Federal Real Property: Selected Agencies Plan to Use Workforce Mobility to Reduce Space, but Most Efforts Are Too New to Have Realized Savings
Published: 2013-10-17T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: New technologies and the adoption of alternative work arrangements have increasingly enabled employees to perform some aspects of their work outside of the traditional office environment. As requested, GAO examined how aspects of mobility have affected agencies' space needs. This report identifies (1) actions selected agencies have taken as a result of increased workforce mobility to reduce their space needs; (2) the assistance GSA provides federal agencies that are exploring reducing their space needs, at least partly in response to increased workforce mobility; and (3) factors selected agencies and private sector organizations viewed as important to achieving space efficiencies in an environment of increased workforce mobility. GAO focused its review on five agencies: GSA, the Department of Agriculture, the Internal Revenue Service, the Department of Commerce's USPTO, and the Department of Justice's Bureau of Alcohol, Tobacco, Firearms and Explosives. Altogether, these five agencies reported holding or leasing more than 400-million square feet of office space in fiscal year 2011. GAO reviewed agency-specific guidance and other documents related to space planning and conducted interviews with key officials from the selected agencies. GAO also interviewed representatives from five private sector organizations to obtain their perspectives on how the private sector plans for its future space needs.
section_title: What GAO Found
paragraphs: The five selected agencies GAO reviewed are either exploring or taking actions such as increasing "telework" participation and implementing a "hoteling" program--which means that employees give up their individual, permanent space and use shared, nonpermanent workspaces when they are in the office-- to reduce their space needs. For example, as part of its headquarters renovation, the General Services Administration (GSA) is making use of open, collaborative work environments and implementing a hoteling program for all employees. In addition, the Department of Agriculture set agency-wide goals for increasing the number of its employees with approved telework agreements as well as its overall telework participation rates for fiscal year 2013. The U.S. Patent and Trademark Office (USPTO) has taken steps to reduce its space needs as a result of increased workforce mobility for more than a decade, and there are indications that USPTO has avoided real estate costs as a result of its efforts. However, GAO was unable to obtain sufficient information to determine the accuracy and validity of USPTO's estimated cost savings. Beyond USPTO, the agencies GAO reviewed have not yet realized space reductions or cost savings because their efforts are too new. In addition, officials at the selected agencies pointed out that increasing telework participation or implementing a hoteling program may not be appropriate in all instances, such as for employees who work with sensitive or classified documents or who interact with members of the public.
GSA offers general guidance as well as customized programs to help guide agencies' space-planning efforts in an environment of increased workforce mobility. In this guidance, GSA has shown that agencies can achieve space efficiencies by reconfiguring the layout of existing workstations and implementing various alternative work arrangements. While agencies may take steps on their own to address their changing space needs, GSA has offered two customized programs since 2011 to assist agencies. These programs are designed to help agencies explore mobility and achieve space efficiencies; however, GSA's client agencies determine whether to act on GSA's recommendations, and it may take years to realize savings due to factors such as the timing of leases and the cost of reconfiguration.
GAO's discussions with officials from the selected agencies and private sector organizations identified two factors--acquiring information about the current utilization of office space, and gaining the support of management and employees--that were frequently viewed as important for an organization to achieve space efficiencies in an environment of increased workforce mobility. By measuring how existing space is being used, organizations are better positioned to determine their future space needs. Similarly, by taking steps to obtain the support of leadership and employees, organizations can help facilitate the acceptance of mobility initiatives. Officials described the loss of dedicated workspace resulting from increased mobility as a significant change in the workplace and indicated that organizations that try to impose such changes are less likely to succeed than those that build organizational support.
section_title: What GAO Recommends
paragraphs: GAO makes no recommendations in this report. USPTO commented on the estimated cost savings of its hoteling programs, as discussed in this report.

