Companies have pretty good metrics for "productivity", its just their overall performance: revenue, profit, cash flow and dept.
They could use that, but if they did, it would show that work from home isn't negatively affecting their performance, and they couldn't use it as an argument to irrationally force people back at the office.
People dispute this by asking: "But would we have made more profit if people worked in-office?"
And I think the reality is, no, the truth is, when you look at it, whatever impact to company performance remote vs in-office has is so minimal either way that you won't actually see it impact performance in a measurable way. So many other decisions you're taking matter more, that probably whatever allows you to attract and retain better talent and make them happy will actually have the most positive effect on your bottom line.
Companies also need to measure the ratio of resources expended to the amount of value being produced, even if cash flow and profit are good at the moment. Unsustainable business practices can remain hidden until the decline begins. When that happens, inept management has to scramble to figure out what's going on and will almost certainly make worse decisions than a lack of sustainability was sussed out much earlier. An apt example would be companies that need to keep hiring more engineers merely to keep the software from collapsing under its own weight. Often times, upper and middle management aren't paying attention to this and are completely distracted by growth and profit, despite the fact that most of their engineering staff are far less productive, perhaps to the point of hardly producing anything at all.
I guess it is about control in the end. Even if your employees are working completely remotely you could always check their output. But the problem is that typically a big part of middle managment has no idea how they would even start to do that. So the alternative is go there and talk to them while observing reactions — and derive your conclusions from that.
But that doesn't work as well remotely. You can't surprisingly be there and catch your employees at doing the wrong thing. What other unspeakable evils might they be doing while you are not watching?
Now of course you are right, just watching the numbers is not enough. But if your middle managment has no way of knowing if their subordinates are doing their jobs remotely, your business would be in a blind spot even if not a single person worked remotely.
> to measure the ratio of resources expended to the amount of value being produced
That's just profit.
I think what you mean is that they need to make sure they can sustain themselves if revenue drops, say because of an economic downturn?
Cash flow and dept measure that to some extent.
But even if, we say those metrics don't tell us enough for this scenario, I find it's pretty obvious remote or in-office doesn't seem very impactful either. You'd want to reduce your costs and be leaner, dropping expensive office space actually seems like maybe a way to be leaner. Maybe some layoffs are in order to reduce payroll and cancelling all non revenue generating ventures/projects which are only burning cash and not making any as of yet (at least pausing on them). Etc.
I'm hard pressed to imagine how in-office helps you at all here. Unless you magically think employees will be so productive, you can half the staff and still have them operate everything without having to cut any scope or corners. But that's ridiculous. That's what I meant. If that was true, you'd be able to measure some impact to performance, but you don't, and that means you can at best expect a very marginal effect.
Sorry, by "value", I meant the value delivered to the customer, and "resources" as a broad abstraction around things like revenue, size of staff, and so on. In other words, while I think that profit can be one of the best measures of productivity, a measure of expenditure relative to a unit of delivered value can be important in forecasting whether profits now will continue to sustain. This is because profit can continue rise for long periods of time despite operational issues festering internally, and those issues will either come to a head when there's a market adjustment (as you mentioned) or if they get to a point where simply adding more staff/resources can no longer sweep them under the rug. In the latter situation, the company may actually still continue making a profit, but it will struggle to grow any further, and those profits may start to dwindle if a more agile newcomer to the field drinks said company's milkshake.
> Cash flow and dept measure that to some extent.
Yes, that's a lot like what I'm thinking. Or, if possible, something along the lines of number of staff needed to deliver value (ex. features, improvements, fixes, subscriptions, yada yada) at a stable rate per customer. I seem to only be able to think in terms of software companies, but I'll go with it. If a company is finding that it needs more and more engineers every year to support software that has not changed fundamentally in years and isn't delivering value at a greater rate than in prior years then, hypothetically, that could be a sign that the business could actually be making more of a profit through better decision making. At worst, it means the business could be more sensitive to when market conditions change and fail to adapt quick enough. But I'm repeating myself now.
> I find it's pretty obvious remote or in-office doesn't seem very impactful either.
It's not obvious to others, apparently. I've been witness to so much time wasted in office environments that, if I were a boss, I'd rather people waste their time at home than pay rent to give them a place to waste their time, so it's at least obvious to me. Then again, I'm not cut out to be a leader and I don't have the ego to want to lord over employees. In any case, I think incentives are better determinants of whether employees waste time. If a company pays employees adequately, actually empowers them, and takes measures to prevent the employee experience from being sabotaged, I think most employees would spend more of their time being productive even if they still aren't technically working every single paid hour. Most of the time, people reduce their effort in response to the environment they're subject to. If an employee isn't getting competitive pay, doesn't believe they can move up outside of nepotism, feels alienated from the fruits of their labor, and hates their daily routine of constantly fighting overcomplicated processes, then of course they're going to give less of a shit, office or not. A lot of employers simply don't want to admit that their employee experience is terrible, or that paying a salary that was once considered good 10+ years ago, and that's why nobody wants to try hard. Blaming remote work is almost always a cop-out.
