Hot desking is kind of the cloud service approach to office resource management. Thus it fits similar scenarios and helps tackle similar challenges.
Scenarios it fits
- there are limited office resources
- and there is substantial fluctuation in resource requirements, i.e. part-time workers, contractors, interns etc. that work at different times and/or switch projects a lot and/or are required to regularly switch the work place to do different tasks
- and/or close communication amongst workers is paramount
Examples would be, for example, companies that internally have a very heterogeneous work force with regard to working times and/or project associations or companies with a lot of sub-contractors, consultants, externals, that will occasionally visit their premises needing work spaces.
Problems it solves
- Easy ad-hoc resource allocation: Part-time worker coming in on Monday, give them one of the free desks, any desk will do. No cleaning required. No central management to assign desks required. Easy identification of a free resource (no one's sitting there/having his stuff there).
Same goes for external visitors that are at your building for a few meetings and that need a place to work in-between etc. This also helps for doing an ad-hoc short term project, no need for management to assign a new office just for this project, the respective people can just get free desks that are close-by.
- Easy resource re-allocation: Worker A is ill and Worker B needs to fill his spot in team Alpha -> just use his place and be directly integrated with the team; Same goes if Worker A needs to support team Alpha for a week, just use any free place, if necessary Worker C who is currently working on a side project for team Alpha and thus doesn't need to sit that close this week can switch to another desk.
- Resource usage maximisation: Considering the example where you have multiple contractors, instead of assigning each one office, which are both only used for half of the week, you assign them both one office which is used one half of the week by one and the other half by the other contractor. Or maybe by some guys from each contractor each day of the week.
- Pipelining: You can easy build a pipeline where the rooms/workplaces instead of the workers change; thus one worker can guide one product/customer throughout a process. Consider a car service, where the technician first does the paper work at a desk, then goes to the garage with you, then fills out the report at another desk.
- High information exchange rate: As workers can easily decide where to sit and change whom they sit next to, it facilitates a high rate of communication between individual workers.
- Resilience: if one resource fails, i.e. a desk/building/room is unavailable, it is easy to switch that worker to another desk.
- Cleanliness: As with most things standardized (proper standard), it is easier for others to use your resources, i.e. the cleaning personal will find it way easier to properly clean your desk regularly. People with a focus on everything being clean and orderly might also find this to be a psychological advantage.
Challenges it introduces
- Your workers need to be able to run on cloud infrastructure, i.e. they need to clear their desk each evening and take everything they require to work with them
- Workers may not "settle in" long-term by choosing their preferred seating place (next to window, flowers, quiet corner) and keep it for their time at the company; this can for some workers make it harder to be creative or get into "the flow"
- Workers that require special equipment at their desk have particularly increased setup effort or may need to be excempted from hot desking. This applies to workers that perform special tasks, but also to workers with disabilities, requiring special desks or chairs
- You need to provide core infrastructure that makes it easy for workers to find free places that fit their requirements (e.g. close to other members of team X)
- You incur overhead to setup and coordination, i.e. get your place ready to start working and find other workers you need to communicate with
- It's more difficult to estimate how many places you need (where)
- Workers may need to be more independent and figure out who is best sitting where in their office by themselves
The crux with this is, that your workers need to buy into the concept. Especially if you apply it to everyone, not all might see the benefit as they don't fall into the groups of people that gain anything by using this approach. I guess this is why this question generates a highly upvoted opinionated dismissive answer; people fearing they need to adapt this, when it doesn't fit their working style. It is also easy to mess it up, same as with cloud infrastructure, management may only see the potential cost benefit of reducing the number of desks - and underestimate the actual requirements in terms of number of desks or the impact of a single day where there are a couple places missing. While it is often seen as management imposing on workers, it can also be an empowerment, as it fits well with a bottom-up approach, where workers manage themselves (to some degree), e.g. just decide to sit together with whomever they need to work with for their current task.
Generally speaking, I've seen this work well, when it was sensibly combined with a traditional approach. Part-time workers, internals, and workers that switch projects on a regular basis go full hot-desking, while workers that do normal day-jobs all through the week have allocated desks and only clear them out when going for an external project or having holidays of a week or longer.
Sometimes there are also dedicated hot-desking rooms to use in addition to normal offices, for ad-hoc group projects.
An important lesson is also: Depending on what you do hot-desking for, you might not actually reduce the number of desks, e.g. if you provide separate hot-desk rooms for ad-hoc projects in addition to your "normal" offices (hot-desk or not).
And yes, if applied blindly to force a mostly 9-5 workforce to use hot-desking, it will likely bring more problems than solve things.
(Then again, it's successfully applied in almost all schools which combines resource maximisation and pipelining.)