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Telecommuting more productive than office work – workplace guru

The Covid pandemic has forced the world to embark on a remote-working experiment. Is it merely a test run or our new reality? Will it transform working life as we know it? We talked to Kate Lister, president of Global Workplace Analytics.

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Sophie Shevardnadze: Kate Lister, president of Global Workplace Analytics, great to have you with us today.  

Kate Lister: Good to be here.  

SS: Kate, now with the pandemic, remote working is finally mainstream. But how long will this effect last? I mean, will telecommuting lose momentum after we're done with the virus? 

KL: I really don't think so. We've reached the tipping point already, about 6% of the population. And this is just going to throw it over. You know, you're hearing company after company that says they're going to continue this after the pandemic. I think the big thing that changed is that managers are no longer afraid of it. That's the thing that's been holding back remote work since 1970s, when the word ‘telework’ was invented, and now that they've done it, they understand that it's possible and that they can manage people remotely. 

SS: But I'm thinking, for instance, [it is] necessity [that] is forcing companies to tell their employees to stay home, like you said, but on the market, like we have many different kinds of companies. Let's say a SoCal startup would probably have no trouble doing work remotely. But then you have like ancient traditional companies like IBM or AT&T or something where you have this, you know, history of hierarchy, showing up for work, etc. Will these giants have trouble operating as efficiently as they were with, you know, people working from home? 

KL: We're seeing it across industry and across size of company and across age of company. And even CEOs are making statements that they surprise themselves that they've been converted. You know, not everybody, not every organization is going to have a huge percentage of their employees working remotely. And I think it's important to say that it's not likely to be a full time thing. The sweet spot is 2-3 days a week. And that's been true, you know, as long as I've been doing this for almost 20 years. It could be still that there's gonna be some people that are fully remote. But you know, I don't think these large companies are suddenly going to give up all the real estate. And the fact is, we do individual work, and we do teamwork. And what we've learned from the pandemic is we can actually function just as well remotely in teamwork, but we don't like it as much...  

SS: Yeah, we're going to talk in detail about that. Because that's, of course, the main point of why people are being a little worried about working remotely. But let me ask you this. Working from home is such a dream for so many of us. I mean, for me, I'm loving it for the past six months, I'm doing it remotely. Yet before disaster struck, it wasn't really the default path for the majority of businesses, right? What is it about remote working that is scary to those who run companies? Have these fears been outweighed by the fear of Covid now? 

KL: Yeah, it traditionally has been that managers simply don't trust their employees. That's the honest truth. They're used to managing by butts in seats, you know, the back of somebody's head, rather than managing by results, which is something that we've known since the 1950s is the way people prefer to be managed and maximizes their both satisfaction and their productivity. So now that managers have done it themselves, they see that it does work. And we've seen that historically, in the research once a manager does it, they're like, ‘Oh, okay, I get it’. But I think the other big thing that's going to change here is that this has become a C-Suite conversation. They've seen that, ‘Wow, you know, maybe we don't need all this real estate, maybe there is a different way to function, and maybe this managing by results thing is a good thing’. Yes, it is a good thing. And with the potential economic downturn coming, the more attention is going to be put on reducing those fixed costs, like real estate. And risk managers and investors are voting with their feet that they want to have companies that are resilient, not only resilient but also sustainable.  

SS: You're probably talking from someone who’s seen research on it, but for those who haven't, a thought I hear often about telecommuting is that it just doesn't provide the same fruitful working environment as the office. And what I mean is like chit chats and lunches together, proverbial watercooler conversations, spontaneous discussions of work matters and insights that appear out of a free-form socialising... Is working remotely not bad at all for collective creativity and overall productivity at the workplace? Doesn't it affect it at all? 

