In the ever-evolving landscape of the modern workplace, one trend has become increasingly prevalent and continues to be in high demand: flexibility. Flexible work arrangements, which allow employees to choose when and where they work, have gained popularity for a myriad of reasons. While they offer numerous advantages for both employers and workers, one of the most significant benefits is the empowerment of employees to be more productive by working when and where they are most efficient. From 2020 – 2022 fully remote and flexible work seemed to be here to stay, with many organizations promising remote work into perpetuity. However, as we’ve gotten further from the height of the Covid-19 pandemic, many employers are mandating a return to office and requiring 5 full days in office from employees. This mismatch between expectations from workers and company leaders is trending as the latest workplace challenge.
What is driving this latest workplace challenge? And where is the great mismatch?
Despite the evidence that productivity increases when employees have flexible work options, many organizations are walking back their remote-first-forever promises in favor of rigid on-site requirements. We’re seeing more and more headlines to the tune of:
Plus, we're all grappling with CEO Tim Gurner's recent interview with the Financial Review Property Summit, which some have called 'the epitome of class warfare.'
“We need to see unemployment rise,” Gurner said. “Unemployment needs to jump 40-50 percent in my view. We need to see pain in the economy. We need to remind people that they work for the employer, not the other way around. There’s been a systematic change where employees feel the employer is extremely lucky to have them, as opposed to the other way around. So, it's a dynamic that has to change. We've got to kill that attitude and that has to come through hurting the economy."
Full clip:
Concerns from Managers & Company Leaders about Flexible Work:
Leaders and stakeholders worry about losing company culture and collaboration by allowing flexible and remote work options.
They also cite concerns around the productivity of remote workers.
Many of these companies still have to pay for office space and are looking to amortize their real estate investments by having employees in the office.
Concerns from Employees about Mandated Return to Office:
Readily available and easily accessible research shows that employee productivity increases with remote work.
At the height of the pandemic, many employees relocated to cities / areas that better aligned with personal and familial needs (e.g., lower cost of living, better school districts, closer to family). For those employees who have proven that they can do their jobs just as well, if not better, in a remote setting, companies will be hard pressed to convince them to uproot their lives and rejoin the daily commute to go back into an office.
In many cases, employees can’t name all, or sometimes any, of their company’s values or beliefs. It’s not possible to be engaged in company culture if you don’t know what defines that culture. In these cases, the argument that it is important to return to the office for the sake of “company culture” will not and cannot resonate with employees.
Many individuals are calling out the hypocrisy of CEO's requiring more sacrifice and 'pain' from workers while making no sacrifices themselves (ICYMI: we are witnessing the highest ratio of CEO-to-worker pay in history).
How are the people responding?
THIS IS BIG: In the June 2023 Forbes Advisor article on Remote work, the author reports that “98% of workers want to work remote at least some of the time.” NINETY-EIGHT percent. That is an astounding statistic. When was the last time we saw 98% of Americans agree on anything?
Do you want the option to work remote at least some of the time?
Yes
No
In addition to near-unanimous support for the option for remote work from employees, research has consistently shown that employees are more productive at home and are able and willing to put in more hours – thanks in part to saving on commute times. In an increasingly digital and connected world, where workplace trends and research outcomes are readily available, and in fact often advertised to globally, individuals are hyper-aware of all the benefits that remote and flexible work provide – both to the individual and the business. The four-day workweek, which saw a number of large pilots in 2023, has proven to be successful (one in Iceland, another in the United Kingdom), with productivity staying the same or increasing for the business, and mental health, sleep, and stress improving for individuals. In fact, a recent Bankrate study found that 81% of employees reported wanting a permanent four-day workweek. Individuals are inundated with factoids and survey results of this nature constantly - on LinkedIn, in their inboxes, on social media, etc., so it is not surprising to see that most employees aren't excited about a mandated return to office.
