Challenges of working remotely

A divergence is taking place in the business community. A traditional leadership approach that values centralization is bringing workers back to the office with the expectation that closer physical proximity generates greater collaboration, hence more efficient outcomes. While another approach, quickly being embraced by the technology industry, believes remote workers can be as effective and happier in a decentralized structure.

These opposing visions are setting the stage this fall for a turbulent re-entry into the workplace if the pandemic recedes. With some of the biggest names in tech offering new hires lucrative opportunities with no requirement to relocate, many workers are leaving their current companies outright rather than return to long, costly commutes and 60-hour workweeks at the office. An even larger swath of associates forced to return are compliant publicly but privately are searching for new opportunities that offer greater flexibility to work remotely. The potential impact across industries is so great that some are already christening this fall “the great resignation” in memory of the great recession in 2010.

As a retained executive search firm speaking daily with executive candidates, we believe companies with the most flexible policies for remote work will secure the strongest and best talent. As equity became the most sought-after currency two decades ago, today a new currency has emerged.  Indeed, location flexibility will be the most valued currency in acquiring and retaining world class leadership.

While leading several CHRO executive search engagements (a $5B national retailer, $3B Private Equity owned CPG company and an acclaimed fast growing Series D SaaS based business), Carpe Diem Global Partners had the opportunity to speak with dozens of HR leaders over the last 3 months regarding how their companies were approaching “back to work” reopening. These HR leaders represented some of the most progressive-thinking companies in the world. In speaking with these leaders, the disconnect between CEOs with a traditional centralization mindset and the changed attitudes of today’s workforce became clear. Based on the broad set of discussions, we believe workforce culture will need to be reinvented and leadership behaviors will need to change to attract and retain the strongest talent post-pandemic. To that end, these three strategies will be critical for leadership teams to be effective going forward.

Some of this will play out quickly over the next 90 to 120 days but I’m more concerned and spend a lot of time thinking about how executives will evolve leadership styles and frameworks over the near term to remain competitive with their most value asset – people. As long as business results of an individual or team are systematically met or exceeded, why does location matter? Because change is difficult, at all levels, including with executive leaders”.

Jeff DeFazio, Managing Partner at Carpe Diem Global Partners.

The future must be flexible

“The genie is out of the bottle; remote work is not going away,” noted one leader we spoke to. With the understanding that the option to work from home is table stakes, organizations are focused on finding new ways to effectively engage their workforces and build team camaraderie as the number of face-to-face interactions are reduced.  Associates can procrastinate, get distracted and spend unproductive time in office as easily as they can at home.  The notion that centralization will influence more effective results is no longer a truth. The pandemic demonstrated individuals, teams and companies can get work done quite effectively from remote locations. Based on our conversations, it seems the US work force has awakened to the same set of values long held by the Europeans. Lifestyle now has greater value to our workforce and flexible working location leads in that regard.

With this understanding, many companies will adopt a hybrid model that gives employees more freedom to choose how they work. Most leaders we spoke with said they’ll be investing more in technology and processes to ensure a smooth transition and make remote communication and collaboration frictionless. They plan to implement measures ranging from greater use of cloud solutions to increased reliance on videoconferencing and social platforms to facilitating ways for employees to pay for better internet connectivity at home.

Standing at desk

As companies migrate away from traditional office environments, many are also planning to reduce their real estate footprint to cut costs­. They’ll convert the office spaces they retain into collaboration hubs, with many organizations switching to a hoteling model to provide employees access to space for scheduled meetings, team projects, or socializing with colleagues in person.

