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Open Office vs. Private Office: Which is Right for Your SMB?

Open office
Credit: Monkey Business Images/Shutterstock

Office layout is often overlooked merely as a stylistic preference, but it plays a major role in employee efficiency. Open offices and private offices each have their pros and cons, and depending on your business, one might be a better fit for you than the other. For instance, while a more collaborative team might perform well in an open space, individual workers, like HR managers, are better off in cubicles with more privacy.

"The goal of improving productivity is giving team members an environment in which they can accomplish as much as possible," said Bill Himmelstein, CEO of commercial real estate brokerage, Tenant Advisory Group. "Sometimes it's more collaborative in nature, and other times it is [finding] some quiet space and [staying] heads down for a while. Either way, an office space should be adaptable, support the company's culture and … serve as a place where employees and partners alike want to spend time."

Many small business owners assume that open offices are the top choice for all workers today, but this may cause issues in some organizations. Rather than picking what's most convenient, or what you think is most popular, weigh the benefits and downfalls of each based on your team's needs. Here's what to consider when deciding on the right layout for your small business.

Open offices, for the most part, lack cubicles and private offices. Colleagues typically sit close to each other with the chance to communicate freely, which can be both good and bad for the company.

Himmelstein outlined pros of open offices:


  • Opportunity for collaboration and innovation
  • Improved company culture
  • More room for new employees
  • More affordable option (less square footage per employee)


  • Loud distractions, which can hinder productivity
  • Limited space for phone calls or one-on-one meetings
  • Higher chance of spreading sicknesses

Open office layouts shouldn't be off the table, but there needs to be a balance. Throwing everyone together in one room, with phone calls, meetings and conversations between colleagues, is a recipe for disaster.

"While the open layout is feasible for some industries, workers need zones dedicated to minimizing distractions," said Himmelstein. "Oftentimes, this style of office layout amplifies the negative effects of overcrowding, as finding a quiet moment to compose emails, reports or make phone calls can be a challenge."

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More private offices, with independent workspaces and offices, allow workers a better chance to focus on their own work without distractions. However, collaboration is limited, and company culture is often lacking.

Himmelstein outlined pros of private offices:


  • Less distractions and increased efficiency
  • Can be used as incentive for promotions
  • Private space for personal or professional matters.


  • Lower levels of engagement
  • Less chance for innovation
  • Higher cost (for cubicles and/or bigger space to accommodate private offices)

While some jobs require for more privacy than others, some extent of privacy is necessary in every business.

"Businesses have quickly discovered that when privacy leaves the workplace, so does productivity," said Himmelstein. "Few private spaces leads to a lack of places to deal with personal issues that will inevitably distract an entire team if someone is stressed or upset. Additionally, employees may be less likely to take risks if their peers are watching them fail in the open."

Focus on the nature of your business. What will suit the types of workers you employ and the tasks you're required to complete?

"It starts with understanding your culture and how your people work, and then carefully planning the office space selection, design and construction," said Himmelstein.

He advised speaking with a designer and broker on the best layout for your team, discussing how much privacy your workers need and what type of environment you prefer. Employees should have a say in the matter, and their situations should be considered when making the decision. For example, said Himmelstein, you could limit private offices seemed limited to top executives and add conference rooms as needed to give people places to meet in private.

"Consider the work and your team's needs," he added. " Does the nature of the work require frequent phone calls with clients, or tasks that require strong focus? Or are your employees often engaged in group projects necessitating regular communication?"

While open offices may be popular today, many companies are realizing the hard way that there needs to be boundaries. You can have the best of both by finding a balance between the two. If you decide on a more open layout plan, provide private locations for phone calls and conference rooms for meetings. If you go with a more private office, on the other hand, ensure you're still collaborating and maintaining positive company culture through team outings or check-ins.

Sammi Caramela

Sammi Caramela has always loved words. When she isn't working as a Business.com and Business News Daily staff writer, she's writing (and furiously editing) her first novel, reading a YA book with a third cup of coffee, or attending local pop-punk concerts. Sammi loves hearing from readers - so don't hesitate to reach out! Check out her short stories in Night Light: Haunted Tales of Terror, which is sold on Amazon.