The Great Mismatch
Forbes is calling this misalignment of expectations and values between workers and organizations “the great mismatch”. With rich data and peer-reviewed research supporting the benefits of flexible work, employees are left feeling like their employers don’t trust them and don’t value their needs. This creates work environments where quiet quitting run rampant, retention drops, and, as a result, organizational success takes a hit as well. On the other hand, leaders and stakeholders worry about losing company culture and collaboration by allowing flexible and remote work options. They also cite concerns around organizational productivity. Ultimately, research warns that companies who take a hardline stance against remote and flexible work, mandating return to office (*without solid reasons that resonate with employees*), must be prepared to lose good talent over the decision.
Unforeseen problems with a mandated return to office:
If the pandemic taught us anything, it’s that a one-size-fits-all approach doesn’t work for most people. The traditional 9-5 in-office standard we saw prior to the pandemic worked well for white men, and not really for anyone else.
When an employee has shown they can perform their job satisfactorily in a remote / flexible setting, they will likely feel that their company doesn’t trust them and / or that their company doesn’t value their needs if they are ordered to return to the office.
Required on-site work greatly reduces the available candidate pool for job seekers. Less job seekers, who are constrained by location, directly correlates to lower representation and diversity of background, which directly correlates to lower profits, innovation, retention, and employee performance.
Doug Dennerline, CEO of Betterworks, warns, “Organizations are guaranteed to lose great people, not only for lack of flexibility, but because many of the best employees moved out of expensive cities during the pandemic and won’t be moving back…With the right performance management technology in place, where productivity can reach optimal levels and the best talent can work from anywhere, there’s no reason employees should be forced to work from an office.” (Forbes)
In addition to proof that remote and flexible work is good for employees, we’ve also seen cases where mandated returns to office can contribute to worse performance and outcomes for businesses. Goldman Sachs, who admittedly has a long history of making would-be-fatal business mistakes (remember their $10 billion bailout in 2008?), is one company that has been leading the return to office mandate. With their rigid insistence on in-office work, earnings for Goldman were down 58% in the most recent quarter. Pair that with the fact that Goldman was also an advisor for Silicon Valley Bank, which has now collapsed, and it begs the question, are these large organizations making smart business decisions? If profits and earnings aren’t increasing with required in-office work, what is the driver behind these return to office mandates?
Shifting our mindset: what if instead of investing in more office space, corporate infrastructure, beer taps, and snacks for the office, organizations invested in the research and exploration of strategies for effective communication, cultivating innovation, creating mentorship opportunities, and conducting team-building activities in a remote-first or flexible work setting?
What are the benefits of flexible work?
1. Tailored Productivity Peaks: Not all employees operate at their highest potential during the same hours. Some people are early birds, while others are night owls. Flexible work arrangements allow employees to align their work hours with their natural productivity peaks. This means they can tackle their most demanding tasks when they're most alert and focused, resulting in increased efficiency and higher-quality work.
2. Reduced Commute Stress: The daily commute to and from the office can be a significant source of stress and time wastage for employees. Flexible work options, such as telecommuting, eliminate the need for commuting, giving employees more time and energy to devote to their tasks. This reduction in stress contributes to better mental health and increased productivity.
3. Enhanced Work-Life Balance: Flexible work arrangements promote a healthier work-life balance, which, in turn, fosters improved job satisfaction and motivation. When employees can choose when and where they work, they have more control over their personal lives. As a result, they can dedicate themselves more fully to their work when they are on the clock, leading to heightened productivity.
4. Minimized Distractions: Office environments can be rife with distractions, from chatty coworkers to loud office machinery. Some employees find it challenging to concentrate in such settings. Flexible work allows them to choose a quieter, more conducive workspace where they can focus without interruptions, ultimately leading to improved productivity.
5. Increased Autonomy and Ownership: Flexible work arrangements empower employees to take ownership of their work. When they have the freedom to structure their day, they are more likely to feel accountable for their tasks and deadlines. This sense of autonomy can drive them to be more proactive, creative, and efficient in their work.
