Does The Hybrid Work Model Even, Um, Work That Well?

I’ve already done a little bit of a deep dive on the general idea of working from home , but I wanted to take some time on the “hybrid” model specifically. It feels like it will be the model that “wins out” for people in local markets — i.e. come in three days, be at home two days. There is a lot of navel-gazing and “heated” online debates around this, specifically “You cannot build a culture this way” vs. environmental impacts of five-day commutes vs. “building and maintaining the culture” and all the rest. Let’s see if we can’t hash this out a little bit.

What is the big picture of hybrid work?

The real tea on hybrid seems to be like … we need to just treat everyone like we treat top sales guys. No one cares where those people are, so long as the numbers are there. If the numbers ain’t there? Ya #piped . We should design organizations where everyone is treated that way, honestly.

If you are a big in-office person, and you want to be there five days, go ahead. We’ll provide masks and wipes, even though we’re not sure (still) if either works that well.

If you want 3-in, 2-out? Go get ’em tiger.

Want 5 out and to have a lunch (or a nooner) with your significant other periodically? You got it, Andy.

So long as the deliverables are flowing in, you can do what you want, when you want. More productive at 9pm? Work then. All good. Once the deliverables ain’t flowing, we can terminate you.

If that was the inherent contract of most places, we wouldn’t need all these navel-gazing pieces about “hybrid” and “blended” and “WFH” and “models of the future.”

If you hit your tasks, you can do whatever. If you don’t, don’t let the door hit ya in da ass on da way out.

It’s not as complicated as we make it.

Now — in the coming weeks and months, as different companies try out different “return to normal” models, you will see a ton of articles (and I mean a literal metric ton) about empathy and compassion and new commitments to work and all this stuff. Those are mostly nice things to discuss. Work will be different, and it may even be a tad more empathetic, which will be nice. But in general, executives drive ships at companies — and they will want a certain amount of things to be happening, and middle management will respond to those things because, well, the executives are their bosses. Then rank-and-file workers have to respond to middle managers because, well, same. And since the human brain has an inclination towards normalcy, we might rush back into 2018 working models — even though 2018 working models were not exactly very good.

It’s likely to be second verse, same as the first at many places, with more of a mixed workforce.

One cool thing I do think companies could try (I use the term “cool” loosely): Every Friday on Zoom, do a fun little lottery deal where people draw numbers or letters … and then those letters are tied to the days you come in next week. “Oh, Randy got a ‘B’ as well! Haven’t seen you in a bit! Excited for Tuesday!” This gives people a mix of at-home and in-office, and the teams and people coming together might be random enough that spurts of innovation could happen cross-silo.

Now, some managers might hate this approach because they would want their entire team physically present on one day. I get it. And, sadly, one of the worst pieces of research that keeps circulating during COVID is that in-office workers get promoted significantly more. The notion of “seat time” is a relic, but it has never actually died.

But I would do 1/2/3 or A/B/C teams in terms of rotating people back in, allowing for some distance and some random connections to be formed and experiences to be shared. Everyone else, relative to their job, can be remote for a minute. While you’re doing this, try to cap Zoom calls at 3, max 4, per day. People do burn out on that stuff.

As much as I’ve bashed WeWork against the rocks on social media for years now, I admittedly do use it myself sometimes these days — and it’s a good option for execs who don’t want to buy a big building or floors of a building downtown. Go send your people there and they can interact but also distance. It makes some sense and it solves some “hybrid model” issues at a much lower cost, which is likely important to you.

Those are just a few ideas and some of the research things we’ve seen and discussions we’ve been having (which are admittedly getting repetitive) in the last four-five months.

Are there expectations around a “Hybrid New Normal?”

Here’s some good news: After a 13-month span that went from: “This is another seasonal flu, it’ll be over in two weeks” to “July is the new normal for work re-entry!” to “Okay, October 2020 is the build back better date!” to “Hmm, 2021 seems more realistic…” we’re now, finally, seeing enough progress in the rate of vaccinations and an overall reduction in Covid-19 rates that the concept of a “new work normal” actually seems within reach. The exact date will vary by company, industry, and geographic distribution of offices, but after a year of postulating about what exactly a return to work might look like, we’re close enough that we can start chasing the idea more concretely.

What’s out there that seems right and wrong?

The elephant in the room: one sector of commercial real estate

There has been a lot of hand-wringing about the future of commercial real estate since the beginning of Covid, with a recent New York Times deep dive painting a grim picture:

According to Moody’s, the credit rating firm, commercial real estate values are projected to decline by 7.2 percent nationally from their pre-pandemic levels, bottoming out by the end of this year. The hardest-hit categories are the office and retail sectors, with values declining by 12.6 percent for offices and 16.5 percent for retailing.

