One Year Into Hybrid Work, the Digital and Talent Imperatives Are Clear
Last May, we wrote about the five key principles that organizations should consider to guide decision-making as they build a hybrid work model. At the time of that writing, COVID-19 cases in the United States were declining. Vaccines were rolling out to the masses, a return to the office appeared on the horizon, and companies were moving to formalize hybrid work.
How things have changed. Emergence of the Omicron variant slowed progress toward new work models. When my firm West Monroe polled executives in the second quarter of 2021, two-thirds said they expected their hybrid work model to be fully operational by fourth quarter. But when we asked again at the end of the year, only 40% reported being there. “The Great Resignation” also materialized, with workforce implications that are every bit as profound. The researcher who coined that phrase predicts the trend will continue but eventually slow in 2022, flexible work will become the norm, and companies will embrace remote work to fill roles.
This environment makes viable and successful hybrid working model all the more critical. As we look ahead, the five principles I outlined last year — experience, empowerment, enablement, excellence and environment — are still relevant and critical guideposts for developing a hybrid model. Based on what we have experienced and learned since then, I have highlighted a few key aspects of each that warrant sharpened focus.
Revisiting the 5 Principles of Hybrid Work
What we wrote last year: "One of the biggest short-term challenges for organizations was creating parity among employees. Successful hybrid models require remote employees to feel just as included as those in-office, whether it’s consistent lines of communication or connections and bandwidth. Workplace data, employee surveys, refreshed employee personas, and journey maps will be critical to make informed decisions."
What’s most critical now: Parity and digital thinking
Diversity, equity and inclusion continue to climb the corporate agenda. The frequency with which CEOs talk about these topics on S&P 500 earnings calls has increased 658% since 2018. Hybrid work has profound implications for parity in the workplace. It is not just about delivering a consistent experience to remote and in-office employees — although that is critically important. The combination of hybrid work and a volatile talent market multiplies the considerations. For example, should you adjust compensation for employees who have moved to locations with a lower cost of living? How can you create parity when new hires command higher pay than existing employees (research shows companies are paying a 20% premium now)? How do people who prefer to work from home — which tend to be underrepresented groups such as women and people of color — receive equitable mentoring or opportunities to work on high-value assignments? These are just a few examples of the decisions that will arise. They hit at the very core of inclusive culture and require deliberate strategy and thinking.
At West Monroe, we believe it takes digital thinking to drive real change and become a truly hybrid workplace. One aspect of “being digital” is about having a fluid intersection between the analog/physical and the online/digital worlds. Think retail, where you can order online and pick up at the curb. The same type of digital thinking that drives customer experiences is also relevant for designing hybrid work because it puts employee experience at the center of key decisions. Consider establishing agile, multidisciplinary, product-oriented teams to design and build fluid, integrated employee experiences.
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What we wrote last year: "Creating and fostering norms for a hybrid workplace — and then using them to guide decision-making — will help create a shared purpose and motivate employees. Consider managers: How will they oversee both in-office and remote employees to create a culture of inclusivity? What about re-engaging remote employees who have disengaged?"
What’s most critical now: Manager empowerment
Managers are in a tough spot. From a personal perspective, they are dealing with the same complex set of issues and pandemic fatigue as everyone else. But they are at the front line of ensuring employees feel included and treated equitably — at a time when the talent retention imperative could not be greater. Manager effectiveness was already a weakness for many organizations prior to the pandemic, but it is now a critical one.
For starters, managers must be able to translate company hybrid policies to their teams. Then, they have to learn how to engage people who have relocated (or who are newly hired) across geographies and time zones. For many, it is a big shift to manage people they don’t see. Managers need to become good at setting clear goals that their teams understand and then giving people the autonomy and flexibility to do their work — as long as they are progressing toward the established goal. Listening, asking the right questions and empathizing move to the top of the set of skills required, but these aren’t things people can just learn and apply by taking a course. They require time, practice and willingness. In short, companies are going to elevate their approaches to learning to get through this transition — and truly empower and encourage learning and reskilling for both managers their teams. The added benefit is that people place high value on the ability to develop, and a well-conceived program could, in fact, help with retention issues.
What we wrote last year: "Zoom, Microsoft Teams and Slack became household names early in the pandemic. Use of these tools poses key questions for employers: Do we have security measures in place for permanent remote employees? Should we mandate what to use and when to use it? How do we protect intellectual property where we don’t control physical security? What do employees feel they need to be productive from home? Whatever you choose, do so from the lens of the employee journey."
What’s most critical now: Human-centric design and the emerging metaverse
This principle is largely about the technology that enables effective hybrid work — but not completely, because technology effectiveness is ultimately about the people that use it.
Organizations threw everything they had at remote-working technology in the early phases of the pandemic. Now, they are fine-tuning the technology landscape as the hybrid future becomes clearer and finding ways to get more from the technologies already in place, for example, “nudge” features in collaboration technology that prompt behaviors that create value. According to Forrester, we will see a “surge of spending” on “employee-centric initiatives and technologies” during 2022 — driven in large part by retention concerns. Companies will allocate 20% of HR budgets to employee experience initiatives, and that 65% will have a formal employee experience initiative in place, up from 48%.
