The Future of work: From remote to hybrid Introduction
“Without an existential shock like the COVID-19 pandemic, you For many organizations, the move to a virtual operating would have needed change management programs to convince environment was not entirely new and had already been and motivate people to make the desired changes. In this case, underway in the pre-pandemic era. In recent years, as there is no time to consider any alternatives; no time to resist. You companies focused on remote working in response to changes wake up and the new way of working simply exists – there is no in employee needs and behaviors, many of them actively alternative and there is no option to return to how things were. looked at hybrid working in some form. A hybrid workforce This amount of change – had it been gradual – would have taken essentially refers to a workforce that is distributed across decades.”– Professor Benjamin Laker, Professor of Leadership, different locations, from traditional office and factory spaces Henley Business School, University of Reading. to remote locations, including within employees’ living space, be it a family home or shared apartment. A hybrid working The COVID-19 pandemic has been a watershed event in model is characterized by the flexibility and choices it offers the history of the world – a major healthcare crisis that has employees, and it can be an innovative way of driving new challenged society in new ways. It has also signalled a major approaches to agility, collaboration, and ways of working. shift for businesses as lockdowns were imposed around the world and organizations were pushed, almost overnight, into A recent report suggested that even in sectors that historically an enforced experiment in remote working. In industries tend to be more location-dependent, such as manufacturing, where all-out virtual working is nearly impossible – such as more than half of businesses were considering some degree manufacturing, power generation, mining, construction, of hybrid working.2 The pandemic has only accelerated this etc.1 – many operations simply ceased, with devastating trend. According to Bryan Campbell, agile transformation consequences for economies and jobs. executive at ExxonMobil, “We absolutely see remote working or ‘work from anywhere’ as the new operating model. In our context, it was already envisioned to be a destination, but it's been greatly accelerated with the pandemic. We recognize this as a new operating model and one that will last in some form in the future.” To understand the evolution of “remote working” into “hybrid working,” we surveyed 500 organizations and 5,000 employees from a range of sectors globally and conducted detailed interviews with academicians and executives. Based on our research, this report examines a range of key questions: 1. What do organizations and employees think about the sustainability of remote working models? 2. What gains can organizations expect from these models? 3. Have organizations effectively managed the shift to remote work? 4. What steps should organizations take to effectively implement a hybrid working model and leverage its benefits?
2 The Future of work: From remote to hybrid Executive summary
Remote work is here to stay Beyond remote: Recommendations for shifting to a hybrid workforce future • Widespread remote working is increasingly becoming the “new normal.” Three-quarters of organizations expect • Rethink the sourcing model to enable “deliver where you 30% or more of their employees to be working remotely, are”: Expand your talent-sourcing boundaries – use more and over a quarter expect over 70% of their staff to be of the fluid workforce (such as freelancers, or independent working remotely. workers) and global tele-workers, either nationally or across international borders. • Organizations expect remote models to work well in functions such as IT, finance, and accounting. However, • Define what constitutes “authentic” leadership: every function will need to transition their operating model Encourage autonomy, empathy, and transparency. Redefine to a hybrid operating setup. the role of leaders to empower employees to make data- driven decisions, use data to manage the remote workforce, The shift to remote working has boosted productivity and and enhance remote leadership skills such as empathy, cost savings active listening, and adaptability, etc. • Employee productivity at organizations grew during • Reinvent a “trusted” work culture with new collective Q3-2020, driven by reductions in commute time and rituals: Build digital communities to activate purpose and a adoption of virtual collaboration tools. Over six in ten sense of belonging. Embrace new collective rituals, such as organizations witnessed productivity gains in Q3-2020 due more virtual team-building activities, and virtually recreate to remote working and average productivity gains ranged modes of informal connection. from 13%-24%. • Install a robust digital infrastructure to accelerate • Nearly 70% of organizations believe that the productivity seamless digital working: Establish secure digital gains of remote working are sustainable beyond accessibility to business processes – anytime, anywhere, and the pandemic. with any device. Leverage digital tools, technologies, and • A majority of organizations expect remote working to skills to drive remote working efficiency and productivity. reduce real estate, facilities management, and business Transform backend technology into a resilient, flexible, and travel costs, among others. cloud-ready enabler for daily activities and innovation. Have organizations effectively managed the shift to • Shape up organizational real-estate to address the remote work? needs of a hybrid workforce: Reimagine the office as a destination that strengthens cultural connection, learning, • Remote employee burnout is on the rise. Over half of and bonding between employees (across onsite, remote employees feel burned out as a result of working remotely and hybrid employees). and the figure rises to 61% for younger employees aged 31–40. • Tailor the employee experience to adapt to a hybrid operating model: Rethink all elements of the • Employees feel apprehensive about long-term remote employee lifecycle, including onboarding, learning and work, which impacts their engagement, satisfaction, and development, compensation and benefits, well-being, and productivity, with 56% fearing the stresses and demands of performance management. being “always on.” Employees also feel organizations do not trust them and are micromanaging them. • Establish a business case for the target hybrid operating model: To make sustainable progress in a hybrid work setup, • New joiners feel lost and disengaged in a remote setup. Half organizations need to conduct detailed assessment of its of them said they would quit if remote working were the impact on key metrics. only option.
3 Remote work is here to stay Organizations and employees both expect remote working models to stay
Widespread remote working has been quickly adopted as • US-based Capital One Financial has extended the flexibility the norm by organizations. According to the executives in of remote working to the majority of employees at its US our study, three-quarters of organizations expect 30% or call centers for cards even after the COVID-19 pandemic more of their employees to be working remotely, and over ends.5 a quarter expect over 70% of staff to work remotely (see • Siemens AG, the Germany-based engineering services Figure 1). Technology companies are far more aggressive in company, announced a new mobile working model to allowing permanent remote work to its employees. Twitter, enable employees worldwide to work from remote location for example, was the first company to allow its employees to for two to three days per week on average.6 work from home permanently.3 Similarly, Microsoft allowed its employees to work from home freely for less than 50% of • French automaker, Groupe PSA, announced that its office- their working week, or move to a permanent remote work based staff will work remotely even after the pandemic upon approval from managers.4 Companies in traditional ends.7 sectors have also announced similar plans:
Figure 1. Around three in ten organizations expect more than 70% of their employees working remotely in the next two to three years, up from just one in ten before COVID-19