Relocation Relocation Relocation: Driving benefits from an office move

Moving or opening a new office is a challenge which all organisations will likely face at some stage. Cost pressure, globalisation and shifting demographics have caused financial services firms to increasingly review their location strategy. BCS is now seeing demand for experienced project and change management practitioners to deliver such projects, ensuring they are run effectively and efficiently. For complex financial services institutions, moving office must start with a critical understanding of its key drivers in order to be successful; including financial, strategic, technological, risk, and cultural motivations. Without this, challenges with the location, design, cost, vendors and staffing will become evident in future.

Key Drivers for a Successful Relocation/Opening

Financial and Strategic Drivers

The fundamental question which must be addressed at the outset is whether operational cost saving is a driver for the organisation. Moving office will require significant capital expenditure to deliver and will impact future budgets[1]. Although it won’t be possible to develop a detailed business case at the very beginning of the project, agreement on projected operating costs such as rent per square foot, and estimated cost of delivery per square foot, will allow the project to begin shortlisting appropriate locations and engaging agents to identify potential offices. Some organisations may want to go further at this stage and agree cost allocation per business unit based on their estimated occupancy levels, however this is unlikely to inform critical decisions around the office location and size.

Additionally, it is vital to establish from the outset the organisation’s strategic drivers. What is the long-term business strategy and how does it impact selection of a new office location? Macro-economic, technological, social and political forces, such as the changing nature of the high street branch, how customers access bank services, and the rise of living costs in previously competitive regions, are just a few important strategic considerations. Our view is that for financial services organisations the primary strategic drivers which inform relocation planning are proximity to clients and proximity to the appropriate talent pool. Once understood, the geographical location of the future office can be agreed.

Technology Drivers

Any organisation should ensure it is equipped with a clearly defined technology strategy, IT standards and security protocols before initiating a relocation/opening project. Office moves are often seen as an ideal opportunity to renovate the technology stack and realise an organisation’s long-term IT strategy. However, such an approach should be taken with caution. The introduction of wholesale upgrades to back-end IT infrastructure, workstations and data storage adds significant risk and complexity at a time of change and instability. In our experience, technology leads should avoid piggybacking off relocation projects to implement fundamental IT infrastructure change and should instead focus delivering on less business-critical systems which can still underpin cultural enhancements.

Risk Drivers

Having appropriate physical and IT infrastructure in place, for any financial services institution, is fundamental to successfully managing risk and maintaining regulatory compliance. An office relocation will have a fundamental impact on the organisation’s operational risk in the form of business continuity planning, operational resilience, and threat assessment. It’s vital that a comprehensive assessment of operational risk be conducted as part of the project to identify whether additional controls are needed, or whether the design and implementation of existing controls should be enhanced. During the design phase of the project, regulatory compliance considerations must be accounted for in relation to information barriers and the construction of physical Chinese walls. This is closely linked to the business strategy and could be affected by business plans to issue new products and services which would require segregation of teams and information.

Cultural Drivers

Any relocation offers a golden opportunity to drive a new corporate culture by re-establishing the organisation and its people in an entirely new context. At an early stage it is essential that project sponsors outline the cultural priorities of the organisation which it wants to cultivate in the future.  This will allow the project to select and design an office and implement processes and systems which empower these cultural priorities. This could include selecting a BREEAM[2] certified building, implementing green-inspired processes to minimise waste and maximise recycling, implementing chemical-free cleaning methods, establishing shared work spaces and providing enhanced remote working capability. BCS have also helped clients to understand their cultural priorities by engaging staff directly through working groups and appointing ‘move champions’ or ‘pioneers’. These staff members can shed light on the priorities of each team and business unit, and can take an active role in fostering cultural changes across the organisation. These priorities can then be fed into the future office’s design, shaping it around the community it will house in the future.

Project Delivery

Clear, critical understanding of the above drivers, although vital, will not result in a successful relocation or opening project in isolation. From the outset, introducing core project management standards are essential in ensuring the foundations are laid for a successful relocation/opening. By driving clear scope definition in a Project Initiation Document, agreeing the project’s approach and by establishing a written Business Case, it is possible to provide clarity of cost, timeline, staffing, vendor management and benefits realisation early in the project lifecycle. Properly reviewing lessons learned from previous projects, and logging lessons learned as the project progresses, must not be overlooked and can provide valuable insights from an early stage.

Ongoing use of disciplined project management controls in the form of RAIDD[3] management, project planning and cost management, give stakeholders ongoing insight into progress and status. Adopting project phasing ensures controlled transition from the project’s conception through to requirements gathering, design, build, relocation/opening, post-relocation/opening support, transition to BAU and project closure. Vendor management during an office relocation/opening is critical to its success given the value of the contracts and the number of vendor relationships. Through successful vendor management BCS has seen significant benefits delivered in terms of delivery cost, quality, timelines and management of external dependencies.

­­­­­Finally, appropriate business readiness planning, a clear communication strategy, effective management of the handover process into BAU and the provision of post-implementation support, minimise disruption to ongoing operations and the client. These often-forgotten aspects of the project delivery lifecycle are particularly important to delivering a successful relocation given its impact on every staff member and will also be relevant and critical when opening a new location.

Conclusion

By shaping the project around a set of key drivers from the outset and adopting clear and rigorous project management standards, BCS has delivered highly successful relocation and location opening projects for our clients. A close partnership with our clients enables us to take responsibility for end to end project delivery, ultimately removing pressure from BAU functions so they can focus on their day to day service delivery. It’s easy to see an office relocation/opening as just a facilities problem but adopting the above approach will secure the delivery of both a comprehensive and successful long-term solution.

Please get in touch if you would like to discuss potential options to meet the changing needs of your organisation.

[1] It will not be possible to capitalise all project delivery costs, so inevitably some will need to be treated as OPEX.

[2] A sustainability assessment used in construction

[3] Risks, assumptions, issues, decisions and dependencies