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The best of both worlds? 

Published 18 August 2022 in Technology • 6 min read

Hybrid working is all the rage, but it is not yet right for everyone. Some organizations are struggling to establish models that spark the chemistry that can only happen in the workplace. But they would be wrong to force through a wholesale return to the office: employees want some remote working. Can leaders find a middle way?

The sound of the backlash grows louder. Amid the COVID-19 crisis, as employers shifted to remote and hybrid working, it became received wisdom that no organization would revert to its pre-pandemic arrangements. But some executives prefer traditional ways of working, and companies including Goldman Sachs have ordered their staff to stop remote working altogether.

Hybrid working models appear to offer compromise, giving staff freedom to work remotely as long as they make regular appearances in the office. Whether hybrid work will capture the best of both, as LEGO Group contends, or the worst of all worlds, as GitLab’s CEO labels it, will depend on how it is implemented.

Staff want hybrid 

Evidence, including this poll of 14,000 European workers, suggests that the majority of people want to continue working remotely at least some of the time. Two-thirds said they had made changes to their living arrangements to do this, creating office space, for example, or even moving house.

So employers will want to at least try to find ways to accommodate their employees’ wishes. All the more so in a labor market where employment is at record highs and vacancies continue to grow.

The organizations that are prepared to upset staff by rejecting the working arrangements they want risk losing them – as Apple discovered when its head of machine learning quit after being told that employees were expected in the office at least three days a week.

Clearly, there is not going to be a one-size-fits-all solution for employers trying to reconcile these arguments. A manufacturing business built around the production line will find it much more difficult to move to hybrid working than a professional services business whose capital is entirely human and intellectual. 

Exploitation work simply depends on staff having the right tools that can be installed in any location

Employers should consider the nature of work 

There are routes through the maze. Above all, it is the nature of work that matters most – thinking about how and when their staff are focused on ‘exploitation’ and ‘exploration’ is one way for employers to design a new workplace model.

Exploitation is the work that simply depends on staff having the right tools – a laptop that allows them to produce a report, for example. These tools can typically be installed in any location – and there is no obvious reason for employers to insist on a location of their choice.

Exploration, meanwhile, is the work that is much harder to do without human interaction. There are tools that enable this connection outside the traditional workplace, but there are limits to what they can achieve. This is the area that employers are likely to focus on when they think about their workplaces.

One recent study,1 co-produced by IMD authors, identified at least three important examples of exploration: 
 

  • First, unstructured collaboration describes the chance encounters that people working in the same location have. These ‘watercooler moments’ might often generate no more than idle conversation, but occasionally they kickstart a process of innovation. Perhaps someone mentions a problem and someone else knows who might be able solve it, or someone raises an idea in passing and a colleague latches on to it. 
  • Second, learning is an important part of the workplace experience. Younger colleagues and new employees, in particular, benefit from proximity: they can ask questions quickly and spontaneously, and a lot of their learning comes from simply being around others and watching the way they work. 
  • Third, the office can also function as an important social anchor. It is a place where people enjoy human interactions and the relationships they build with the colleagues they encounter each day. And this is not a luxury – those relationships form an important part of the company’s culture. 

Some people believe that these exploration activities can be pursued happily even when staff are working fully remotely. Sid Sijbrandij, GitLab’s CEO of GitLab, which has operated with an entirely remote workforce for a while, goes further, saying that “hybrid can be horrible.” Hybrid working is divisive and impractical, he warns, urging other employers to instead embrace either a fully remote or a fully office-based model. GitLab has compiled a 2,000-page handbook containing the lessons it has learned about how to achieve those goals outside of the workplace. 

But many organizations are less convinced. They worry that while rapidly evolving workplace technologies provide some help, and were essential during the pandemic, they do not fully replicate the office experience. Chance encounters have to be converted into more formal and scheduled meetings, learning by symbiosis is no longer possible, and relationships suffer without personal contact.

‘Watercooler moments’ might often generate no more than idle conversation, but occasionally they kickstart a process of innovation

Take stock before you restock 

Now, companies are running out of cultural credit: during the pandemic, they drew on the engagement and camaraderie they had already built up, but there is not an endless supply of this. Loyalty is being tested, and new employees have never had a chance to build up any reserves.

This means it might be time for us to return to the office to restock. But if we agree to do that and pursue the exploration activities with new fervor, we need to make sure that the workplace is fit for purpose. 

That requires a considered approach to hybrid working, rather than a laissez-faire policy. An employer that asks staff to come in at least twice a week, for instance, may be disappointed by the results if one half of the team picks Mondays and Tuesdays and never meets the other half who have opted for Wednesdays and Thursdays.

Employers must think hard about what is right for them before taking divergent approaches. Apple, for example, has decided not only that staff must be in the workplace three days a week, but also mandated that those days must be Monday, Tuesday and Thursday. The LEGO Group, on the other hand, is aiming for three days a week on average across the business, and is much less prescriptive about when – it also gives individual team leaders more discretion about how to apply the policy.

One factor in The LEGO Group’s approach is that its new campus is not sized to house all its employees at the same time. And this is an important point. For organizations that see hybrid working models as an opportunity to reduce their physical footprint, there will be practical issues in what they expect from staff. In the UK, the Government’s instruction to the Civil Service to set an example by returning to work forced staff to work in canteens and corridors because there were not enough desks to go round.

Hybrid working
“Thinking about how much time staff spend on exploration and exploitation may help employers to decide how to balance remote and office-based work.”

Optimize the workplace for exploration 

Finally, it is not just when staff are in the office that matters, but also what they are doing when they are there. Thinking about how much time staff spend on exploration and exploitation may help employers to decide how to balance remote and office-based work. And for the latter, they need to encourage as much exploration as possible.

So they may need to rethink the design of the office and provide more space for formal and informal encounters. Acoustics are important, too: how can offices be designed to encourage buzz without drowning out the thoughts of those trying to concentrate? The smallest details matter: staff cannot meet at the coffee machine if the company has not installed one.

Technology also has a role to play here. The US real estate company Silverstein Properties, for example, has developed an artificial intelligence platform that tracks the movement of people around its buildings in order to create office layouts that are optimized to encourage chance encounters.

The whole point is to address the practical issues that are fueling the backlash against the hybrid model. Employers may prefer a workplace-based model, but their employees prefer hybrid. If they can maximize the gains when staff do come together, that could be the best of all worlds.

Authors

Robert Hooijberg

Professor of Organizational Behaviour at IMD

Robert Hooijberg is Professor of Organizational Behavior at IMD. His areas of special interest are leadership, negotiations, team building, digital transformation, and organizational culture. Before joining IMD in September 2000, Professor Hooijberg taught at Rutgers University in their MBA and Executive MBA programs in New Jersey, Singapore, and Beijing. He is Program Director of the Breakthrough Program for Senior Executives and the Negotiating for Value Creation course.

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