True, the fate of the physical office space remains uncertain for much of white-collar America, but it’s also important to note that commercial real estate, overall, isn’t necessarily dead in the water — just that the sector has pivoted more from conventional office space (think HQs) to industrial and warehouse spaces, which are common for e-commerce and retail businesses that need more space to store their product inventory. Consider: Industrial property indices actually rose in 2020, by 7.4% year over year.

When you focus on a “hybrid” model, does that mean that neither experience (home and in-office) are inherently that great?

But the notion of a vibrant downtown urban core dotted with corporate HQs — with employees grabbing lunch and running errands — and the hidden trillion-dollar office economy attending to all of that activity? Well, that might be very slow to recover.

Yet in many cases, offices are big cultural investments for organizations, and there is a prevailing mentality that “having the team together” in real life has enough ROI for a company, or at least a greater amount of value than attending to Zoom fatigue, that they’ll keep them around. So to assume every COO or CFO will tear up their commercial lease agreement, post-pandemic, and send everyone to Bozeman, Montana is wishful thinking — plus there’s growing evidence that Bozeman (and other Zoom towns) can’t handle the influx of remote workers, anyway.

As large swaths of corporate America inevitably return to a physical work environment, we’ll see an increase in a hybrid-remote model: some in-office, some online, rotating by “pods” or days of the week.

This brings us to the second elephant residing in the room

Is the hybrid-remote office model even a good idea?

The Society for Human Resources Management, SHRM for short, has indicated the hybrid model might be “the new normal” for 2021 and beyond. But Wired has made a point echoed by many others: When you focus on a “hybrid” model, does that mean that neither experience (home and in-office) are inherently that great? Have you ever been to a restaurant with a 20-page, glossy menu and decent enough ambience but nothing about the food really stands out? (You basically leave the restaurant with a bland, “meh” experience.) Maybe that’s what the future of work would be like under a hybrid model. I call it the “The Cheesecake Factory Theory of The New Normal.”

As Byrne Hobart wrote in Marker earlier this year, a wide-scale adoption of the part-time office model could “introduce an imbalanced power dynamic for employees who choose to return to the office versus those who may opt to continue working from home.” Are we really ready to contend with a new version of office politics and corporate angling? And “[w]hat will be the unintended blowback for employees who decide to come into the office only every other month versus those who make a point of being physically present every day?”

One area where hybrid-remote could shine: enabling workers to actually compartmentalize different work modes as Harvard Business Review contextualizes in its piece on how the pandemic has exposed the fallacy of the ideal worker :

What many knowledge workers need is spurts of unstructured interaction, followed by hours of quiet time to execute — time that’s often more productive done away from the office. Finding the optimal combination of telework and on-site work will vary from company to company, job to job, and person to person.

I agree. That’s the hybrid model we may see adopted by default in the coming weeks and months, one that keeps employees safe and distant, but also brings them together for pockets of social interaction and “brainstorming,” insofar as that even works.

Could we make the hybrid model more “fun,” perhaps?

Here’s an idea: Every Friday on Zoom, carve out some time for a lottery or office roulette of sorts, where employees draw numbers or letters and then have those letters correspond to the days they come into the office.

“Oh, Randy got a ‘B’ as well! Haven’t seen you in a bit! Excited for Tuesday!”

This gives people a mix of at-home and in-office, and the teams and people coming together might just be random enough that spurts of serendipitous innovation could happen cross-functionally.

Now, some managers might hate this approach because they likely want their entire team physically present, together, on any given day. And, sadly, one of the worst pieces of research that keeps circulating during Covid is that in-office workers get promoted significantly more. The notion of “seat time” is a relic, but it never actually died.

Consider doing 1/2/3 or A/B/C teams in terms of rotating people back in, allowing for some distance and some random connections to be formed and experiences to be shared. Everyone else, relative to their job, can be remote for a minute. While you’re doing this, try to cap Zoom calls at three, max four times, per day. People really do burn out on those.

A hybrid model also means you need to retain your physical space for “on” days and/or larger group gatherings (all-hands meetings), so it helps justify the decision to retain the physical space financially.

Beyond the hybrid-remote office model, what else should we be thinking about differently for a “New Normal?”

