this post was submitted on 18 Dec 2024
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Work Reform

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[–] [email protected] 54 points 4 days ago (2 children)

You would think that of all people, rich CEOs would understand the concept of the sunk cost fallacy.

The money on desks, rent, insurance, etc. is already spent. You're not getting it back. Asking people to come back to the office "so that it doesn't go to waste" assumes that you aren't taking on additional costs for people coming to the office.

You now have worn carpet, doors, pens, paper, etc...money you could have saved if you weren't such a knob.

[–] [email protected] 38 points 4 days ago (1 children)

Are you really suggesting that you expect CEOs to be competent? Scamming people and exploiting workers doesn't require skills, except if immorality is one.

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[–] [email protected] 6 points 4 days ago

How was this not obvious when the panic set in with the pandemic.

It's never about productivity, it's always about increasing value.

[–] [email protected] 50 points 4 days ago (1 children)

Early in the pandemic, our CEO asked why we paid so much for real estate if everyone could work from home. They've been trimming leases as quickly as they can.

We've been hiring people who live out of state. They only come onsite very rarely, maybe only once a year.

[–] [email protected] 23 points 4 days ago (1 children)

My company did that too, then they replaced us with cheaper labor from overseas.

[–] [email protected] 19 points 3 days ago

Ours did that before the pandemic and not my area. Within a year, it went back to what it was because of how terrible the quality was. Now they are dumping all the buildings that aren't needed and sent a lot of us home. Of course, the main product that my job deals with needs buildings for machines to work so they didn't get rid of everything. No more corporate, and for now, we are all home for the foreseeable future. I also wonder when they will get the bright idea to start outsourcing again now that it's been like 7 years...

[–] [email protected] 20 points 4 days ago

I guess they should enjoy the consequences of their actions like... regular people do?

Or maybe these bosses just aren't good at what they do. After all, they wasted millions on real estate and empty desks. Shouldn't the shareholders be demanding new leadership?

[–] [email protected] 11 points 4 days ago

I thought it was because they couldn't make friends & wanted to force people to be around them.

[–] [email protected] 12 points 4 days ago (1 children)

I think some of them are also doing it for the tax breaks they get if they pump a bunch of employees into the local area's economy.

And we all know how difficult is is to get companies to voluntarily give up free tax money from the government. It's like trying to take drugs away from an addict.

[–] [email protected] 5 points 4 days ago* (last edited 4 days ago)

Corporate "Welfare Queens"

[–] [email protected] 3 points 4 days ago (1 children)

Worked at Boeing, where you have 1990's cubicles with 17" 3:4 monitors. I'm glad to he back in the office.

[–] [email protected] 10 points 4 days ago (1 children)

So does that mean you guys are gonna start doing actual work on the new planes, or…?

[–] [email protected] 7 points 4 days ago

Sorta. It's going to take 8 weeks for me to get a box of pens.

[–] [email protected] 20 points 4 days ago (1 children)

We don't even have the office space anymore for full RTO. If at some day too many people would go into the office some wouldn't have desks to work on...

[–] [email protected] 19 points 4 days ago

Same here. A smart CEO wouldn't force RTO, they would lease out that unused space or expand using those unused desks.

[–] [email protected] 166 points 4 days ago (7 children)

Anyone who does not understand the sunk cost fallacy should not be in management.

You've spent $x on office space. You can:

A. Use it, and make your employees hate working for you or

B. Let it go unused, and your employees are happier to continue working for you.

The money is spent either way. The only difference is morale, which does in fact directly contribute to your bottom line.

[–] [email protected] 2 points 4 days ago

There have to be relationships at play or something like that. Or saving face. Maybe investments?

[–] [email protected] 10 points 4 days ago

It's nice to find the rant in your head written out. A previous employer of mine dropped two properties in favor of a store front.

[–] [email protected] 69 points 4 days ago (2 children)

C. Get rid of what you don't need so that everyone is happy

[–] [email protected] 10 points 4 days ago

You mean sell it for money and actually make more profit while everyone is happy? Preposterous!

[–] [email protected] 37 points 4 days ago (7 children)

When you are locked in to a 3/5/10 year lease for the space, that's not actually an option. Most leases signed pre covid should be up by now but clueless management probably renewed anyways.

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[–] [email protected] 18 points 4 days ago (1 children)

Or c, keep just enough office space to create rolling “layoffs” as people are asked to return to the office.

[–] [email protected] 22 points 4 days ago

Step 1: Hire staff

Step 2: Train staff to do job

Step 3: COVID! Oh no! Everyone work from home.

Step 4: ???

Step 5: Fire staff to save money.

