Every business wants their workplace to be a productive one. But how do you know if it is without digging into the data? Specifically, space utilization features and metrics can shine a light on how productive and efficient a workplace is by showing how in demand certain spaces are and how much employees use them. There’s a lot to glean from looking at utilization.

In fact, there are plentiful opportunities for more efficient and productive business operations in workplaces that achieve strong and consistent space utilization. Getting employees to use spaces with regularity and be productive while in those spaces enables broad benefits for everyone. Here’s a look at why space utilization is such an important variable in the success of business operations.

What is space utilization?

Space utilization is the rate at which space serves a productive role for a business. It’s also a measure of efficiency. If space utilization is low, the business is likely wasting cost and squandering productive opportunities. If utilization is high, there’s implied efficiency in the willingness of employees to use that space to productive ends.

Space utilization is best expressed mathematically. At the building level, it’s occupancy divided by capacity. If there’s 200 people in a building that accommodates up to 275 people, the utilization rate is roughly 72%. At the workspace level, utilization is the number of occupied hours divided by total available hours. If a desk is occupied an average of eight hours a day out of an available 10 hours, it has an 80% utilization rate.

The metrics of utilization get increasingly complex depending on how you look at them. Utilization isn’t a static percentage in agile offices, and there are different types of utilization to consider. What matters is a high utilization rate using the metrics that best-apply to your workspace.

How to identify utilization rates

The simplest way to identify and understand utilization rates is to rely on space utilization software. Dashboards make it easy to aggregate inflows of data and identify trends that signal high or low utilization rates. For example, if the four standing desks in your workplace have an 85% utilization rate against four phone booth pods with a utilization rate of 35%, there’s a clear preference. Software can show these simple insights, as well as trends and outliers that inform decision-making that shapes the workplace.

Space utilization benefits worth exploring

Why is there such an emphasis on utilization? Because there’s an abundance of space utilization benefits that accompany well-purposed space. Here’s a look at six of the biggest benefits companies can expect to see when they prioritize effective use of the workplace:

  1. Better workplace efficiency. Providing employees with space they’ll use not only results in better workplace utilization—it also increases efficiency. Employees are able to find and use workspaces that suit their needs, and do so with ease.
  2. Improved agility and flexibility. A well-moderated utilization rate enables a workplace to stay agile. Whether it’s hoteling or flexing into breakout spaces, appropriate utilization rates break down barriers that might prevent employees from using spaces efficiently.
  3. Reduced workplace friction. When they don’t feel cramped or restricted in the workplace, employee morale goes up. Higher employee morale leads to reduced friction among staff, and better collaboration and productivity.
  4. Lower cost of operation. Better utilization of available workspace saves companies the cost of wasting money on space they don’t need—or under-utilizing space to a point of losing money.
  5. Bottom-line savings and ROI. When the revenue generated by productive employees exceeds the cost of the space they work in, it signals efficiency. Good utilization rates can actually bring down the cost of operation, to generate even stronger bottom-line savings.
  6. Insights into employee needs. Facility managers who understand the context of space utilization have insight into what employees expect from their workplace. This understanding allows them to make changes that ultimately benefit everyone.

These benefits are only privy to businesses that understand and capitalize on efficient space utilization rates. Just because employees use space, doesn’t mean it’s valuable to them. Utilization tells a tale of the spaces they need and want, so facility managers can tailor a workplace that’s supportive and accommodating.

A focus on utilization can improve business efficiency

Space utilization features heavily into an efficient workplace. When employees have the workspaces they need, they’ll use them. When it’s easy to flex in and out of them, they will. It all boils down to understanding the ebb and flow of the workplace and how people interact with it. A clear understanding of interaction becomes the basis for informed improvements that bolster utilization rates.

There’s significant opportunity to increase utilization rates in workplaces big and small. When they do, businesses will reap the benefits associated with more efficient day-to-day operations.

Keep reading: Make Every Space Count with Space Utilization Software

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Jonathan writes about asset management, maintenance software, and SaaS solutions in his role as a digital content creator at Eptura. He covers trends across industries, including fleet, manufacturing, healthcare, and hospitality, with a focus on delivering thought leadership with actionable insights. Earlier in his career, he wrote textbooks, edited NPC dialogue for video games, and taught English as a foreign language. He hold a master's degree in journalism.