Where We Forget, Our Buildings Remember
Making sense of centralized and distributed workspace
Every generation builds the world of their imagination. Human memories, however, are short-lived, and we forget the imaginations of past generations. That forgetfulness can lead to the mislabeling of foreseeable market forces as unexpected social disruptions — making the path forward unclear. Where we forget, our buildings remember. They tell a story of cycles of change: expansions and contractions of production that result in an ebb and flow from centralized to distributed workspace.
If you were born a century ago you may have thought of Dearborn Michigan as the land of economic opportunity. Much like the Bay Area today, an energetic worker would be attracted to its high wages and abundant opportunities. Where else could you have such a fast track to owning your own piece of the American dream?
The long-term cycle that led to the centralization and eventual distribution of the productive forces of Dearborn Michigan a century ago may well hold some hard-earned lessons for the highly-centralized state of the Bay Area today. A century ago, Ford was operating in an immature marketplace. Cars were new. The means of producing cars was still evolving. The supply chain was riddled with labor disputes and high costs of moving material from one place to another. There were few universal standards for the car industry. These combined forces layered on top of a capital intensive manufacturing process created massive incentives for Ford to centralize. By bringing more of the materials and processes in close proximity to each other, by bringing more of the labor force under one roof, Ford drove down the cost of production while offering a higher than industry-standard wage for the labor. Over the course of the 1920s, Ford’s River Rouge became a world unto itself with ninety-three buildings totaling sixteen million square feet of factory space.¹ That state of centralized production was not to last.
A generation later, by the 1950s, the car industry was a mature industry. There were many reliable suppliers of the parts and pieces that went into cars. In addition to the growth of the number of suppliers, there were more standards to engage with these third parties. The combined impact of the maturation of the industry (lowering external production costs), the development of standards (lowering of the transaction costs) as well as the ever-increasing complexity of managing overhead costs (increasing internal production costs) led to a new equilibrium — one where it made more sense to buy components from the external network of suppliers than to produce them internally. This new equilibrium was an important moment for Ford’s workspace, their River Rouge manufacturing plant. It was the moment when the forces driving centralization of Ford’s workspace in Dearborn stopped and forces for distributed workspace began.
Over time, Ford’s network of production has expanded well beyond the constraints of Dearborn, Michigan. A Ford car today is likely to have a significant portion of its parts made outside the United States² and its plants are spread across North America.³ Instead of processing raw materials into final products, as in the 1920s version of the River Rouge, Ford’s workspace is now an “assembly plant” where prefabricated parts are assembled from a rich network of distributed suppliers. Ford’s assembly plants have become a place where complex components link together efficiently into higher-value products. Ford’s workspace evolved from a massive centralized node of vertically-integrated, local production into a series of links, assembly plants, capturing the value and efficiency of internationally distributed network of production.
What does a 1920s Ford factory have to do with the Salesforce Tower today? Our 2020 economy is not made of the same stuff. Our world today is driven increasingly by ideas and innovation not just by materials and manufacturing. Instead of the underlying value being held in physical products, much of the value now resides in digital products, like those made by Bay Area technology firms. Over the last business cycle, the wealth of these digital-product companies reached levels previously unseen. More people under one roof (or at least in one metropolitan area) meant more ideas and more possibility for innovation. Following that logic, there was a correlated centralization of workspace. Facebook, Apple and Salesforce all undertook the construction of massive centralized campuses in the region. Salesforce even went so far to strategically take advantage of San Francisco’s urban fabric, expanding out into the city for its annual Dreamforce event that boasted more than 170,000 people.⁴ Then, 2020 took a different turn.
Even before the coronavirus, there were telltale signs that we were approaching the limits to the efficiencies of centralization. Cost of talent kept rising, driven by a competitive labor-market, increased commute times and the rising costs of housing and educating the families of workers. Despite this, the dominant paradigm of centralized workspace remained intact, strengthened by the conviction that more casual collisions and serendipitous connections were needed to stir the petri dish of innovation and drive more value into digital products.
