The Strategic Business Case

THE MARIS METHODOLOGY:

FROM COST CENTRE TO VALUE DRIVER

At Maris, we advise clients to stop calculating “Cost per Square Foot” and start calculating “Value per Head.” Our methodology for building a business case rests on three pillars of Return on Workplace Investment (ROWI):

1. Friction Reduction (Operational Efficiency):
A poor workspace is full of invisible friction: slow IT, lack of meeting rooms, poor acoustics and illogical adjacencies. These micro stresses compound. As we noted in our introduction, studies show that a 2% to 5% gain in output is enough to offset typical accommodation costs. Our design process begins with a “Friction Audit” – identifying the physical barriers that slow your teams down. We then design specifically to remove them, using Activity-Based Working (ABW) principles to provide the right setting for the right task.

2. The Magnetism Mandate (Talent Acquisition):
In a tight labour market, your office is your brochure. It is the physical manifestation of your culture. Prospects – especially Gen Z and Millennials – interrogate the workspace as part of their decision-making. Does it support wellbeing? Is it sustainable? Is it flexible? A fit-out that answers “yes” reduces the cost per Hire and shortens the recruitment cycle.

3. Asset Optimisation (Hybrid Rightsizing):
Many businesses are currently paying for empty desks. A strategic fit-out allows you to “right size.” This doesn’t always mean taking less space; often, it means repurposing underutilised desk farms into high-value collaboration hubs, client suites, or wellness zones. We use utilisation sensors and occupancy data to restructure your square footage, ensuring every metre contributes to business goals.

THE CFO’S CORNER:

CALCULATING THE COST OF INACTION

When presenting a fit-out business case to the Board or Finance Director, emotional arguments about “culture” rarely suffice. You need hard data. The strongest financial argument for a high-quality fit-out often lies in the Cost of Attrition.

Consider the “1-9-90” rule mentioned earlier. If you cut the fit-out budget by 10% (affecting the 9%), but the resulting poor environment causes a 1% drop in staff retention or productivity (affecting the 90%), you have made a net loss.

The Math of Attrition

According to Oxford Economics, the cost to replace a single employee (including recruitment fees, onboarding and lost productivity) averages £30,000.

• If your company has 100 staff and an attrition rate of 15%, you are losing £450,000 annually to turnover.
• If a strategic fit-out improves retention by just 30% (a conservative estimate for high-quality environments), you save £135,000 per year.
• Over a typical 5-year lease, that is a £675,000 saving – often enough to cover a significant portion of the fit-out works themselves.

Tax Efficiency & Capital Allowances

Furthermore, the net cost of fit-out is often lower than the headline figure due to Capital Allowances. In the UK, many elements of a fit out (such as air conditioning, lighting, cabling, and kitchens) qualify as “Plant and Machinery.” Under the Full Expensing regime (introduced in 2023), companies can often claim 100% first year relief on qualifying main rate plant and machinery. This can effectively reduce the real cost of the project by up to 25% (depending on your Corporation Tax rate). Always consult a tax specialist, but ensure this relief is factored into your gross vs. net budget presentation.

MARIS TOOLS:

THE ROWI CHECKLIST

Before taking your business case to the board, use this checklist to gather the necessary data points. If you cannot answer these, your business case is incomplete.

• Utilisation Data: What is your current peak occupancy vs. average occupancy? (Do not guess; measure.)
• The “Churn” Cost: How much did you spend on recruitment fees in the last 12 months?
• Productivity Lag: What is your current “Time to Hire”? Has it increased?
• Maintenance Bleed: How much are you spending annually on ad-hoc repairs (HVAC failures, lighting, patch fixes) that a new fit-out would eliminate?
• Energy Baseline: What is your current energy spend? (New LED lighting and VRF air conditioning can typically reduce this by 20-30%.)
• The “Change” Metric: What specific business objective (e.g., “Launch new division,” “Merge two teams”) is currently being physically blocked by your office layout?