Step 6: Profit.

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[–] [email protected] 84 points 4 days ago (2 children)

We had some slight pushing into going into the office more, but instead of firing people, it was decided to switch to a smaller office space, so the people who like to work in an office can do so, and less money is wasted on a mostly empty office

Understandable that this is not an option for all companies, but insane that people are happier losing talent than at least trying to work something out

[–] [email protected] 27 points 4 days ago

Ours tried full RTO, and then they compromised with hybrid WFH when they lost many skilled people who had been there for 10+ years to remote positions at other companies. Sometimes with little to no warning.

Some execs gotta learn the hard way.

[–] [email protected] 53 points 4 days ago (2 children)

When the CEO personally owns the building and leases the office space to the company, that's not an option.

[–] [email protected] 26 points 4 days ago* (last edited 4 days ago) (4 children)

Then he should act like any other office building owner and rent some space to other companies.

Bonus points if he gets with the future and works to convert some of the building to living space so people don't have to travel to get to work. Not everybody will want that, but it will appeal to enough to make it worth doing. Shopping malls across the country are being converted to such hybrid spaces so most everything one needs is within a convenient distance.

[–] [email protected] 6 points 4 days ago

i think you fundamentally misunderstand the motivations involved that would lead to the CEO owning the office real estate. commercial real estate is a means for them to siphon profits from the business, not a genuine attempt to provide a valuable service to anyone.

[–] [email protected] 5 points 4 days ago (1 children)

Then he should act like any other office building owner and rent some space to other companies.

There are more buildings/office spaces to rent than people wanting office space these days. There are LOTS of empty unrented buildings. He would have difficulty even finding a tenant.

Bonus points if he gets with the future and works to convert some of the building to living space so people don’t have to travel to get to work.

An exceptionally small number (we're talking single digits in the world) of Class A office buildings are good candidates for this, and these are typically done with grants/subsidies from state or local governments. These are only in the most lucrative geographic locations where housing is at an absolute premium regardless of the cost.

For good value of converting office space look at Class C buildings. These are typically older and smaller office buildings (think built in 1910s-1950s). In these, there are ways to make cost effective residential conversions and these are happening by the dozen now.

Here's a guide to the different class of office buildings

[–] [email protected] 1 points 4 days ago (1 children)

The class B pic shown in your link would be a perfect candidate to retrofit to housing if it's unrented. The classifications you're showing are classes of rentals, not building construction.

[–] [email protected] 5 points 4 days ago (2 children)

The class B pic shown in your link would be a perfect candidate to retrofit to housing if it’s unrented.

According to the architectural studies I've read when I looked into this question for myself, you would be incorrect. Open floor plans are apparently pretty horrible for residential conversions. Many residential building codes require each bedroom to have a window with a screen for ventilation. Now look at that picture of the Class B. The only exposed areas that could have a window with a screen would be on the perimeter. Further, codes many have rules that say that you cannot have one bedroom accessible by passing through another, so that would exclude long skinny apartments unless the are a 1 BR. That would leave lots of square footage trapped in the middle unusable for bedrooms. Could you put windowless living rooms and kitchens there? Sure, but even then its very few residences when they could knock that building down and get many more windowed rooms on the same piece of land.

Class C's don't have these issues as they were built with small individual offices in mind and not open floorplans, which make for affordable cost effective conversion to residences.

The classifications you’re showing are classes of rentals, not building construction.

I'm no building expert, but I am not aware of a difference in "class of rental" vs "building construction" you're making the distinction of. The studies I read only referred to them by class letter and never mentioned any distinction that you're referring to.

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[–] [email protected] 11 points 4 days ago (2 children)

Bold of you to assume he already doesn't. But WFH across many industries drives down urban office space value overall.

[–] [email protected] 2 points 3 days ago

Won't someone please think of the poor rent-seekers!

[–] [email protected] 3 points 4 days ago (1 children)

I edited the comment to expand more clearly upon what I mean. There are other ways to capitalize on the space.

[–] [email protected] 8 points 4 days ago (1 children)

Converting office space to residential is costly (if even possible for a given building), and would require a lot of effort. There may be zoning issues in the way as well.

Much easier to just use the CEO hat to keep desks full, and the landlord hat to collect rent.

[–] [email protected] 5 points 4 days ago

Which is why I gave it "bonus points" for attempting to do so.

[–] [email protected] 1 points 4 days ago (1 children)

The other companies that are also doing WFH?

[–] [email protected] 3 points 4 days ago

I edited the comment to expand more clearly upon what I mean. There are other ways to capitalize on the space.

[–] [email protected] 5 points 4 days ago

then it's not wasted money is it

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