KL: For productivity, the research has shown for the last 15 years that it increases productivity. And the two big reasons is reduced interruptions, we did a survey, just about a month into the pandemic, and found that people said they lost 35 minutes a day less to unwanted interruptions at home, which was kind of a surprise, because you know, with all the things that are going on at home, right now, this is not the best of times to be doing it. And so that's one element. The other element is they tend to give back 50% of the time that they would have otherwise spent commuting. Those two factors have forever increased productivity. Also, it makes people more loyal, they're able to work when they're maybe not feeling well, you know, they might have otherwise called in sick, but if they can work at home, they're happy to. On the issue of collaboration, there's always been this idea that you can't collaborate virtually. Well, I'm sorry, but we're a global economy. So regardless of whether you call it telecommuting, we are collaborating, virtually. Fact is people want to do it in person. So the survey that we did show that they're just as productive in teamwork, working remotely, but they're not as satisfied.

SS: Yes, as being social animals. 

KL: So they want that human contact, they want that face-to-face. But there are all-virtual companies that don't have any of that. And how they replace it is through virtual communication but also by getting together physically, maybe once or twice a year. It turns out that it doesn't take much to maintain those trust bonds and those social networks. And one of the things that we found is gaming, just gaming for 10 minutes together with your colleagues is something that creates and maintains those social bonds. But you know, that mix is better. I'm not advocating for all-remote, because really, you know, some people like to be together with other people. And that's important. 

SS: But still, you're saying a lot of it's going to be done remotely, for the most part. And like we've said, experience shows that issues can be solved in messengers and Zoom. How can these convenient, but in a way, imperfect tools fully make up for lack of eye-to-eye communication with our colleagues? Are they going to be perfected in a way that, you know, we don't even feel the need anymore to have face-to-face contact with our colleagues? 

KL: Yeah, I mean, look at how quickly Zoom backgrounds came on the scene. You know, Silicon Valley is already looking at this, and how do we improve it? There's a new technology coming out that allows us to be sitting in the same room, so that, you know, we feel we're together, you know, we're never going to have that three-dimensionality. Well, I shouldn't say that. Maybe with holograms, we will. But you know, it's not going to replace it. But there's times (and I think this is something that leadership is realising right now) that good enough is good enough. So rather than sending somebody across the world on an airplane, or across the city to have a meeting, meeting like this is good enough. And I think that that's what we're going to learn coming out of this - this is that there's a time to use technology, and that we can improve productivity by relying on technology. And there's times that we do want face-to-face. And we have to find that cooperation at that point in-between where it works best. And by the way, it's going to work different for every company, every team, every individual. So you know, it's a matter of what works for me. 

SS: So should companies right now be investing in virtual reality software instead of offices downtown? 

KL: I don't think it's there yet. I think we're getting close. I think that that will become a norm. It's already being used in a lot of industries for things like walkthroughs of facilities. So you know, in so many ways, the pandemic has not created new technologies or new norms, but has accelerated them. So we were already working remotely. Now we're working remotely more. We were already working on virtual technology. Now we're really working on it. 

SS: And I wonder if this work remotely regards all professions with no exception? Because, for instance, I make my money by interviewing people, and that entices me and you talking face-to-face, and of course it's better when you are face-to-face in person. Do you think someone like me, an interviewer, can hope to have its profession transformed to a point where I will never see you face-to-face, like all of my interviews will be like this in the future? 

KL: I absolutely think so. You and I would have never met. You know, you wouldn’t have flown to me across the world, you know, you wouldn't have come to me. So, you know, it's making possible connections that wouldn't have otherwise been possible. And so you know, there's talk about it's going to reduce the serendipity encounters and, you know, that's not good for innovation. Well, in fact, there's evidence to show that it actually increases your network. We can be global, we can talk to anybody anywhere. So, you know, I think we have to stop looking at how do we replicate old norms, and start thinking about how do we use technology to do things better than we have in the past. People talk about the watercooler. My husband has a line, “We try to get better and better, we should work harder and harder to get better and better at something we shouldn't be doing at all.” So you know, was the watercooler that good thing? And is there a different way to collaborate that in fact is more inclusive, you know, that doesn't leave the introverts out of the conversation? That's what my hope is that going forward that's what we'll learn from this. 

