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The Open-Office Concept Is Dead Meet its replacement.

By Laura Entis

This story originally appeared on Fortune Magazine

White Packert | Getty Images

The staff at W&P Design, a New York-based startup that makes trendy barware and cocktail kits, has an unspoken policy: headphones in means "don't bother me."

Lead designer Justin Fuller often wears earbuds even when he's not listening to music. Without the visual cue, he is at risk of near-constant interruptions. The company's entire team, including co-founders Eric Prum and Josh Williams, works out of a single room on the fourth floor of an airy, sunlit converted warehouse in Greenpoint, Brooklyn. That means Fuller's 12 co-workers are never more than an elbow away.

The extreme openness was a tactical decision. Yes, there are minor headaches -- noise is an occasional issue, as is the lack of privacy -- but for an early stage startup where workflow depends on collaboration, it's the only layout that made sense, says Prum. In fact, the company's open design plan inspired its latest project: ¡Buenos Nachos!, a hipster-chic Nacho cookbook. Prum and Williams had initially discussed the idea but weren't sold on its potential. Their eavesdropping colleagues, however, were into it from the beginning. "People turned around and started generating a bunch of ideas for people we could reach out to for recipes," Prum says. The book -- which includes 50 recipes from famous chefs and celebrities -- will come out later this year.

Such spontaneous collaboration was the dream of the open-plan office. Invented in 1950s Germany, the idea of creating a workspace free of dividing walls only took off in the U.S. within the last decade, spreading from tech startups to more established industries such as advertising, media and architecture. By tearing down literal barriers, the thought was that creativity and productivity would skyrocket.

W&P's open-plan office in Greenpoint, Brooklyn.
Image credit: Laura Entis

It didn't exactly play out this way.

By now the backlash against the open office -- which, by industry definition, includes spaces with cubicles since cubicle walls aren't permanent, but by popular definition means a space without any high dividers -- has reached fever pitch. The trend "is destroying the workplace,"declares a 2015 Washington Post headline, which labels the setup "oppressive." A quick Google search surfaces hundreds of similar articles and testimonials, most published in the past couple years, which depict the open office synonymous with the spread of disease, ceaseless distractions and, according to a 2015 Bloomberg article, "being forced to listen to phone calls about the veterinary issues of your co-workers' cats."

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The research is similarly damning. Evidence is mixed on whether open plans actually foster collaboration, and studies have shown that open office plans decrease productivity and employee well-being while increasing the number of sick days workers take.

What went wrong? And, if an open plan isn't the solution to the modern workplace, what comes next?

The office of the future is already here.

There are no hanging pods or virtual reality work stations -- instead, the office of the future looks an awful lot like an amalgamation of offices past, with some important tweaks.

The next-generation office combines private offices, cubicle banks and truly open floor plans (in which even cubicle dividers are dismantled) as well as communal areas and sound-proof rooms where employees can go to concentrate on solo work. That last part appears to be of increasing importance -- a study by the architecture and design firm Gensler found that workers in 2013 spent 54 percent of their time on work requiring individual focus, up from 48 percent in 2008.

The end result is a hybrid office, which incorporates a range of spaces and gives employees the autonomy to move between them throughout the day.

"I'm not at my assigned desk that often anymore — I'm getting work done outside a conference room or taking calls in a phone booth," says Holly Honig, a senior manager at corporate furniture manufacturer Herman Miller. Honig often works from her laptop at the coffee bar or spacious lounge because "it's much more energetic -- the buzz and energy makes it a desirable place to be." When she needs to focus or make a call, she returns to her desk or uses a focus room.

To look forward, it helps to look back.

Robert Propst's "action office."
Image credit: Herman Miller

The cubicle is still the backbone of the modern office. Invented by Herman Miller chief executive Robert Propst in 1964, it was created as an antidote to the open-office floor plans of the 1950s, where junior-level employees lacked any semblance of privacy. Made from high-quality panels, it included a range of moveable components so employees could choose to stand or sit as they worked. The goal wasn't confinement, but liberation -- by giving workers privacy, their own space, and the flexibility and autonomy to change postures throughout the day, Propst hoped to set them free.

His creation -- which he called the "action office" -- may have been built to deliver a more human sense of work, but companies, concerned with their bottom lines, had other ideas. As competitors began selling knock-off versions, Propst's vision was downgraded in size and quality, morphing into the rows of drab, grey boxes found in corporate parks across the country. In the early 1980s as personal computer sales exploded, cubicle sales closely followed suit.

Honig compares Propst to Otto Hahn, who discovered proof of nuclear fission, in that "he thought it would lead to wonderful things, but instead it turned into something horrible." (Both men would grow to have complicated relationships with their inventions -- after World War II, Hahn campaigned against weaponizing nuclear energy and Propst, in a 1998 interview with Metropolis magazine, said too many organizations had used his original idea to "create hellholes.")

Despite Propst's intentions, by the 1990s the cubicle -- whose bleak confinement is expertly portrayed in the 1999 sleeper hit Office Space -- had become a trap. Workers wanted out, which made it easy for companies to tear down the walls entirely. Ironically, it was a return to the 1950s-style open plan that Propst had originally tried to escape.

