How have we reconfigured? Reflections on a year of the isolation economy
Over the past year we’ve been collecting data on how we see businesses evolving their collaborative practices and technologies in response to the extraordinary situation in which we all find ourselves.
As of 3 April 2020, nearly 50 percent of the global population was under some form of lockdown or shelter-in-place order. In the months that followed, waves of lockdown and travel restrictions came and went as governments attempted to stem the tide of the pandemic. We’ve previously referred to the social, political and economic impacts of these changes as the isolation economy. In the world of work, some of the more headline-grabbing developments included:
- Barclays boss Jes Staley saying offices might be a thing of the past (though Barclays recently clarified that it intends to keep a major presence in Canary Wharf in London.)
- Aviva deciding to close offices and move to a permanent remote-first model for its UK staff.
- The world’s major digital-first companies, including Google, Amazon, Facebook, Netflix, Salesforce and more, working from home for most of the past year, and many adopting permanent location-flexible policies.
My personal ‘lockdowniversary’ is Saturday 14 March when last year I returned to London from a holiday in the southwest of England. When I embarked on 7 March things were still relatively normal: the pandemic was in the news, but it was something happening ‘out there’. It seemed ridiculous to even contemplate cancelling my trip (though being an extremely risk-averse person, the idea did flit through my mind.) By the time I got back the tide of public opinion had shifted drastically, though no official measures were yet in place. When I stepped off the train at Waterloo Station, London’s streets were eerily empty. Picturing my typical passive-aggressive battle to squeeze onto the tube at rush hour, everyone pretending they aren’t millimetres from one another’s breath, I took a taxi home instead. My cabbie extolled the virtues of black cabs with their plastic shields between driver and passenger, and he told me how he’d taken to spraying surface disinfectant on his hands as well as the seats between each ride. I haven’t set foot in an office since.
All this remote working comes at a cost: there are reports of growing inequality for those who have the least access to digital services, those who are in the most precarious work situations (such as gig economy workers), and those whose work cannot be done remotely. In the UK, according to some estimates only 10 percent of the bottom half of earners can work from home, compared to 50 percent of top earners; while in the US, people of colour are disproportionately represented in front-line roles which require them to be physically present to do their work, meaning they cannot work from home to reduce their own risk of exposure or that of those close to them. These factors could have a long-lasting impact on the way that our society, and our economy, functions: as of January, women’s labour force participation in the US is the lowest it’s been in 33 years, with 2.3 million women having left the workforce since February 2020, and women of colour being disproportionately impacted by these losses. As there is a wealth of evidence from multiple studies demonstrating that diverse teams financially outperform homogenous peers, these trends should strike fear into the hearts of anyone who cares about the bottom line.
As we contemplate an increasingly distributed future, there is the risk of further exacerbating inequality (and by extension, decreasing effectiveness and profitability). A decade-old longitudinal study of promotional patterns among employees working in a ‘hybrid’ environment (some working from home, some co-located in an office) shows that people who work from home were promoted at about half the rate of those in the office. Two common reasons researchers heard were that people at home were forgotten, while the office workers developed more ‘managerial capital’ by having lunch, coffee or general chit-chat with each other and their bosses. With caregivers (disproportionately women) and people with disabilities more likely to choose flexibility by working from home, it’s possible that the lack of visibility in the office could cause divergence between their career prospects and those of their more office-present peers.
Plenty of knowledge-work businesses are sceptical of shifting the balance away from co-located working, with Goldman Sachs CEO David Solomon declaring: “This is not ideal for us and it’s not a new normal. It’s an aberration that we are going to correct as quickly as possible.” There is some data to suggest that trading floors suffered due to the inability to replicate tacit information-sharing in a distributed way. There are also fears that the ‘productivity peaks’ experienced by many businesses during the pandemic are not sustainable shifts to working patterns, but panic-working born of specific point-in-time stressors which might lead to a ‘burnout cliff’ if not addressed.
Preparing to write this commentary, I re-interviewed several business leaders who participated in our prior research Reconfiguring the Collaborative Workspace: Making the Most of Time, Space & Attitude. They echoed fears about losing social capital within the organization, noting that it’s especially difficult for new starters to integrate with the team in a virtual-only environment. Connecting only through digital tools can feel more transactional than the incidental coffee conversations that used to happen in the office. “I miss 30 second elevator chats,” said one. Others also echoed that online-only communications feel more formalized; personal relationships begin to lose their depth when conducted solely through the screen. Another described missing the “inertia”: those moments in the office when you think nothing is happening but subtle signals of ‘something in the air’ give a sense of how the team is progressing, or where someone might need extra help. All this formalized diary time also left several scrambling for slots to do their individual work – a common tension even prior to the pandemic which we addressed in Reconfiguring the Collaborative Workspace.
