Harnessing the Potential of Coworking

Harnessing the Potential of Coworking Coworking evolved when the home office proved to be an insufficient space for freelancers seeking collaboration with like- minded, independent people. Coworking spaces provide a productive, creative, and satisfying work atmosphere, not just for freelancers, but also for corporate organizations. Fraunhofer IAO, one of Haworth’s many research partners around the world, conducts research around new ways of working. We have summarized their findings, which reveal that coworking has great potential to fundamentally change knowledge work and catalyze innovation in the future. Harnessing the Potential of Coworking / 5.16

Coworking evolved when the home office proved to be insufficient for freelancers, who require a productive, creative, and satisfying work atmosphere. In a study about new ways of working, Fraunhofer IAO, in Stuttgart, Germany, learned that coworking has great potential to change the world of knowledge work.

Coworking is not just for freelancers and start-ups. More and more corporations have already started to realize that coworking offers great potential for fostering innovation. But, where are the roots of this potential? How can they be transferred to different types of businesses?

Haworth summarizes the findings of the Fraunhofer IAO study, The Fascination of Coworking – Potentials for Companies and Their Employees, and provides answers to some of these questions about coworking. Fraunhofer IAO plans to continue its research within this fascinating sphere of coworking, and has already developed solutions for several businesses that want to harness the potential of coworking.

Stefan Rief; Klaus-Peter Stiefel, Fraunhofer IAO

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A paradox has emerged in the past ten to fifteen These conditions created a wide range of freelancers and years. Coworking spaces seem to promote growth, corresponding work uncertainties: performance, and creativity that are unparalleled • No formal or stable boundaries in terms of employment when compared with most corporate settings. contracts, working hours, or workplaces Fraunhofer IAO responded to this paradox. Through • Declining importance of traditions to justify social practices • Greater subjectivity in the work; at the same time, the work extensive research as part of the group project requires greater subjectivity from individuals3 Office 21®, Fraunhofer IAO gathered data through semi-standardized interviews with operators of Thus, project-oriented, time-limited contracts for work and services surpassed working within a traditional office system. The coworking spaces, with coworkers (people who workplace, for some, as a furnished, thoroughly organized place of work in coworking spaces), and with representatives work had been replaced by home offices and Wi-Fi cafés. However, of companies that were experimenting with working remotely limited crucial networking opportunities for and benefiting from coworking. Fraunhofer IAO knowledge exchange. It was time for something new. recommends solutions that take advantage of coworking interfaces between the corporate world and the evolved forms of free work. Here, Haworth provides an abridged version of their findings published in The Fascination of Coworking – Potentials for Companies and their Employees (Fraunhofer IAO 2014), which covers: 1. How coworking came to be Growth of Coworking 2. The fundamental characteristics of coworking 3. How corporations can benefit from this new That “something new” happened in 1995 when C-Base opened in Berlin as one of the first hacker spaces worldwide.4 Although form of collaboration the term “coworking” did not exist at that time, C-Base was considered a “pre-stage” for coworking spaces. It embodied three key coworking features: • A collection of like-minded people with similar interests Collaboration: The Power of Coworking and values Prime Conditions for the Birth of Coworking • Emphasis on community • Space available for coworking and events The global village once predicted by Marshall McLuhan1 in the 1960s is here. Thirty years of information and communication technology fundamentally changed the way we live, work, and innovate—and it continues to change at an exponential rate. To meet this global challenge, companies need the right talent at the right time in the required quantity, quality, and composition—a task that can paralyze today’s “lean” companies due to the constraints of traditional office systems. With their infrastructure, supportive information technology, and established culture, traditional office systems—while perhaps effective at supporting business outcomes such as continuous improvement—can stifle creativity and innovation. Additionally, many knowledge workers were left adrift from outsourcing and offshoring IT service trends in the 1990s.2

1 McLuhan, M., 1962 and 1964. 4 Foertsch et al., 2013. 2 Boes et al., 2004. 3 Pohler, 2011b.

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“Coworking,” coined by Bernard DeKoven in 1999,5 was fundamentally What is more relevant than which space was the first “true” different from traditional corporations where work was cordoned coworking space is the fact that these such spaces emerged at off in hierarchical structures and under constant observation different locations worldwide, independent of one another. All of and assessment—conditions that led to competition rather than which focused primarily on the collaboration of like-minded, collaboration. The core concept of “coworking” was working together independent people working in mutually beneficial ways— as equals, and in the following years, a variety of coworking spaces the foundation of a successful coworking model. opened their doors.

