The New York City Government centralized structure

The New York City Government centralized structure

The New York City Government has a highly centralized structure that is divided into three branches, namely the Executive, judicial and legislative. The Executive is responsible for all the services in the city and the enforcement of city and state laws. The judiciary consists of the Court Systems in the state. The legislative, on the other hand, is the City Council consisting of 51 elected officials responsible for proposing and revising bills. The New York Government has employed approximately 75000 employees who occupy 300 million square feet in buildings such as offices and warehouses. Therefore, the government owns some buildings in the state and leases some buildings to cater for its real estate needs. This paper analyses a case study of space optimization for its real estate portfolio.

From the economic downturn in 2008, there was a decrease in the tax revenue in New York State, leading to a deficit in the budget and a strain on expenditure. The state was faced with the challenge of reducing administrative functions and find a strategy for savings. After some research, the leaders resorted to operational efficiency that saved the state $100 million. The government owns some visible properties such as state house and schools and other rented buildings such as equipment storage facilities and legislative offices. However, most of the space under the government is usually underutilized because the use of real estate has not been fully utilized. At the beginning of 2009, there were dramatic examples of success in the optimization of real estate portfolio despite the high costs of real estate in New York City, making the savings on the project greater.

From the case study, there are a variety of elements that were implemented in an attempt to optimize the real estate portfolio fully. The first element was the operations strategy and competitiveness. The element is defined as planning the specific design and usage of strategy to support the strategy selected. In the case study, Bloomberg’s deputy mayor for operations identified five priority areas to improve efficiency (Wiseman, 2017). Besides, they formulated they had one key recommendation that would reduce the cost of occupancy in the city’s real estate. The element gave them a competitive advantage in the real estate market in New York City, where the prices of real estate are high. The priority areas were used to ensure the strategy was objective oriented to ensure success.

The second element involved statistical quality control, a process that utilizes statistical methods to monitor and maintain the quality of a project. This process is often used in real estate markets to either accept or reject properties (Campbell, Jardine & McGlynn, 2016). In essence, the element allows detection of errors during the planning and implementation process. The New York Office Space Optimization stood out in the incorporation of data, in the seven-step strategy, the first two steps involved gathering, assessment and analysis of data. The data analysis step involved statistical quality control that showed how office space was the most expensive real estate in the state’s portfolio. Eventually, the data was used to formulate a strategy to reduce the average square footage per employee.

The third element is just-in-time and lean systems. This element refers to the implementation of a strategy at an ideal time to ensure the most positive results and to use systems that are easy to implement. In the study, the optimization came after the downturn of 2008 that left the prices of real estate dropping and a good time to invest. However, the optimization followed the priority areas that were predetermined to ensure they are in line with the expected outcomes.

On the other hand, the four elements were forecasting, which involves predictions of future trends and events. The optimization was completed by a small team of city staff that had information on the real estate landscape of the state, which they used to formulate trends and forecast the utilization of the state’s office space. Through the information, it was discovered that the average space could be significantly reduced due to the existence of vacant desks.

In addition, the fifth element implemented was the work system design. A work system design includes the work measurement, description and purpose of the work. When planning an optimization, it is important to have objectives and develop systems and procedures that will ensure the objectives are achieved. In the study, there was a seven-step process to optimize the real estate portfolio. There existed a team of city staff that was responsible for the collection and assessment of data to be utilized in the optimization (Wiseman, 2017). Subsequently, they had a three-step implementation that right-sized the real estate portfolio and the team focused their attention on the most crucial part of the optimization: advancing efficiency. Besides, the leadership made a perfect example and motivated the team to work towards the objectives.

The other element was resource planning, where human and non-human resources are allocated to maximize the efficiency of available resources. In the case study, the main focus of resource planning was to get an overview of resource availability and capacity. In line with this element, the team relied on data and the objectives of the measures. The metrics were direct drivers of cost and were compared across different departments and to plan for their optimization (Wiseman, 2017). Besides, the metric of rentable square feet was easy to measure and provided the variations across different departments and buildings. Through the data obtained, the team formulated a budget that was aimed at cutting costs.

The final element was project management. This element describes the processes such as planning, controlling and execution required to achieve all the goals (Campbell, Jardine & McGlynn, 2016). To conduct project management, the team requires good leadership, communication, risk management, critical thinking and quality management, among other skills. In the case study, the team hired a chief asset management officer in order to create a lasting infrastructure that would last over different administrations. The new officers were expected to meet the set standards to reduce the footprints of the floor space. On the other hand, the project was supported by the city’s budget office, that was a powerful partner in reducing costs. The project management element played a crucial role in the success of the project.

The project by the New York Government was amazing and greatly reduced the expenditure of the state while optimizing the real estate portfolio. I think the optimization was a good step by the government after the 2008 economic downturn, but the project had been delayed. The project was triggered by the economic condition, although the poor management had over the years increased the state’s expenditure. The accomplishments by the state were remarkable, especially because of the reduced expenditure that allowed the state to channel the surplus funds to more productive projects in New York City. Furthermore, I believe other states should utilize similar optimization of their real estate portfolios because most states have buildings that are left underutilized and floor spaces that designed in traditional setups that waste space. However, the strategies may differ because of the uniqueness of each state’s portfolio.