Ron Livingston, David Herman and Ajay Naidu take revenge on their nemesis, the fax machine, in a scene from "Office Space."
Image credit: Getty Images

Eliminating the cube also saved companies money. "The cost saving aspect was a big driver -- if you take down the walls, you can get a greater density of people in one space," says organizational psychologist Matthew Davis, who studies office design. Today, most companies use 6-by-6 foot cubicles. When dividers are eliminated and benchlike setups are used, however, space per employee drops to 2 feet by 4 feet. "An open plan can easily fit 300, 400 people in one room -- it's a little bit like chicken factory farms," Davis says. "These are not places you want to spend much time."

Thanks to financial motivations and changes in the way people worked, the cubicle grew less popular as the percentage of companies with open, benchlike setups in the U.S. climbed, a trend that took off in 2009, according Mabel Casey, a brand strategist at corporate furniture manufacturer Haworth. Today, Casey estimates 15 to 20 percent of offices are using completely open-plan spaces without dividers.

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Thanks to the corresponding backlash, we may be at the beginning of the next wave in office design. Suddenly, there's a demand for flexible design even outside the talent-strapped tech industry, says Casey. Whereas 20 years ago, Haworth's corporate clients reserved around 10 percent of space for communal use, today the company says it's closer to 40 percent. And buoyed by a strengthening economy, more companies have the resources to invest in redesigns and new furniture. According to an IBISWorld report, the office furniture manufacturing industry is projected to increase by 2 percent in 2016, largely due to "rising corporate profit levels." Which means, says Casey, employers are finally asking, "how do we create spaces where people actually want to be?"

These economic factors dovetail neatly with a shift in how employee performance is measured. Portable devices and communication tools such as Slack make it easier than ever for managers to measure performance by output, as opposed to where, when or even how work is completed.

Flexible design in action.

It's 3:30 p.m. on a Tuesday and a group of twenty-somethings are on the floor trying to hold the "plank" position for an optimistic five minutes. As the seconds tick by and the group grows increasingly wobbly, nearby co-workers continue typing, chatting and sipping iced coffee, unfazed.

"Our data engineering manager started it," says Marissa Arnold. "On Slack he'd say, who wants to do planks at 3 o'clock? And now there's a growing amount of people doing planks for five minutes."

Arnold works on the communications team at General Assembly, an education company that offers bootcamp-style courses on subjects from coding to marketing. Similar impromptu "meetings" happen throughout the day at the company's New York City headquarters, where the vibe is solidly, almost stereotypically, startup. Men and women lounge with laptops in the common room, which is littered with aluminium trays of leftover taco toppings from the afternoon's "all-hands" lunch meeting. Rows of earbud-wearing workers sit at communal tables festooned with photos. Other workers engage in "focus time" in the sound-dampened pods scattered throughout the floor.

A premium is placed on mobility. Space may be tight -- 250 people work out of the 30,000-square foot office, which means each person has a below-average 120 feet of personal space, including common areas -- but employees are given the autonomy to use it however best suits their task and mood. Frequently this means getting creative (storage closets occasionally double as conference rooms) and sometimes it means leaving the building altogether. "My favorite meetings are walking meetings," says Anna Lindow, the company's general manager.

Meanwhile, the concept of a personal desk is dying. "You can have your space, and the expectation that you set up shop for a day," says Allison Down, a talent director at the company, "but it may not be the same place you are going to be tomorrow."

Allison Down, a talent director at General Assembly, in the company's lounge area.

A boundless office?

Flexible design now extends beyond the physical workplace itself. "If I need to leave during the day for a doctor's appointment, I can make up that time after dinner and catch up on emails from my couch," says Honig of office manufacturer Herman Miller. By doing away with assigned seats, companies makes it easier for employees to work remotely.

Related: One Easy and Cost-Effective Way to Get Inside Your Customers' Heads

Such flexibility, however, tends to dissolve the distinction between work and personal life. Mobile technology, which allows employees to dictate their own workspaces, also eliminates a clear endpoint to the work day. Increasingly, managers require employees to be accessible at all hours. In a survey from the American Psychological Association, over 50 percent of U.S. workers said they regularly check their email before work, after work and on weekends. The modern "office" has become a nebulous concept, one that extends to the coffee shop, the couch, the bed -- or anywhere else with an internet connection.

And as activities traditionally reserved for the office continue to invade the home, the aesthetics of the home are creeping into the office. In April, Haworth acquired JANUS et Cie, which manufactured contemporary outdoor and interior home furniture. Last spring, West Elm teamed up with a Canadian commercial office interior company to launch West Elm Workspace, a line of office furniture designed to feel like a living space. Casey, Haworth's brand strategist, has a word for the growing trend to design corporate spaces as if they could be in someone's home: "resimerical."

The ultimate flexible workspace is perhaps a blend of the home and the office, where both spaces are used for professional and personal pursuits. When emphasis is placed on output, work can happen from an office or from one's living room -- just as long as it gets done. It's no coincidence Herman Miller named its recent corporate concept, which features 10 distinct work settings, the "Living Office."

"We're no longer designing spaces for people who work 8-to-5," says Meena Krenek, an associate principal at the New York City-based architecture firm Perkins+Will. "Work is now 24/7."

Laura Entis is a reporter for Fortune.com's Venture section.

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