section_title: Letter
paragraphs: New technologies and the adoption of alternative work arrangements  such as “telework” and “hoteling” have increasingly enabled employees to  perform some aspects of their work outside of the traditional office   In recent  environment—such as at home, in the field, or while traveling.years, the administration has required federal agencies to consider how  innovative approaches to space management and alternative work  arrangements could help agencies reduce the need for office space. As  the federal workspace evolves, the federal government is starting to  reassess how it uses its real property assets, which includes nearly 800- million square feet of office space that is owned by the federal  government or leased by different federal agencies. As the federal  government’s real property manager, the General Services Administration  (GSA) provides agencies with guidance regarding real property  management and manages selected properties for some agencies.
You asked us to examine how aspects of mobility have affected agencies’  space needs. We identified: (1) actions selected agencies have taken as  a result of increased workforce mobility to reduce their space needs;      (2) the assistance GSA provides federal agencies that are exploring  reducing their space needs, at least partly in response to increased  workforce mobility; and (3) factors selected agencies and private sector  organizations viewed as important to achieving space efficiencies in an  environment of increased workforce mobility.
We focused our review on five agencies: GSA, the Department of the  Treasury’s Internal Revenue Service (IRS), the Department of Agriculture  (USDA), the Department of Commerce’s U.S. Patent and Trademark  Office (USPTO), and the Department of Justice’s Bureau of Alcohol,  Tobacco, Firearms and Explosives (ATF). We selected these agencies  because they have high levels of real property holdings or have adopted  business practices that support a more mobile workforce. We reviewed  pertinent laws and regulations that apply to space planning, space  utilization, and alternative work arrangements. We assessed efforts by  the selected agencies to pursue space reductions as a result of increased  workforce mobility based on the July 2010 Presidential Memorandum that  federal agencies explore how innovative approaches to space  management could help reduce the need for office space.
We also reviewed Office of Management and Budget (OMB) guidance  and agency-specific guidance and other documents related to space  planning, and conducted interviews with key officials from the selected  agencies. We analyzed Federal Real Property Profile data for fiscal year  2011, the most recent available, on how much office space was reported  held and leased by the agencies we reviewed, as well as government- wide. The Federal Real Property Profile is a database of federally owned  and leased space held by executive branch agencies. In 2012, we  reported problems with the reliability of Federal Real Property Profile  data, but that it can be used in a general sense. we used Federal Real Property Profile data for the limited purposes of  providing background information and selecting agencies for review.
See GAO, Federal Real Property: National Strategy and Better Data Needed to Improve  Management of Excess and Underutilized Property, GAO-12-645 (Washington, D.C.: June  20, 2012). business practices for leveraging the mobility of their workforce or  adapting their physical space needs to increased workforce mobility. Our  findings based on the efforts of the selected agencies and private sector  organizations are not generalizable to other federal agencies or private  sector organizations, but provide insights.
We conducted this performance audit from January 2013 through October  2013 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
subsections: section_title: Mobility and the Federal Workspace
paragraphs: “Mobility” is an overarching term that describes the ability of employees,  enabled by information technology, to perform their work in areas other  than an assigned office or workstation. GSA has been reporting since the  late 1990s that federal agencies could do more to reduce their space  needs and achieve savings by recognizing that many of their employees  are able to perform their work either outside the office or in smaller  workspaces. GSA has noted that mobility can improve employees’ work- life balance, such as by giving employees greater control over their  schedule, and can reduce employees’ commuting time. GSA has also  noted that federal agencies have not yet widely embraced mobility, but  trends in the private sector, workforce demographics, and technology  suggest that agencies could do so in the future.
