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June 29, 2017

Is an Office Still Necessary?

In a decision that surprised everyone in the industry, Automattic, the company behind WordPress, announced that it is closing its San Francisco office. The company chose to allow its employees to work remotely, whether it is from home or any other location. The decision was made because many of the company’s employees were already working remotely.

The decision by Automattic CEO Matt Mullenweg raised a question regarding whether a beautiful, superbly-equipped office is still needed. Experts weigh in on the matter.

A Distributed Company

Automattic should be regarded as a special case. Since it went public and earned its $1 billion valuation, Automattic has always been a fully distributed company. It has more than 550 employees working on services like WordPress.com and the blogging platform, WordPress, but only around 30 members of that large team actually live in San Francisco.

It is also worth noting that the company is perfectly set up for remote working from the start. Mullenweg is known to hire people without even meeting them. Interviews are conducted via chat or video conference. The same can be said for internal meetings and team communications.

Automattic also provides employees with the ability to travel anywhere in the world whenever the in-person time is needed. Teams can get together anywhere to work on a more serious, more hands-on projects that need to be handled in person. This practically eliminates the need for a fixed office, although the company still decided to move to a 14,250-square-foot office that it will be closing soon.

The Need for an Office

For the majority of businesses and startups, an office is still a necessity and not an option. Over 80% of businesses have their operations run and maintained from a fixed office, even with employees still having that ability to work remotely.

The office also serves a number of other functions. Documents and assets are usually stored in the office for better safekeeping and management. The available meeting rooms and other facilities are provided to allow better teamwork and more fluid operations on a day-to-day basis.

There is also the need of the clients. Automattic is a tech company that doesn’t deal with customers in person. For many other startups and businesses, this is certainly not the case. A physical address and a representative office still provide a competitive edge.

Business Hubs

One other reason why experts believe that investing in an office is still necessary is the presence of business hubs around the world. In London, for example, there are certain areas where top companies set up their offices. You can easily build better relationships by looking for available office space in Shoreditch and there are companies like The Workplace Company to help you establish a suitable office for your growing business.

Even the more traditional tech companies such as Google and Amazon are relying on their well-equipped offices to provide employees with the perfect working environment for maximum creativity and productivity. Is an office still necessary? In most cases, the answer to this question is a big YES.

The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters.

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