COWORKING TIMELINE

2006 “Jellies” – loosely organized “working events” Hat Factory, San Francisco 2006 A few people meet occasionally for work at a certain Possibly the rst space oering full-time working options location (such as a café, a private space, or an oce). using the description “coworking,” also by Brad Neuberg.7

Community O ce Space for Writers & Programmers, 2005 San Francisco The Hub, London 2005 The rst space to actually carry the title “Coworking Opens its space as the “factory of opportunities” Space” in Spiral Muse, by Brad Neuberg; however, as a “community of companies.” 6 work can only be performed here two days a week.

2002 Screw Factory, Vienna

Small market research agency rents out surplus space (desks) in a factory converted into an oce. 42 West 42, New York 1999

Flexible desks, freelancers cooperating with coworking space at parent company Boyle Software. 1995 C-Base, Berlin

One of the rst hacker spaces worldwide; considered a “pre-stage” for coworking spaces.

GROWTH OF COWORKING SPACES Thus, coworking spaces doubled every year since 2006 as reported 4500 by Deskmag.8 Every workday, the number of coworking spaces grew, 4000 on average, by 4.5 spaces. In 2012, there were 200,000 coworkers 3500 worldwide and every workday the figure increases, on average, by 3000 245—which corresponds to a conservative estimate of an annual 2500 growth of 50,000 people.9 2000 1500 1000 500 0 2006 2007 2008 2009 2010 2011 2012 2013 (Foertsch, 2013a)

5 Foertsch et al., 2013. 8 Linsay, 2013. 6 Foertsch et al., 2013. 9 Foertsch, 2013a. 7 Foertsch, 2013b.

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Stabilization of Coworking Coworking: A Working Definition print services, lounge and kitchen for eating and socializing, formal meeting Despite this growth, The Hub in Brussels, The unbelievably wide range of different rooms for clients, and event venues. Citizen Space in San Francisco, and coworking spaces that exist today makes Additional services can include providing Betahaus Cologne in Germany—just defining coworking a challenge.13 However, work tools, such as monitors and to mention a few—had to close their the breadth of coworking spaces can be keyboards, lock boxes, a physical mailing doors. Potential reasons for failed described with the following attributes: address, 24/7 access, telephone (landline) coworking spaces include the mismatch • Size – Varies wildly from rooms and floors services, etc. of lease periods, thin capital base,10 to buildings or coworking associations • Ambience – There are coworking unfavorable location in terms of balancing (e.g., Instant Hub). spaces that resemble student spaces; cost-effectiveness and convenience, • Informal cooperation – There are others are more stylish; and yet others incompatible personalities and needs coworking space “chains” such as The appeal more to business professionals. between space operators and coworkers, Hub, and there are independent spaces While initially most coworking spaces and misaligned space with business models. that are loosely connected (usually within attach importance to cost-effectiveness Coworking spaces that claim to establish the same city) via cooperation, such as (resulting in rather dull spaces), as they and develop a “community” need to be of a Coworking Visa, CoPass, or LEXC.14 grow their ambience improves. certain minimum size; according to one of • Motivation of operators (profit oriented, the Fraunhofer IAO interviewees, coworking nonprofit oriented, and city development) Keeping in mind the above variations, spaces are usually only profitable from – There are spaces whose operators gain coworking hinges on community with the 1,000 sq. m (approx. 10,800 sq. ft.).11 profit (although not very high profits following key attributes: to date), and there are owners of small • Common infrastructure shared among companies who rent larger floor space coworkers “The workplace of tomorrow, than they need and sublet the extra • Independence of coworkers from one workspaces. (The income usually covers another where the best and brightest or partially cover the company’s own • Mutual benefits resulting from rental costs.) In some cities, such as Paris, of the digital generation will cooperation among coworkers coworking spaces can now even receive aspire to work, will look more public subsidies as part of the promotion of local trade and industry.15 Thus, coworking can be like coworking spaces rather • User structure – On the organizational level, users can be freelancers, the defined as “the flexible than today’s corporate offices.” space operators themselves (as “anchor entrepreneurs”), and company employees. working of knowledge - Andrew M. Jones, 2013 On the professional level, some spaces focus largely on just one specialty field workers largely independent (such as software developers), while others While the growth rate in excess of 80 percent are completely open to the professional of each other at a common, will most likely decline in the coming years, mix of varied expertise. institutionalized location. In a significant increase in the number of • Occurrence in cities of different sizes – coworkers and coworking spaces will likely Coworking spaces exist in cities with a 12 that respect, the hierarchy- continue. According to Deskmag, there are wide variety of sizes. While most spaces five reasons coworking is here to stay: (48 percent) exist in large cities with more free social network facilitates than one million residents, seven percent 1. Coworking spaces usually invest their of coworking spaces are in cities with wide-ranging cooperation own money. fewer than 20,000 residents.16 Coworking 17 2. The labor market constantly changes could be an excellent instrument in the benefits for the participants.” the demand on certain office types. future to significantly enhance the value - Fraunhofer IAO 3. Coworking spaces don’t thrive on of rural areas. market crises. • Services provided (extended professional 4. Coworking spaces adjust to the needs and social services) – While providing Flexibility and freedom are keywords of its members. workspaces and internet access are here, as coworkers work where they 5. The coworking market is far from saturated. common denominators for all coworking want to, as long as they want to, and, spaces, the rest of the services vary greatly. ultimately, how they want to—without Basic services include providing phone a major commitment. booths for private conversations, basic