6. Geographical Freedom: Remote work and flexible work hours also offer the benefit of geographical freedom. Employees are not tied to a specific location, which can be particularly advantageous for those with family obligations or a desire to live in a different city or country, or those who can’t afford to live in increasingly unaffordable cities like San Francisco, Manhattan, Los Angeles, and Brooklyn. This freedom can lead to happier and more motivated employees, ultimately boosting productivity.
7. Better Health and Well-Being: Flexible work arrangements contribute to better employee health and well-being. By allowing employees to work when they are most productive, they can better manage their energy levels and avoid burnout. This creates a more engaged and productive workforce.
The Solution:
Experiment! No great innovation or breakthrough has occurred without experimentation. This holds true for organizational culture. Start by defining your company culture – include core values and beliefs. Brainstorm on ways to maintain company culture in a flexible work environment. Benchmark current profit and employee performance so that you have a baseline to measure against. Implement a flexible work environment and continue to monitor profit and performance for several months. Compare your baseline data with your new numbers and determine if a flexible work environment is sustainable for your organization.
Remember: every person is unique. In the same way that children display different learning types in school (Visual, Auditory, Read/Write, and Kinaesthetic), adults are each able to achieve their best work in different environments – in office, hybrid, or remote, and hit their peak performance at different times of day – morning, afternoon, evening, or overnight. Human capital (people) is a main driver of success for a business – there aren’t many business models or organizations that could survive without people. In examining tactics for increasing productivity and your bottom line, we should be looking to our people first and asking how we can provide the resources and environment to allow them to do their best work. Doing so will ultimately result in better results for the individual and the company.
Keep in mind that, just as every person is unique and will thrive under different conditions, companies will need to assess their specific needs to determine the best work schedule and requirements. A company centered around research that must be performed in a laboratory will not benefit from remote or hybrid work. A company that has employees scattered across the world will likely not reach their highest levels of profitability and efficiency with required on-site work for all employees.
Where possible, implementing flexible and remote work arrangements provides a win-win for employees and employers. Flexible work has been shown to enable greater productivity and output, reduce stress, enhance work-life balance, minimize distractions, foster autonomy, provide geographical freedom, and promote overall well-being. As organizations continue to embrace flexible work options, they not only unlock the full potential of their employees but also cultivate a culture of trust, empowerment, and adaptability that is crucial in today's dynamic world of work. For organizations or roles that can’t allow for remote work, don’t miss the opportunity to ask employees what support and resources will help them be their best selves in the office. Work schedules and on-site requirements are just one piece of a larger puzzle that factors into employee satisfaction and performance, and it is always worth exploring opportunities to better support your workforce.
Level is a remote organization, but through on-site and virtual volunteer work with local organizations, our team practices our values of compassion, sustainability, and authenticity, and lives our mission of igniting social change.
Action Items and Additional Resources:
If you aren’t sure if your company culture can be maintained in a remote / flexible work environment, start by writing down your company mission, values, and beliefs. How do those show up in the company? Take some time to explore creative ways to achieve your values and uphold your beliefs in a flexible / remote work environment. Consider implementing annual or quarterly in-person “bursts” focused on team building and learning, which can garner great results with less required in-person time.
Ask your employees what resources, opportunities, and work set-ups will make them most productive. A company pulse survey that is administered by a 3rd party and ensures anonymity is a great way to get this information. Reach out to Level for more information on this solution!
Develop online / digital training tools and resources to enhance the onboarding process for remote workers.
Schedule regular one-on-ones with team members and direct reports to show intentionality and ensure engagement.
Check out our interview with 2 local leaders on how to manage remote teams effectively.
Check out The Radical Promise of Truly Flexible Work by Organizational Psychologist Ludmila Praslova, which explores unlocking productivity at scale through 'making work fit people, not the other way around.'