Organizing the workplace around mobility can reduce the size and  number of dedicated individual workspaces and accommodate the same  number of employees in less total physical space. For example, when  agencies provide the necessary technologies, employees may perform  their work in areas other than an assigned office or workstation. It may be  possible for agencies to reduce their space needs when this mobility is  combined with hoteling, which means that employees give up their  individual, permanent space and use shared, nonpermanent workspaces  when they are in the office.more of an organization’s space to collaborative areas, such as  conference rooms, team rooms, and informal meeting rooms. Figure 1  illustrates one possible way an agency could reduce its per-employee  footprint by redesigning space to reflect mobility.
section_title: Selected Agencies Are Using Workforce Mobility to Increase Their Use of Alternative Work Arrangements and Reduce Their Space Needs
paragraphs: Officials at the five agencies we reviewed told us they are exploring or  taking actions to reduce their space needs and achieve space  efficiencies. These actions depend, in part, on a mobile workforce and  include increasing telework participation, introducing hoteling, and  reducing the size of individual workspaces. However, some agency  officials we spoke with pointed out that actions such as increasing  telework participation or implementing a hoteling program may not be  appropriate in all instances. Some employees, for example, may not want  to telework for personal reasons or be unable to telework due to the  requirements of their work—these include employees who work with  sensitive or classified documents, or who interact with members of the  public as part of the jobs.
With respect to the agencies we reviewed:  USPTO has been taking steps to reduce its space needs as a result  of increased workforce mobility for more than a decade. For example,  under USPTO’s Patent Hoteling Program, more than 4,000 full-time  employees—or about 36 percent of its workforce—telework 4 to 5  days per week. These full-time teleworking employees do not have a  personal workspace in the office; instead, they use an automated  system to reserve a workspace for times when they need to be in the  office. According to USPTO officials, most of their employees are  patent examiners who perform solitary, independent work, which  makes them good candidates for teleworking. USPTO officials told  us their Patent Hoteling Program has enabled USPTO to  accommodate new hires without having to increase its space needs.  Further, we note that there are indications that USPTO has avoided  real estate costs as a result of its efforts. For example, in 2012, the  Department of Commerce reported, that as a result of USPTO’s  Patent Hoteling Program, USPTO has avoided almost $17 million in   In  real estate costs annually since 2006 when the program started.addition, an analysis of the costs and benefits of USPTO’s Patent  Hoteling Program that USPTO conducted for fiscal year 2012  indicates that USPTO’s estimated savings could be larger. However,  while we reviewed documentation provided by USPTO regarding its  estimated cost savings, we could not verify USPTO’s estimates as  some key assumptions—such as rental costs per square feet—were  not supported.  In designing its headquarters renovation, GSA officials told us they  made extensive use of open, collaborative work environments;  eliminated private offices for most employees, including senior-level  employees; established a target ratio of one workstation for every two  employees; and implemented a hoteling program for all employees.  GSA also eliminated cubicles in favor of a workbench configuration of  space, as shown in figure 2. GSA estimates that its renovation,  scheduled to be complete before the end of 2013, will allow it to  eliminate the need for additional leased space at four locations in the  Washington D.C. area, resulting in projected savings of approximately  $25 million in annual lease payments, and about a 38 percent  reduction in needed office space. However, this estimate does not  include the costs of GSA’s renovation, which has not been completed.
The IRS implemented new space standards in October 2012 that  reflect changes in the mobility of its workforce and is applying these  new standards as part of its space-planning efforts. Under the IRS’s  new space standards, employees who work out of the office an  average of 80 hours or more per month no longer have a dedicated  workstation and must hotel with other employees who are also out of  the office an average of 80 hours or more per month.
USDA set agency-wide goals for increasing the number of its  employees with approved telework agreements as well as its overall  telework participation rates for fiscal year 2013. Officials told us they  believe that the increased use of telework could allow the department  to reduce its real estate needs. In addition, officials of the Forest  Service, an agency within USDA, told us that the Forest Service plans  to increase telework participation, utilize hoteling, and decrease the  size of individual workstations as part of its headquarters renovation.  The renovated space, which formerly provided space for 420  employees, is expected to provide workspace for approximately 760  employees. Forest Service officials said the agency estimates saving  at least $5 million in annual rent as a result of these efforts. However,  this estimate does not include the costs for its headquarters  renovation, which has not yet been completed.