10 Foertsch, 2011. 13 Schurmann, 2013; Pohler, 2011a; Buczynski, 2012. 16 Cashman et al., 2012. 11 Fraunhofer IAO, 2014. 14 Ng, 2013. 17 Fraunhofer IAO, 2014. 12 Deskmag, 2013. 15 Cagnol, 2013b.

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The Five Core Coworking Values The Nature of Coworking To best facilitate coworking, the coworking movement cites five basic values, initially Freelancers typically work from home formulated in Citizen Space—one of the first coworking spaces in the US:18 for a lengthy period of time, essentially eliminating the boundaries of work and private life.20 Such loss of boundaries can lead to excessive working hours, distractions, conflicts in private life, and constant tension.21 Additionally, without community, spatial and social isolation arises. Being alone not only has a negative effect on the psychological state,22 it also has a detrimental effect on professional performance.23

After a certain period of time, freelancers can find themselves without professional and social security.24 This lack of security forces many freelancers to look for alternatives with more certainty— conditions ripe for coworking.

“I think a lot more people Openness Sustainability are going to get into this Also includes open-mindedness and a All three pillars should be supported: fundamental interest in others, respectfully economic (sharing building and [coworking] as time goes dealing with coworkers and the willingness infrastructure); ecological (using fewer to share with them. resources, as workspaces, printers, meeting on. People are free to work rooms, and amenities are all shared); social Collaboration (equal opportunities and the option to from home and are free to participate applies). In the broadest sense, it describes the not have to go into an office. fundamental willingness of the coworkers Accessibility to work together and to help each another.19 People work from home and Defined by the financial and geographical Community accessibility of the coworking spaces, i.e., then realize how much it affordable for everyone and located in an An atmosphere characterized by trust; it is area well served by public transportation. sucks, so they want to see the social bond that motivates coworkers to help and support others. what else is out there. I think These five core values are evident across various coworking initiatives, as illustrated in the a coworking spot is really Global Coworking Manifesto’s Code of Conduct. Understanding the rise of coworking and how to appropriately define it, Fraunhofer IAO research reveals the nature of coworking as the best of all worlds.” 25 well as how corporations can harness the potential of coworking spaces. - Kevin Scott, 2011

Global Coworking Manifesto’s Code of Conduct: Although coworking spaces can vary widely • Collaboration over competition • Boldness over assurance to appeal to a broad spectrum of workers, • Community over agendas • Learning over expertise there are three common components • Participation over observation • People over personalities across all coworking spaces: • Doing over saying • Value ecosystem over value chain • Structure • Friendship over formality • Community • Independence - The Coworking Wiki, 2015

18 Hillman, 2011. 21 Jurgens et al., 2007. 24 Pohler, 2012. 19 Schurmann, 2013. 22 Rajaratnam et al., 2008. 25 DeGuzman et al., 2011. 20 Kempf, 2013. 23 DeGuzman, 2011.

