HYDERABAD: Banking and payment solutions provider VSoft Technologies has terminated leases for 11 out of its 15 offices pan India post lockdown, while InsideView Technologies has ended the lease on its Hyderabad office housing about 180 people.

In Mumbai, cybersecurity player SEQURETEK has ended the lease on a 50-seater facility, even as Bengaluru-based PromptCloud Technologies has done the same on an additional 3,000 sq ft space it acquired just before lockdown and Chennai-based e-learning player HeyMath! is halving its office footprint.

After the Covid-19 outbreak forced the world to embrace 100% work from home (WFH) – many small and midsized companies have already started giving up real estate or cutting down on their office footprint. This is not just a belt-tightening exercise. These companies feel WFH makes better business sense.

Arpan Jha, chief strategy officer of PromptCloud, for whom WFH was an absolute no-no, has already made her 60-people big data company adopt the new culture. “Before the lockdown we were skeptical about WFH despite employee demand. We expected people to be in office if they were working. But after Covid-19 forced us to work remotely, we realised things worked pretty well,” she explains.

Jha’s company is expanding but investing the money saved on realty in tools to track employee output and engaging strategic HR consultants to formulate a detailed WFH policy.

Murthy Veeraghanta, chairman & CEO, VSoft, says the fact that productivity did not dip during WFH gave them the confidence to terminate leases of smaller offices that housed 25% of the 1,200 workforce. VSoft is now looking for a more compact Hyderabad HQ.

InsideView’s decision to terminate the lease on its entire 17,000 sq ft office in Madhapur, Hyderabad, last month was just part of the plan to go big on WFH, says board member Sesha Rao.

“Our internal survey showed employees are enjoying the freedom, flexible hours and the fact that they don’t have to spend 2-4 hours on daily commutes. We asked ourselves why we are spending so much on a facility when everyone is enjoying WFH,” says Rao.

“We always had a high WFH staff as we never viewed it as an HR benefit but an organisational culture of trusting employees. We went 100% WFH from early March,” he adds.

Pankit Desai, co-founder & CEO, SEQURETEK, sees Covid-19 as a blessing in disguise.

“Today, we can hire talent anywhere without getting them to relocate or having to set up an office. Our worries about productivity and customer intimacy too have been proven wrong,” explains Desai, who also shelved plans to double office footprint in Bengaluru from 50 people. In the long run, Desai is looking at a 50% WFH setup.

G R Reddy, founder, Husys Consulting, an HR function management company, says many of their clients are rethinking their real estate strategies with many smaller ones resorting to lease terminations and bigger players looking at renegotiating rentals if not reducing footprint.

But these companies realise that once the Covid-19 threat is over and its business as usual, employees will want to come back to office for collaboration, bonding and celebrations. “That’s why we will take a much smaller space but there’s no hurry as we expect realty rates to go down,” says Rao, who is mulling a 70-85% WFH in the long run.

“If we can reduce costs without impacting productivity, why not? After two and half months on WFH we realised we need only half the space as most employees are enjoying WFH. Once things get back to normal, they can come in twice a week for which a 25-seater space is enough,” says Nirmala Sankaran, founder, HeyMath!, which has 65 employees.

Realtors too admit that WFH is here to stay. It might result in a 10-20% office space reduction over next two to three quarters as companies try to reduce costs but it’s only a short-term phenomenon, believes CREDAI national chairman Jaxay Shah.



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