Analysis and Strategy for Office Move

7511 words (30 pages) Essay in Management

23/09/19 Management Reference this

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REPORT

COMBINATION OF OFFICES

 

COMBINING TWO OFFICES IN LONDON

There are two management offices of Cognita in the United Kingdom, London Office in London and Group Head & Europe Regional Office in Milton Keynes. The distance between two offices is 1 hour and 4 minutes in driving, about 51.3 miles. Cognita Management are considering combining these two offices into one but they are thinking Milton Keynes or London is the best place for moving to. Chris Jansen, the Group Chief Executive Officer of Cognita is asking a report on combining offices of Milton Keynes and London.

Internet is very popular and strong. There are most of information on internet for comparison. Beside that Estate Agents in London and Milton Keynes can help with more information and making decision. Staff survey is also key information of the office moving because keeping experience staff is very important and bring lots of benefit and saving cost for the Group such as recruitment, training, relocation, etc…

When moving office, there are many aspects need to be considered so that it does not influent much to the business, such as:

-          Distance of the current office and new office and the schools in the Group

-          Advantages and disadvantages of the new place

-          Cost living

-          Cost of office rent and house rent

-          The present trend of people and government

-          Staff survey to have their point of view

-          Report of the estate agents

Here are the address of the Cognita Offices in the United Kingdom

GROUP HEAD AND EUROPE REGIONAL OFFICE

LONDON OFFICE

5 & 7 Diamond Court,
Opal Drive,
Eastlake Park,
Fox Milne, 
Milton Keynes,
MK15 0DU, UK

3rd Floor,
41-42 Eastcastle Street,
London,
W1W 8DY, UK

Brief of London and Milton Keynes

London

Milton Keynes

As you know London is not only the capital of the United Kingdom, it’s also the dream destination of people around the world, especially students all over the world. It’s a largest city of the United Kingdom.

People consider London as the world’s leading global city and has been termed as:

-          Most powerful

-          Most desirable

-          Most influential

-          Most visited

-          Most expensive

-          Innovation

-          Sustainable

-          Most investment friendly

-          Most popular for work

-          Most vegetarian friendly

Follow estimates of the population for the UK, Wales, Scotland and Northern Ireland, June 2017, population of London is 8,787,892, the most populous of any city in the European Union.

Transport in London is very convenient.

-       London is the busiest city airspace in the world. There are 8 international airports in London in which 6 of 8 use the word London in their name:

+ London Heathrow Airport in Hillingdon, West London

+ London Gatwick Airport, South of London in West Sussex

London Stansted Airport, North-East of London in Essex

+ London Luton Airport, to the North of London in Bedfordshire

+ London City Airport, Newham, East London

+ London Southend Airport, East of London in Essex

-       Rail is very convenient with London Underground, Suburban with more than 360 railway stations, Internal-city and International with 70% of rail journeys starting or ending in London and Freight.

-       Buses and trams, they are the largest in the world, running 24/7.

-       Cable car, the first and only cable car opened in June 2012.

-       Cycling is very popular in the whole Greater London, around 650,000 people use a bike every day.

-       Port and river boats handle 45 million tons of cargo each year as provisional port statistic 2009. It is the second largest in the United Kingdom.

-       Roads, in the centre of London, most of the journeys are made by public transport, car is popular in the suburbs.

The UK Government wanted to develop new towns in the South East of England to relieve housing congestion in London. Milton Keynes was a new city since the 1950s. Milton Keynes was taken from the existing village of Milton Keynes in a “designated are” of 34.1 square mi.

From 2004 to 2011, 25 five years after the new city founded, the Milton Keynes Partnership, QANGO,  had development control powers to accelerate the growth of Milton Keynes.

Milton Keynes is the urban design on development of land use, building environment, air, water and the infrastructure such as transportation, communications and distribution networks.

The population of Milton Keynes was 266,800 (as UK population 2018) and predicting the increase of 2,220 people in 2018 so its population will be 269,020 people in estimate. The area population under 16 is 22.6%.

