As we begin our meeting, she tells me about the beautiful office that the company redesigned and shows me a graph tracking the number of employees actually showing up at that beautiful office on the agreed office days. That graph represents their frustration – the inability to bring back the employees to the workplace. “And why is that a problem?” – I ask. “Because this does not match what was decided,” she responds, “our hybrid work model states that employees must come to the office two days a week, on specified days.”
That’s what leadership decided. And yet employees are responding with their own decisions. And they are not showing up.
“The Great Resignation” indicated a change in the employment contract between employees and organizations. This change is still in its infancy. And if management does not learn to hold the pen, it is the employees who will write how this plays out. But holding the pen does not mean writing from the past. Management should now engage with employee to write this new chapter in the future of organizations. And in doing so, also re-write how we measure: measure outputs rather than inputs; measure organizational health rather than attendance. Eventually, organizations may even choose to switch from measuring traditional employee attrition and retention rates and design new metrics to reflect managerial and organizational flexibility.
In the new reality, it is essential to put the right people in the right job, at the right time, with the right skills and the right managers. It is important to measure what matters, not what is easy to measure or what we used to measure. This also includes not worrying about a graph measuring what percentage of your employees come to the office. This is not the measure of success of hybrid work.
But then, what is?
Imagine for a moment that we would assure you that employees can generate 200% output consistently, compared to your expectation or past performance. And imagine you discover that they can do that while only working two days a week. Is it acceptable? A common managerial response to this question is “if they can create 200% output in 2 days work, we should expect 500% with five days.” But this is a Win – Lose response. Because the internal motivation that causes workers to produce 200% output in two days is precisely the fact that they have been given free rein to use the other three days for their non-work life as they see fit.
And this is the emerging story of the changing world of work.
The debate over whether people should manage themselves or should be managed is slowly becoming less relevant. From the beginning of the Covid-19 pandemic we have seen a steady increase in self-management and witnessed the rise of internal motivational mechanisms. Work is a part of life. People who work on something they love will be happy to do it. They will work because they feel their work is satisfying, developing, meaningful, and enables them to contribute to the world. Not because they were told, observed, and measured. These are the internal drivers that connect people to work. People are not connected to the office, a water cooler, or a corporate event. Employees care about the team, follow their managers, invest in doing something that they value and are about.
So, nowadays, when looking to figure out “how to make this hybrid thing work” or “how to manage this generation” or “how to retain these sought-after employees,” you should remember that the answers will emerge if you focus on creating a win-win situation in which the work environment serves both the organization and its employees.
Research Shows a Surprising Improvement in Organizational Culture
New studies are being published every week around this win-win question, in an attempt to understand the mechanisms of success behind hybrid work, people commitment, and organizational culture. A new study by Cisco and MIT Sloan School of Management tries to identify these internal motivators. Its respondents include CEOs, mid-level management, and ordinary employees in organizations of all sizes and industries in different countries. To understand perceptions about organizational culture, the research included questions about belonging, inclusion, fairness, communication, and a sense of security.
Nine out of ten respondents say that corporate culture has improved as a result of hybrid work. Only 10% of respondents felt that they suffered because of working remotely in terms of comradery, involvement, diversity, inclusion, or the ability to express opinions. The same also goes for diversity and inclusion, where hybrid work helps deal with biases. If you work for a global organization or an organization with a sizable headquarters, you’ve probably experienced the bias of location –management sees those who work out of headquarters, get to know them and, as a result they are top of mind when opportunities arise. Those who are far away, as the proverb says, are “far from the eye – far from the heart.” Hybrid work, however, helps mitigate this bias in that more communication is location agnostic.
Belonging is created through leadership, not through the office. Remote work during the pandemic has taught us that a sense of belonging relies much more on organizational culture and leadership than on location. And the good news is that managers in hybrid environments are very aware of this. Eight out of ten employees are confident in the ability of management to strengthen a sense of belonging in the organization. The same proportion feels that managers encourage open and ongoing dialogue and share opportunities at work equally. The picture is similar on the part of executives. Nearly eight out of ten board members and senior executives surveyed agree that workers working from home do a great job most of the time.
The “Great Resignation” turns into the “Great Negotiation”: workers are now looking for opportunities and not for guidelines. They want to be able to choose where to work, rather than enjoying pampering benefits or indulging workplaces. Six out of ten respondents agreed that the ability to work from a place of choice needs to be optional, not mandatory. Seven out of ten people say that engagement and employee well-being directly depend on their ability to choose where to work. In other words, in the minds of employees, hybrid work does not mean “how many days a week will I work from the office” or “what days of the week will I work from the office”. Hybrid work means the ability to integrate work into life. And the nuances are very personal and differ from one person to another.
Just like in any negotiation, employees are willing to give, not only to get – even when it comes to changes in work conditions, salary, and other benefits. About 70% of research participants agree with the idea that employees may receive different conditions for the same work, according to the location of their workplace. In other words, employees agree with the existence of a reasonable difference in pay between employees living in the low cost areas and those who live in more expensive metropolitan areas, based on cost of living. And when remote employees were asked what they need, eight out of ten did not seek reimbursement for home office expenses, nor even additional benefits like access to shared offices or subscriptions to a local gym or care costs for family members. They were simply asking for the right to choose when and where they work, and were willing to pay for that choice.
Employees also understand that the work environment is changing. They see the office as a place to meet other employees and do the things that are best done at the office – not just as a place to be seen. When asked why they choose to come to the office, the three main reasons are collaboration and creativity, work-life balance (including the need to have a reason to leave home at least sometimes) and – worth noting – a desire to learn and develop new skills.
Managers, please do not try to make a U-turn: So yes, we are still in the middle of negotiations, but it is very important that managers now do not try to move, but backwards. Because the new is difficult and challenging and it is tempting, in the short term, to retreat to what is easy and familiar. Tempting, but not smart. Because as we speak, there are those who are learning to adjust to the new environment, to manage differently, to connect differently, and to build a different culture. At some point they will figure it out. And when they do, they will be better prepared, not only organizationally and managerially, but also business-wise.
Cisco and MIT’s research reveals that corporate culture does not necessarily suffer when people are not in the same physical space. In some cases it even thrives! We also learn that leadership has done the right thing to ensure fair conduct in times of great uncertainty and that employees’ desire to choose the workplace stems from the need to live a more balanced life. It is therefore important that managers fully experience hybrid work, as employees themselves, and then manage in a way that creates a sense of belonging and a safe environment where people can work and express themselves freely.
Leave the past models behind us and move forward to write the new social contract together, one that is adapted to the future world of work.