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Office extravagance and the bottom line

Plain or lavishly decorated, an office's decor has nothing to do with the organisations' financial performance.

I have stepped into many corporate headquarters. Reporters are usually taken to executives' offices to conduct their interviews, or sometimes they gather in a meeting room for a group interview or press conference. Some are lavishly decorated, some are minimalist and others reflect the CEO's spartan style.

At Indorama Ventures, which calls itself one of the world's largest vertically integrated polyester chain producers, the CEO's floor is small - just a few executive rooms and a modest meeting room.

The CEO's room itself is small, especially in the context of annual sales of Bt232 billion in 2013. Indorama CEO Aloke Lohia is ranked the 1,465th richest prmson in the world by Forbes, with a net worth of US$1.1 billion (even though this has halved since 2011).

Elsewhere, the headquarters of Kasikornbank on Ratburana Road are all cold steel from the outside. But on the top-floor meeting rooms for big clients and top executives, the decor is softened up thanks to paintings on the wall. No surprise that the bank is one of the country's big corporate collectors of art.

Many of the valuable paintings - some stretching two metres across the wall - are exhibited in the large meeting room overlooking the pristine Chao Phraya River. The bank should be commended for channelling some of the profits, which hit Bt41 billion last year, to support artists.

Tisco Bank's headquarters also feature hundreds of paintings, some of them on show in the lobby. The pricey ones, however, are on the higher floors.

At the Energy Complex, the CEO floor of PTT Exploration and Production - which has the biggest overseas interests of any Thai company - looks modern yet barren. There are few rooms on this floor, which boasts two large columns and a plush red carpet. Reflecting the nature of the company, which deals mainly with overseas business, few people are seen on the floor.

I was impressed with the meeting room at Thai Union Frozen Products, where I recently interviewed its president, Thiraphong Chansiri. The room was small, with enough room for a two-seat couch and four chairs plus a sideboard displaying the company's main products. The large windows overlooking Phaholyothin Road helped give a sense of spaciousness as the backdrop for our interview, so that size no longer mattered.

Corporations' variety of approaches to office décor is echoed in government.

Electricity Generating Authority of Thailand's headquarters at Bang Krauy look old. Even though the state enterprise is among the top performers, the governor's room is small. Typical for the office of an official bigwig, it contains a big desk and a long table for hosting small meetings. Yep, that's it.

Would you bother to redecorate if you took the top job? Probably not, once you had considered you may be forced out of the room faster than you imagined.

At Thai Airways International, the president's office also looks simple. Yet it is more elegant than its EGAT counterpart. That's understandable, as THAI does lots of business with international companies. Next door is the meeting room, featuring a long table and comfy chairs along with some model aircraft.

Notably, last year, THAI showed a net loss of Bt12 billion, while EGAT showed a net profit of Bt10 billion in the first quarter of 2013.

The Bank of Thailand governor's office is also small, barely big enough to seat 15 persons comfortably. Yet, the view of the Chao Phraya River is magnificent.

Imagining a desk with tonnes of paper? That would be the office of the secretary-general of the National Economic and Social Development Board. He can't help it, given the office's responsibility to chart the nation's long-term development plan and monitor government projects.

Indeed, decoration style does not guarantee good financial return and benefits for stakeholders. In contrast, efficiency should be at the heart of operations. It remains a puzzle how Heineken can keep its sale and administrative expenses at little more than 10 per cent of sales, when Carlsberg's ratio is about 30 per cent, according to recent research by Sanford C Bernstein.

Big offices also require huge maintenance costs. Two years ago, PepsiCo spent nearly US$243 million upgrading its old 250-rai complex in New York.

Media is often used by organisations to broadcast their messages. I have to say that office decor does not influence my writing - unlike interviewees' answers to my questions.

Young entrepreneurs are setting a positive trend in focusing more on building up their empires and less on appearances. Small offices are usually fine and, sometimes, coffee shops serve as great meeting places.

Many in business know that the venue is not what's important. To reporters, it comes down to one thing - content that will interest readers.


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