When pursuing change of this magnitude, human-centric design is critical, ensuring that you are looking at solutions not just through a productivity lens, but also from the perspectives of retention, inclusion, flexibility and other needs. For example, it is still an art to be cognizant and inclusive of the person who is attending the meeting by phone and is not visible in the meeting room or on screen. That is a hard skill to acquire and illustrative of the need to design with both technology and behavior in mind.
Information security remains a key and continuing concern with a distributed workforce. In West Monroe’s third quarter Executive Poll, participants cited it as their second-largest threat to conducting business.
This is a good time to encourage thinking outside of the box. Which brings us to the metaverse, a concept that is now drawing a flurry of attention. Companies see the metaverse as the next digital frontier for work, play and shopping. In a recent West Monroe poll, a majority (86%) of executives say the metaverse offers potential business value for their own company in the next one to five years. The technologies that comprise the metaverse — immersive environments; augmented user experiences; and digital representations of people, places, activities, and products — hold new opportunities to optimize virtual interaction and optimize hybrid work arrangements.
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What we wrote last year: "Your technology strategy is likely to change — if it hasn’t already — and must be driven by and designed to support your value streams. Optimize your processes, identify opportunities for automation or outsourcing, and identify upskilling need to keep your organization competitive. The goal here is to maximize efficiency and deliver a positive experience — no matter where your employees are working."
What’s most critical now: Workflow, automation, performance measurement
A high-performing hybrid workplace won’t happen through tweaking current processes. Instead, companies need to completely rethink and redesign processes and workflow. For example, how could you use automation to handle certain tasks so that teams can focus on their time on making the most of personal interactions. Leaders of one of the retail banks in Future of Work Consortium analyzed and reimagined workflow by asking three critical questions: Are any team tasks redundant? Can any tasks be automated or reassigned to people outside of the team? Can we reimagine a new purpose for our place of work? This degree of process change can have significant implications for organization design, training and skill development and career development. Here again it is helpful to have a multidisciplinary team focused on this area.
And on the topic of performance, organizations and managers will also need to rethink the way they measure people’s performance and productivity. That was easy (or easier) when everyone was in the same space. When you don’t see people working, measuring performance can be much more challenging. Metrics will need to shift from activity-based measures to outcome-based measures.
What we wrote last year: "In our second quarter Executive Poll, building and keeping company culture was the top challenge of a hybrid working model. The war for talent also rages on. How will your organization shore up strategies for talent retention? Other hybrid workplace culture ideas include pulse check-ins, company-wide leadership forums that feature two-way dialogue, and making sure people take time off to recharge."
What’s most critical now: Culture and well-being
In Microsoft's global study of workers one year into the pandemic, 54% of people said they felt overworked and 39% reported feeling exhausted. The emergence of Omicron after rays of hope in 2021 has been particularly deflating for many people. Poll after poll reveals the magnitude of pandemic fatigue. Without proper attention, this can have a detrimental impact on productivity and, in the midst of the Great Resignation, retention. Organizations need to prioritize employee well-being — including helping employees find ways to recharge and maintain intentional connections.
Similarly, companies need to be keenly attuned to culture and proactive in preserving it. Much has been written about hybrid work and the impact on culture, but the current environment elevates the importance of this — and also the challenges. Showing that you understand what employees consider to be important in a company culture is key. For example, the pandemic has prompted employees to reconsider their sense of purpose and that they want to have more impact on society, political and environmental issues — and that they expect to connect with their employer at this level. A 2020 Gartner report found that engagement can drop by one-third when employees are disappointed with their employer’s stance on issues. The report’s authors propose that a “chief purpose officer” may be the next major C-Suite role.
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It May Be a Bumpy Ride, So Remain Adaptable
Prithwiraj “Raj” Choudhury, associate professor at Harvard Business School and an advisor to top companies, believes that in the future, there will be two types of companies — one that embraces work from anywhere and one that is in denial. Leaders have to decide what kind of company they want to lead. His prediction: “In five to 10 years, we won’t call it remote work — it’ll just be work.”
Nearly two years into the pandemic, much remains unknown. In addition to uncertainty about the course of the pandemic, hybrid work hasn’t been truly put to the test. The lack of stability over the second half of 2021 meant that companies haven’t been able to deploy or sustain hybrid models at full capacity. We are still very early on the learning curve. Furthermore, many experts feel that achieving an effective hybrid model is more challenging than having a fully remote or fully in-person workforce. As companies move in this direction, there will be stumbling blocks — making it all the more important to avoid knee-jerk reactions back toward “what we know.” Given the fluid environment, adaptability may be the most important trait that organizations can have.
About the Author
Kaumil Dalal is a Senior Partner in West Monroe’s Product Engineering practice and a national leader focused on delivering world class, impactful industry-leading digital products. He partners with organizations to establish strategy and deliver tailored experiences to enable employee and customer experiences, and power intelligent, adaptive, and hybrid digital workplaces.