Over 70% of businesses have decided a remote and hybrid workforce is here to stay, but most are still working out what that actually looks like.
We’re coming to grips with a new reality. When Insight’s Head of Communications, Nikki Parker, walked into Insight’s New York office 14 months after the pandemic began, her desk looked like a relic from the eruption of Pompeii. As she put it, “I could have been sitting at my desk an hour earlier. A water bottle half full. My colleagues’ row of high heels lined up neatly under her desk. The birthday streamers from a colleague’s 50th on the window, slowly peeling off.”
Insight, like our portfolio companies, had walked out of the office expecting to be back in a few weeks.
A year later we’re reimaging our return-to-office, as are the ScaleUp companies we’ve invested in. Not just how we work, but where we work.
This isn’t the first time that businesses have examined the purpose and meaning of an office. In the last 30 years of corporate history, there have been shifts in how offices are designed and used. The 1980s saw the rise of the often-ridiculed “cubicle farm.” Cubes were created to maximize productivity while still enabling privacy. In the 1990s and 2000s, open-plan offices emerged that included bench-seating, cubes with lower walls, and kitchens laden with snacks to entice worker retention and time in the office.
In the late 2000s, some companies, notably IBM and Yahoo!, flirted with home office setups and were seen as a harbinger of a new way of working. Alas, this rapidly turned back when in February 2013, Yahoo!’s new CEO, Marissa Mayer, banned working from home, citing lower productivity and diffusion of Yahoo!’s culture. IBM too walked back from the company’s initial enthusiasm for remote work. Data sources vary, although most agree that fewer than 20 million people had some form of flexible work at the start of 2020.
The question that leaders need to answer is, “What will this be like a year from now?” What has changed for good in our attitudes and our understanding of how we work, and how have we evolved?
To answer this, Insight fielded a survey of Insight’s ScaleUp tech companies and opened responses to the broader tech community, garnering more than 200 responses across companies large and small, and across geographies (primarily, North America, Europe, and Israel). We subsequently interviewed two experts in the tech industry. Below, the data show that 75% of companies plan to be remote or hybrid, with a surprising 21% of respondents choosing Remote-First as the guiding principle.
Looking at the graph above, and recent research on this topic reveals there are two approaches that serve as opposing bookends in the return-to-office debate: Office-First and Remote-First. In the large middle ground, ~50% of companies propose a hybrid work model of some days in an office, some days remote. More than 10% are still deciding.
Two tech companies represent the bookends and discussed their policies with Nikki Parker via LinkedIn Live events. Matt Jahansouz, Chief People Officer at WeWork, is in the In-Person/Office-First corner, while Whit Bouck, COO at HelloSign, a Dropbox Company, represents the Virtual/ Remote-First perspective.
Both Matt and Whit make clear that there’s been a huge amount of work over the last 14+ months to make their current implementation plans thoughtful and thorough. Both leaders point out that a lot of their time has been spent listening to other executives, polling their employees, talking to business peers, and gathering as many data points as possible to decide what their (near term at least) future would look like.
Despite the varying perspectives on what the future will look like, one thing has stood out as a unifying theme amongst tech leaders – indecision is a decision. As Matt Jahansouz states, “Too many executives are hesitating or acting as if they need to make a definitive plan for the next ten years. You don’t. You are planning for 2021… 2022. This is a fluid situation, but a lack of conviction in your operational plan will have a negative impact on employees and long-term business health.”
Both executives highlight that managing through COVID-19 has been an ambiguous and fluid situation that has required constant assessment and an iterative response. Whit further emphasizes this by calling out a “learning mindset” as being critical for executive teams navigating such a major shift within a business.
In terms of making a decision, Insight’s ScaleUp survey has taken a pulse on executive sentiment and their plans for the timing of returning to the office. We encourage you to download the survey report by completing the form below.
Most of Insight’s executives (45%) anticipate reopening office space for the majority of employees in the autumn/fall of 2021, although 27% intend to bring employees back during the summer months. How vaccinations will play into return-to-office policies is also top of mind – the majority of firms having a strong preference that only employees and guests who are vaccinated are able to enter the office.
More than 70% of respondents expect to pursue some kind of hybrid or Remote-First return-to-office policy, and more importantly, employees want and expect flexibility (80%) and variety in where and how they will work. Insight’s ScaleUp survey data show that a majority of people prefer to work remotely ~3-4 days per week but appear to expect their companies will require slightly more in-person days than their own preference.
Employees value more flexibility, and hence, this first step in developing a return-to-office strategy is to align on this core question: What is the role of a physical office for my business and employees?
Three core tenets are emerging as companies adapt and prepare for the future of work:
- Variety in working style is expected from employees – there are very few roles that require only one style of working. Employees benefit from a blend of heads-down work, team collaboration, and moments of reflection. These types of work do not need to happen in the same location, although the physical space for them to occur must exist.
- Clear communication is critical when it comes to change management. This is especially true given that the environment that your employees have called home has changed.
- Flexibility in some capacity is non-negotiable; however, a clear line in the sand and policy that aligns with your approach is expected. Companies need to convey policies to avoid ambiguity so that employees understand the guardrails.
