Guest post from ACE holder Ram Srinivasan
Over the past three decades, the advent of e-commerce has reshaped the retail industry. Physical stores now co-exist with the digital world, but the physical store has also changed forever. This retail revolution was driven by people — consumers. Today, we stand at the cusp of a workplace revolution, driven by people — your employees. Today's employees are demanding customer-grade workplace experiences. How will you adapt? As we move through the gears of hybrid work experimentation, what lessons can we learn from the retail industry?
Offices were 40-50% occupied pre-pandemic, but most organizations focused on the 'work from office' default.
Although the pre-pandemic default for the workforce was work from the office, offices were never fully occupied. Many companies planned for growth, which meant there was always some surplus space. Add to this time away from work, working off-site or time off, and the result is that office space was never 100% occupied. In fact, the average percentage of occupied space was closer to 40-50%. And while this number may have varied by industry, role or nature of work, flexible work was possible, and technology allowed for it, but, in most cases, this was not the norm. Rather this was an exception. Leaders and managers focused on the "default state,” i.e., those workers who were primarily office-based. Now, the pandemic has changed how we work forever and challenged our “default” settings.
If flexibility was implicit pre-pandemic, the call from the workforce is to make it explicit.
A recent survey found that working in a hybrid mode is expected by 60% of office workers and 55% are already doing so today. Further, flexibility was implicit — very few companies had well-documented flexible work policies or offer flexibility at scale. Work from home arrangements were informally agreed upon between manager and employee. Now employees are seeking out flexibility as an explicit option. The result is that in the competition for talent, flexibility has become a crucial differentiator in many cases beyond compensation. Larry Fink, chairman and CEO of Blackrock, recently opined that no relationship has been changed more by the pandemic than the one between employer and employee. The concept of 9-to-5 in the office five days a week is gone — the keyword is going to be flexibility.
Balancing in-person and remote through hybrid mandates is faux-flexibility.
Mandated office days, like the 3-2 model feel right intuitively — it provides a measure of autonomy that employees did not have pre-pandemic and increases the sense of certainty for leaders who feel the need to closely oversee their employees. However, this is a compromise and — like most compromises — it is leaving almost everyone feeling dissatisfied. A recent survey of a leading tech company found that 76% of employees were dissatisfied with the company’s return-to-office plan, and 56% are looking to leave because of the in-office requirement. It is becoming increasingly clear that hybrid mandates and flexibility are not the same thing, and, in fact, mandating in-office days is faux-flexibility. Hybrid work presents an operational and cultural challenge for leaders: when should employees be in-person versus virtual?
Instead of mandated in-office days, we must be more deliberate about why, when and how we meet in-person.
Rather than outlining broad return-to-office mandates, leaders and managers will need to spell out clearly why, when and how they want people to be in the office. Organizations will need to assess workflows, identify what needs to be done in-person and what can be accomplished virtually. This will ensure people are not in the office doing what they could do virtually — while at the same time — they are not isolated working virtually and can connect in-person for complex collaborative work. By being more deliberate and planning in-person meetings better, team members will understand why they need to meet in-person. While this may limit individual freedom to an extent, it is for reasons that most employees will understand. At the same time, this allows leaders and managers the discretion to design workflows and interactions to maximize collaboration and building effective teams. Of course, this has downstream implications for the workplace.
“It is becoming increasingly clear that hybrid mandates and flexibility are not the same thing, and, in fact, mandating in-office days is faux-flexibility.”
This is not the death of the office, rather it is the birth of the “consumerized workplace.”
The rise of e-commerce did not kill the physical store. In other words, the importance of the physical store did not diminish — instead the role of the physical store changed. We are seeing several retailers who were once online-only are now aggressively focusing on physical stores. They are doing so because physical stores provide many benefits: convenience and immersive exploration for the customer and the ability to build brand loyalty for the enterprise. The most successful physical retailers are offer experiences that make the destination as alluring as their products. Similarly, companies will need to make the workplace a commute-worthy destination that shapes high-quality peak experiences. Destinations that provide people with what they need when they need it.
Use digital technology to create ‘Amazon Go-like’ in-office workplace experiences.
Throughout 2020 it became clearer than ever before that consumers expect omnichannel experiences — focused on the overall quality of interaction between consumers and brands. Consumers shopped online and picked-up in store or curbside. Amazon Go has taken customer experience to the next level. Customers can simply grab and go — no lines, no checkout. Creating peak experiences like these did not require companies to reimagine just the physical store, but required a transformation of the whole organization, supply chains, technology integration, data analytics, service standards and more. Similarly, companies cannot simply focus on reshaping physical offices. They will need to holistically transform work process, policies, performance management, investment in technology and more. They will need to think omnichannel to deliver an ‘Amazon Go-like’ workplace experience.
How we work will continue to evolve. We must listen, learn and adapt.
Does everyone shop online for everything all the time? No. Do we shop online and in-store when most convenient? Yes. Will where we shop for things change over time? Certainly. Does everyone shop the same way? No. Can you force someone to buy in-store on certain days and online on others? Maybe, but you will likely lose that customer. Much of this is true for where we stand in the hybrid work discussion. There is no one-size-fits-all model, and there never will be. The truth about hybrid work is that it will continue to change and evolve. Just as the most successful retailers do, we must listen to our customers — our employees, learn through experimentation — some will fail, and adapt, for it is not the strongest that survive, but the one that is most adaptable.
In his 2016 letter to shareholders, Jeff Bezos noted "customers are always beautifully, wonderfully dissatisfied, even when they report being happy and business is great. Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf." The question to ask therefore is: Are you bringing customer-centricity and a desire to delight to your workplace? If the answer is yes, you are on the path to success.
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About the author: Ram Srinivasan has worked with Fortune 500 companies, real estate developers, and the public sector across the Americas and emerging markets in Asia Pacific. He is currently Managing Director with JLL’s Consulting practice and was previously a Vice President with Deloitte Canada’s Real Estate and Infrastructure Advisory Practice.
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