need to be charging me that much for advertising?" It's a real tough one, isn't it, Richard?
Richard deVries: It is. For us, it's about being very appropriate with the spend, and marrying that to the brand image of the company. For a top-tier law firm, maybe that fifty grand boardroom table is exactly what they need to engender confidence and a feeling of gravitas and all the rest, but quite frankly, for most businesses, it's about allocating the funds properly, and tying in with the brand image but then spending the money in the right areas. The back-of-house areas, quite frankly, a desk is a desk is a desk, and we can do an expensive workstation or a more modest workstation. They're still of a certain size with a certain number of power points and data outlets, but maybe allocate more money to the front-of-house areas. But again, being appropriate in how we do that so we're not gilding the lily so much that we frighten your clients off.
Phil Tarrant: You spoke about how the nature of workspaces, or how people have fitted their workspaces, has changed rapidly over five or ten years. A desk, etc., that you mentioned. Today, in today's modern workplace environment, if there's three things that you needed to get right in terms of your fit-out to show you're modern, you're practical, and you're staff-conscious, what are those three things that you would recommend spending your money to get because bang for your buck?
Richard deVries: There's a great buzzword around at the moment. A lot of people don't know what it means. It's called "activity-based working." What it really means is about having a workspace that is appropriate and gives flexibility, and that is the key to it today, Phil, that people have the flexibility; they're not tied to one desk. They can get up, take their laptop, go and work in a kitchen environment, in a soft-seating environment, on a coffee table; it's about having the systems to support that, and that's one of the results of having IT where it is today, is we can have that flexibility. Ten or fifteen years ago, we were very restricted to plug-in points, but with mobile phone technology and wireless, you can work anywhere, so it's about making the workspace as flexible as possible, and that's really the key thing.
Phil Tarrant: Have you seen it, and a little bit, I've seen it in our business, where you create these opportunities for people to work in that environment, but they don't really use it? And whether that's because of they've been institutionalising the work in a particular way. I get the idea of creating the activity-based working environments, but how do you actually get people to use it? Can you encourage it, or can it happen organically?
Richard deVries: I think it can happen both ways. I think certainly if a person's been working at that desk for the last fifteen years, he's a bit bolted on, and perhaps needs some encouragement. It's maybe senior management holding meetings in those areas, and everybody brings their laptop or their iPad or their device, and they sit there and they brainstorm and they work in that environment. Gradually, that gets across the idea that we don't have to be tied to a desk. Some businesses don't have as many desks as they have staff. Some people call that "hot desking." Traditionally, hot desking is where there are not as many desks as staff, staff are out on the road a lot, and you grab the first desk that's available when you come in in the morning. Now, that's not appropriate for all businesses, but it's increasingly appropriate to have the flexibility that if I want to work at a stand-up bench or a sit-down desk or a soft-seating area or the kitchen or wherever, I can do that. I don't have to be tied to the desk. But the more we can encourage people to see the whole office as their workspace, not just their desk, the better it is.
Eric Brown: And speaking of flexibility, too, things like operable walls, that you can put up and move down and expand space or contract space depending on what you want to get out of it is pretty important these days.
Alex Whitlock: Once the fit-out is complete, once the new structure is in place, obviously the people who are the architects of the design have a fairly clear vision of what they're trying to achieve. The staff usually have little visibility. In your experience, how long do you think it takes for teams to adapt to the new working environment? Because not everyone likes change, do they?
Richard deVries: They don't, Alex. Change is one of the big things every organisation struggles with. People hate it at one level, even if it's good change. It's very hard to get over the perception that people are losing something, even if it's moving from that big L-shaped desk that they had with the big monitor that would have been there ten years ago to a smaller desk where they perhaps have really just as much work space. It's always seen as a negative.
Alex Whitlock: Yeah.
Richard deVries: So selling the idea, and getting people to buy into the concept, and even choosing some champions, if you like, from amongst the staff, who can help get that message across. One of the things we do is often spend time in workshops with staff, just explaining what this new work environment is going to be about and trying to remove the fear from the equation and show people that, in fact, it's helping them, it's a positive, and they will indeed be better off because of it.
Phil Tarrant: One of the things I like about recording the My Business Podcast is that I get all the free advice. Which is good. Hence the reason why people listen in to this, because that's absolutely invaluable. The way I frame change; I love change, I think change is brilliant. I often forget that for a lot of people, they're very scared of change, and they don't really know how to react to it. It takes me often a bit of a process to put myself in other people's shoes to understand the situation
Alex Whitlock: Particularly when, our circumstances; we've worked for other businesses, we've sat around business-ups, I think we're wired just to meet change head-on and to foster change, but you're right. Not everyone is wired that way, and I think some people find it very, very difficult to cope with. Look, we all do occasionally, but I think it's quite tough for some people to adapt to.
Phil Tarrant: I like the idea of internal champions to sell people this stuff, we'll be picking up that idea.
Eric, I'm going to come over to you, mate. What's the worst, biggest mistake you think you've ever seen fitting out an office for someone, in terms of the negative outcomes of it?
Eric Brown: I think natural light. If you went down the avenue of creating... plasterwall's a lot cheaper than glass, right? So a lot of people think they can save costs by replacing their glass walls with plasterwalls, which does save a third of the cost, roughly, but by cutting down the natural light it's actually an awful place to work. It affects our morale, it affects how we feel. The biggest mistake, hands-down, is when people shut that light off and don't let the light through, and it makes that office, no matter what you do artificially, without the natural light coming through, it's horrible. Try living in the UK through winter and you'll understand what I mean. That's why the pub culture is so big over there.
Phil Tarrant: "What am I, inside of a pub?"