Transportation at Milton Keynes is very convenient

-       The grid roads system. It is a network of predominantly national speed limit for private and public transport in Milton Keynes, Buckinghamshire

-       The grid squares is the space of 1km between grid roads so that people are able to walk to a bus station.

-       Redways system, it was designed for leisure cycling, slow moving cycle and pedestrian from fast moving means. This was a segregate system.

-       There are 6 railway stations in Milton Keynes:

+ Milton Keynes Central

+ Wolverton

+ Bletchley

+ Fenny Stratford

+ Bow Brickhill

+ Woburn Sands

-       The London Luton Airport is the nearest international airport to Milton. It takes around 32 minutes by car or 1 hour and 3 minutes by national express from Milton Keynes to the London Luton Airport. Milton Keynes has a direct rail connection to Birmingham International Airport, around 2 hours.

-       Education, there is further education at Milton Keynes College but it’s up to foundation degree level and Postgraduate Certificate in Education course is available. This course is in partnership with and accredited by Oxford Brookes University since February 2012. Milton Keynes does not have its own university proper although it is the UK’s largest population centre.

The state secondary schools in Milton Keynes are:

+ Stantonbury Campus

+ Denbigh school

The private schools in Milton Keynes are:

+ Webber Independent School. This is a mixed sex for children from 3 to 18 years old.

+ Milton Keynes Preparatory School. It is mixed sex for children from 21/2 to 11 years old.

List of Cognita Schools in UK

There are 17 Cognita Schools in London and 23 Schools through the United Kingdom.

Schools

Town/ City

Distance from Milton Keynes

Distance from London

Hour

Min.

Hour

Min.