A few things jump out:

• We assume a mental health reckoning is coming, but perhaps it’s not? One interesting study from the EU based on first-year Covid data studied people’s feelings of social connection and relatedness under quarantine. After a few weeks, the vast majority of people reported little to no drop in feelings of social connectedness, including extroverts. And while many people reported increased feelings of lethargy, overall life satisfaction was barely affected. In fact, early on, mental health problems slightly decreased. There’s a belief that people might emerge from Covid with healthy savings accounts and a pent-up desire for travel and a new roaring 20s , so maybe that joy will carry over to in-work engagement as well.
• We need to do something for working moms, and post-haste: The Minneapolis Federal Reserve actually wrote a paper during Covid called “Why Is Mommy So Stressed?” and many have taken to calling this not a recession but a “she-cession.” The author of that Minneapolis Fed paper did an interview with UPenn’s Wharton school of business recently , and noted: “I think, as soon as possible, there have to be some temporary and extraordinary measures to provide child care.” Some of the child tax credit proposals in the $1.9 trillion stimulus may help, but more discussion and reckoning here is needed.
• Automation — a tipping point we need to consider: Sales of automation software are projected to rise 20% this year, up from 12% last year. Increasingly, corporations are looking to automate white-collar jobs that otherwise haven’t been disrupted through the rollout of a robot. McKinsey, prior to the pandemic, predicted 37 million U.S. workers would be displaced by automation by 2030, but over the course of the pandemic actually went ahead and upped that to 45 million. At the same time, economists are predicting it will take four years and seven months to replace the currently missing 10 million American jobs at our current pace. When you combine the speed of automation with the semi-sluggish jobs recovery, we have a major problem to consider. What’s the answer there? More incentives to create small businesses, perhaps? Entrepreneurial incubators like we’ve tried in North Carolina and other places? Throughout human history, we’ve been able to respond to automated processes with new human jobs — think the Industrial Revolution, Mobile Phone Revolution, etc. — but the pace of automation is accelerating as various job types are eroding, and how we handle that is a major post-Covid storyline.

The bottom line

We honestly won’t know much about Covid’s long-term impacts — on our collective mental health, commercial real estate, corporate relocations, or on kids who participated in “Zoom school” — for at least a decade, if not more. It will take time to suss out exactly what happened to us, our connections to work, our views on money and its relationship to the greater economy, our views on the legitimacy of experts, and many more wide-reaching and salient issues. But in the short-term, the implications of the hybrid-remote model, the future of urban downtown business hubs, and the race to automate will be among the most interesting trends to keep an eye on.

But then there’s ridiculous notion of coming into the office simply to do stuff you could do at home

You absolutely knew, in your soul, that companies would find a way to absolutely destroy the COVID moment and its possible lessons for workplaces, and that’s all now beginning to ratchet up into completely meaningless bullshit and misguided decision-making.

The first wave of travesty was “Everyone shall be WFH forever, if they can!” leading to “Well, we’re sorry you moved to Bozeman. Actually, we’re going to take back some of that salary too.” The second wave of travesty was all the stops and starts about returns and policies, though some of that travesty lies at the feet of local governments and their communication inefficiencies. The next wave of travesty is what the process of return looks like — and this process is well underway in some places, as I’ve seen stats that only 13% of Americans are still five days remote.

I recently rolled off — a fancy way of saying “I got piped!” — from a gig called Neuroleadership Institute, where the founder, God bless his soul, used to regularly show up 11 minutes late to a 50-minute call, harried as founders are, and launch into “what he’d be telling executives this week.” (The place did consulting and training, essentially.) He had a concept called “one virtual, all virtual,” which he admitted sounded awful , and it’s exactly as it sounds. Even if 5–10 people are in the office, if anyone is remote/virtual, those 5–10 people have to sit on their laptops in different conference rooms and join the meeting virtually instead of sitting together somewhere. I thought this idea was awful, but you can’t push back on a founder, or you get the pipe. I didn’t push back in this case, and I still got the pipe. Life is fickle.

Realistically, why would a company spend money on an office, which is often 2%+ of revenue, if people report to the office to sit on video calls by themselves? That can be done from your laundry room. Now, there is an element here of “I want to get out of the house.” I work from home, and some days I do go to a WeWork for this exact reason. Admittedly, there is nuance. But the problem becomes this: if the “culture” of an organization is “We want you here, but when you’re here, all you will do is stuff you could do in your living room,” well, that’s not going to end well.

How it will end: employees will leave for places with more flexible and logical policies. Instead of reading the tea leaves accurately, executives at the places where people left will double down on control — control is more beloved to an executive than their first-born — and say, “Everyone needs to be in five days/week. This isn’t working.” They will claim innovation is suffering, and anyone with a brain will say, “Um, the only product you have that sells was developed in 1993. I don’t think this is an issue of COVID and remote work, Gary.” But because they make the biggest bucks — Highest Paid Person’s Opinion, or HIPPO — their “process” needs to be worshiped and revered and sacrosanct, and more people will leave, so long as the openings market stays hot (it should for another 8–10 months).

