Decision-Making in the Dark? Why Leaders Should Not Overlook Data in Return-to-Office Planning

Imagine a workplace where employees are happier, more productive, and passionately loyal to their employers. This isn't a futuristic fantasy—it's the present reality for companies embracing hybrid work models. Yet, despite a mountain of data showcasing these benefits, many leaders are “dragging” their employees back to the office. Why are they making decisions in the dark?

Consider this: 

The evidence is clear. So, why are so many leaders ignoring these insights and enforcing rigid RTO (return-to-office) policies? The answer might surprise you. Recent research suggests these decisions are less about improving performance and more about power dynamics and deflecting blame for company shortcomings. It's a strategy rooted in control rather than data-driven logic.

In this blog, we uncover the data-backed benefits of flexible work setups and dive into the reasons behind the persistent push for office returns. It's time to shine a light on the real motives and help leaders make informed, strategic decisions that truly benefit their organizations and employees.

TL;DR:

  • Flexible work models lead to happier, more productive employees and higher loyalty. Data from various sources highlights the advantages of flexible work arrangements, such as increased productivity, revenue growth, and cost savings.
  • Despite ample evidence supporting flexible work arrangements, many leaders enforce rigid return-to-office (RTO) policies. Reasons behind RTO mandates include managerial control dynamics and scapegoating employees for company shortcomings.
  • By leveraging comprehensive data analysis and prioritizing people and performance, organizations can navigate the modern workplace landscape with success.

Data-Backed Benefits of Flexible Work Setups

The problem with ignoring data is that it will come back at you like a boomerang, as inflexible, top-down RTO mandates without employee buy-in can be harmful. The Q4 2023 Scoop Flex Index provides compelling evidence that companies embracing flexible work arrangements are not just surviving, but thriving. Fully flexible public companies have shown a 16% lead in revenue growth over their less flexible peers, even when excluding tech companies from the data.

And data doesn’t stop here:

  • Thumbtack’s research shows that 74% of workers report increased productivity in virtual environments, a sentiment shared by 75% of senior leaders. 
  • The Talent Insights report from Aquent supports this, indicating that 66% of remote teams are high performing compared to 47% of on-site teams. These teams excel in diversity, innovation, and adaptability. 
  • McKinsey also finds that top-performing employees, the “thriving stars,” are more likely to flourish in hybrid and remote-working models than in mostly in-person environments.
  • Plus, IWG’s research reveals that 89% of U.S. CEOs with hybrid working arrangements have observed direct cost savings, including reduced office space and amenities. Notably, 96% believe their reputation as CEO has improved due to implementing hybrid working, with significant benefits in employee happiness, productivity, retention, and attraction.

employee in the office analyzing workplace data and reports

What Do Employees Want?

So, there is enough evidence that flexible work arrangements benefit companies as well as employees. Some of the employees’ most cited arguments evolve around:

  • Freedom and flexibility, as remote work allows them to choose their own hours and locations, balancing work with personal commitments.
  • The comfort of working from home, which avoids commutes and daily expenses, leading to better financial management.
  • Productivity, which often increases with remote work, as employees can manage their tasks independently and focus on outcomes rather than strict schedules.

According to a recent research from the Professor of Business Administration at the University of Pittsburgh Mark Ma and his graduate student Yuye Ding on RTO mandates, the positive correlation between WFH and employee satisfaction and performance can be attributed to various factors, including enhanced work-life balance, improved work efficiency, and increased work autonomy. Offering people a hybrid solution where they can work from home, or the office is a great way to create a work environment that meets their needs while enhancing overall productivity and satisfaction. Offering such flexibility can often play a pivotal role in staff retention: 54% of workers would consider leaving their current jobs if they weren't provided with flexible schedules.

And despite all these…

Why Are RTO Mandates Out of Sync with Employee Preferences?

The persistence of RTO mandates appears increasingly disconnected from the realities of the modern workforce. Dr. Ma’s cited study uncovers a startling reality: RTO decisions stem less from concrete evidence or a belief in enhancing firm value and more from managerial control dynamics and using employees as scapegoats for unsatisfactory firm performance. Contrary to the claims of improving firm value, RTO fails to positively impact financial performance.