However, all noted positive outcomes from the great shock of the pandemic as well. One said: “The thing about a crisis is that it does create an opportunity for creativity.” Several agreed it had pushed their technology transformation plans forward three to five years in the space of three to five months. The inertia of ‘We’ve always done it that way’ simply fell away as we were all forced to adapt. With everyone working from home, the fundamental importance of the IT estate became clear: communications are the lifeblood of any business, and technology teams became overnight heroes as they worked to ensure the integrity of information flow. Executive communication styles also underwent a major shift in most places: leaders went into overdrive communicating with staff about this period of instability, with an increasing focus on prioritizing personal well-being. “We’ve learned to look after each other in a different way,” said one leader. Interviewees also noted that communications with staff feel more reciprocal now than former top-down styles. At a team level, people are more aware of one another’s lives outside work as we get literal glimpses into each other’s homes. Another leader reported that regional collaboration had improved since there is now no co-location advantage that leaves remote parties out of the decision-making loop.
There is reason to hope that we are in a different place from a decade ago when study results showed that remote workers are at a disadvantage. There are new possible outcomes for extended working-from-home emerging from new technology to keep us in better touch despite distance; from more intentionally inclusive workplace cultures; and from a better understanding of the pitfalls. As we said a year ago:
“There are some simple techniques that organizations can use to help their teams set up for remote success. First and perhaps most important is to find ways to replicate the ‘coffee conversation’. This might seem frivolous, but it’s in these micro-interactions that we build the trust with one another in small ways that we later rely on in big ways when something tough comes up. A few techniques we saw from our research included explicitly setting aside time at the beginning or end of a meeting for ‘warm-up’ or ‘cool down’ chat outside of the formal business; arranging virtual coffee times during the week for everyone to dial in or for a one-on-one informal time together; and introducing games, quizzes, team awards and so forth to build a sense of shared team camaraderie.
Defaulting to the needs of the most-remote person is another way to mitigate some of the communication inequalities that happen in blended teams. This strategy is often recommended by accessibility inclusion advocates also, and is known as the curb cut effect: optimizing for your most vulnerable user (or in this case team member) ends up benefiting everyone. This can mean introducing practices such as that if one person is dialling into a meeting, everyone dials in, so nobody has the advantage of physical proximity for seeing a screen or taking the next turn speaking.”
Plenty of organizations had already adapted to a fully distributed model even prior to the enforced home-working of the pandemic, such as Automattic, the sofware services firm behind WordPress, Gravatar, Tumblr and other publishing platforms. Automattic founder Matt Mullenweg’s Five Levels of Autonomy for distributed teams is a practical guide to answer the question ‘How remote do we go?’
Figure 1: Matt Mullenweg's Five Levels of Autonomy
Increasingly distributed work is here to stay, though exactly what the ‘office of the future’ will look like, not to mention the cityscapes surrounding them, remains to be seen. We may see a bifurcation of knowledge-working organizations into those that embrace or repudiate distributed working in the short to medium term. Some functions like software development may be more likely to adopt an ethos of primarily asynchronous collaboration, as demonstrated in the legendary Bezos API Mandate, which essentially enforces the primacy of documentation as the way to collaborate: if you must have a conversation to explain the API, you’ve missed the point. At the same time, firms like Goldman Sachs may double-down on the benefits of synchronous co-located collaboration for knowledge sharing between and across teams (though their peers might be more willing to branch into technological solutions for replicating the benefits of collaboration, with UBS trialling a virtual trading floor and Lloyds experimenting with a part-virtual underwriting room). For teams grappling with these issues, we offer future-focused structured thinking on this subject through our research and advisory workshops on The Dynamic Workplace.
There is also a middle way of more integrated digital and physical work: we’re betting that some of the micro-moments people are missing from their in-office interactions will be recreated through increasingly virtual environments as people seek the benefits of co-location without the drawbacks. Our next project on the future of work, Braving New Worlds: Virtual Spaces for Enterprise Collaboration, will take an in-depth look at how our working environments might become a blend of the physical and digital.
Are you experimenting with a virtual campus or augmented reality technology to help make collaboration more immersive? We want to hear about it. Reach out to tell us more.