Polam School

Bedford

Bedfordshire

0

29

1

41

Long Close School

Slough

Berkshire

1

18

1

7

Akeley Wood Junior School

Milton Keynes

Buckinghamshire

0

16

1

51

Akeley Wood Senior School, 

Buckingham

Buckinghamshire

0

25

1

50

King’s School, Plymouth

Plymouth

Devon

4

12

4

39

Colchester High School

Colchester

Essex

2

24

2

21

Oxford House School

Colchester

Essex

2

36

2

15

St Margaret’s Preparatory School

Gosfield

Essex

2

10

2

3

Kingscourt School

Catherington

Hampshire

2

28

2

7

Meoncross School

Fareham

Hampshire

2

45

2

24

Duncombe School

Hertford

Hertfordshire

1

15

1

10

Hendon Preparatory School

Hendon

London

0

58

0

39

Charterhouse Square School

Islington

London

1

39

0

20

Clifton Lodge School, , London

Ealing

London

1

25

0

49

North Bridge House Nursery School

London

1

13

0

17

North Bridge House Preparatory School

London

1

19

0

17

North Bridge House Pre-Preparatory School

London

1

14

0

11

North Bridge House Senior School

Hampstead

London

1

14

0

21

Salcombe Preparatory School

Southgate

London

1

13

0

53

Southbank International School

Westminster

London

1

27

0

10

Southbank International School

Kensington

London

1

27

0

20

Southbank International School

Hampstead

London

1

15

0

18

North Bridge House Senior School & Sixth Form

London

2

11

0

11

St Nicholas Preparatory School

Kensington

London

2

16

0

19

Oakfields Montessori School

Upminster

London

1

48

1

36

Breaside Preparatory School

Bromley

London

2

23

1

15

Cumnor House School for Boys

South Croydon

London

2

19

1

22

Cumnor House School for Girls

Purley

London

2

15

1

28

Quinton House School

Northampton

Northamptonshire

0

38

1

49

St Mary’s School

Henley-on-Thames

Oxfordshire

1

29

1

34

Downsend Pre-Preparatory School

Leatherhead

Surrey

1

49

1

19

Downsend Pre-Preparatory School

Ashtead

Surrey

1

50

1

22

Downsend School

Leatherhead

Surrey

1

48

1

21

Milbourne Lodge School

Esher

Surrey

1

54

1

13

Downsend Pre-Preparatory School

Epsom

Surrey

2

7

1

23

Glenesk School

East Horsley

Surrey

2

6

1

18

St Clare’s School

Porthcawl

Wales

3

25

3

47

Oakleigh House School

Swansea

Wales

3

47

4

9

Hydesville Tower School

Walsall

West Midlands

1

57

2

50

Huddersfield Grammar School

Huddersfield

West Yorkshire

3

7

4

4

Cost living in London vs Milton Keynes (following data on NUMBEO.com)

Note: all currency in this report is Pound Sterling (GBP)

Minimum cost for a person living in Milton Keynes is around £3,030.91, but you want to maintain the same standard of living in London, you have to need at least £4,600.00 (assuming you rent in both cities). The data is from “Cost of Living plus Rent Index” to compare cost of living. Saving cost each month for a person living in Milton Keynes is £1,569.09.

As the info of NUMBEO, the indices difference are (the data below is from NUMBEO website):

Indices Difference

Consumer Prices in Milton Keynes are 16.97% lower than in London

Consumer Prices Including Rent in Milton Keynes are 33.28% lower than in London

Rent Prices in Milton Keynes are 54.12% lower than in London

Restaurant Prices in Milton Keynes are 14.64% lower than in London

Groceries Prices in Milton Keynes are 9.49% lower than in London

Local Purchasing Power in Milton Keynes is 3.43% higher than in London

Here is the board in basic of cost living

  London

Milton Keynes

Difference

Restaurants

Meal, Inexpensive Restaurant

£15.00

£13.50

     -10.00 %

Meal for 2 People, Mid-range Restaurant, Three-course

£50.00

£40.00

     -20.00 %

McMeal at McDonalds (or Equivalent Combo Meal)

£6.00

£5.00

     -16.67 %

Domestic Beer (0.5 liter draught)

£5.00

£3.50

     -30.00 %

Imported Beer (0.33 liter bottle)

£4.50

£3.50

     -22.22 %

Cappuccino (regular)

£2.72

£2.58

     -5.08 %

Coke/Pepsi (0.33 liter bottle)

£1.29

£1.16

     -9.64 %

Water (0.33 liter bottle)

£0.98

£0.88

     -10.12 %

Markets

Milk (regular), (1 liter)

£0.92

£0.84

     -8.47 %

Loaf of Fresh White Bread (500g)

£1.11

£0.94

     -15.33 %

Rice (white), (1kg)

£1.73

£1.30

     -24.95 %

Eggs (regular) (12)

£2.14

£1.89

     -11.76 %

Local Cheese (1kg)

£6.93

£4.50

     -35.07 %

Chicken Breasts (Boneless, Skinless), (1kg)

£6.66

£5.59

     -16.16 %

Beef Round (1kg) (or Equivalent Back Leg Red Meat)

£8.79

£10.40

     +18.36 %

Apples (1kg)

£2.25

£1.82

     -19.39 %

Banana (1kg)

£1.03

£0.89

     -13.47 %

Oranges (1kg)

£2.12

£1.53

     -27.72 %

Tomato (1kg)

£2.25

£1.83

     -18.67 %

Potato (1kg)

£1.15

£1.07

     -7.49 %

Onion (1kg)

£1.14

£0.95

     -16.38 %

Lettuce (1 head)

£0.77

£0.55

     -28.88 %

Water (1.5 liter bottle)

£0.98

£1.13

     +15.27 %

Bottle of Wine (Mid-Range)

£8.00

£5.50

     -31.25 %

Domestic Beer (0.5 liter bottle)

£1.56

£1.45

     -6.89 %

Imported Beer (0.33 liter bottle)

£2.09

£1.60

     -23.57 %

Cigarettes 20 Pack (Marlboro)

£11.00

£9.30

     -15.45 %

Transportation

One-way Ticket (Local Transport)

