Despite technological advances, location is still important, writes Paul Hunt, managing director of Phoebus Software
Even as Boeing developed the 747 jumbo jet in the ’60s, its director of engineering said supersonic transport was going to take all its business. 50 years later, while sub-sonic flight is still going strong, Concorde is the stuff of history. DAB radio was going the bury FM until it turned out to be a white elephant. And the internet was going to make the post obsolete. But somehow the Royal Mail is still delivering 84 million items every working day. For the financial year 2008-9 Royal Mail had an operating profit of £321 million, with all four group businesses in a full year profit for the first time in two decades.
Many people are writing off the traditional office workplace now – but like sub-sonic flight, the FM radio and the humble postie, I don’t think it’s going to die any time soon.
The concept of the virtual office – meaning a work environment simulated by computer software to permit its user to perform tasks remotely that in the pre-computer era required the user to be physically present at an employer’s place of business – has actually been around for a long time. The term was first used in 1983, in, of all places, American Airlines’ in-flight magazine, American Way. Since then, the death of the traditional bricks and mortar office has been foretold by countless commentators. After all, with laptops, tablets, smartphones and teleconferencing, staff can work for their multi-national from practically any location. And cloud computing – storing information on remote servers rather on local PCs – means that projects can be synced effortlessly, no matter where you are.
But even in the early adopting world of tech, place still plays an important role. When the University of Oxford’s Said Business School hosted its annual meet-up of US and British entrepreneurs, why didn’t they just all stay where they are and gather on Skype? And let’s not forget that Silicon Valley is still going strong and producing corporate behemoths. One tiny building in Palo Alto, 165 University Avenue, has produced Google, PayPal, and the mobile phone developer Danger. In New York, there is now talk of a ‘Silicon Alley’ because of all the start-ups. Germany’s equivalent is Munich.
Clearly, location still matters. Technology certainly enables people to work together more easily, in the same way that it is easier to keep in touch with family and friends because of Facebook. But the connections that come from being in an area (be it the same office space or the same city) where people are thinking along the same lines are essential. People are sociable animals (even software developers &hellip) and being around like-minded people is hugely important.
This is one of the reasons we are based in the West Midlands conurbation. It’s a hub for the UK’s mortgage industry with West Bromwich Building Society, BM Solutions, Tipton & Coseley Building Society, Exact Mortgage Experts, Dudley Building Society, New Life Mortgages, and Paragon Mortgages all based nearby. It’s the density of talent that makes the area attractive, in terms of lenders, advisers, employees, and even potential acquirers. It’s like an ‘ecosystem’ where all the ingredients to make a company work are there already. Let’s not forget the huge serendipity of the physical world and the importance of relationships – especially in an industry like ours.
Although location matters, I’ll concede that maybe it matters a tiny bit less than it used to. Technology has made it easier to stay connected to people. However, it can’t replace face-to-face meetings. You always want to meet potential employees, investors, and business partners in person.
