Hybrid Work vs. Office: The Productivity Debate

Amazon's CEO recently issued guidance advocating for a return to a 5-day office week (RTO), created quite some public debate. There is obviously a lot behind such decisions, but at its core, this debate revolves around one key issue: productivity.

When we talk about working solo on a task, there’s little doubt that working from home often leads to the highest output. Without office distractions and the time saved from commuting, many can simply deliver more and better. Let's face it, not everyone has an ideal home setup. Factors like a lack of proper workspace or the presence of a demanding family or noisy neighborhood can make working from home less productive.

However, most of us don’t work in isolation. We work in teams, and productivity in a team context can vary greatly. Daily operations of departments like accounting or procurement, might differ significantly from other units like digital product teams. These cross-functional teams, usually made up of software engineers, product managers, and UX designers, collaborate to develop complex digital products. Their success relies heavily on a strong, collaborative approach. Nevertheless, there are times when individual tasks are best completed at home. But there are also crucial phases that require collective brainstorming, reflection, and strategy sessions, where being in the same room is far more productive.

Research from top universities like Stanford or Harvard highlights the many advantages of a hybrid work model. It increases productivity by up to 40%, improves job satisfaction, reduces quit rates by a third, and, surprisingly, enhances communication with no signs of reduced innovation.

You might remember the famous Spotify squad concept with dedicated team spaces:

I find this office setup quite promising to balance collaborative areas with individual workspaces. Overall, the office should evolve into a space focused on collaboration, a hub for socializing and connecting with your peers. But the office also needs to offer an option for those who struggle to work efficiently from home. Achieving this requires significant changes and investments in most current office setups. They typically provide individual workspaces following the open space concept where people sit in rows like hens on a perch, wearing headphones to avoid constant interruptions. Additionally, shared bookable meeting rooms, where the expectation is to leave the space clean and remove any meeting materials afterward, do not promote productivity.

Ultimately, finding the right setup is a complex challenge. Prior to the pandemic, companies like Google, Apple, and Amazon have invested heavily in creating attractive office environments. It can be frustrating, in particular from a financial perspective, to see those spaces underutilized following a hybrid working model.

You may have heard former Google CEO Eric Schmidt's recent speech, where he claimed that Google has lost its ability to deliver cutting-edge technology because people are no longer working as intensely, especially not in the office anymore. Schmidt pointed to Elon Musk, who maintains a startup-like atmosphere by calling meetings at all hours in the office, even in the middle of the night. While I agree this can create immense pressure to deliver, I question whether it's a sustainable approach. For someone like Elon Musk, this might not matter, as he might see his people as "human resources" only. But for a company like Google, where values historically play a significant role, a different approach is needed.

So, what’s the best setup to ensure sustainable outcomes that ultimately lead to the highest productivity?

In my opinion, teams should be empowered to determine what works best for them, with the goal of maximizing measurable outcomes. The challenge for companies is to provide the flexibility to support these diverse needs while fostering a culture that embraces differences across teams and functions. A "one size fits all" approach doesn't seem to be the best solution.

It feels like enforcing a return to the office five days a week comes across as micromanagement. A management implementing this policy seems more focused on controlling their employees rather than trusting them to make decisions that benefit the company. A recent scientific report emphasized that the key to maximizing people's potential, regardless of age, isn't through strict rules or tight control. This stands in contrast to a recent KPMG survey of CEOs, in which 83% expect a full return to the office over the next three years.

It's scientifically proven that an office-only policy hinders productivity rather than improves it. It also reduces employee satisfaction which leads to less performance. On top, companies that stick to strict office mandates are likely to lose top talent to those that adopt a more flexible approach. The good news is that this creates a unique competitive advantage for organizations willing to navigate this complexity thoughtfully, instead of simply forcing employees into the office five days a week like obviously many companies plan to do.