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Structure idea creation and collaboration occur in large coworking spaces no less than 67 in the coworking space. In coworking percent of the members know the first Coworking spaces provide a framework that is spaces, people work independently, names of most of the other coworkers, physical on one hand and social on the other. together; with less hierarchy, workers and 83 percent are comfortable leaving are accountable for their own projects, personal items such as laptops and • Physical Structure progress, and working method. These phones at the workplace.32 Although Space and infrastructure form the conditions prevent “social idleness” shared values can differ across coworking physical framework. The aspect of an and “free-riding,” counter-productive groups, having shared values within a external space (i.e., outside of the home behaviors found in group processes coworking group increases trust among office) facilitates a spatial separation in which responsibility is too diffused the members. This is how coworking between work and leisure. This physical among members and processes lack spaces become reservoirs of like-minded separation also creates a mental transparency. people to meet, implement their shared separation and prevents potential values, collaborate, and innovate. conflicts, minimizes distractions, and Community promotes motivation. Besides space, infrastructure—internet access, printers, Community is built on this physical and “If one imagines these meeting rooms, and services, such as social structure. In coworking spaces maintenance, cleaning, and purchases— members know, support, and trust people who collaborate is also shared in coworking spaces. With one another. There is a user-oriented fewer physical structure requirements for dimension and a social dimension in such with co-strategies and a the individual, more resources are freed communities. A professional network and up for work itself. collaboration built on trust and shared ‘sharing economy,’ it is values within the user-oriented dimension • Social Structure affect productivity. The social dimension almost a matter of course Coworking spaces also help alleviate consists of indirect effects on productivity, that a wide range of type of social isolation, creating a social such as well-being. framework for work life. Human collaboration emerges, and interaction is important to thriving; the • User-Oriented Dimension Hawthorne experiments in the 1920s The user-oriented processes people that such collaboration will proved it.26 Social factors have a strong experience in coworking communities influence on work performance beyond consist of networking and collaboration. bear fruit.” the objective working conditions. These The professional network is the experiments revealed that workers who precondition for coworking. The revolving - Fraunhofer IAO were observed and received attention nature of membership in a coworking 27 network provides fresh insights, from third parties performed better. Furthermore, diverse ideas from a knowledge, and access to subject matter Although working conditions have coworking network of highly trusted experts that lead to projects, products, changed as a result of technological and coworking colleagues maximize the and even markets for products and economic developments, human nature advantages of collaboration, and services. Freelance coworkers report that has remained stable. provide opportunity for knowledge their business relations have expanded transfer and needs-based learning.33 by as much as 80 percent as a result In coworking spaces, the presence For the same reason, coworking spaces of working in a coworking space30 of others—known as the “colleague and lower the risks in vulnerable phases of effect”—has a positive effect on most likely contributed to the increased start-ups and support the transition 28 motivation and performance. Coworkers productivity and income cited previously. from moving an idea to fruition in a themselves also report a productivity small company. Therefore, coworking increase of 75 percent and an income Fundamentally, these networks are spaces act as catalysts for start-ups in increase of 38 percent since working in collaborative and characterized by trust which ideas are born, skills are grouped 29 a coworking space. These increases and shared values. Trust—“a willingness together, contacts are established, and most likely are due to a combination of to put oneself at risk based on another 31 infrastructure is made available. Start-up working at home, working in a coworking individual’s actions” —is built on shared growth opportunities improve compared space, and the lack of hierarchy in personal knowledge of fellow coworkers, to development without the institution and collaboration requires individuals collaborative, coworking efforts. of coworking spaces.34 Concentrated, focus work can occur in to be situated in a stable, trustworthy the calm seclusion of a home office while relationship. To illustrate this level of trust,

26 Mayo, 1949. 29 Foertsch et al., 2012. 32 Foertsch et al, 2012. 27 Nerdinger at al., 2011. 30 Foertsch et al., 2012. 33 Alves et al, 2007. 28 Sprenger, 2013; Mas et al., 2009; Falk et al., 2006. 31 Atkins, 2013. 34 Schurmann, 2013.

