Where we work has always been a key factor in determining where we live. During the earliest days of human existence we followed the herd and the seasons because we hadn’t mastered agriculture. Agricultural societies made possible the growth of towns and cities, and the complex societies we call civilisations. So, too, the factory made possible the modern city of the industrial era. We have up until very recently had to live where we worked. Even when industries became globalised, we still travelled to the locations where we did business. Other than limited forms of communication, there was little choice.

Where we work has always defined where we go and, more importantly, where we live. But what happens when the output of the work, and the person doing it, can be separated and they no longer have to be in the same place? What happens when we don’t have to be near the factors of production in order to organise them? What happens is we see people making personal choices about their preferred place of work and abode. The choice is no longer an economic imperative. It’s no longer a choice designed by the owners of capital because we all own the capital now. It is distributed and accessible to all and that changes the physical landscape. It changes the distribution patterns of people themselves. In this sense, location follows technology. Human locations are a function of technology of the day and technological mobility.

From the city, to the suburbs, to wherever

Most of the industrial-era technology was big, expensive and fixed in single locations. This meant these facilities had to be built in central locations and it also meant we had to move to these locations if we wanted to participate in the high-paid jobs they offered. This was true for both manufacturing and the emerging administrative support systems of the office. We had to go to the place of technology to undertake our work. The set-up costs were high enough that we had to aggregate around them to benefit from them, so we moved to the city en masse. We also had to live relatively close to our place of work in the city because our transport options were so limited at the time. Most of the inner-city suburbs in major industrialised nations are a clear reminder of how we lived. These houses have no driveway and they’re most often homes with a very small frontage and limited living space. It’s almost as if the house knew its primary purpose was to house workers, hence the name ‘worker’s cottage’. The fact that most of us walked or rode bicycles to work was a function of the technology available too. There wasn’t much of a choice for anyone who wanted to be part of the economic benefits industrial companies provided. Get close to where it was all happening, or miss out. While there was more living space on the farm and the outlying areas of the wider city, it was too difficult to live there and get to and from work. Where we lived was defined by what we had access to.

Along came Henry

When Henry Ford made the automobile affordable, he also invented the idea of the suburbs. All of a sudden we no longer had to live in the city to get to work. We could drive on the motorway and live in a house with much more space, a backyard, neighbours, parkland, mega malls, new schools and fresh air for growing families. Access to private transport quickly changed where we chose to live. For large parts of the late twentieth-century, inner-city suburbs — the former enclaves of the industrial worker — became run down and often slum like. Who would want to live in a tiny timber house smack bang in the middle of industry and wedged between freshly laid highways? The suburban choice, with its improved living standards, was a simple one to make. It was only when travelling in and out of the city became a horrible, traffic-induced nightmare and many of the pollution-inducing factories went offshore that the inner city had its own mini renaissance. Over the past 20 years, inner-city suburbs where I live in Melbourne have gone from being half the price of the outer suburbs to twice their price. And the reason this has happened is because technology (private transport) failed us, creating a new proximity necessity.

That said, we’re about to enter a phase where living in the city becomes a choice rather than a necessity because technology enables us to choose where we live and to design our places of work and abodes around our personal requirements, not those of an industry. And the industries will go along with it simply because it will be more profitable for them to.

The end of offices

The office itself is a weird thing that surfaced when factories did. Sure, lawyers and accountants had them, but not in the sheer quantity or corporate format in which they exist in today. The office was an addendum to where stuff got built. But as factories have been shrinking and moving offshore to lower cost labour markets, offices have been growing in size, number and inhabitants. It was to be expected as most developed markets moved from a manufacturing-based output to a knowledge-based output, a trajectory we continue on to this day.

The office was a little bit like the factory, where the parts that made it function — the office machinery if you like — was also expensive. The tools for organising business weren’t cheap. It made sense to centralise things. But today cost efficiency can’t be the reason to centralise office services. So why do they still exist? It can’t be the cost of the tools because every piece of technology that used to make setting up an office expensive is now already in most people’s homes. Xerox machines and teleconferencing facilities are not needed anymore. The much-touted telecommuting dream is finally possible, and, although it’s been a slow process, it will arrive.

History repeats

If the technology of the day has decided where we work in the past, I can’t see why it won’t do that in the future. The staff want it and it will represent significant cost savings for them and the business. Where we work will change again; the time just hasn’t come yet. When it does, workplaces will be a fragmented combination of shrunken offices, homes, mobile locations and meeting spaces. Work will happen wherever the person doing the work decides it should, not in some arbitrary location.