£2.50

£2.40

     -4.00 %

Monthly Pass (Regular Price)

£140.00

£52.00

     -62.86 %

Taxi Start (Normal Tariff)

£5.00

£3.25

     -35.00 %

Taxi 1km (Normal Tariff)

£3.00

£2.50

     -16.67 %

Taxi 1hour Waiting (Normal Tariff)

£40.00

£13.50

     -66.25 %

Gasoline (1 liter)

£1.28

£1.24

     -3.19 %

Volkswagen Golf 1.4 90 KW Trendline (Or Equivalent New Car)

£19,572.50

£17,000.00

     -13.14 %

Toyota Corolla 1.6l 97kW Comfort (Or Equivalent New Car)

£20,703.70

£17,500.00

     -15.47 %

Utilities (Monthly)

Basic (Electricity, Heating, Cooling, Water, Garbage) for 85m2 Apartment

£150.21 £

£162.30

     +8.05 %

1 min. of Prepaid Mobile Tariff Local (No Discounts or Plans)

£0.11 £

£0.04

     -60.44 %

Internet (60 Mbps or More, Unlimited Data, Cable/ADSL)

£32.77 £

£29.17

     -11.00 %

Sports And Leisure

Fitness Club, Monthly Fee for 1 Adult

£45.73 £

£28.77

     -37.09 %

Tennis Court Rent (1 Hour on Weekend)

£11.10 £

£14.88

     +33.98 %

Cinema, International Release, 1 Seat

£13.00 £

£10.00

     -23.08 %

Childcare

Preschool (or Kindergarten), Full Day, Private, Monthly for 1 Child

£1,251.65 £

£900.00

     -28.09 %

International Primary School, Yearly for 1 Child

£16,649.91 £

£12,000.00

     -27.93 %

 

Clothing And Shoes

1 Pair of Jeans (Levis 501 Or Similar)

£63.50 £

£45.00

     -29.13 %

1 Summer Dress in a Chain Store (Zara, H&M, …)

£30.51 £

£24.00

     -21.34 %

1 Pair of Nike Running Shoes (Mid-Range)

£67.01 £

£51.33

     -23.39 %

1 Pair of Men Leather Business Shoes

£79.87 £

£56.67

     -29.05 %

Rent Per Month

Apartment (1 bedroom) in City Centre

£1,711.78 £

£831.25

     -51.44 %

Apartment (1 bedroom) Outside of Centre

£1,238.45 £

£651.11

     -47.43 %

Apartment (3 bedrooms) in City Centre

£3,186.27 £

£1,186.88

     -62.75 %

Apartment (3 bedrooms) Outside of Centre

£2,019.00 £

£1,071.67

     -46.92 %

Buy Apartment Price

Price per Square Meter to Buy Apartment in City Centre

£13,265.98 £

£4,700.00

     -64.57 %

Price per Square Meter to Buy Apartment Outside of Centre

£7,763.15 £

£3,017.00

     -61.14 %

Salaries And Financing

Average Monthly Net Salary (After Tax)

£2,543.46 £

£1,763.89

     -30.65 %

Mortgage Interest Rate in Percentages (%), Yearly, for 20 Years Fixed-Rate

£3.26

£3.38

     +3.74 %

Last update:

December 2018

December 2018

Contributors:

737

58

Data from past:

18 months

18 months

Currency: GBP


Base on the board above, here is the summary of the basic expenses and saving cost when living in Milton Keynes

The basic cost for living as the analysis board above, the living cost in London is much expensive than Milton Keynes.

Cost of rental office

Cost of office rent is not less important. Following is the average cost of flexible office space in the United Kingdom per person per month is between £200 and £1,400, depending on location and amenities (data from Instant Office).