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• Social Dimension Creating a culture of Coworking spaces provide an The quality of a community has an overall opportunity for people to enjoy the effect on the well-being of coworking community and maintaining increasing freedom without losing all individuals, which in turn influences the security and suffering negative performance. However, work no longer is such is no easy task, but it is consequences. First, the work in just about performance and its associated coworking spaces is self-determined. stress. A fundamentally new interpretation absolutely essential for the This means that the location and time of work has developed among the highly of work, as well as the work itself, can educated and younger generations. These success of a coworking space. be determined flexibly at any time by workers seek work that is pleasurable the individual. Then, the workplace and that makes sense. Enjoying going to and the community in the coworking work, meeting people, and exchanging However, it is no easy task to establish space can be organized. Coworking ideas are becoming the basic values and maintain such a community. One spaces are geared towards the needs of around which the most time-intensive critical factor is the initial group of people their members, and thus draw in new activity of our current society revolves. who establish the culture at a new members with similar interests. Finally, It improves work morale, and a pleasant, coworking space. Once a community has the work in coworking spaces satisfies productive atmosphere abounds. Since formed and defined itself, self-selection the requirements of an individual and social cohesion and social interaction are regulates the new arrivals in a way that self-determined worker. naturally intrinsic rewards for people, the the culture is slow to change. existence of a community can raise the Coworking spaces meet the changing general well-being of workers.35 • Freedom and Independence values in the workforce. As more people If work were absolutely free, it would with ever differing values, technology, mean that one could decide: and work requirements seek workplaces, coworking spaces are poised to meet • When to work those needs—and corporations are • Where to work paying attention. • How much to work • With whom to work • For whom to work • What one does as work Coworking spaces establish an

almost impossible compatibility While freedom in relation to work is almost always relative, a certain level of of opposites: freedom already exists today in our work, • Security within insecurity Additionally, a common spirit exists in even at traditional companies. Freedom is becoming more and more important for • Consistency in variation coworking spaces, where work is lived • Commitment in non- unconventionally and “un-corporate.”36 employees who desire self-determined and meaningful work that aligns with commitment In a time when a) flexibility leads to • Individuality in collective individualization; b) hierarchies are their individual goals. For freelancers, ultimate freedom also means that one is activity becoming flatter and cease to exist for • Loyalty in rivalry freelancers; and c) workers become alone. One needs to deal with everyday uncertainties at work alone and manage • Intimacy in anonymity self-reliant, coworking spaces are ideal • Familiarity in the unknown communities characterized by trust the anxiety of failing without support. that create a sense of security. Instead In this respect, the opposite of “freedom - The Coworking Wiki, 2015 of isolation where everybody only dies with security” becomes true. A looks out for themselves, a new sense high level of freedom proportionately of security in the community emerges. reduces existing security. Freedom also The feeling of being able to fall back creates constraints such as self-control, on the competence of an entire group self-discipline, self-incrimination, and whenever needed has a calming effect. self-exploitation, all of which create stress It appears that people have a strong for freelancers. Moreover, freedom can yearning for such a close community. A overwhelm employees and can lead to “we time” appears to be dawning, but a reduction in performance. Thus, an under no circumstances is it a step back appropriate introduction of coworking is to traditional, controlling structures. necessary, involving cultural change and building a culture of trust.

