By Sophy Moffat, Associate Director of Research
Our latest report, The Future of the TMT Workplace, explains how TMT players can use their workplaces to future-proof their businesses, while identifying the five forces that are driving TMT sector players to fundamentally rethink their workplace and real estate strategies. The five forces driving change are explained in more detail here.
Accelerated adoption curves and shortening product lifecycles means that competitive advantage in the TMT sector is increasingly derived from an organisation’s ability to develop new products and services to unlock new sources of growth. Workplaces, location strategies and the composition of workforces at TMT players are all changing to accommodate the new products and services that companies in the sector are developing.
New applications of technology, the falling costs of computational power and the availability of platforms to easily build, distribute and market new products is empowering the rise of disruptive new entrants to the sector. Young companies and new business units can scale rapidly, making it harder to develop strategies for the long term. In this context, forecasting workplace and real estate requirements is a significant challenge – as one corporate real estate professional for a large technology company told us, ‘technology moves quickly; property doesn’t.’ Increasing the flexibility of their portfolios is a key priority for the companies we spoke to.
Concentrations of customers and talent in cities are drawing TMT players to base their operations inside urban locations, rather than in out of town ones. Cities can act as testbeds for new technologies for TMT companies, but heads of real estate need to be able to identify which cities have the deepest talent pools, best universities, most vibrant startup ecosystems and established networks of peer companies.
4. Emerging Markets
The shift in economic dynamism from the developed economies of the West to the emerging economies of the developing world is leading TMT companies to think more seriously about their emerging market strategies. These countries not only offer huge opportunities for growth, but also deep pools of talent. While this makes them attractive locations for TMT firms, they’re also home to ferocious local competition that developed market firms will have to tackle head on.
There’s a war going on for top technical talent. Demand for developers, data analysts and engineers already outstrips supply, and as technology is high up on the agenda of businesses beyond the TMT sector, the competition for talent is growing more intense. Furthermore, the generational divide between younger coders, who tend to be proficient in different programming languages, is leading to an impending skills gap for many companies. Attracting the right talent is driving decisions about location and workplace.
The above is an excerpt from our newest GOS report, The Future of the TMT Workplace, which can be downloaded here.
Sophy is an Associate Director of Research, her team produces studies on the central London economy, capital markets, occupier market, and factors that affect supply-demand fundamentals in commercial real estate. Sophy has produced research for investors including St. Martin’s, Ho Bee and Dekabank as well as authoring various published reports which identify workplace trends. Sophy is regularly featured in the UK national and trade press and frequently speaks about the future of the workplace at industry events.