Cost to Rent Office Space in Top UK Cities

City 

Average Cost Per Person 

London

£650 – 1400

Bristol

£300 – 400

Leeds

£250 – 400

Manchester

£300 – 350

Birmingham

£200 – 450

Everyone can see office space rental in London is highest. If the office is moved to another city, the company may save:

And rental offices cost in Milton Keynes is between £56 to £250 per person per month per person in average. There are some spaces with higher cost, people can call for a deal.

The cost of rental office in Milton Keynes is much cheaper than in London. The company can save 91 to 82 % on this cost.

Following Financial Times, London Business move north as cost rise

 

“At least seven big companies are considering opening in Great Manchester rather than expand in London, as the high cost of doing business in the capital begin to bite.

About 70 per cent of the 30,000 plus students who graduate in Manchester every year remain in the city, providing a skilled workforce. “You can get lawyer in Manchester for half the price of London” Mr. McFarlane said.

Andrew McFarlane, head of Northwest for Colliers, said London was reaching a point where the costs of doing business outweighed the advantages for some.

In the capital, rents have hit £67.50 per square feet in the City and £125 in the West End, compared with £34 in Manchester. In response, companies are looking at moving to suburbs such as Bromley and Croydon. “If you are moving out of central London you might as well look at other city centres.”

Manchester’s population speaks more than 200 languages and its airport serves more than 200 destinations.

Average house prices of £100,000 are less than a quarter of London’s. As well as two Premier League football clubs, it has two orchestra and its biennial International Festival has won critical acclaim.

Midas expects to beat last year’s record investment figures, when it attracted 4,067 jobs from almost 100 projects, and says it is talking to more than 200 potential investors.

Manchester Evening News had a question: Why are so many Londoners leaving the capital for Manchester?

There were a big number of people, 10,200 people, left London to move to Great Manchester last year – but there was only 8,870 people moving from Great Manchester to London.

It means London loss of 1,330 people to Great Manchester – or more than three a day.

People think that it’s find to move to Great Manchester because it’s is around 210 miles away from the capital. People can drive a car or take airplane when they need to be back and forth between London and Great Manchester.

According to new data from the Office for National Statistics, Great Manchester welcomed the highest immigration from London to Manchester in five years.

These are the areas at Great Manchester that Londoners moved to

-          Salford, 380 people

-          Stockport, 210 people

-          Rochdale, 180 people

People love to living in London. At the first time living in London, It’s very good for social life but later on they recognise that London is an expensive Capital and they want to move out of London.

House renting in London is too expensive so that they choose to move out of the Capital a little bit. Same payment but they move out of the heart of London, they can have a bigger space for living and not too much far from the Centre. Recently people select this solution.

A M.E.N. reporter, 29 years old said “I think people are becoming aware of the fact it is no longer necessary to build your career in the capital, there are many opportunities for graduates in Manchester”.

House price is one of the key reasons that more people moving from London to Greater Manchester. In fact people recognize it’s cheaper to live in Great Manchester.

Buying house in London, you have to pay £484,584 at least but in Great Manchester is £155,868. It’s 67.8% for save.

Map from London to Milton Keynes and Great Manchester.

From London to Milton Keynes, it’s 54.3 miles and to Great Manchester, 212 miles

Staff Survey result

Looking at the survey result, 71.34% staff in London Office may move to the Cognita new office for working and living and 51.14% love to move to Milton Keynes for working and staying. The supporting with free tuition fee for their children is very good. It attracted the staff who have children and married. There are 71.34% staff agree to move to Milton Keynes if the Group support free tuition fee for their two children.

Summary and Conclusion

In summary, recently many companies in London are looking for a place to move the office out of London because of increasing price. London is one of the most expensive cities in the world. Although London is very convenient for business with transportation system, 8 International Airports in London around, business centre, and labour sources but people now want to move out of London to another cities in the United Kingdom such as Birmingham and Great Manchester, for example last year there was 4,710 people in Manchester moved to London but there was 4,810 Londoners moved to Manchester for working and living. London shorted 100 people for Manchester.

