The Permanent Hybrid Workforce

The permanent hybrid workforce is one of the most significant global business and cultural changes that has emerged from the pandemic. Hybrid is the new enterprise.

A little over a year ago, as the wildfire-like spread of the COVID-19 virus forced businesses to close their offices and have employees work from home, I wrote “Home is the New Enterprise” which introduced the controversial notion that — for a number of economic and lifestyle reasons — working from home would likely become permanent for a majority of employees in the US.

With the pandemic receding I thought this would be a good time to look at the longer-term effects of the pandemic on businesses, their employees and customers and provide an update of my views about the future of work and work-life.

I was not “all right” a year ago about the pervasiveness of permanently working from home, but it is increasingly evident now that the hybrid approach, which benefits both business and their employees in several ways, is here to stay.

Google “productivity” and you will find it is defined as the rate of output per unit of input.

When the pandemic hit, businesses went remote because they had no other alternative. Understandably, business leaders and owners were very anxious at the outset about losses in worker productivity and the negative financial impact of those anticipated productivity decreases.

Their fears were not realized. In fact, there’s convincing evidence — particularly in the tech companies I work with closely — that the pandemic-caused shift to remote work brought on an increase in productivity. 

The level of productivity improvements has varied by function, but there is no question productivity improved substantially for sales and marketing, which is always the largest line item in a company’s annual budget. 

Responses from a recent informal survey of companies I work with showed a decrease in sales and marketing travel-related expense of between 50% and 75%.  This coincided with an increase in overall sales of between 20% and 50% year over year. Those are dramatic improvements, and ones I doubt would have happened without the pandemic.

As employees return will we have to give up productivity gains? Not necessarily.

With bottom-line proof that overall sales can increase substantially even as sales and marketing expenses plummet, companies are unlikely to return to past practices. For example, the days of hopping on a plane and flying cross country for a two-hour sales meeting may be in the rearview permanently.

A lot of important and profitable business was conducted successfully from home offices, dens and bedrooms on ZOOM et al in the 14 months to the benefit of both buyers and sellers. There is no reason to change what’s working and the conferencing/collaboration tools and technologies that enabled that success are continuing to improve.

Similarly, corporate spending on industry trade shows and conferences will be curtailed sharply for the foreseeable future. Promoters of those events are going to be hard-pressed to make a convincing economic case for investing millions of dollars annually on shows and events that companies have proven they can do without or certainly with less frequency.

Also, because of COVID’s disruption, many businesses have begun to realize that they own or lease too much space. At least in tech companies, there’s evidence that most software developers prefer to work primarily from home.  While they are open to coming back into an office, they do not want to do so every day of the week. Companies’ bottom lines will grow because of having to lease less office space for their hybrid workforce.

Similarly, sales and marketing teams that work collaboratively are likely looking forward to returning to an office for the camaraderie, group activities and social aspects of the job. Some things just can’t be done remotely. One of the cultural hallmarks of the Black Duck Sales team was our ‘war room,’ which was decked out in camouflage netting, pictures of George Patton and other wartime paraphernalia...  We gathered in the war room at the end of each quarter to track progress against our goals. I have no idea how one could make a virtual or zoom ‘war room’.  For this kind of activity people must be together. 

Executive teams are the most likely to spend most of their time in the office – at least until a longer-term hybrid model is understood – to collaborate in person, get to know new employees and help re-establish a company culture that was disrupted by the pandemic.

Having a permanent hybrid workforce will also level the playing field for all employees. Pre-pandemic, there was a tendency to view those who “worked from home” as slackers of a sort and somehow not quite full-fledged team members. Out of sight; out of mind. Working in the office and maximizing so-called facetime with the bosses was seen as the best way to move up, irrespective of actual performance. Political maneuvering will be greatly diminished as the permanent hybrid workforce becomes the norm. That’s a good thing.

It’s early days of course and companies are just now deciding exactly what having a permanent hybrid workforce will entail. It will take time to figure this out and also create a new vibrant hybrid work culture.

So, my belief is that it will be a hybrid world going forward, one which balances the needs of employees who have now experienced a better work-life balance with less time stuck in traffic and more time with family. I also believe we can retain the productivity gains we have so clearly demonstrated are possible with remote work. 

The winning companies will balance the hybrid model well to attract and retain the best talent and create a healthy, thriving hybrid culture.