35 Chang, 2013. 36 Bender, 2013.

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Corporate Coworking Numerous forms of coworking-like these people only have positive organizational and work approaches experiences. Those who opt out lack the “The primary reason for ‘corporate are being implemented by companies, information of coworking benefits and coworking’ is to generate and test small and large. What follows are eight think coworking spaces are noisy, open new ideas.” current corporate coworking approaches, workplaces and they’ll lose privileges - Dr. John Sullivan, 2013 possible caveats to corporate coworking, such as a dedicated workspace, free and four potential future corporate coffee, a subsidized corporate cafeteria, It is no longer rare that companies are coworking approaches. etc. A potential pitfall of renting occurs engaged in coworking, taking advantage when the cultural difference between the of coworking interfaces between the Current Approaches company and coworking space make it corporate world and the evolved forms more difficult to successfully implement of free work. In 2012, six percent of all Sub-leasing the coworking potentials for the company. coworkers were employees of large 37 In such arrangements, companies rent out companies (more than 100 workers). Operating Coworking Spaces External workplaces to external parties. Potential to the Company motives for companies include: rental …Gilbreath explains, “I think revenue, vacant space due to fluctuations in Some companies open their own employee numbers, contact with innovative coworking-like spaces as powerhouses of you’re gonna see the blurring freelancers and start-ups, possible subject ideas to tap into freelancer networks, fresh matter expert hires, and acquiring new and talent, and collaboration opportunities with of the lines of workplace. maintaining existing customers. start-ups. Such arrangements can lead to hotspots where companies and freelancers Whether you’re a freelancer Offsite Meetings come together and jointly start projects. Innovation done at the periphery is easier Some companies occasionally organize or a corporate employee, to transfer to the company, because their offsite meetings at a coworking space. individuals who work at coworking spaces workplace is wherever I While this can be expensive, motives include are in a weaker relation to the company inspiring environments for employee and suffer less from the consequences of am. It’s not just explicitly meetings or targeted workshops involving failure than employees firmly anchored in local coworkers to speed up innovation and, the company.39 If risk is outsourced, more my company’s office, it’s rarely, acquiring new personnel. independent thought is promoted. In the wherever I am as a consumer. end, the company’s weaker links to the Renting periphery bring new ideas to the company. Coworking as a principle just In this scenario, companies rent workplaces It is precisely this type of relationship found at coworking spaces. Motivators for such in coworking spaces and part of the reason means a vibrant environment arrangements can include: why, for example, Google operates an where space sharing is part • Saving costs (coworking spaces are usually attached coworking space. very affordable) of the concept. And there’s • Flexibility (rent is on a monthly basis; it is Haworth also operates a space in Sydney also a great way to establish a first office in called The Porter, which is a fully hosted rich interaction when people a new country) and managed business lounge designed to • Added value for employees (particularly facilitate quality meetings, collaboration, want it and there’s privacy to teleworkers or to those with long and workshops. It provides its members commutes) with unique access to shared spaces and when they need it. And I think • Tapping into a new talent pool amenities within a large building. While you’ll see...those principles will • Potential to increase employees’ creativity membership is open for anyone, it is (by being in a different work culture and expected that the majority of memberships invade workplaces, wherever environment) will soon be held by building tenants, including the University of New South they exist…” Typically, these are on a trial basis, initiated Wales. The space is equipped with more often by individual management Haworth’s new furniture models, which - as cited in Blackstock, 2013 than supported and implemented by a are tested there for day-to-day use and broad corporate strategy. Usually it is on are reconfigured several times a year to a voluntary participation basis, and while accommodate changing needs. Haworth It is clear that the traditional office the percentage of people who actually do also uses the space to gain experience with environment in its current form is not participate is still low (three percent),38 coworking and “future of work” in general. the only solution for future workplaces.

