RTO Mandates Do Not Work
How long will leaders continue to push it?
Many people sent me the Washington Post article citing the Pitt study concluding what I have believed and touted but simply didn’t have the numbers for. Smarter people than I collected the data and crunched the numbers and dear reader, the foundational theme of my rants has been proven true: RTO has no beneficial financial effect on the firms who mandate it for their workers.
I pondered this the past week as I sat in the middle seat of a Metro North train recently. Yes, we are back to middle-seating on the commuter trains here in New York. I thought we’d hold out a bit longer, but the trains are crowded, and even with a short ride to GCT no one wants to stand. I get it. As I squeezed into the middle seat - made even smaller thanks to everyone’s cold weather accoutrement - I wondered to myself, why the hell are we doing this?
Follow the Numbers
When we were first trying to wrap our heads around whether remote work had any effect on productivity, the studies were all over the place. Some said it was good for productivity, others said it was an anchor around the neck of it. Studies done before the pandemic by remote work’s academic guru Stanford economist Nicholas Bloom showed that remote workers were more productive than when they were on-site.
Obviously, the pandemic and the unexpected rush home with little forewarning makes this more complex, so it’s no surprise that the studies in the years following the outbreak of Covid-19 were mixed in terms of remote work’s effect on productivity.
But the circumstantial evidence began to mount up. Workers were saving a lot of time not commuting and were putting almost half of that time into their work. Corporate profits soared (all you heard about was inflation, but that’s a post for another time). In other words, not only were things getting done, but it seemed that they were getting done just as well - if not better - with the flexibility WFH allowed for certain industries.
And now there is a new study out of Pitt that analyzed the performance of over 450 firms, showing that RTO mandates did not affect financial performance. In other words, your company’s financial performance was neither hurt nor helped regardless of your RTO mandates (or lack thereof.)
There was, however, one area where RTO mandates decidedly had an effect: employee morale. These kinds of mandates made employees less happy (and we all know happy employees are productive employees.) So what benefit is there to mandated RTO if the financial aspect is negligible and it simply makes employees upset?
CEOs Need a New Tune
The push to get people back in the office was always financial at its core. Real estate holdings are a large piece of a company’s fixed cost, and in a market where commercial real estate was taking a big hit, it wasn’t the time to sell (and landlords weren’t exactly jumping to let leases break.)
Service industries saw clients question overhead charges that included office costs. Municipalities threatened the tax breaks they (ill-advisedly, in this newsletter’s opinion) offered companies to set up shop in their locales. The office was just sitting there: a sad line of open-plan tables and chairs, with no one to fill them and be as sad as the furniture that they inhabited. How could executives not want to remedy that?
But now executives are going to need more ammo. If we’re not driving the business forward, what are we doing in the office so often? The reasons given in the past - “in-person collaboration,” “coffee machine chats,” and, most laughably, “creative combustion” - are not driving the results we were told they would. Does that mean we get some flexibility and autonomy back as employees - especially those of us who participated in this grand experiment executive pipe dream?
I Wouldn’t Bet On It
There are four needs of the ego, and it’s important to avoid making business decisions based on them. But if anyone interacts with leadership at their companies, there tend to be a few with very large egos in the bunch. Giving employees choice and treating them like the adults they are would violate every ego need of an executive who has forced them back into the office.
It would prove the executive was 1) not right. It would force the executive to 2) cede some control. It would force the executive to 3) not look good. And finally, it would force the executive to 4) experience pain. Good executives won’t care about these four things if it means following the data and doing what’s right for their companies and workers, but many will care. This year will show us who those executives are.
So We Can All Just WFH All the Time, Right? Right?
As I’ve found myself going down rabbit holes on this topic, one curious piece of the RTO debate has emerged. There is a segment of the anti-RTOers that claim they simply never have to be in the office. That any kind of mandate to be in an office on behalf of a corporation is borderline tyrannical and they simply can’t work like that. I find this to be the other side of the pendulum in the debate (and also extremely specious for those who have been in the workforce for longer than four years.)
