Hybrid Work Model Shaping The Future Of Work

In October 2023, Tata Consultancy Services ended its work-from-home arrangement for most employees, requiring them to return to the office five days a week. To assist employees who joined during the pandemic, the company introduced dress codes for those returning to work. The company’s top management expressed confidence in the success of the return-to-office policy, emphasising its role in preserving TCS’ organisational culture. Speaking to Moneycontrol at the World Economic Forum, K Krithivasan, CEO and MD of Tata Consultancy Services (TCS), disclosed that about 65% of TCS associates are now attending the office 3 to 5 days a week, only a quarter after the policy was enacted, setting TCS apart from its industry counterparts.?

It represents a significant shift from TCS’ earlier 25X25 vision announced in 2020 by former CEO Rajesh Gopinathan. Under the plan, by 2025, only 25 percent of TCS associates were expected to work from its facilities at any given time, with employees spending no more than 25% of their time at the workplace.?

This event raised the concern - are businesses shifting to hybrid work models? However, as per insights, most big businesses worldwide look comfortable with the hybrid work model and have no plan to alter it.?

When the COVID-19 pandemic started in 2020, the daily routines of billions of people underwent significant changes. A sudden and substantial transition to remote work was one of the most notable changes, especially concerning real estate in major cities. This shift was made possible by the widespread adoption of videoconferencing and file-sharing technology. Almost overnight, millions of employees began working not from their downtown offices but from the comfort of their own homes.?

This transition influenced their behaviour in three primary ways. Firstly, it changed where they work. Secondly, it impacted where they chose to live; freed from the constraints of the daily commute, many individuals relocated away from the city centres. Thirdly, it changed their shopping habits, with online shopping and local stores gaining preference over urban establishments.?

Following the onset of the pandemic, employees initially abandoned their workplaces but are now returning more frequently, although not as often as before. The frequency of officer attendance varies depending on the city, particularly in those with high housing costs and a significant number of knowledge-based economy workers. Several insights suggest that office attendance has stabilised and will remain at current levels.?

At the outset of 2020, office attendance drastically declined in major cities. Factors such as lockdowns, office closures, and the discomfort associated with wearing masks provided momentum for remote work, facilitated by available technology. In cities like New York City and San Francisco, office attendance decreased by 90 percent, while in Austin, Dallas, Houston, and Los Angeles, the decline was around 70 percent.

Fast forward more than three years, remote work has transitioned into hybrid work, and officer attendance has substantially recovered. However, as of fall 2022, employees were, on average, only going to the office 3.5 days per week, marking a 30 percent decrease from pre-pandemic levels, as per a McKinsey & Co. survey.?

McKinsey & Company’s study revealed that office attendance levels differ across various metropolitan areas. For instance, employees in Beijing typically attend the office 3.9 days per week on average, whereas those in London only go 3.1 days per week. Other metropolitan areas fall between these extremes, nearly averaging around 3.3 to 3.6 days in office. Additionally, the proportion of workers who never work from home varies by country. In Japan, over half of the officer workers spend all five workdays in the office, whereas in the United Kingdom, only 28 percent do so.?

Cultural norms and government policies also influence office attendance. For instance, the high rates of office attendance in Chinese cities are likely due to the prevalent “996” office culture, where employees work from 9 am to 9 pm, six days a week. Moreover, office attendance dropped to near zero during citywide lockdowns in Beijing and Shangai. Overall, from a broader perspective, the hybrid work model is becoming more convenient for most businesses worldwide, and they are likely to continue with it.?