Is Working From Home Such a Bad Thing for Companies?

With the number of coronavirus cases multiplying by the day, the media is overflowing with coverage of the epidemic, especially the toll it’s now taking on the economy. The virus has already had a demonstrable impact on business, from supply-chain interruptions in China to forecasted red ink for industries such as airlines and cruise operators. But even as the short-term fallout continues to emerge, corporations are facing an even bigger challenge: What will happen to the fortunes of companies that end up sending millions of employees home to work? Last week, Twitter announced it was “strongly encouraging” its global workforce—some 5,000 employees—to work from home. In Washington state, tech firms including Amazon and Facebook have told their Seattle-area employees the same thing. And since many more companies will probably follow suit, they will also contend with the range of outcomes that occurs when workers who usually commute to an office are suddenly expected to do their jobs from the living-room sofa.[article_summary section="1"] Ever since “telecommuting” became a thing in the early 1970s, employers have debated the question of whether stay-at-home workers are more or less productive than those who sit in an office. That debate is now more relevant than ever. It's also complicated by the fact that a good number of the homeward-bound employees simply aren't accustomed to working remotely. Ultimately, then, will the impact on industry be positive or negative? Anat Lechner, professor of business management at New York University’s Stern School of Business, thinks it'll probably be both. “There are quite a few people who have never worked from home and are not accustomed to doing so, so there has to be a bit of a learning period,” Lechner said. “The learning curve takes time—and we won’t have time to learn.” Matt Rizzetta, founder and CEO of brand strategy and communications firm North 6th Agency, said working from home also poses a challenge for companies that aren't used to managing a workforce remotely. On a cultural level, Rizzetta said, “the key is for employers to make employees feel as close to the office as possible when they’re working from home, especially for a longer period of time.” [kickout id="1"] That means building technical systems and management procedures that help employees maintain productivity as they try to do their jobs in their pajamas. But apart from systems, the bigger issue is whether stay-at-home workers are ultimately more productive than their counterparts who slog to the office. In recent years, a number of studies have suggested the answer is yes. Often cited is a study that found employees who worked from home made 13.5% more calls than did their cubicle-bound counterparts—one of the findings from a 2014 study conducted by James Liang, co-founder of Chinese travel website Ctrip. An equally compelling statistic comes from a 2016 paper from consulting firm TinyPulse, which found that 91% of employees working remotely believed they “get more work done" when doing so. Reports like these have prompted many employers to become far more sanguine about allowing their employees to work from home than they used to be. Even so, as the coronavirus essentially forces more employers to adopt work-from-home policies, questions remain about how a company’s fortunes will fare amid this compulsory change. That’s because some jobs lend themselves to working remotely better than others and, similarly, not all workers enjoy working from home. Differentials like these create the biggest potential hurdles for employers. In 2018, Baylor University researchers found that the success of working from home depended in large part on the emotional makeup of the employees. Workers who are autonomous anyway tend to be comfortable working from home, but not so employees who are easily stressed and require managerial support. “If someone gets overwhelmed easily or reacts in big ways to issues in the office,” the researchers wrote, “they are likely less well positioned to work remotely.” [article_summary section="2"]Research also suggests it’s largely the employees who truly prefer to work from home who are most productive when they do it—and, of course, that’s not everyone. As the TinyPulse study found, workers who have no choice but to do their jobs from home tend to feel less happy, less valued and are even more likely to leave their jobs within a year. In addition, nearly a third of remote employees (27%) admitted to having problems because they hadn’t built the interpersonal relationships necessary to get their work done. That finding is especially significant for marketing departments whose work historically depends on close, in-person collaboration among employees. After helping pioneer the work-from-home model, IBM did a 180 on the policy in 2017 when CMO Michelle Peluso informed her far-flung marketing team of some 2,600 people that she would henceforth expect them to work “shoulder to shoulder” in designated office locations. She further stated that “creative and inspiring locations” (read: the office) was the “one recipe I know for success.” Her move wasn’t an aberration. In 2013, Yahoo’s then-CEO Marissa Mayer ended the company’s popular work-from-home policy, informing employees that “to become the absolute best place to work, communication and collaboration will be important, so we need to be working side by side. That is why it is critical that we are all present in our offices.” [article_summary section="3"]The current coronavirus outbreak seems likely to reverse these policies, sending the ranks home regardless of how a company feels about it or whether it’s really prepared. But the picture is hardly bleak. NYU’s Lechner suggested that the epidemic may already be turning into a huge management experiment that might well yield positive results. She pointed out that because the younger segments of the American workforce have already grown up using social media and online collaboration tools including Dropbox and Slack, they’re better prepared to work from home than managers might think. What’s more, by forcing employees to learn to do their jobs remotely, the current crisis might well result in a more flexible and resilient workforce. “I’m expecting to see some interesting shifts that are going to emerge from this crisis,” Lechner said. “As is always the case, crisis brings innovation and capacity, and I think that’s what we’re going to get.”

Coronavirus

Companies Might Send Millions of Employees to Work From Home. Is That Such a Bad Thing?

Confusion and productivity losses might well result—but perhaps innovation, too

Robert Klara

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Robert Klara