As updated in December 2018 on NUMBEO, a minimum cost for a single person in London is £802.64, without rent. Cost living index of London is £81.60. London is the 27th city in ranking of cost living in the world. Below is the chart of distribution of expenses. Look at the chart, rent per month is 44% of the expenses.

Comparing with distribution of expenses in Milton Keynes as below. Cost of rent per month is only 28.8% of the expenses, the difference is 15.2% for rental

Office rent in Milton Keynes is much cheaper than in London. Paying from £65.00 to £250.00 for one person per month in Milton Keynes but in London, this cost is from £650.00 to £1,400.00 for one person per month. A company in Milton Keynes can save 91% – 82% on the office rent.

Cognita have 17 private schools in London and 23 private schools in the United Kingdom so total private schools of Cognita Group are 40 schools. Most of Cognita schools in the South of United Kingdom. When having guests, they can pick one of the Cognita schools in London to meet with visitors. The facility at Cognita Schools is read for such meetings.

Through the staff survey result, it’s very happy to see the most of staff are ready to move with the Group. 71.43% of staff at London Office are able to move to new office and 57.4% staff want to work and stay at Milton Keynes. 

The weather in Milton Keynes and London is not much different if we don’t want to say it’s same. This is one of the advantages for moving to Milton Keynes.

Transport at Milton Keynes was originally designed as urban so it’s very convenient.

-          Canal – The Grand Union Canal. It is as a main axis of the design of Milton Keynes.

-          Railway – there are 6 railway stations in Milton Keynes

  • West Coast Main Line: Milton Keynes Central, Wolverton, Bletchley
  • Marston Vale Line: Fenny Stratford, Bow Brickhill and Woburn Sands railway station

-          Motorway

  • the M1 motorway runs along the east flank of Milton Keynes.
  • the A5 road, a grade separated dual carriageway, runs right through Milton Keynes
  • the third main road is A509, connecting Milton Keynes with Welling borough and Kettering
  • the A421 and A422 run from west to Buckingham and east to Bedford

-          Long-distance coaches stop at the Milton Keynes coach way and the Regional coaches stop at Milton Keynes Central.

-          Buses – a number of routes pass through or serve Central Milton Keynes.

-          Airlines – London Luton Airport is the nearest international airport. There are most of necessary services in the airport such as superb shopping, cafes, restaurants, bars, shops, currency exchange booths, free wifi service, passenger service assistants, lost and found service, special assistance, multi-faith prayer room, etc. 

Following all information above, I think it’s better we combine two offices into one. With all the advantages in Milton Keynes now, the decision moving the London office to Milton Keynes is the best one. With the trend Londoners run away from London to another cities, we can consider to build up more schools in the cities that Londoners moving in such as in Birmingham and Great Manchester. Moreover, we can consider to build up a “camp” school for middle and high students in Milton Keynes. We will attract students from City to “Country” breathing the fresh air and enjoy a “break time” when they want to avoid the hustle and bustle of the big cities. The programme can be linked between the “camp” schools and other Cognita Schools in London and other parts of the United Kingdom. Milton Keynes is not too much far from London and this school may offer short terms for long trips for middle and high students whose parents want to move out of London with fresh air, low cost in Milton Keynes. Catching the trend of society, people like to move out of the Capital because of cost living and house rent. We can see this very clear through the staff survey result. There was 71.43% of staff working at London joining the survey. Most of them are ready to move with Cognita when the company want to relocation of the office and there was 57.14% choosing Milton Keynes for working and living. It is an amasing number, moreover it is more confident to move out of the London with 71.43% staff agreed to move to Milton Keynes for working and living if the company offer free tuition fee for their children. People balance their cost very carefully. Combining two offices into one is a good choice, the company can

-          merge the same function departments into one. This helps to reduce cost to pay for head of departments;

-          reduce renting office cost;

-          pay less for house renting for staff (the company cover housing allowance);

-          help staff keep standard of living but live in bigger house and have saving money.

-          look for a chance to open new business in Milton Keynes or develop to other parts of UK.

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