Abstract pattern of people

Leadership and HR will be more employee-centric

During the pandemic, associate needs became HR’s top priority. That will have to continue with the help of the broader executive leadership teams as workers transition to a hybrid workplace with a greater reliance on technology. As regularly occurring in-person interactions decline, HR will need to facilitate more personalized and intimate employee experiences in a virtual setting. Most of the leaders we spoke with also plan to review and revise their benefit offerings to ensure they are competitive, conduct more frequent pulse surveys, and redesign their HR function around employee-centric models that include chatbots, chat rooms, and a simplification of policies. “Now more than ever, HR teams need to be trained on Design Thinking Principles – with the purpose of creating positive, memorable experiences for their employees – through the hire to retire lifecycle. At NCR, the company created a regional business leader role focused on engagement and communication, and a new Employee Experience Leader role to ensure they are responsive and attentive to their employee’s changing needs” states Patrice Graves, Chief Human Resource Officer of NCR, a $6.2B leading software- and services-led enterprise provider in the financial, retail and hospitality industries.

The experiences of last year and a half have also driven people to re-evaluate their values and motivations around work. HR will have to consider the workforce’s greater expectation of empathy and transparency from leadership and the challenge of meeting it in a hybrid workplace. “We’ll be looking at how leadership behaviors will have to change to connect more with employees,” said one leader.

Employee centric also means “Inclusion, Diversity, Equity, Allyship and Storytelling (IDEAS) are fundamental elements in creating a culture of belonging.  These principles are important for driving innovation, trust, and a common purpose,” states Graves.

Legal issues are now arising as well. How will associates be taxed in a remote out-of-state setting after being part of a centralized location? What are the state jurisdictions for non-competes in a remote setting? Does a company’s headquarter location or the associate’s location in another state drive the legal standard?  This is a huge consideration for tech companies located in California, as California law does not recognize non-competes in most circumstances compared to other states.

To be most effective, broader leadership must equally join HR in its focus on employees, stated one HR leader of a $2B North America region of a PE owned $3B global business.  “HR has been pushing for more location and time flexibility, hybrid work models, etc. for decades.  One HR leader stated the “theme that continued to emerge during a recent interviewing process was around the role of people managers/leaders”.  The comments above that really resonated with her was “the genie is out of the bottle” and “there is no going back”.  No going back to dated managerial/leadership principles that got leaders where there are today, or pre-pandemic.  With the “peter principle” still alive and well, managers/leaders have been allowed to be successful with minimal personal or professional time investment in their people.  It’s always been about driving success the way they gained it, i.e. top performers get promoted, regardless of EQ or leadership capabilities.  With so many new generations in the workforce, coupled with a post pandemic world, leaders will finally have to place a higher value on their employee relationships.  Another HR leader in our discussions referenced Marshall Goldsmith’s classic book, What Got You Here, Won’t Get You There.  Leaders who hold onto their dated practices and beliefs (i.e., less focus on employee relationships, less willingness for work location flexibility, etc.) will either lose or not be able to attract the talent needed for this next journey.

wellness in the workplace

There needs to be a greater focus on wellness

Coping with the disruption of the pandemic took a heavy psychological toll on everyone, regardless of their role.  That was compounded by remote work arrangements that eroded work-life boundaries and left many employees feeling isolated, disconnected, and burnt out. That includes the HR function.

Organizations will have to understand the critical link between associate wellbeing and the quality of their work and adapt policies and behavior accordingly. Workplace wellbeing starts with leadership advocating a healthy culture and managers proactively creating a sustainable work environment with clear work-home boundaries. Many organizations plan to expand their mental health and family care programs and resources to better support employees by preventing and treating mental distress. As one leader said, “Mental health is not a sideshow, it’s a mainstream health benefit.”

For companies that operate in over 100 counties, localization of engagement is more important than ever.  “At NCR, the company is being intentional about building fun and collaborative environments both in person and in remote environments. For instance, on Thursdays, the company hosts a Fun Thursday social hour and encourage employees to get together at any of their locations around the world or online”, states Graves.

Carpe Diem Partners

These market insights from Carpe Diem Global Partners are gathered from the firm’s extensive client work leading Board, CEO, CXO, and CHRO executive search engagements for public and private multinational companies. For deeper, custom insights, contact Jeff DeFazio at info@carpediempartners.com.