Talking to Whit, we see that she exudes the compassion and empathy she (and her team) has for employees at their high-growth tech company – in fact, empathy is baked into the core values of Dropbox and was similarly a part of HelloSign’s company ethos. Empathy for employees has remained central to its approach to remote work during the pandemic, and this underpins its decision to go Virtual-First – an approach many have called radical, but that Whit calls the result of a ton of data collection, discussion, and planning during 2020 and 2021 (also known as the greatest work experiment of all time).
To Whit and Dropbox, Virtual-First means that the primary day-to-day work of all employees occurs at home, or away from their office HQ. Offices are not dead, but their role in work is radically different. Their use case has been reimagined. Dropbox Studios have been redesigned to be purpose-built for specific team-based types of work: Imagine stadium-style training rooms, nooks with digital touchscreen walls where remote and in-person team members can collaborate in real-time, and labs with tactile toys to spur innovation. Rows of desks for employees to sit in daily are a thing of the past in Dropbox’s Virtual-First model.
Whit relays three things to consider in creating a Virtual-First office environment:
- Physical office space will look different with no desks or cubes, which means that employees’ home setup also needs to look different to help them function effectively from home. COVID-19 forced workers to reconfigure their at-home workspaces, but many considered this temporary. If this is permanent, companies should consider setting up a WFH stipend or approved-item list that employees can easily procure to ensure their home office is efficient.
- Employees may choose to move locations, and employers should consider whether they will provide relocation support or adjust salaries based on an employee’s home base. Whatever policies are chosen, make sure these are clearly explained and applied appropriately for all employees. Dropbox has made transparency central to its communications approach – it has created an online portal in which employees have access to every piece of data necessary to make personal decisions about where to live, expected compensation, and other company benefits.
- Companies need to be more deliberate about building role modeling and learning into work scheduled – in an apprenticeship model, these would previously have happened organically. Companies can use virtual environments and software to set up ways for employees to learn and make connections. Managers also need to lead by example to ensure that there’s a demarcation between work and home life. In this video discussion, Whit cites some examples such as blocking out your calendar during lunch, when you’re enjoying the time with your family, or setting emails to only come out after 9 a.m. to clearly model boundaries.
WeWork, a new Insight portfolio company, has decided to be In-Person/Office-First in its approach. Matt, like Whit, is deeply empathetic to the WeWork employee population. WeWork’s business focuses on giving other companies an improved and flexible workplace experience. With this as the company’s mission, the executive team identified that an Office-First approach to returning to the office would work best for their culture and purpose.
In-Person/Office-First does not mean that employees have no flexibility or days that they might work from another location, but WeWork identified that its office spaces are the central destination for its clients and its own employees, and working from the office is a core driver of its success. For a company that is dedicated to providing inspiring and valuable workspace for entrepreneurs, SMEs, and corporates, this decision is hardly surprising. In fact, WeWork has seen an influx of new types of potential tenants who are exploring using WeWork’s global office network as a way to give their employees some of the facilities and flexibility needed if they’re working outside of company headquarters.
The In-Person policy at WeWork requires employees to be in their local office at least three days per week, one day can be worked from another WeWork location, and the fifth day can be worked away from the office. For WeWork, offices have been designed to democratize access to the tech, tools, and people that team members need to get their job done. WeWork’s internal data show employees value this work environment.
Matt relays three things to consider in creating an In-Person/Office-First office environment:
- Just because you are “returning” doesn’t mean things shouldn’t change in your office. Social distancing requirements and other safety protocols are needed to ensure employees are as comfortable as possible being in the office.
- Policy is universal; flexibility is considered individual by individual. As Matt says, “What happens when an employee isn’t comfortable riding public transport or returning at all? What happens if an employee can’t find sufficient childcare or eldercare?” The answer is that WeWork is flexible when employees need it. In New York, for example, the company provides additional support to help get people into the office, like CitiBike memberships for employees who prefer not to catch the subway and comped Uber or Lyft rides to get to and from the office. Companies are offering financial support for childcare. The bottom line is that if an employee is not comfortable returning to the office, they should be empowered to work remotely. Employees and managers need frequent dialogue to ensure both the employee and the business are set up for success.
- Structure and process are paramount so that employees understand what is expected of them. Questions like “When will I be in the office? Where will I sit when I am there? Do I have a space that I share or one that is permanently mine? Will I be given a locker for my personal belongings?” must be answered before companies bring employees back. This is an iterative process. Approaches that companies put in place in the first few months of returning to the office might not be the long-term reality. The tension caused by evolving processes and policies can be alleviated with clear communication and employee-expectation management.
With over 250 companies in Insight’s ScaleUp portfolio and workforces that range from 10- person teams to more than 5,000 global employees, it’s clear that a return-to-office is going to look different for everyone. Even so, there is remarkable clarity among most companies that hybrid is here to stay. This is what employees request and what businesses see as essential to their competitive advantage and their ability to attract talent.
Download a copy of Insight’s Return to Work Survey results by completing the form below. If you’re an Insight portfolio investment, you can access the report directly by going to Insight's GO portfolio platform.