Here is why:

The Monetary Dimension

This dimension addresses the most frequently cited justification for RTO mandates by executives: the belief that these mandates are crucial for enhancing employee productivity, improving overall company performance, and, ultimately, increasing company value. This rationale, often presented as a straightforward and logical approach, posits that bringing employees back into the office will create a more collaborative and efficient workforce, driving the company’s financial success.

However, the study’s findings contradict this narrative. The data-driven analysis explored whether there was a tangible link between CEOs' financial stakes in their companies and their propensity to enforce RTO mandates. Contrary to conventional wisdom, the study found no significant correlation between the level of stock ownership by CEOs and the likelihood of implementing RTO mandates. This suggests that the decision to mandate RTO is not primarily driven by a belief in its financial benefits. Instead, the study finds that managers might use RTO mandates as a strategic tool to divert blame for poor firm performance. 

The research found a notable correlation between RTO mandates and poor stock performance among S&P 500 companies, suggesting that managers might employ these mandates to shift the narrative towards employees' supposed lack of productivity in remote settings, thereby deflecting attention from their own strategic missteps.

The Psychological Dimension

The study also points out the psychological motives behind RTO mandates, proposing that they may serve as a mechanism for managers to reassert control over employees. This means that power-seeking CEOs—typically males with significantly higher salaries than their next highest-paid executives—are more likely to enforce top-down RTO mandates. This pattern indicates a desire for control and dominance rather than a strategy aimed at improving firm performance. Remote work offers employees autonomy and flexibility, diminishing the immediate control managers have over their teams. 

By mandating a return to the office, these CEOs attempt to regain direct oversight and influence more easily exerted in a traditional office setting. This dynamic challenges organizations to reflect on their leadership models and consider whether traditional power structures align with the evolving expectations and preferences of the workforce. The findings suggest a need for a shift towards more inclusive, empathetic, and flexible leadership styles and the need for investors to reign in the worst impulses of power-seeking CEOs.

facility manager collecting data

Data Offers a Solid Foundation for Crafting a Strategic and Employee-Centric Office Return

There is plenty of data which shows that a one-size-fits-all RTO approach can increase turnover, disengagement, and reduce productivity. For example, Unispace’s Returning for Good report found that 42% of companies with RTO mandates experienced higher than expected employee attrition.

Moreover, the three reasons why employees are ignoring or rejecting RTO mandates, according to Harvard Business Review, are:

  • The rising value of autonomy: many employees, having experienced the freedom of remote work, are reluctant to give up their newfound autonomy.
  • Health and safety concerns: even with improved health measures, employees remain wary of the risks of illness and the spread of germs in crowded office spaces.
  • Enhanced work-life balance: working from home has provided employees with greater control over their time, making the elimination of daily commutes a significant benefit.

So how can you craft a strategic and employee-centric office return? 

  • Firstly, and mostly, you should base their decisions on data. To gather this data, you’ll have to review macro-level trends, studies, and reports, look at how other companies are implementing their RTO policies, organize internal surveys that involve all stakeholders, and embrace an open-door policy. 
  • Then, you should communicate clearly and often, explain the why, address employee concerns, leverage all communication channels to bridge any communication gaps there may be. 
  • Thirdly, foster an environment of trust and autonomy by setting clear expectations, demonstrating empathy, and encouraging staff to take ownership of their tasks.
  • Lastly, you should utilize modern workplace technology like collaboration tools, video conferencing platforms, and workplace experience platforms to streamline operations and enhance employee experience in and outside the office.

Workplace experience platforms, such as Yarooms, introduce a new dimension to connectivity, serving as centralized hubs that consolidate functions such as desk and meeting room booking, carbon emissions tracking, hybrid work planning, digital signage, visitor management, etc.

These platforms offer a digital connection for teams to access vital information, fostering alignment and shared understanding. But most of all, they are a source of valuable, doubt-proof data that can help you create an employee-centric RTO strategy.

