Back to the office?

Fifteen months and a pandemic later and the US economy is reopening to varying degrees. The pandemic isn’t over though, and the next few months will be critical in finally getting to the point that it is controllable around the world. In a global economy no country stands alone, and as long as there are out of control hot spots there’s risk for us all. This is particularly true as more variants of the virus emerge. The point of course, is that the schedule and scope of recovery is still relatively fluid.

Companies around the world are starting to define their next steps policy for employees and work locations, returning to the office, etc. Several companies, especially some well known large tech companies, have already made it clear that they will allow employees choice over if, when and how much they will return to office work. The range of these announcements goes from “remote first”, “fully remote”, “optional”, “partial”, “hybrid” and “mandatory return”. Let’s look at each policy and some of the recent announcements.

Remote first, or defaulting to remote employees while maintaining the option of choosing to go to an office is popular, particularly among tech companies. This approach lets the company reduce the number / amount of office space they need to maintain while accommodating employee choice across the range of options (completely remote, completely in office, in office on a regular schedule and in the office whenever the employee chooses based on capacity limits). From a process stand point, the companies optimize remote tools and processes first and in office is secondary. Companies that have announced permanent remote first policies include Nationwide Insurance (shrink offices from 20 to 4), Shopify (they called it digital by default), Box, Upwork, Coinbase, VMWare, Fujitsu, Okta, Pinterest, Dropbox, LogMeIn, Instacart, Drift, and Snowflake.

Fully remote is a unique choice and so far, has only been announced by a few companies including Basecamp and Quora. Eliminating offices completely may seem extreme but both companies were already substantially work from home before the pandemic and the cost saving can be substantial.

Remote optional allows all employees the choice of remote, in office or some mix of both. Companies that have already announced this plan include Square, Slack, Novartis, Zillow, Siemens, Atlasssian, Hubspot, Deutsche Bank, Microsoft, Salesforce, Splunk and SoFi.

Partial remote allows some employees to choose to work remote based on role and situation. Companies using this approach include Twitter, Hitachi, REI, J.P. Morgan Chase, Verizon, Alphabet / Google, Coca Cola, Deloitte, Reddit, Capital One, State Farm, HSBC, US Airforce and US Navy (mostly applied to Pentagon based employees).

Hybrid is a pre-set mix of in office and remote. The key difference is that some or all of the specific office days are “required”. Companies that have announced this approach include Apple, Amgen, Fiat Chrysler, ServiceNow, British Airways, Ford, BP, State of MA, and Spotify,

Complete mandatory return to the office is currently rarer than hybrid models, although many companies are making plans that are tied to other events like children returning to school this Fall. Companies that have already announced mandatory return include Morgan Stanley, Goldman Sachs, Amazon, Bank of America and EY.

There are various drivers for each of the approaches of course, but underlying some is the idea that remote work leads to lower productivity. So how has the past year been from a productivity perspective? A study from Standford of 16,000 workers over 9 months found that working from home increase productivity by 13%. In the same study workers also reported increased satisfaction with work, and attrition rates went down by 50%. According to a survey by ConnectSolutions 77% of those who work remotely at least a few times per month show increased productivity, with 30% doing more work in less time and 24% doing more work in the same period of time. There are many other surveys from the past year that look at productivity, all showing that in general productivity is better for remote workers.

Productivity isn’t the only reason to go back to the office though. Many companies reference the collaborative nature of in-office work over remote video interaction. There’s some evidence to support that, at least for highly collaborative roles. That’s from a management perspective though, so what do employees want? In an employee survey (https://www.mckinsey.com/business-functions/organization/our-insights/what-employees-are-saying-about-the-future-of-remote-work) conducted by McKinsey & Co in Jan 2021 (full-time corporate and government employees N=5043) 52% of respondents want hybrid work models, 11% want a fully remote opportunity and only 37% wanted wanted to return to on-site post pandemic. That’s a large shift from pre-pandemic results of 62% on-site (-25 points), 30% hybrid (+22 points) and 8% remote (+3 points). In the same survey 30% of the respondents indicated that they were likely or very likely to switch jobs if their employer returned to fully on-site work and 50% wanted to work remotely at least 3 days every week. Respondents also reported top 4 hopes and fears:
Hopes:
1. Better work - life balance
2. Better flexibility for day-to-day work
3. Positive implications for compensation
4. Increased focus on employee well-being

And fears:
1. Worse work-life balance
2. Increased chance of getting sick
3. Decreased focus on employee well-being
4. Worse flexibility for day-to-work

Flexible work policies are clearly popular with employees. What are the consequences to companies that restrict that flexibility? One of the most important is access to talent. Another shift caused by the pandemic is a move away from cities, particularly expensive ones to improve their quality of life. This means that talent pools around many office locations is likely depleted. Add to that the potential for employees quitting over a more restrictive work location policy, and the shortage of good candidates for open positions is an important consideration. A reduced talent pool also has negative implications for diversity, equity and inclusion (DEI). There are other potential challenges including the loss of the costs savings from reducing expensive office space.

Here are a few ideas to make your policy and process work better:

• Communicate with your employees before you finalize and announce a policy…and listen

• Build a return to work plan based on:

  • Employee feedback

  • Business needs and requirements

  • Customer feedback

  • Local government and health department guidelines and regulations

  • Capacity limits, workplace design (and changes, particularly to communal spaces), facilities, and special accommodations, cleaning standards, etc.

• Work out how to control visitor / non-employee access

• Develop vaccination policy, mask policies, and policy for symptomatic employees

• Communicate early and often once you have developed a plan

• Solicit ongoing feedback and do something with it!

We can help, contact us to set up an advisory call on remote work policies.