ATF officials told us they are developing a workstation-sharing policy  for those employees who telework 3 or more days per week.  According to ATF officials, this policy, which they expect to have in  place in October 2013, will help ATF reduce the amount of space it  needs to lease in the future.
Officials at each of the five agencies we reviewed told us that they expect  their efforts will result in space reductions and cost savings over time.  However, it is too early to determine the specific cost savings that might  be realized for actions agencies like GSA and the Forest Service are  taking, given that they are in progress.
section_title: GSA Offers General Guidance and Customized Programs to Help Agencies Address Their Changing Space Needs
paragraphs: Since the late 1990s, GSA has issued several reports that provide  general guidance to assist with agencies’ space-planning efforts in an  environment of increased workforce mobility. These reports have  highlighted the variety of actions that agencies can take to achieve space  efficiencies and help ensure that workspaces adequately support their  agencies’ missions. GSA’s research on how public and private sector  organizations use office space shows that office space in general, and  federal office space specifically, is often underutilized as employees work  elsewhere. For example, in 2006, GSA reported that its surveys of federal  workspaces indicate that employees are typically seated at their desks  less than one-third of the average work day because they are often  working elsewhere—collaborating with team members, working off-site, or  in meetings—the rest of the time. In its reports, GSA has provided  examples of how various federal agencies have achieved space  efficiencies, including reducing their space needs, through reconfiguring  the layout of existing workstations and implementing various alternative  work arrangements, such as hoteling and increased use of telework.
While federal agencies are ultimately responsible for addressing their  changing space needs, they can also seek assistance from GSA. An  official at the Forest Service’s headquarters told us the Forest Service  worked with GSA to measure utilization of its leased office space in the  Washington D.C. area. According to the official, working with GSA helped  provide the Forest Service with information on how its space was being  used, and helped the Forest Service determine that it could reduce its  office space needs by 25 percent.
In late 2011, GSA established a Workplace Program Management Office  designed to help agencies explore and implement mobility initiatives.  GSA helps agencies explore mobility as part of a broader approach to  space planning as well as engaging workplace strategists in developing  solutions focused on mission, people, and space opportunities. For  example, since 2011 GSA has offered two customized programs known  as Client Portfolio Planning and National Engagements for Workplace  Services. In part, these programs are designed to help agencies explore  mobility and achieve space efficiencies and also determine the type of  workplace configuration that best supports the accomplishment of the  agency’s mission. According to GSA officials, these programs also offer  additional benefits, such as increased employee satisfaction. GSA  officials stressed that customized programs work better because each  agency has a unique mission and culture.
GSA officials describe the Client Portfolio Planning program as one that  will help an agency find ways to increase energy efficiency and mobility,  potentially allowing an agency to reduce its need for office space. GSA  collects information about the client agency’s space use and needs  through various instruments, including employee surveys. GSA  subsequently works with the agency to identify potential opportunities and  develops recommendations. According to GSA officials, having a client  agency actively participate in this process is a key factor to achieving  success in implementing GSA recommendations. If an agency chooses to  act upon GSA’s recommendations, it could take years to realize savings  due to factors such as the timing of leases, the cost of reconfiguration,  and negotiation with employee organizations. GSA officials told us that  they work with three new agencies each year and currently have nine  departments or agencies participating in this program.
Unlike the Client Portfolio Planning program, GSA’s National  Engagements for Workplace Services program is designed to help  agencies examine their operations and identify new ways of working that  leverage technology and furniture solutions. According to GSA, the  information obtained by participating in this program can help guide an  agency’s space-planning efforts and mobility initiatives and provide a  business case for making changes. GSA funds initial services, such as  performing space utilization studies, evaluating existing workplace  conditions, developing alternative work arrangement standards, and  implementing pilot programs. The client agency funds subsequent  services, such as implementing developed programs and evaluating the  results. To date, GSA has completed national engagements with two  agencies—the Defense Contract Audit Agency and USPTO—and is in  various stages of working with eight other departments or agencies. Of  the agencies we reviewed, USPTO has worked with GSA under both  programs. According to USPTO officials, as a result of working with GSA,  USPTO set a goal of releasing space when leases expire and is exploring  opportunities to consolidate additional personnel within its headquarters  building.