SS: But also, the argument that people have in favor of face-to-face work is that it's going to become more rare, but it's going to become more expensive and more exclusive, and thus, everyone's going to strive to have that. Do you agree with that, that face-to-face contact in any field, whether it's journalism or big corporations, is going to be a luxury, but it's going to be something that people will strive for? 

KL: I think it's gonna be a long term, a long time before we get to that point. I think there's going to be this huge rush back to the office and this need for face-to-face and it's really hard to separate what's going on with the pandemic, and what's going on with remote work. Are we starving for connection because, you know, we can't even go to the store? So I think that there’ll be a period of getting over that and getting away from the kids and getting away from the spouse. But, you know, I think that we will settle into a pace where people work where they’re best, where they do their best work for whatever it is that they're doing, and yet one day that may mean getting together in person and another day, that may mean working remotely, but I think that stigma has gone away now. People realise that working at home does not mean sitting on the sofa and eating bonbons. 

SS: Kate, listen, do you think remote working will become an option for every employee someday?

KL: Warehousing, manufacturing, distribution, you know, there are a lot of industries that just are not compatible. You know, there may be something compatible in each job maybe one day a week or maybe one day a month or something like that. I think as robotics and automation take hold, many of those jobs will be able to be done remotely. But you know, there will always be people that - you know, drivers or maybe not even drivers, you'd be able to get a drive from your living room with this vehicle. But it certainly is an office-based knowledge worker that is most suited to remote work. And I think that it's important for organisations to create an environment and a culture of flexibility that goes beyond remote work. People are desperate for some control over their day over their life. When you think about a Saturday, you’ve got errands, you’ve got this to do and that to do, but it feels like a Saturday, because you're in control of that, you're in control of when you do those things and how you do those things. And that's what we want in our work lives. I mean, even offering flexibility increases employee satisfaction even if they don't use it. It's just having that little bit of control over your schedule and autonomy.

SS: Okay. I mean, also, there are concerns that remote employees can end up being discriminated against in terms of pay and bonuses and promotion prospects as compared to their office-based colleagues. And I wonder why these fears are even there? I mean, why should some remote, you know, sales manager be paid less if his sales are just as good as those of his office-bound colleagues?

KL: Yeah, it's always been a fear that the media talks about. But everything we've done in terms of surveys over the years and even recently, has shown that it's a minor concern for employees. About 20% of the population says that they're concerned about it but nobody is very concerned about it. I shouldn't say nobody but a very, very small percent is very concerned about it. One of the things that remote work does, as we talked about, is force people to manage by results. And like you say, if you make the same sales when you're sitting at the desk in the office, and you're at home, that's managing by results. And we can all have those kinds of goals, it actually increases the fairness in those salary decisions and those promotion decisions because, you know, it evens the playing field if we're all being managed by results. There's no pet employee or the guy that comes in at six o'clock in the morning and doesn't leave till six o'clock at night and looks like the most productive guy there when in fact, we don't know what he's doing. If you think about the fact that Amazon shopping peak hours are during working hours, it doesn't, doesn't say much about being able to ensure that people are productive even when they're at the office.

SS: The rise of remote work will also lead to a more homebound life, right? It could change the whole landscape of how cities look right now. Our whole cities are built around the idea that people wake up at home in one place and commute to work in another. Like We have the City of London where nobody lives but people come in droves during the day, for instance, and so many big megapolises are built that way. Will the idea of the central hub of a city where everyone goes to work thus making it the center just sort of die out? 

KL: I don't think it's going to die out, it is going to be different. We're already seeing an outpouring from cities, to suburbs and to rural areas. Some of the real estate platforms have seen 100% increase or 1000% increase in people looking for suburban properties and rural properties. And once they've been told that they're going to work at home forever, they want to get out of the city. That was already happening. This is also coincident with the millennials now having families so that exodus from the city was already starting to happen. But cities are going to be hurt by this and all of that, not just the offices, but all of the ancillary businesses that support them… 

SS: I was going to say, the empty offices mean no weekday lunches, no happy hours, no need for a cleaning crew, the maintenance... 

KL: Coffee, serendipity shopping, you know, all of those things... 