Work options

Which of these two work options would you prefer? Would you rather:

• option 1: turn up to an office five days a week to do your work, because, well, that’s where someone decided the work should be done? You invest valuable hours and money commuting to the office every week. You make sure you turn up for the official office hours, which haven’t changed in hundreds of years. Before you leave home, you get dressed in appropriate office attire, which is likely not what you’d wear if you had a choice. You buy or rent a house near where someone has chosen to locate the office, which is supposed to suit all staff, but actually suits no-one. Sound familiar? It’s a bit like those TV-industrial-era mass products they used to push

or would you rather:

• option 2: work mostly from where you decide to work? It could be a co-working space, your home office, a company office … anywhere you can plug into the network. You live where you actually want to live, near that nice beach or lake or mountain with the fresh air and nice restaurants, or maybe in the city if that’s your thing. You no longer waste any time commuting to an office to work. You don’t spend any time getting road rage from fighting peak-hour traffic. Instead you come into a smaller, central office on the days you need to meet with colleagues, which is probably one day per week. When you do need to go into the office you drive in non-peak hours, making the journey more pleasant and taking a fraction of the time. You can wear what you want because as you know your clothes don’t make you any more or less capable. And you can also work the hours that make sense for you and your family because you work for a company that cares more about output than office face time.

Smart people will choose option 2. Actually, you don’t even have to be that smart; you just have to be human.

Offices, control and profits

People will say option 2 won’t work for a company. It would be too loose, too unstructured, non-hierarchical, without authority or control, and that too much power would be in the hands of the people. Here’s a simple fact: companies like profit more than they like control.

While it would be quite an adjustment for companies, deep inside every company’s DNA is a desire to reduce costs in every facet of the business. The office itself is no different from the factory, the advertising budget or staff numbers. If costs can be removed, they will be. Companies that are already large organisations have the most to gain from such a shift. The companies with the largest administrations are often from mature industries where it’s much harder to find top-line revenue growth. In these situations, it’s operating costs that are targeted. Reducing the office size is a solution that’s available and profitable and it could even be a cost-effective way of attracting the right staff even at a reduced cost per head as it represents real savings for the employees in question. It’s hard to see this not happening. Both employee history and desire itself point to reinvented, highly distributed office structures.

The time and cost benefits of staff being together every day, on demand, for when issues arise is a bit of a misnomer. For every emerging meeting or information exchange, there are usually other unnecessary meetings about the meeting, known as alignment meetings. These usually occur in place of someone actually making a decision. Or even worse, these are the meetings that turn out to be a public reading event, a time when the meeting organiser gets stakeholders in a room to go through a project or update everyone. This is often where something is presented on slides, copies of which really could be distributed to everyone to read instead of wasting everyone’s time in a meeting environment. Anyone who has ever worked in an office knows that the relative benefits of immediate access to the team are clearly offset by pointless interactions and office folly.

Just as the information we call on has moved from filing cabinets to in-house computer servers to the cloud, so will staff members. We’ll enter an era of the cloud employee — distributed and on-call human capital — and it will be better for everyone.

A better office offer

The office of the future will be much smaller, a more collaborative, creative space for interactions, not a battery farm of corporate cubicle dwellers laying digital eggs. It will be the kind of place where people actually want to hang out to connect and share ideas with others. And they will do this when they choose to be there. The companies that embrace the idea of a diffused workforce will need less physical space because their staff will only come in on occasion, when they genuinely need to interact in person. And because the space will be smaller, it can become a more creative space that generates value because it inspires, rather than being a human warehouse where employees have to sit under electric lights with air-conditioning. It will be a new space that’s about connection and inspiration, not only about doing work. That will be done elsewhere, in a place that suits the person doing the work, not the person paying for it.

Idea diffusion

It’s true that people come to offices not just for the work, but for the social interactions and direction others can provide. But social interactions at the office are a symptom, not a reason. Wherever people gather, socialisation and idea diffusion takes place. Once we spend less time working in offices, the social needs and idea-exchange voids will be filled in new places such as shared creative spaces and co-working hubs. It’s not really the interactions with other staff members that matter so much, but the interactions in general with people who don’t need to necessarily be part of the same organisation. In a mash-up kind of workplace, external interactions are potentially more valuable. In a world of digital demarcation, employees who are around people with different world views, from different industries and with different domain knowledge are what companies need more of. Enforcement of existing cultural ideas from the one company blueprint can never be as valuable. Idea cross-fertilisation and diffusion is far more likely to happen when we’re in new and varied environments and this is exactly what companies need in times of revolution. The burgeoning co-working space is already evidence of how this can work.