Several factors can affect what strategies or recommendations, if any,  GSA’s clients may decide to implement as a result of these programs.  These include an agency’s culture, mission, funding sources, and the  flexibility it has within its existing leases. For example, USPTO stated that  while it concurs with the goal of releasing space when leases expired, its  future staffing projections need to be considered when evaluating any  proposals. In addition, USPTO noted that it was in ongoing discussions  with its employee organization over changes affecting employee  workspaces. Also, not all of GSA’s client agencies may complete these  programs. For example, GSA officials told us that because one agency  did not actively participate during the planning processes of the Client  Portfolio Planning program, GSA opted to refocus its efforts on another  agency that it perceived was more willing to collaborate in the planning  process.
GSA officials also noted that because these programs are relatively new,  they involve an iterative and ongoing learning process, including the  development of tools to help agencies explore the benefits of mobility. For  example, GSA is in the process of developing an additional Excel-based  tool aimed at helping agencies quantify the benefits and costs of  increased telework participation and implementing other alternative work  arrangements, such as hoteling. According to GSA officials, this tool will  be available to agencies later this year. GSA is also developing tools to  help agencies measure the extent to which their office space is being  used on a daily basis. For example, GSA is exploring how using mobile  devices such as cell phones could provide information electronically on  which offices are occupied. According to GSA officials, such tools would  allow agencies to collect such information without the need to rely on  manually observing the workspace.
section_title: Accurate Data and Organizational Support Were Viewed as Important to Achieving Space Efficiencies in an Environment of Increased Workforce Mobility
paragraphs: Our discussions with officials from the five selected agencies and five  private sector organizations identified two factors as particularly important  to achieving space efficiencies in an environment of increased workforce  mobility: acquiring information about how office space is currently used  and gaining management and employee support. Leading practices in  capital decision-making and OMB guidance have stressed that having  accurate data is essential to supporting sound capital planning and  decision-making. By measuring how existing space is being used,  organizations are better positioned to determine how much space they  really need. We have also previously found that people are at the center  of any management initiative for serious change, and that leading  practices for managing change include ensuring that top leadership is  behind transformations and that employees are involved throughout the  transformation.
subsections: section_title: Acquiring Information
paragraphs: Officials from three of the agencies we reviewed told us that organizations  must first obtain the data necessary to inform their decision-making about  future space needs; such data might include current information on space  utilization rates, telework participation, and employee views about  alternative work arrangements. For example, GSA officials noted that to  obtain this type of information, they count heads (i.e., they manually count  the number of offices occupied) and solicit employee opinions on  proposed workspace changes. Officials at the other two agencies told us  they take similar steps. For example, Forest Service officials told us that  when planning to consolidate space in the Washington, D.C., area, they  performed head counts twice a day for several weeks to determine the  feasibility of implementing hoteling. According to these officials, their data  showed that 60 percent of employee workspaces were occupied at any  given time. They then used that knowledge to reduce the number of  workstations in their renovated space. IRS officials told us that when their  agency implemented a new collaborative workspace design at its  headquarters, they held focus groups to obtain employee input on various  design features.