Say from my perspective, say within this process for us, to evolve our workplace, we've worked before on fitting out some other areas of our office as we've grown and evolved. I think you did our first fit-out ten years ago when we were 60 square metres-
Eric Brown: Two men in a broom closet.
Phil Tarrant: Yeah, and now we're about 1500 square metres, so you've down this journey with us beforehand, and this is the next step in our revolution, and you've worked with me on this. How do you think, myself, I can best prepare myself or be planning myself to make your job as easy as possible? Because I know a lot of business owners meddle in processes and slow things down, or they make it a bad experience for you to deliver what I want. How can I do what I do better so you can get the job done as fast as possible, and as cheaply as possible?
Eric Brown: I think trusting in someone like Richard to champion the design concept and then going with that. I think any time you make changes to a conceptual plan, it adds costs, it adds time, and it makes it a lot more difficult. We've had some clients feel that, we put walls up, and two days later, the client will come in and say she doesn't like where that wall's going, pull it down, put it up again 200 mil[limetres] to the left of that. In theory, we're getting paid for it, so it doesn't make that much difference, but to the morale of my staff, when they've got to put so much effort and their heart into building something and making it perfect, and then ripping it down a day later because someone didn't think about it properly, and putting it up in another location, it does affect them.
Phil Tarrant: So, it's a really difficult process in many ways, because you need to realise the vision of a set of plans, and because you're a professional, you do this every day. You're able to look at a two-dimensional drawing and see it as three dimensions, but that's a skill that not many people have. I imagine a lot of business owners don't have that skill.
Eric Brown: I've got a great tip for you, and I did this with my house, I've done this with offices, generally, with my clients, is a roll of masking tape. Before we build, we'll tape it out on the floor. You tape your walls out, you tape your doors out, you can put desks. If you're doing it for your home, you can put your toilets. Everything you need or you think is going to happen in that office or in that workspace, tape it out on the floor, and then walk around it and have a look at it. I've strung stuff out in the park before because we didn't have enough space, and the client comes and looks at this space in a park, with masking tape on the grass, and the changes your make there or the information you get out of that is invaluable. It's fantastic.
Phil Tarrant: In terms of the costs associated with a fit-out, yourself would work with someone like Richard, and you'd come up with a spec and say, "This is what we can do. X is the Toyota version and Y is the Bentley version." You might be either/or, you might meet somewhere in the middle. Once that decision's made, and you get the go-ahead from a business owner or whoever is the champion internally running this process, do you guys just want to be left alone then and get it done? Or do you want input from the business owner, ongoing process? Richard what's the best way?
Richard deVries: That's a good question. Most of the input, Phil, comes at the front end, and to an extent, once we've got that information, we need to actually sit down and get it done. There's usually a couple of weeks of drawing time in a project. Everything is done on CAD [computer-aided drawing] these days. I still sketch by hand, because that's the way I think, I'm of that age where I learned to draw by hand. But we need to get that information down on paper, get it done accurately, talk about it with Eric. It's where we get unexpected cost consequences that Eric will let me know about, and I will come back to you and say, "Look, perhaps we could think about this aspect or another aspect in a different way to meet your cost expectations." It's those sort of things. We try and resolve any planning issues right at the front end, when we're still at that sketch stage, so that when we do get into formal architectural documentation, we're not having to go back and do stuff again.
Eric Brown: I think from the start, if you've got an idea of what you want to spend on the project, and you talk to your architect about that, and you say, "Look, I've got X number of dollars," fit-outs vary from $500 a square metre to $3,000 dollars a square metre. They probably get north of that, but you have to design something, I think. That's the benefit of having a designer your trust, and a good designer, is their flexibility in designing space to suit your budget, whatever that budget may be. If there's a bit of flexibility from the design perspective, everyone's happy. You're not wasting time designing $3,000 square metre fit-out when you've only got $700 dollars a square metre to spend on it.
Phil Tarrant: In terms of paying for a fit-out, how does it normally work with, say, a guy like yourself, Eric? When do you - I'm talking from a budgeting perspective as a business owner - when do you expect to be paid? After what milestones?
Eric Brown: It's usually 20 per cent up front, and then there will be a 50 per cent milestone, and then probably a 95 per cent milestone. We leave a little bit hanging at the end there, just to make sure you're happy with all the defects, and we do walk-throughs, and once that's all signed off, then that last five per cent comes through. But they're staging it. Years ago, it used to be do the job, and do it at the end. I've been caught a couple of times not getting paid, so business owners like me are getting a little bit smarter and staging our progress times to help our cash flow.
Alex Whitlock: That makes a lot of sense.
Phil Tarrant: Okay, so we're at the design phase now, and the guys are working through our plans. We thought this would be a really good case study for our listeners to join us on. We'll keep you involved as you embark on this process. Hopefully it's a nice, smooth one, I say with a smirk on my face as I look at these guys. But when we start working, we'll give you guys a bit of an insights into the type of decisions we've made from a design perspective. I think these work-out areas are probably the most important things that we could chat about.
Alex Whitlock: Maybe we can get some photographs and get another case study up, maybe.
Phil Tarrant: Yeah, absolutely. That would be really good. So let's get you back soon, as we get on this. Richard, Eric, thanks for joining us. Do appreciate it.
Eric Brown: Thanks, Phil. Thanks, Alex.
Richard deVries: Thanks, Phil. Thanks, Alex.
Phil Tarrant: Eric, how do we find you, mate?
Eric Brown: Www.qvscommercialinteriors.com.au
Phil Tarrant: Nice one. I appreciate it. Have you got pictures up and stuff of other things you've done?
Eric Brown: Yeah, plenty of photos.
Phil Tarrant: All right, nice one. Thanks again, guys. Alex, thank you.
Alex Whitlock: Cheers. Thank you.