Seven Truths About Hybrid Work and Productivity

Our collective experience of the pandemic enabled us to conduct endless experiments with work. Initially, the experiments were about where work took place (the home becoming a viable option), and soon they became about when work took place (the rigors of nine-to-five morphing into more flexible arrangements). Even now, leaders are watching with some combination of unease, hope, and curiosity to see what effects these experiments are having on the organization, especially on workers’ productivity.

In mid-July, I and my research team at HSM ran a research webinar on the topic of productivity, in part to explore how the definition and measurement of productivity are shifting and what these changes mean for individuals, managers, teams, and organizational design. More than 200 people, mostly in human resources and primarily at the managerial level, participated. It was a small but diverse sample, representing 79 organizations and 28 countries. Using quantitative polling during the session, we dug into the current situation.

One standout set of data points: Of the people polled during the webinar, 61% said hybrid has had a positive impact on productivity (16% said very positive and 45% said positive). Only 15% said it was negative. Of course, the answer to the question of whether hybrid is always best is more nuanced than a simple yes or no.

What We’re Seeing in Hybrid Experiments Worldwide

The webinar reinforced what has been emerging over the past three years in my research about how people work today and the drivers of sustainable high performance. Although the big takeaways are a work in progress, seven truths about hybrid work and productivity have begun to emerge.

1. Hybrid work is a continuum. Our research indicates that there’s been a settling down of practices and implications since the end of the pandemic. Some companies (like JPMorgan and Tesla) are requiring the majority of employees to go back into the office. Some companies (like Airbnb) are implementing a “work from anywhere” policy. The majority are somewhere in the middle: We see language such as “majority office-based” (like Goldman Sachs), “team-led office days” (like Apple and Salesforce), and “flexible arrangement” (like HSBC and CCL Industries). These are all riffs around employees spending some time in the office and some at home. In other words, it’s a continuum of flexibility with a great deal of variety.

2. It’s crucial to communicate policies straightforwardly. My advice to senior teams about hybrid working: Make the “deal” clear. For example, don’t pretend that there’s flexibility when the culture is to be in the office and a failure to show up will be punished. Humans are perfectly capable of making informed choices about the organizations they want to work at. But to be informed, people need clear and unambiguous information about what the terms of the agreement are.

3. Leaders need to be prepared for the trade-offs. Another piece of advice for senior leaders is to acknowledge that all deals have compromises associated with them. Now, with three years of hybrid experiments under our belts, it’s becoming ever clearer what these trade-offs are. Take the “work every day from the office” deal. The downsides of return-to-office mandates are the loss of some potentially highly talented people who value flexibility, and the potential erosion of the energy of those who are enduring a long commute. Or take the “work from home most days” deal. Here, a potential trade-off is the erosion of social capital. Sure, an experienced manager can mentor and coach remotely, but many struggle with it; the consequence is that unexperienced workers may fail to receive that all-important in-person coaching attention. Leaders need to face up to the inevitable drawbacks of whatever deals they make and mitigate the downsides.

4. Acknowledge differing narratives about the impact of hybrid working on productivity. I saw differing narratives play out recently in a leadership team meeting I attended and in the global webinar my research team conducted. In the leadership meeting at a global fintech, I was the external speaker. I had prepared five themes to discuss (including the hot topic of generative AI). Yet, quickly (and surprisingly), I realized it was hybrid work that was the topic of the moment. And as I listened carefully to the debate, the word I kept hearing was productivity. More specifically, it was the concern that in the long run, productivity would drop in situations involving hybrid working.

As I noted earlier, 61% of attendees in my webinar who took our poll said that hybrid was having a positive impact on productivity, while 15% said it was negative. Fifteen percent is a smaller figure, but it’s not insignificant.

It’s clear that narratives differ. Groups of leaders (like the fintech leaders) fret about the impact of hybrid — while the perception of the webinar group (more representative of the development and HR functions) was more generally upbeat that hybrid working is having a positive impact on productivity.

5. Productivity is usually challenging — and measurement is always complex. The axis of these differing narratives about hybrid are concerns about productivity. So let’s put the hybrid/productivity issue into context. In the webinar, we asked the question, “Has increasing productivity gains been a challenge for you?” Only 13% answered “Increasing productivity is not a challenge.” The current experience for the majority of people who responded is that increasing productivity gains is a challenge. When we asked why, we heard that productivity is a concept that is complex, little understood, and hard to move the needle on in a verifiable way. In other words, productivity is not simply a hybrid work issue.

Yet there’s something about understanding productivity that’s particularly important for understanding the impact of hybrid work on it. I caught a glimpse of this in the answers to two further questions.

The first was a qualitative question: “Describe a time when you feel productive.” Webinar participants posted their views in the chat field and used an open-field link to share longer answers. Comments included “a state of flow,” “focused, energized, and in control,” “proud of my accomplishments,” “working well with others,” and “feeling autonomous.” It’s clear that we humans know when we’re feeling productive and that we have no difficulty describing our feelings.

The second question was also qualitative: “How do you measure productivity in your company?” Some of the comments were “utilization rates,” “lines of code,” “revenue per employee,” “on-time delivery,” and “customer feedback.” Notice the distinction between how it feels to be productive — which are human descriptions — and the measurements of productivity, which are mainly machinelike descriptions. The challenge is that commonly used productivity measures capture solid, verifiable outcomes. Our human perspective, on the other hand, is about energy, collaboration, and feelings.

So here is one of the biggest hybrid challenges: Many jobs that can be designed as hybrid —such as project management, strategy planning, creating presentations, and coaching a team member — are based on cognitive tasks that rarely include easily verifiable, comparative productivity measures. If we want to increase our understanding of potential hybrid productivity boosts, like increasing energy (which can come from avoiding a commute) and increasing autonomy (which can arise from working from home), we need to widen our thinking about metrics. And the same is true if we want to confront hybrid productivity challenges, like working with others (which can feel jeopardized if people feel isolated at home).

6. It’s useful to view hybrid work as fundamentally a job design option. We asked the webinar participants to share examples of when and how they achieved productivity gains. Three major clusters emerged: when they used generative AI and chatbots, when they had more effective collaboration, and when they developed skills. We then asked participants to rate which of five potential productivity boosts was most important: Thirty-three percent selected “working with machines,” 24% selected “job design,” and 23% chose “leaders.” This is important — for although hybrid work has primarily been seen as a creator of flexibility, in reality it’s a job design play. In other words, the question we should ask isn’t so much “How can hybrid work deliver on job flexibility?” but rather “How can the redesign of work increase productivity, with hybrid work as an enabler?” When seen through the lens of work design, the possibilities of hybrid work are about how we can increase collaboration, provide more time for focused work, and remove energy-depleting activities.

7. An expanded set of productivity measures needs to be part of the conversation. Too often, the move to hybrid work has been seen almost as an article of faith: You are either a true believer or someone who’s totally against it. What I heard from the fintech leadership team was a more nuanced question about productivity. They wanted to understand, at a granular level, the impact of hybrid work on productivity and, importantly, to answer the question “Does it boost or deplete productivity?” This is an entirely reasonable question.

As I mentioned earlier, though, to answer it, companies need to reengage with measures of productivity — particularly collaboration, energy, and focus. Some of these characteristics can be measured quantitatively (for example, through collaboration network analysis) and some qualitatively (for example, feelings of energy and focus). Until these productivity measures are in place, leaders will always fear and debate the impact of hybrid work on productivity.