Why it is almost always better to expand to two smaller offices rather than to one large office


An organization typically starts its life with one office.


A move is required to avoid some limitation.  


Two possibile limitations:


1) Increased rent exceeds budget.

2) Increased personnel exceed office capacity.  


Lets say those two limitations became issues for your company at the same time.


Assuming you want to keep your people and stay in business, you have a choice to make.


You can choose to move to a larger office.  You can choose to move to some number of smaller offices.


Choose more than one office.


Why will choosing (carefully) two or more offices be better for your organization than one?:


1) You halve the number of people who will resign when you move.  (And in the future, you can capture some employees that would otherwise leave due to moving away.)  Moving is not great, but commuting further every day is terrible.  


2) You will double your new-hire applicant pool.  


3) All the other advantages of cutting your employee travel time way down: increasing employee happiness, productivity, etc.


4) You will have two *better* offices with quieter working conditions and stronger ties between workers.  (If you hadn't noticed, I'm not linking out to references for lack of time, but I assure you, the internet *did* tell me this is true, and it fits with my experience.)


5) If your two new offices are situated with the optimal travel time between them (about an hours commute, IMHO), then you can retain the commute-savings and other advantages, and make live easier for executives and managers.  They get to deal with team of a manageable size *and* they can still get together with cross-functional and cross-office teams in person.  


6) It's a hell of a lot easier to move or expand.  You can open new, smaller offices more easily than big ones.  You can creep offices forward in this way, expanding your applicant territory.  Hit the border of the viable territory?  Want to move one of your offices to a distant location with more employees?  Moving one small office should be doable.  Shrinking a big office or moving a big office is not as easy.


7) You take advantage of modern tools.  You are not restricted by the technology of the past.  It's o.k.  You can get rid of the old business strategies that you don't have a reason for anymore.  You can telecommute to work, work with remote teams, and just get together once in a while as needed where needed.  You know that's what it's supposed to be like.  These tools are only getting better, and fast.  Use them.


8) There could be a savings in fixed costs.  By splitting the offices, you move, on average, closer to your employees.  I suspect that this is almost always true, even if you move to slightly lower cost areas!  You would have to do the math in your specific part of the world to be 100% sure.  


Verifying this is probably quite fun:


Get a big paper map (or a digital one).  


Map out where your employees live, your prospective employees live, and costs for offices half the size of the one you were looking for, in all of the areas within 10, 15, and 30 minutes commute of the employee and prospective employee centers.


Find the optima.


Those are the eight that came to mind before my hands got tired and I moved on to something more interesting.  I'm sure you could think of a couple more.