In response to the global pandemic, the entire “knowledge economy,” including Facebook, Apple and Salesforce, suddenly learned to work from home. This rapid change was facilitated by the reduction in costs of remote communication technologies (like Zoom, Dropbox and Microsoft Teams), but a lasting effect will be found in the new standards and rituals that have developed to allow more digital product talent to work from more locations. These new standards for flows of information among workers on digital products could have a similar impact to the development of standards for the flow of physical components of Ford’s production model, resulting in a long-term trend toward distributed production and economic growth across more locations. To this point, after announcing their plans for most of its employees to work remotely part or full time, Salesforce’s Chief Operating Officer said “On the other side of the pandemic I do think we’re going to see more innovation in more parts of the country, and I think that’s healthy.”⁵
Again, like Ford, it is not just about transposing the same activities and relationships that were centralized to different locations. It is about growth of the economic system occurring through a linked network of distributed production. In fact, Salesforce plans to add 12,000 employees this year.⁶ But to maintain this new decentralized network of production, we can use our Ford analogy to predict that the Salesforces of the world will begin to invest in workspace not just as containers of activity, but as links of production — the connections among and between both internal talent and external partners. It should be no surprise then that experts in workspace design are now calling out the return-to-the-office as something different, a place of collaboration and connection to bring together component ideas generated elsewhere. It is possible to see this as an assembly plant connecting complex ideas and insights through standardized rituals of convening — the backbone of which we happened to have developed in response to the coronavirus.
Why talk about Ford of yesterday to explain Salesforce today? Because the decisions that were in front of Ford executives, in our grandparents and parents generations when they were considering distributed production models, were clearly visible. If you didn’t have a railway or highway going to a town in the 1950s, you weren’t going to consider partnering with a manufacturing plant there. When products were physical and their links were physical, it was clear and obvious where it made sense to have distributed nodes of production. For digital products the connections are less tangible and consequently the decision making about the location of distributed nodes of production is less clear. What is important about looking at Ford in 1920 and Salesforce in 2020 through the same lens is that the properties of economic growth and their relationship to workspace hold true in both cases. Both the 1920 Ford and the 2020 Salesforce will be able to grow economically as they are able to grow their network of production. In both cases, their network of production will have internal production costs, external production costs and transaction costs that sit on the edge of the firm — and the cost of those transactions will decrease as standards are developed to link to more ideas, people and things. In both cases, their network of production requires high quality links and nodes that allows for the flow of complex information. No single node can compete with a network of nodes, and no network of nodes can function without high quality links.
So as our economy continues to evolve and cycle through phases of centralization and distribution, it can be useful to consider that when workspace is no longer serving as a node of production, like a manufacturing plant in 1920 or dedicated workstations in 2020, it may take on a new role as a link, like an assembly plant in 1950 or series of flexible collaboration spaces in 2025. By looking at the long-term memory of our buildings, we can see the potential to transform our workspaces from places where simple products are made to where complex ideas come to life — and that potential can spark the imagination of the next generation.
Network Communities is jointly authored and edited by Nash Hurley and Josh Emig.
Nash Hurley is the founder of a researched-based architecture studio in San Francisco. Josh Emig works out of New York and leads Product and Research at Canoa.
¹ Hidalgo, César. 2016. Why Information Grows: the evolution of order, from atoms to economics. New York. Basic Books. Page 87
² Pete, Joseph. “Cars made here, but with a lot of foreign parts” NWI.Com Jan 3, 2014
³ Where are Ford Vehicles Made? January 23rd, 2019 https://www.kimbercreekford.com/blog/ford-plant-locations/
⁴ “Dreamforce 2019 in Review: Key Facts and Figures” December 3 2019 https://www.salesforce.com/news/stories/dreamforce-2019-in-review-key-facts-and-figures/
⁵ Bindley, Katherine. “Most Salesforce Employees to Work Remotely at Least Part Time After Pandemic.” Wall Street Journal, February 9, 2021
⁶ Ibid.
