As Work-from-Home arrangements have been widely adopted during the COVID-19 pandemic, the Indonesian government may go further with a Work-from-Anywhere (WFA) policy for its employees to enhance productivity.
It is unsurprising that the way people work has changed significantly during the pandemic. A from Accenture, a consulting firm, found that 83% of workers prefer a hybrid model for work. The same survey also found that over two-thirds of high-growth businesses have switched to a work-from-anywhere model, while the majority of 鈥榥o-growth鈥� companies remain focused on where people are going to work physically.
In Indonesia, as Work-from-Home arrangements have been widely adopted during the COVID-19 pandemic, the government may go further with a Work-from-Anywhere (WFA) policy for its employees to enhance productivity. The government plans to implement a more flexible working system for civil servants by allowing them to WFA in the future. The framework is being developed across ministries and government agencies.
The Head of the Legal, Public Relations, and Cooperation Bureau of the Administrative and Bureaucratic Reform Ministry Satya Pratama said the application of WFA was intended to increase the effectiveness of ASN performance and provide efficiency to government bureaucracy. 鈥淭he important thing is that performance and targets are achieved," he said, as quoted by Kompas on May 12, 2022.
Unlike other working arrangements, WFA doesn't require employees to work from a specific place, like their homes. Neither does it require them to have mandatory office hours. The accelerating remote work culture, therefore, is bound to further propel the growth of flexible workspaces like co-working spaces, especially since employers are looking at the prospects of remote working as a long-term practice. This signals that the future of working today synergizes with the future of co-working space.
The Benefits and Challenges of Co-working Spaces
The shift in working habits has encouraged the use of co-working spaces across Indonesia as an alternative to Work-from-Home and Work-from-Office. According to M. Syahran W. Lubis, in his editorial published in Bisnis Indonesia, the business providers of co-working spaces are predicted to grow rapidly along with the development of the hybrid work pattern. Co-working spaces provide offices for individuals and companies that embrace alternative models of work. These offer all the expected amenities of standard offices and can be rented by corporations, full-time and part-time workers, and even freelancers.
In Indonesia, the implementation of the hybrid working model like WFA has already been done by several leading giant companies. Blibli.com, one of the well-known e-commerce sites in Indonesia, has officially implemented the WFA system since January 2022 after seeing progressive positive growth by implementing remote working early during the pandemic.
The co-working space business condition becomes more attractive when many companies convert the costs that were originally spent to pay for office space into costs for renting a cheaper co-working space. Co-working space service providers also prioritize networking, often holding events for their tenants. As a result of frequent interactions between large conglomerates, small start-ups, and freelancers, co-working spaces often have more lively and dynamic environments, which encourage innovation. At a glance, this offers sustainability for Small-and-Medium-Enterprises (SMEs) to grow without the burgeoning cost of creating a new building to operate.
鈥淭he use of co-working space is a concept that has been formalized for a long time. The concept of sharing exists in our culture, namely mutual cooperation for entrepreneurs. We must be observant. The level of user variation opens up networking access and opportunities for collaboration. The concept of virtual office and cloud computing is also an efficient and effective solution for SMEs,鈥� according to the Indonesian Ministry of Tourism and Creative Economy Sandiaga Uno as quoted by Investor Daily.
The challenge faced by co-working space providers today is the declining demand from startups despite the opportunities that may be present in terms of communal environment and financial flexibility for new businesses. This is mainly due to the trend of working from anywhere, be it from home or elsewhere throughout the pandemic.
Additionally, only about 48.9% of startups survived 2021. Data from the Indonesian Venture Capital Association (Amvesindo), as published on IDX Channel, highlights that up to 10-15% of start-ups close because they cannot compete. Meanwhile, startups are the main target for co-working space providers.
Prospects for the Future of Working and Co-working Spaces
The future of the coworking space depends on the strategies and abilities of co-working and office providers to adapt and adopt the opportunities that may be present in the current pandemic situation.
According to Digital Economist Researcher Nailul Huda from the Institute for Development of Economics and Finance, the co-working space business today can be developed into a provider of addresses for various companies. This is because enterprises in Indonesia must have an office address. Huda also stated that the co-working space must be capable of becoming a virtual office that handles numerous office administrations.
As such, despite the challenges that co-working space provider are facing, it is hoped that opportunity for entrepreneurs and companies to participate in a shared environment that provides flexibility, learning opportunities, as well as a community that offers support and networking opportunities, will remain open and enhance the sustainability of business activities in the future.
In line with this, EKONID offers a one-stop business solution for European Companies to establish or expand businesses in Indonesia through the European Business Center (EBC). Discover your own local sales workforce, access to market intelligence and legal support as well as the utilization of complete office facilities without the risk and investment of having your own legal entity.
For more information contact
Ms. Olivia Nathalie Noor
Head of Market Entry
+6221 5098 5801