Officials from each of the five private sector organizations we contacted  also told us that when working to incorporate elements of mobility into  space planning, either for a client or their own organization, data on how  employees currently use their space is necessary for informed decision- making. For example, a representative of one organization told us that  when working with a client, his organization first acquires data on how  that client uses its space by examining costs, office density, and space  utilization rates; within his own organization, they perform daily head  counts to determine how their office space is being utilized. Similarly, a  representative of another organization told us that he advises clients  seeking to make physical changes to their workplace that they must first  do some research to understand the current level of office utilization.
section_title: Gaining Support
paragraphs: When introducing physical space changes associated with increased  workforce mobility—including the loss of dedicated workspace— organizations may encounter resistance from agency leaders, managers,  employees, or employee organizations. Officials from all of the agencies  and the private sector organizations we contacted described redesigning  space to reflect mobility as a significant change. Several noted that  employees have traditionally regarded their workspace as their own  personal space and that mobility initiatives can result in reduced personal  space for employees. Some pointed out that managers also may be  uncomfortable with mobility initiatives for various reasons. For example,  managers may be uncomfortable supervising employees who work  outside the office, or they may perceive a reduction in office space to  mean that they or their programs have become less important to the  organization.
To implement changes, agencies we reviewed, as well as private sector  organizations we contacted, have taken a number of actions to gain  support. For example, IRS officials told us they worked with agency  leadership as well as their union, when they implemented new space  standards that reflect changes in the mobility of their workforce. IRS  officials told us that they used budgetary pressures as the primary driver  to help both managers and employees understand why they needed to  substantially change their view of personal workspace. Similarly, Forest  Service officials told us they worked with their employee organization  when negotiating the space-sharing arrangements they plan to use in  their renovated space. Representatives from the private sector told us  their organizations took similar steps. For example, a representative of  one organization told us that his organization advises clients to ensure,  when downsizing offices, that employees understand the link between  reducing real estate costs and budgetary sustainability. A representative  from another organization told us that when his organization provides  space-planning services for clients, it always ensures that employee  organizations are consulted. Officials from the agencies we reviewed, as  well as private sector organizations we contacted, told us that  management needs to gain organizational support for changes and  cannot impose change on managers and employees. In their opinion,  organizations that have tried to impose such change are less likely to  succeed.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to OMB, GSA, IRS, USDA, USPTO, and  ATF for review and comment. USPTO provided written comments, which  are reprinted in appendix I. In its comments, USPTO stated that a  February 2012 audit performed by the Department of Commerce’s  Inspector General indicated that USPTO has avoided real estate costs as  a result of its Patent Hoteling Program. USPTO also stated that this  audit indicated that further analysis would point to increased cost  avoidance and savings, and that USPTO has since performed an analysis  of its Patent Hoteling Program’s costs and benefits. As noted in our  report, we reviewed USPTO’s analysis of the costs and benefits of its  Patent Hoteling Program. While USPTO’s analysis provided estimates for  some of the Patent Hoteling Program’s costs and benefits, we found that  some key assumptions USPTO made—such as rental costs per square  feet—were not supported. Accordingly, we could not verify USPTO’s  estimates. USPTO also provided technical comments, which we  incorporated where appropriate.
GSA, IRS, and USDA provided technical comments that we incorporated  where appropriate. ATF and OMB did not have comments on the report.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies of this report to the Director  of OMB; the Administrator of GSA; the Secretary of Agriculture; the Acting  IRS Commissioner; the Acting Under Secretary of Commerce for  Intellectual Property and Acting Director of the USPTO; and the Director  of ATF. Additional copies will be sent to interested congressional  committees. We will also make copies available to others upon request,  and the report is available at no charge on the GAO website at  http://www.gao.gov.
If you have any questions about this report, please contact me at   (202) 512-5731 or wised@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. GAO staff who made key contributions to this report are  listed in appendix II.
section_title: Appendix I: Comments from the U.S. Patent and Trademark Office
section_title: Appendix II: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
paragraphs: David J. Wise, at (202) 512-5731 or wised@gao.gov.
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Keith B. Cunningham (Assistant  Director), Russell C. Burnett, Colin J. Fallon, Robert K. Heilman, Wesley  A. Johnson, Terence C. Lam, John P. Robson, James R. Russell, Crystal  Wesco, and Nancy Zearfoss made key contributions to this report.