What’s next after returning to office duties? CEOs plan to eliminate hybrid work.Newest KPMG CEO Outlook 2023A survey of 1,325 CEOs of companies with more than $500 million in revenue found that 64% of large company CEOs expect to return to pre-pandemic office routines within the next three years. In turn, 87% are trying to achieve this by tying financial rewards and promotion opportunities to on-the-job attendance.
However, when CEOs direct employees to follow pre-pandemic norms, they may sacrifice long-term organizational health for short-term gains.After all, a new A BCG survey of 1,500 office workers around the world found that nine in 10 respondents believe flexible work options are important when looking for a job. Additionally, employees who are dissatisfied with their work patterns are 2.5 times more likely than satisfied employees to consider leaving the organization in the next year.
Given that many surveys have found similar results to BCG’s, CEOs must be aware of the risks to recruitment and retention of rigid office work policies. But there’s an additional risk that CEOs may not realize: The methods used to eliminate flexibility reward presenteeism.
A mirage of obsolescence
A bustling office, with employees arriving at work at nine and leaving at five, may picture in the minds of many CEOs a picture of an efficient and engaged workforce. This traditional scene is embedded in the corporate ethos and embodies a sense of order, control and business as usual. This scene resonates with people’s desire for predictability and routine.
However, as modern workspaces continue to evolve, driven by technological advancements and a global pandemic, the fallacy of equating presence with productivity is becoming increasingly apparent. Not only is this paradigm, known as presenteeism, outdated, but it can also harm an organization’s innovative edge and competitive position in today’s ever-changing business environment.
Presenteeism, the practice of valuing employees based on their physical presence rather than output, is a mirage that many organizations struggle to transcend. This is a superficial metric that masks a true indicator of an employee’s value and contribution to the organization. When the cornerstone of recognition and rewards revolves around time spent in the office, the focus shifts away from what really matters: the quality of work, the creativity infused, the problems solved, and the value added to the organization.
The trap of presenteeism
The implications of this presenteeism paradigm are manifold. It creates an environment that deemphasizes actual performance. Instead of spending energy on impactful work, employees divert their energy to being in the office, attending high-profile events, and networking. This scenario can increase the visibility of value creation.
This strategy of rewarding tenure rather than performance sets a dangerous precedent. It sends a clear message to the entire organizational hierarchy: your physical presence is more important than your actual output. This distorted incentive system can demoralize high-performing employees who thrive in flexible work environments and can trigger a brain drain. Talented people may seek greener pastures when they find themselves locked into a system that does not value their actual contributions, using performance as the currency of recognition.
This approach completely ignores the diverse needs and preferences of the modern workforce. The era we live in heralds a diverse talent pool, with different work preferences and life situations. Rigid office work models fail to respect this diversity and instead shoehorn employees into one-size-fits-all molds. Not only does this model stifle flexibility, it also stifles creativity, innovation, and the rich cross-pollination of ideas that flexible work settings can facilitate.
Furthermore, policies that reward incumbency promote a culture of compliance rather than a culture of engagement and innovation. When employees are simply incentivized to perform rather than make meaningful contributions, the energy, curiosity, and vitality that drive innovative businesses can be overshadowed by a culture of compliance.
Additionally, less compliant employees can opt to “coffee badge” — Employees enter the office briefly just to grab a cup of coffee and chat with colleagues, then leave. Technically, they fulfilled their obligation to come into the office that day. In fact, they are not following the spirit of the policy of working in the office. Why do this when they can get their work done better at home than in the office?
When dissecting its impact, the irony becomes apparent. In an effort to reinvigorate pre-pandemic work norms, organizations may find themselves sacrificing the essence of a thriving, innovative and engaged workforce. The illusion of presenteeism is a thing of the past, and modern organizations would do well to move beyond it as they navigate complex, ever-changing work environments.
Reward the right metrics
In modern businesses, measures of success and productivity bear the imprint of the organization’s values and aspirations.when helping customer organization figure out their Hybrid working mode, I highlight how at the heart of this paradigm shift lies a shift away from presenteeism towards more outcome-focused assessment. This shift not only aligns with changing work dynamics but also resonates with a more equitable, performance-based organizational culture.
Several aspects emphasize the need to focus on output rather than physical presence in the office. When the focus is on output, employees are motivated to optimize their performance, enhance their skills, and make meaningful contributions to the organization’s goals. It fosters a culture of accountability and self-management in which individuals are recognized for their actual contributions rather than their ability to adhere to strict work schedules.
Output-focused assessment and reward systems are inherently inclusive. It respects the diverse work preferences, life situations and productivity rhythms of the modern workforce. Whether employees perform their best in the comfort of their homes in the wee hours of the morning or prefer the collaborative atmosphere of an office environment, what ultimately matters is the quality and impact of their work. This inclusivity not only fosters a positive work culture but also taps into a wider talent pool regardless of geography or time constraints.
When employees are evaluated based on results, there is an inherent motivation to increase efficiency, foster innovation, and find better ways to achieve and exceed goals. It is a culture that promotes problem solving, creativity and a relentless pursuit of excellence.
Furthermore, an output-focused model is consistent with the spirit of transparency and fairness. It removes the ambiguity that often arises when evaluating employee performance based on subjective parameters. Instead, it provides clear, measurable indicators of individual contributions, making the evaluation process transparent and objective.
The shift to an output-focused model is not without challenges. It requires a strong performance indicator framework, regular reviews and open feedback channels. Leaders need to create a supportive environment where employees have the necessary resources, guidance, and trust to effectively manage their work, no matter where they perform their tasks.
relieve pain
From the perspective of employees, the daily commute is a big ask. It’s here that commuter compensation can play an important role, but it shouldn’t just be about paying employees.Instead, commute compensation should focus on easing the burden of commuting so that when employees come to the office, they are more focused on productive interactions that drive meaningful outcomes: the moments that matter, e.g. A recent study Discovered by Microsoft.
These include intensive forms of synchronous collaboration, such as decision-making conversations, coaching and on-the-job training, complex discussions that benefit from immediate feedback, or social and team connections. These elements are critical to building strong teams and a culture of continuous learning and innovation.
Essentially, it’s all about creating a win-win situation. Employees feel supported during their commutes, and organizations benefit from the valuable face-to-face interactions that occur when teams come together. Through commute compensation, companies can promote a culture that values meaningful work and productive collaboration.
In the long term, companies that adhere to rigid office routines will face a brain drain, leaving behind an aging, high-cost talent pool. Rigidity stifles innovation, reduces engagement, and ultimately makes such organizations less attractive in a competitive talent market.
The undercurrent of the shift to an office-based work model reveals a short-sighted perspective that ignores the need to evolve and adapt to today’s dynamic work environment. Hybrid working models, which blend flexibility and engagement, are not just a response to the pandemic but a step towards a balanced and inclusive work culture. The path forward requires us to move away from outdated working models, adopt practices that value output over attendance, and foster a culture of innovation, engagement and overall well-being.
Gleb Zipulski,PhD. (aka “The Office Whisperer”), helps technology and finance executives drive collaboration, innovation and retention in hybrid work.He serves as CEO of boutique Future of Work Consultants Disaster prevention expert.He is the best-selling author of seven books, including Never go by your gut and Lead hybrid and remote teams.His expertise comes from over 20 years of experience consult For Fortune 500 companies (from Aflac to Xerox) and More than 15 years in academia as a behavioral scientist at the University of North Carolina at Chapel Hill and The Ohio State University.
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