Employee Productivity Vs. Energy Savings: The 2-20-200 Rule

November 12, 2019 By Mid-Atlantic Controls 4 minute read

Here's what you need to know about Employee Comfort Vs. Employee Productivity, LEED, and Environment...

LEED, Energy, and Environment

Can Employee Productivity Really Have a Bigger Impact on the Bottom Line than Energy Savings?


Energy efficiency is a very important cost and resource to consider in the operation of any facility, but it may not be the most important consideration.

Regardless of energy costs rising or falling we need to pay attention to the cost as it applies to our business's, but beyond that we need to consider the fact that we all need to contribute to the conservation of natural resources. For this reason, organizations like LEED are very important in raising the overall awareness of energy conservation as one of their goals. But LEED goes far beyond this and is raising the overall conciseness of everything relating to buildings, neighborhood's, communities, and the greening of our future. You don't have to be a tree hugger to appreciate what LEED is trying to accomplish in this regard.

Encouraging Employees to Learn About LEED

MACC is becoming more involved with the LEED principals and encouraging all of our employee's to learn about what LEED is trying to accomplish because it represents a way of thinking that can propel our business's into a complete new dimension. LEED is not just a professional affiliation, a club, or a society. LEED requires education and obtaining the LEED affiliate status is a significant accomplishment at each level. I would encourage everyone in our industry to learn about LEED and become an affiliate.

What is "Green Building?"

The 2-20-200 Rule

Skyscrapers and house in the light bulb

As an example, we'd like to share with you just one of their innovative principals and initiatives that we have benefited from in many ways and encourage our customers to embrace as well. That principal is the 2-20-200 rule (referred to as the 3-30-300 rule in more expensive markets). The concept behind this is for business owners and CEO's to ask themselves just how important energy is in the overall scope of their business. Obviously this varies from an electric utility to a professional service company but that is the whole point of the exercise.

Cost of Operations: Energy, Space, Employees

So back to the 2-20-200 rule, and try not to split hairs on the numbers or you will lose the point.

Breaking Down the 2-20-200 Rule:
  • 2 - represents how much energy costs per square foot of most building space today.
  • 20 - is the cost of a commercial rent/lease/mortgage per square foot of building space.
  • 200 - approximates what employees cost per square foot.

It's important to recognize that an aggressive strategy to reduce energy costs might impact employees, who account for 100 times the cost of energy. This is not to say that reducing energy always results in lowering employee comfort, but it is important to recognize that it can and that knowledge is the power we want you to have as business owners and facility managers.

Wide Angle View Of Busy Design Office With Workers At DesksDon't Sacrifice The Comfort Of Your Most Valuable Resource - Employees

Stated another way, if we could increase employee production by 1% through better work environments, we would erase the energy component of a typical business's cost. But what if we raised employee production by 10%? The increase in production offsets the entire cost of rent/lease. These types of gains are easily accomplished, and what it costs to realize these gains is usually much less than the benefit realized. It should be understood that they don't really disappear, because your utility will still send you a bill and the landlord still wants their lease payment. The point is that if we are trying to increase the “financial efficiency” of a business don't get too focused on the energy efficiency part. Companies like Google go to great lengths to increase employee efficiency and they clearly see the benefits.

Putting Energy Conservation Into Perspective

That said, LEED is about conservation of natural resources but only a small part of their real mission is energy. We are not suggesting that you ignore this very important goal. We just suggest conservation be put in perspective to take the maximum reductions at both ends.

So, we suggest you implement an energy conservation program that not only concentrates on reducing energy costs but also considers how to best increase the occupant/employee comfort considerations that yield the biggest results. Happier and more productive employee's and lower energy costs will increase profits, employee retention, as well as help attract new and better employees.

Check out this page about Energy & Environment to learn more about how MACC can help you accomplish your commercial facility goals with the 2-20-200 rule.

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