> Unless you magically think employees will be so productive, you can half the staff and still have them operate everything without having to cut any scope or corners. But that's ridiculous. That's what I meant.
I'm not exactly sure what you're communicating here (could just be poor comprehension on my part), but I think we're on the same page. Based on your second to last paragraph, it sounds like your saying that whether employees are in-office is irrelevant because the biggest sources of drag are other things like frivolous projects and overhiring, as examples. I definitely agree, and I've worked at places that burned lots of cash while simultaneously being avoidant towards remote work; one place I worked for had burned millions of dollars over 3+ years developing what was essentially a glorified clone of CouchDB. There was never any revenue model for it, but was someone's foolish idea with no adults in the room to axe it. It's like, if you're gonna set money on fire, I'd appreciate letting me burn some of it so I don't have to drive in to the office every day. Better yet, give me a few million so I too can write my own useless software.
I had a remote manager a few years ago and kind of thought that he didn't ad much value to the process. Then they got rid of him and I had to deal with the company owners directly. Absolute nightmare.
Good management is one of these things that you don't really notice. Bad management you do notice and not for positive reasons.
I agree. Early in my career, I thought a manager was like a driving teacher, someone to help guide you and hit the brake when you're about to crash. Now that I'm a manager, I think of it more like being a snowplow; you wake up in the morning and you can get your job done thanks to the work that someone else is doing behind the scenes.
Are your remote workers more productive? Look at the individual, if they're under-performing or under-communicating maybe set (or at least threaten) in-office, if they're at expectations putting them in-office will only make them worse.
Also, the kind and culture of the remote environment or office matters much more than "remote vs in-office". I don't really care working in-office, but I have a lot of things I do really care about (short commute, peace and quiet, breaks, decent office temperature) which make me prefer remote whenever possible.
But of course these "let all your employees be remote vs. force everyone to the office" blog posts take this "wrong" question and completely miss the right ones. And a lot of companies who are doing RTO are for their own specific reasons like getting people to quit.
Not a single mention of tax breaks these companies receive by forcing workers into the office. These tax breaks were extended during COVID, and are now being re-assessed, hence the sudden and coordinated push to RTO.
From talking to senior folks at tech companies, there's a real perception that, modulo the first few months of covid where there was not much to do hut work, productivity has suffered at their companies.
In other circumstances (eg MOOC discussions) it is not controversial that many people have self control/motivation problems, so it's not super surprising that being less visible leads to less output.
And while everyone likes flexibility as an employee, we are all familiar with the mythical man month and why saving some money on real estate or salaries doesn't help offset productivity losses.
As long as these two beliefs remain in place, remote work will keep getting squeezed out at places that see themselves as being in competitive markets where they need to bring their A game.
would be nice if companies were run in some kind of democratic way. one employee one vote.
so that if management called for RTO and most employees voted against, the management would lose.
but of course management is there to serve themselves and the shareholders foremost. and so the employees are expected to do the same. see the "bigger picture" as i was recently condescendingly told after refusing RTO.
You could always start your own. Absolutely nothing stopping people from doing that but if you are going to make the effort of starting a company, I can understand why most people would want to profit from that.
Companies that doesn’t offer WFH will simply be less competitive in the employee market. Which will have a medium to long term negative impact on revenues. The best developers I know refuse to work for companies that aren’t WFH flexible.
Yeah and there's that adage that you want to hire lazy people because they will find an easy way to solve something.
The right question as alluded to in this article being "where are you happiest working?" is equally dumb. Of course people are happier in their preferred environment.
This whole discussion is just a distraction and the points don't even matter as to who wins the argument.
They could use that, but if they did, it would show that work from home isn't negatively affecting their performance, and they couldn't use it as an argument to irrationally force people back at the office.
People dispute this by asking: "But would we have made more profit if people worked in-office?"
And I think the reality is, no, the truth is, when you look at it, whatever impact to company performance remote vs in-office has is so minimal either way that you won't actually see it impact performance in a measurable way. So many other decisions you're taking matter more, that probably whatever allows you to attract and retain better talent and make them happy will actually have the most positive effect on your bottom line.