A lot of the core issue about how work is designed comes down to two factors: firstly, executives don’t do the actual work. They don’t know about the nuts and bolts of the sausage, and it’s been 20+ years since they’ve needed to, and that probably happened at a different company anyway. Because they’re so distanced from how the work gets done, they have no business setting policy on questions of that nature. But, because we worship hierarchy and are all secretly kindergartners who need direction, we can’t think of a better way to manage any of this. (In reality, an employee should work however they want to work, including at 3am, naked, in a public park. And if the work isn’t getting done, you fire them. Or a sheriff’s deputy arrests them. Whatever comes first. The how doesn’t matter. The what — output — does.)

The second issue is that being an executive is often an elaborate game of follow the leader. You look up and sideways at rivals and similar companies to see what they’re doing, and certain ideas get “hot” in certain periods of time. Right now, hybrid is hot, and one of the elements being discussed with hybrid is bringing people in only to sit alone on a laptop doing a call that includes someone who is five feet away but who you cannot sit in the same frame with. If you even thought about this for 20 seconds, you’d realize how stupid it is, but goddamn, it was mentioned in The Wall Street Journal that some people are doing it, so I guess this is the thing we try now? Let’s roll. No time to think about the logistics or the idea behind it, though — got a standup on Q1 2022 revenue plays in 10. Has Marcia sent me the briefing deck yet?

It’s a stupid idea to spend money on a physical office and then have people come to that office to do things they could do at home, before you mention commutes, childcare, dinner time, how family should matter more than work, etc. We need to design work around how people like to work and where they need to be to most successfully live their lives while retaining that the what matters the most. Again, it doesn’t and shouldn’t matter where you are in knowledge work (a term that drips with privilege) so long as you get the work done. That should be the only goal.

Unfortunately, because people are complex and therapists want to buy nice homes, it’s never the only goal.

Important question for the employee level: Will hybrid work make you susceptible to getting laid off, especially in a recessionary environment?

From this op-ed by the CEO of Washingtonian Media:

While remote working is certainly industry- and job-dependent, and the future employment scene will probably be some type of hybrid, the CEOs I have spoken with fear erosion of collaboration, creativity and culture. So although there might be some pains and anxiety going back into the office, the biggest benefit for workers may be simple job security. Remember something every manager knows: The hardest people to let go are the ones you know.

First funny thing: I dated the daughter of the editor of The Washingtonian for 2.5 years. She’s now married to a partner in a law firm, and they have two kids. I am typing a Medium article while wearing gym shorts and a Calgary Flames t-shirt. You decide who won.

I have two concerns about these hybrid plans. The concerns are basically cousins of each other:

• If you work from the office more, you will get promoted more and have more responsibilities.
• If you work from the office less, you will get fired more (quote above).

This is borne out in other places. In the same op-ed above, you have this:

While some employees might like to continue to work from home and pop in only when necessary, that presents executives with a tempting economic option the employees might not like. I estimate that about 20 percent of every office job is outside one’s core responsibilities — “extra.” It involves helping a colleague, mentoring more junior people, celebrating someone’s birthday — things that drive office culture. If the employee is rarely around to participate in those extras, management has a strong incentive to change their status to “contractor.” Instead of receiving a set salary, contractors are paid only for the work they do, either hourly or by appropriate output metrics. That would also mean not having to pay for health care, a 401(k) match and our share of FICA and Medicare taxes — benefits that in my company’s case add up roughly to an extra 15 percent of compensation. Not to mention the potential savings of reduced office space and extras such as bonuses and parking fees.

Right. I know this shit all too well. I’ve actually applied to full-time jobs, not gotten them, seen the job posted four weeks later still, and contacted the person that didn’t pick me to offer to do the work as a contractor. Because this saves them budget, a lot of times it works — all many managers care about is saving budget, because it makes them look better to their bosses. So yes, if someone is mostly working from home, there is a big incentive by the organization to shift them from W-2 to 1099. After all, if you’re sitting on your couch, why do I need to pay your health insurance? That will be the mentality.

In this good New York Times newsletter about going back to work , you also have this:

Sid Sijbrandij, the chief executive officer of GitLab, argues that the hybrid model will create a cumbersome and potentially discriminatory system of tiered communication: “Eventually, remote workers will find that they are not getting promoted at an equal rate, because they are less visible, and the productive remote employees will leave for all-remote companies that invest in their remote team members.”

I would agree with that.

So while we’re all racing to do this “hybrid” thing right now, we don’t know for sure if it will work — it could be the worst of both worlds, not the best — and a big concern might be sheer job security.

Takes?

Oh, PPS: I have a friend that moved from San Francisco (at a higher salary) to Montana, and her company dropped her base salary $20,000. Obviously that’s completely legal and maybe even justified, but that’s going to be a third/fourth area to watch as this all comes into focus.