37 Foertsch, 2012. 38 Fraunhofer IAO, 2014. 39 Klambauer, 2006.

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Coworking-Like Features In-House meeting rooms, forcing people to utilize the that operate in this scenario contain both open-space cafeteria for staff meetings. features. An example is Telekom Innovation Companies focusing on improving Laboratories (T-Labs) in Berlin. Established in their innovative capabilities introduce Sponsoring 2004 as a central research and development coworking-like features internally. Basic institute of Deutsche Telekom, its objective preconditions are: 1) spatial structures It is not uncommon for coworking spaces is to develop innovative IT products and of openness that enable serendipitous to be sponsored financially, usually by solutions, with activities geared towards encounters and informal communication; large companies. The TechHub in London founding start-ups. 2) project-oriented, temporary collaborations; is an example—a coworking space for and 3) increased levels of freedom, such as technical entrepreneurs within the Google Zappos (acquired by Amazon in 2009) flexible working hours and work teams. Campus. (Other sponsors besides Google invested $350 million for the city Benefits include: are Telefonica Initiative BlueVia, Blackberry, development in downtown Las Vegas, • Places to withdraw from disruptions. and BT.) of which $50 million was spent on • Coworking with people from various “Vegastechfund,” a fund for innovative, business units and valuable insights to The benefits for sponsoring companies community oriented technology start- how the organization as a whole works. include the opportunity to participate in ups. The city is described as the “world’s • An excellent way for knowledge transfer interesting innovations and being very most community-focused major city” within the organization, which otherwise closely aligned with innovative start-ups, as and the “world’s coworking capital can be difficult. well as various marketing opportunities. city.” Instead of a short-term return on investment, maximizing the long-term Under the “Future of Work Program” Incubator and Accelerator Programs “return on community” is envisioned. at Capital One, a spectrum of different Companies can partner with start-ups workplace types was created that support to develop ideas and products, increase 40 Alternative to Home Office the following four postulated work modes: innovation, and perhaps reduce development time and/or costs. Coworking spaces can, by At companies like IBM, where a large their nature, support such models. proportion of employees no longer have an office provided by the company and work from home, employees choose to FOCUS COLLABORATE While incubator programs support individuals and groups involved in start-ups, accelerator rent coworking spaces, in part even at concentrated collaborating their own cost.42 People are social beings individual work with others programs help start-ups achieve quicker development, usually via coaching during a and, to a certain extent, require social certain period. In both cases, there is targeted contacts, discussions, and exchanges. support from companies, in hopes of gaining The loneliness for people working from access for knowledge, ideas, and innovations. home can be alleviated by commuting SOCIALIZE LEARN The main differences are: to a coworking space. In the future, companies will likely take a more active maintaining acquiring new • Incubators are normally considered relations, bonds, knowledge significantly more generous in terms of role in offering this opportunity for their and values and skills the timeframe; the interest is on a lasting employees (and also paying for it). Benefits collaboration between the start-up and include: the company. It is also not uncommon to • An opportunity to escape home office see companies investing in the start-ups isolation. Giving employees the choice of where and via capital contributions. • Savings in commuting times and costs how to work makes them more effective, and • By contrast, accelerator programs involve (also more sustainable). 41 flexibility also makes employees happier. support for a very limited and specific • The opportunity to maintain and period of time—frequently just three to enhance local community networks. Similarly, in 2011, SAP AG established six months. However, during this period, • An increased level of freedom in relation the SAP Innovation Center in Potsdam, the start-ups undergo intensive coaching. to the work, having a positive effect on Germany, in an attempt to boost The objective frequently consists of motivation, creativity, and performance. innovation. Their coworking-like space is developing innovative products that can • Attraction and retention of talent geared towards supporting project work subsequently be acquired or licensed by (qualified employees who do not want and creativity for flexible teams. All desks the companies. to give up their place of residence, are on casters and can be moved anywhere or want to move freely to a different and plugged in to the power and internet In practicality, operating coworking spaces location, can be recruited or retained). connections that are supported with a for incubators or accelerators is difficult, raised floor. Communication is supported however, to make a clear distinction by a deliberate reduction in the number of between the two. Most coworking spaces

40 Gensler, 2009. 41 Jones, 2013. 42 Jones, 2013.

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Future Approaches Coworking for Professional Training In Summary Coworking can offer high potential for As the previous scenarios illustrate, companies Numerous variations of coworking spaces training, and its positive effects still are are already implementing and benefiting already exist, in terms of size, quality, largely underestimated. Employees can from the concept of coworking. In the future, management, culture, and other attributes. spend a period of time in a coworking such arrangements are likely to expand. Both the number of coworking spaces and space with professionals from similar fields. The following arrangements seem to have their variety will most likely continue to Such arrangements can also be a welcome a particularly promising future. grow in the near future. change from the conventional daily routine, and a more informal way to extend one’s Coworking as a Sabbatical Coworking is in a position to fundamentally knowledge by exchanging ideas with change knowledge work. Freedom, An interesting trend nowadays is that likeminded individuals. It may also provide independence, structure, and community— coworking spaces are already available at a lower cost alternative for companies than this combination of attributes, which attractive holiday destinations, linking work providing in-house training. to date are almost exclusively realized and leisure in a unique way. Such a model can simultaneously by coworking alone, be well suited for project work that calls for a Coworking in an Association of is becoming attractive to knowledge high level of creativity. If the space combines Enterprises workers. More and more companies will be coworking with specific leisure activities, the In this model, different companies operate adopting coworking-like arrangements, as coworking effect can be intensified. a coworking space jointly and make it an opportunity to tap into fresh talent, and available to their employees in order to retain employees. conduct joint developments or projects that require constant collaboration. This type of Coworking can provide huge opportunities arrangement could move beyond the initial for employees, too. While they can continue goals due to the community of trust, yielding to enjoy corporate advantages, such as the information exchange, future collaborative relative job security, structure, and career projects, and strengthened partnerships. options, employees can also enjoy the opportunities arising from coworking, such Companies in the future may offer their Booking Start-ups to Develop Ideas and as developing new communities, expanding employees the option of partial sabbaticals— Products knowledge and networks, and increasing working part time on a temporary basis work-related levels of freedom. Potentially at such destinations, while on sabbatical Companies frequently engage or incorporate “commuting” between these two worlds or on vacation. While it might be hard to with start-ups to develop specific ideas and gives knowledge workers a very good separate work and holiday, and it is certainly products. The more innovative the company opportunity to integrate work and life. not for everyone, some might benefit from wants to get, the more the qualities of such arrangements as they can take longer coworking apply. By using coworking vacations while still keeping in touch with spaces as institutionalized contact centers, colleagues. This could also be a reward for companies can cooperate with start-ups past outstanding results, with positive effects to bring specific levels of creativity to the on employee creativity and performance. innovation process via freelance experts.