SS: So do you think the service sector will suffer because of this? 

KL: Oh, absolutely. I think there'll be a period of adjustment. But I think that some of that excess office space could be re-purposed to make housing more affordable. It's going to require some re-zoning but there's already examples of this in areas throughout the world where they've done it, where they converted those spaces, where they've converted malls to housing. So I think there's an opportunity to re-purpose. The biggest reason people don't go downtown is because of the traffic getting there and getting out of there. I live in San Diego. And, you know, my husband and I used to go down to the city, which was a 20-minute drive to go to a play or to walk along the harbour or whatever. But we stopped doing that 15 years ago, because you just never know how long it's going to take to get down there and how long it's going to take to get back out. So I think that cities can return to being places of cultural connection and restaurants and nightlife and those kinds of things. But there's going to be a period of transition, it's going to be hard.

 SS: But also I’m thinking, if more people switch to work from home, and probably choose suburbs over the big city, how likely is it that they will actually help the growth of some kind of local businesses, restaurants and whatnot?

KL: Exactly. I agree. You know, one's going to lose, the other is going to gain. I envision there are other people talking about kind of a hub-and-spoke model. So the hub being the centre downtown office, which is now smaller, and then places throughout the suburbs, where if you want to drop in for a day, or you want to go to work two days a week, and you want to have access to, you know, the big video conferencing room or to see your colleagues or whatever, you'll be able to do it in these regional spaces. And I don't think that those are necessarily going to be company-owned. I think that we're going to look at the co-working model. And that's going to be transformed into something like a cooperatively owned hub, or spoke I should say, or collaborative places, or maybe even independently owned as in the co-working model. So I think the whole model is going to change. And suburban commercial real estate has been in trouble for years, so ... This is a pendulum. It's going to swing and right now it’s going to swing towards the suburbs.  

SS: So what's gonna happen to cities like New York, San Francisco? With bright minds always working from home now, moving to cheaper cities, what do you think will happen to the legendary ones in America? Like, will they finally become affordable to live in again, for most of us? 

KL: Yeah, and I think they’ll become more accessible,you know, in terms of those haves and have nots, the people that can work remotely and people that can’t work remotely. I think the benefit of reduced traffic will benefit the people that in fact have to go to the cities to work, and potentially, as we said, give them maybe a less costly place to live. 

SS: Okay. You know, some say that work from home helps maintain better work-life balance. Others claim the opposite, saying that, you know, their working schedule has become increasingly blurred, forcing them to actually be functional, basically 24/7. While some say that their productivity and creativity got a boost in the comfort of their homes, others actually miss very much this in-person collaboration with colleagues. You've actually mentioned it earlier on. So remote work isn't it like the promised land for everyone. How will this two approaches balance themselves in the coming years?

 KL: It’s important that employers don't force people that don't want to work remotely. You know, you have to give people choice. There are some people that don't have a suitable home area/ One of the things that we found out in our survey and others have revealed since is that it's the younger generations that are having more difficulty at home right now because they probably live in smaller places, they may be sharing with a roommate, they may be living with their parents. And so, you know, that's part of the difficulty. But you know, we've got to recognise that some people are going to want to continue to go to the office, and everybody loves to make this conversation polar — you're either all in or you're all out, and it just isn't. It's that hybrid, it’s that middle ground. And, you know, I think that as technology improves, and as jobs become more automated, that more and more people will have the option to do this, and hopefully also the option to go to the office and socialise. There's also some conversation that goes along the lines of over the past decade: we stopped socialising with friends and more commonly, the people we know are people at work. So maybe that's going to flip too. I've gotten to know a number of neighbours because I'm walking more. And maybe communities are going to become tighter and closer. 

SS: Alright, Kate, it's been a pleasure talking to you. Thanks for all your forecasts, and good luck with everything. And hopefully we can get to do this maybe like in one year's time, so we can recap on everything we spoke about and see what actually came true and what didn't? 

KL: Yeah, that'd be great.  

SS: Alright. Thanks a lot and have a great day. Thank you.