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Data That Helps to Create Successful Return-to-Office Plans

Here are some types of data which – with the right tools – you can gather to craft your own RTO strategy:

Employee Surveys and Feedback

When organizations ask the right questions, they gain insights that enable data-driven decisions for continuous improvement, ensuring the workplace evolves with employees' needs. Their feedback can reveal what employees value most about flexible work arrangements and highlight their concerns about returning to the office, enabling informed decision-making and tailored support. 

Workspace Utilization Data

A workplace analytics solution provides data-driven insights into how your workplace is being used, which enables better decision making regarding resource allocation and optimization strategies. One key benefit of workplace analytics is its ability to provide real-time data on workspace utilization. This information can be used to understand how employees use different workspaces throughout the day, for how long, and identify underutilized spaces that could be repurposed or downsized. By allowing employees to book workstations at their convenience and personalize them according to their needs, they feel more comfortable in the workplace and are more motivated to come in.

Collaboration and Meeting Data

Workplace collaboration plays a vital role in enabling organizational change and agility by breaking down hierarchical and operational silos, making businesses more responsive and innovative. So, insights into meeting effectiveness can guide the development of a data-based RTO policy, helping determine which meetings are best held in person and which can be effectively conducted virtually, thereby enhancing collaboration and productivity.

Workplace experience platforms like Yarooms help foster collaboration at all levels. Besides collecting valuable workplace data (utilization, visitor, sustainability analytics), they allow employees the flexibility to schedule their work, gain visibility into colleagues' availability, and easily book workspaces for teamwork. This is the data you should count on when deciding the type of RTO policy you want to implement!

collaboration between colleagues

Productivity and Performance Data

Historically, productivity was measured by hours logged at the office, equating longer hours with higher output. However, in the light of Dr. Ma’s study findings, companies should rather focus their attention on task accomplishment over time spent. Companies should prioritize outcomes over attendance, emphasizing quality over quantity.

By monitoring metrics across various work settings—whether remote, in-office, or hybrid—organizations can gather concrete evidence about where employees are most productive. This data can highlight specific tasks or roles that benefit from remote work versus those that thrive in an office environment. For example, data may reveal that creative tasks and deep-focus projects have higher output and quality when performed remotely, whereas collaborative and brainstorming sessions might be more effective in person. This shift grants employees greater autonomy and responsibility, allowing them to manage their schedules while meeting deadlines and producing quality work.

Moreover, performance data can identify trends in employee engagement and satisfaction, providing insights into how different work environments impact these factors. Understanding these dynamics helps tailor flexible work arrangements that maximize both productivity and employee well-being, and ensures the creation of a balanced RTO policy.

Employee Commute Data

Employee commute data can significantly enhance a return-to-office (RTO) strategy by providing insights into the impact of commuting on employee well-being, productivity, and job satisfaction. Understanding commute times and stress helps identify how it affects employees' overall well-being and productivity, guiding decisions about optimal office locations to minimize travel time. 

This data informs flexible work policies, such as staggered start times or hybrid schedules, reducing peak hour congestion and commuting stress. Leveraging one single platform to collect and analyze this data is of great help. For example, Yarooms collects information about employee commuting habits and calculates the carbon footprint of their commute. Addressing these challenges can boost morale and retention. At the same time, reducing commuting can lower the company's carbon footprint, which means more environmentally friendly and cost-efficient policies, but also a RTO strategy that is considerate of employees' needs.

Final Thoughts

Data doesn't lie! Flexible work arrangements not only benefit employees' well-being and productivity but also contribute to the success of organizations. Despite overwhelming evidence supporting the advantages of hybrid work models, many leaders persist in enforcing rigid RTO mandates. However, understanding the motives behind these decisions reveals a disconnect between traditional power dynamics and data-driven logic. It's time to flip the switch! By embracing employee-centric strategies informed by comprehensive data analysis leveraged through proper measuring tools, organizations can craft successful return-to-office plans that prioritize both employee satisfaction and organizational success.

Topics: Hybrid & remote work

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