Potential Caveats of Current Corporate Coworking Some drawbacks of the above arrangements include: • Security conflicts: Since openness is one of the basic values of coworking, it’s all about sharing and the free exchange of information. On the other hand, corporations are extremely competitive and information security is important to them. This creates a potential conflict when implementing coworking-like concepts. • Lack of organizational freedom: Hierarchy-free coworking spaces are not being realized by a long margin at companies; they are probably not even considered. • Deciding on which employees are suitable for coworking: The selection should involve considering work tasks, equipment needed, and personal characteristics around self-initiative and responsibility. • Managing corporate culture: When employees are remote, corporate culture can be more difficult to build, maintain, and strengthen. But people at coworking spaces usually create a unique culture, completely different from their company.

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Agnes Weiss Bauer, Wilhelm, S Rief, K.P. Stiefel, A. Weiß., eds. Faszination Coworking. Potenziale für Unternehmen und ihre Mitarbeiter. Fraunhofer IAO helps companies and institutions introduce new (The Fascination of Coworking. Potentials for Companies and business models and efficient processes to make their businesses more their Employees.) Stuttgart: Fraunhofer IAO, 2014. successful. With our in-depth knowledge of organizational structures and technologies, we have the skills you need to put applied research Bender, D. “Mobile Arbeitsplatze als creative Raume. Coworking into practice. We participate in international networks, investigating Spaces, Cafés und andere urbane Arbeitsorte.“ Aufl. Bielefeld: and shaping the frontline themes that are most relevant to the future of transcript Materialitaten, 20 (2013). Germany as a business location. Our goal is to systematically optimize the ways in which people, organizations, and technology interact. Blackstock, J. Coworking Spaces… Run by Corporations. deskmag.com, 2013.

Editors Boes, A. and Schwemmle, M. Herausforderung Offshoring. Internationalisierung und Auslagerung von IT-Dienstleistungen. Dr. Gabor Nagy holds a Ph.D. in Architectural Dusseldorf, Germany, 2004. Engineering with an emphasis on workplace performance. As Haworth’s Research Program Buczynski, B. “Why You’ll Never Find Coworking in the Dictionary.” Manager in San Francisco, he is responsible for shareable.net. 2004. applied research on corporate culture, workstyle, and workplace performance, and provides advisory Cagnol, R. Public Support of Coworking Spaces: The Example of France. services to clients. Gabor’s passion in the last several deskmag.com, 2013. years has focused on the interdisciplinary field of Organizational Network Analysis (ONA) where he Cashman, A., Dullroy, J. and Foertsch, C. Coworking Survey Booklet. has used wearable technology and big data to Hg. v. Deskmag. Berlin, 2012. map informal organizational and value networks, for the benefit of increasing performance at client Chang, A. “Increase Your Happiness by Coworking.” herahub.com. organizations. 2013.

Beck Johnson holds a B.S. in Scientific and Technical DeGuzman, G. “Home Office, Coffee Shop, or Coworking Space? Communication and an M.A. in Communication. A Comparison.” deskmag.com, 2011. With 14 years of experience in social science research methodologies and as a Research Specialist at Haworth DeGuzman, G., Tang, A. and McKellar, C. Working in the “Unoffice.” she conducts primary and secondary research A guide to coworking for indie workers, small businesses, and addressing workplace issues— creating knowledge nonprofits. San Francisco: Night Owls Press, 2011. insights to support Haworth’s vision as industry knowledge leader. Her goal is to build knowledge of Deskmag. Is there a Coworking Bubble? Nope, Coworking Spaces leading workplace issues and related social science Grow Organically. http://www.deskmag.com/en/is-there-a-bubble- and provide credible communication to clients and of-coworking-spaces-601, accessed 2013. their teams at various stages of the design process. Erwin, J. “Creative Co-Working Culture – Betahaus Berlin.” YouTube.com. 2013.

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