Sure, there are people for whom being fully remote would work. And before the pandemic - even though it doesn’t seem like it - they existed and thrived. And on the other side of that coin, there are plenty of people today who come in five days a week because they prefer to, which is great. I’m on a team with both types of folks and it works.
But what this newsletter advocates for is flexibility over everything. If the mandates being thrown out were one or two days a week (at the employee’s choice, of course), I actually don’t see that as a tyrannical or even highly unreasonable move. It’s not nearly as disruptive as the current three-, four-, and five-day mandates we see in the corporate world today. On top of this, new studies coming out show the first people to get the layoff ax are fully remote employees. It may not be right, but it’s reality.
In fact, seeing the writing on the wall with my own agency’s RTO mandates, I began going in one or two days a week in anticipation of an expected three-day requirement. When the mandate came, I naively assumed an extra day would not make a huge difference. Dear reader, let me tell you that the difference between going in twice a week versus three times is logarithmic. We are not dealing with a linear model when it comes to mandated RTO, which makes that move from two- to three days a week particularly jarring.
This doesn’t even delve into the benefits that working parents - particularly mothers - have seen with flexible RTO. Or the neurodivergent. Or those with mobility issues. The list goes on.
But let’s level-set: I don’t think it’s realistic to expect to be entirely remote for one’s entire career. I think the pandemic has shown that five days a week in the office is overkill. But we cannot deny that there are some benefits to a flexible RTO policy if administered correctly and in line with what’s best for the employee (and not the executive ego.) To say no one ever needs to return to an office is as farcical as the argument that we need to be there five days a week. Flexibility should be the overriding concern, with the understanding that coming in the office for less than a majority of working days in a week is a victory compared to where we were pre-pandemic. And sometimes you just need to take the W where you can. Let’s hope we rack up some RTO wins in the coming months.
Grab Bag Sections
WTF Internet Brands: One of the best things to come out of RTO might just be this video that Internet Brands (owner of WebMD) put out telling threatening people to come back to the office.
*Stefon voice from SNL* This video has everything. Green screens of executives “in the office” telling people to get back to the office. Senior leaders that have to read their three lines because they couldn’t be bothered to memorize them. Hand gestures someone learned at an airport Marriott course on presence in front of the camera. And, most bewilderingly, an outro of the old Mardi Gras Indian chant “Jock-A-Mo” - made famous by New Orleans’s Dixie Cups in the 60s - with threatening language subtitled under it.
No one quite knows what “Jock-a-mo Fee No Nay” exactly means, but there is a loose translation of “We mean business,” which is what Internet Brands went for here. The juxtaposition of out-of-touch tech execs dancing happily to a Mardi Gras Indian ritual chant they are using to threaten people to come back to the office is truly a sight to behold. Centuries from now sociologists will point to this video as one of the peaks of the RTO debate. I’m just glad we’re all here to summit it together.
Album of the Week: Before anyone tries to make the claim on it, I called Yebba the “Ozark Adele” the second I heard this week’s featured album years ago (with “Stand” as the song that got me hooked.) The fact that I haven’t seen the moniker anywhere else is wild, and I want to get it on the record before anyone else tries to take credit.
There aren’t really any skips on Dawn. “Boomerang” has one of the best opening lines of a song I’ve heard in a while. A$AP Rocky has a solid feature on “Far Away,” “Louie Bag” has a ton of energy, as does “Love Came Down.” “October Sky” vibes are A1. If you don’t feel anything when listening to “Paranoia Purple” you’re likely dead inside. Do yourself a favor and give this album a listen and keep your eye on Yebba. The one downside of this album? I can’t find it on vinyl anywhere.
Quote of the Week: “Insanity is doing the same thing over and over again and expecting different results.” - Rita Mae Brown
See you next week!