The office is not immune

Just like everything else that’s occurring around us, a democratised structure that removes power from the few and gives choice to the many is also likely to become the norm in offices. Like the other factors of production, offices and corporate working structures are not immune to the changes. The same forces are at play. A move from integrated vertical structures to distributed, choice-based, human-led infrastructure will be, and is, occurring. We went from the farm and villages to the city, then to suburbs, and next will be regional satellite centres. It’s foreseeable that the next phase of where we live will consist of regional centres of great beauty that are near major cities. We’ll have all the benefits of city living, without having to live in cities. This replicates the benefits of mobile technology. Our lives will be more mobile, although it won’t be one-size-fits-all, and we won’t leave the city for the non-city. We’ll be able to make the niche-living choice that suits us, not the corporations we work for.

The last industrial relic

I think the office is the last industrial relic. It needs to be radically changed. Even the name ‘office’ is wrong. It sounds official and full of rules. But if offices really added that much value, why do so many leading-edge startups not have them? Why are so many white-collar jobs being offshored to low-cost labour markets? It’s because entrepreneurs and smart businesses know offices are expensive to run, they’re outdated and better options exist for information workers, especially as we enter the age of projecteers, as I’ve already discussed in chapter 2.

While this is a simplification of the flow of jobs over time, there’s no disputing that the type and structure of work we do is in a constant state of flux. Soon employers will realise they don’t actually need employees. Smart companies will realise what they actually need is for tasks to be completed, projects managed and leadership provided. In a connected world they won’t need to pay for people to perform these duties five days a week, on a salary, because they can access the skills on demand with limited friction and wastage. This is especially true when you consider that a large amount of time that employees are paid for is unproductive downtime that’s spent as being part of the organisation, rather than towards outputting for the organisation. What we need to remember is that companies pay people based on the value they deliver, not by the hours they’re present. If an employee costs $x for five days’ work, but it really only takes three days for them to do that work, companies should be happy to pay the equivalent of four days of the employee’s time to a projecteer in view of the reduced overheads connected to outsourcing. On average, an employee costs twice their salary to carry. In a connected world, roles for employees will fragment into pieces and projects. There’s no real reason why human capital can’t be an on-demand resource, as are many of the other factors of production we now access instead of owning. And it’s already happened with many purely digital tasks. Outsourcing labour markets such as eLance, oDesk and Freelancer are more than an opportunistic digital niche. They’re proof that the employee model is changing in line with the wider economic shifts and that with the reduced friction of access labour, new models are arriving that are more fluid and independent. The biggest customers of these ‘liquid labour markets’ are among the world’s biggest companies. The efficiency low-friction labour markets create opens up an opportunity for further independence of worlds, which is more profitable for those who need things done and those doing it.

The type of work to evolve will be that of projecteers. These people — who aren’t really staff members, and don’t really run companies either — are digitally facilitated freelancers with skills that are in demand from the new economic landscape, such as UX Consulting, app developers, big data scientists, community managers, cloud services specialists, online course teachers and 3D printing designers, as well as jobs that don’t exist yet. They’re niche roles for an increasingly fragmented world.

The greatest fallacy in modern politics is the idea of saving jobs. There aren’t many people who hunt bison for a living in this day and age and saving jobs is a simple misallocation of taxpayers’ dollars. A far more effective approach is to recognise and facilitate the shift in creating new jobs. Structural unemployment is a perpetual and ever-moving beast, and it occurs at a more rapid pace when the fundamental structure of society changes. The breadth of tasks people will do for a living in the coming years will astound, and it’s a massive opportunity to re-humanise the work we do and the way we do it.

Not only will projecteers gain a deeper satisfaction for the work they do than an employee would, they will also gain a greater revenue clip for the time they have given. Meanwhile companies will save on the cost of having the work done. In addition to this, neither party will be mentally chained to the other, resulting in a more creative work and life ecosystem.

Even the most complex of projects can be undertaken virtually — projects that employ all the tools of the new digital world, even when the participants are living worlds apart.