Remote work has been around for a few decades, but took off in the mid-late 1990s with the explosive growth of the Internet. There were predictions that the Internet would lead to the decline of cities, because technology was making location less relevant to our work and personal lives. Why would anyone choose to live in an expensive, stressful metropolitan area and endure a long daily commute? However, instead of declining, superstar cities continued to attract talented, ambitious knowledge workers, and to generate the greatest levels of economy activity and innovation.
But, even before the pandemic, “a movement was brewing within knowledge-work organizations,” wrote Harvard professor Prithwiray (Raj) Choudhury in a recent Harvard Business Review article, Our Work-from-Anywhere Future. “Personal technology and digital connectivity had advanced so far and so fast that people had begun to ask, ‘Do we really need to be together, in an office, to do our work?’”
“We got our answer during the pandemic lockdowns. We learned that a great many of us don’t in fact need to be colocated with colleagues on-site to do our jobs. Individuals, teams, entire workforces, can perform well while being entirely distributed – and they have. So now we face new questions: Are all-remote or majority-remote organizations the future of knowledge work? Is work from anywhere (WFA) here to stay?”
To better understand the answers to these questions, Choudhury studied a number of companies that have embraced the WFA model, such as the US Patent and Trademark Office (USPTO). A recent paper that he co-authored evaluated the experience of the USPTO.
In 2006, the USPTO introduced a voluntary Work-from-Home (WFH) program with an initial group of 500 patent examiners. Participants in this program had to be physically present at headquarters, in northern Virginia, at least one day a week. Then in 2012, the USPTO launched a WFA pilot. Patent examiners were eligible for the WFA pilot if they had spent two years at headquarters, followed by participation in the WFH program. Those selected for the WFA pilot could then live anywhere in the continental US, provided they agreed to waive their rights to be reimbursed for the required trips back to headquarters, which were capped at five per year.
Detailed company studies found that WFA offers a number of benefits to individuals, organizations, and society. At the same time, concerns about WFA’s potentially negative impacts must be addressed. Let me summarize some of these findings.
Benefits of WFA
For Individuals. “One striking finding is how greatly workers benefit from these arrangements, wrote Choudhury. “Many told me that they regard the freedom to live anywhere in the world as an important plus.” The cost-of-living are relatively straightforward. “Because the USPTO did not adjust salaries according to where employees chose to live, one patent examiner told me, ‘I was able to buy a large home in my new location for about a quarter of the cost in northern Virginia’” The ability to live close to friends and family is another big benefit, as is the flexibility it offers parents and caregivers.
For the increasing number of dual-career families, WFA “eases the pain of looking for two jobs in a single location. One patent examiner told me, ‘I’m a military spouse, which means I live in a world with frequent moves and personal upheavals that prevent many spouses from pursuing lasting careers of their choice. WFA has been the most meaningful telework program I have encountered. It allows me to follow my husband to any U.S. state at a moment’s notice and pursue my own aspirations to contribute to my home and society.’”
For Organizations. WFA participants clearly prize the greater flexibility in setting their work hours and the additional time of avoiding a daily commute to an office, which the Census Bureau estimates takes US workers almost 30 minutes each way, or around 225 hours per year. Higher job satisfaction leads to ample organization benefits. “For example, they increase employee engagement – an important metric of success for any company. In 2013, a year after it instituted work from anywhere, the USPTO was ranked highest on the Best Places to Work in the Federal Government survey.” Happier workers are also more productive. The USPTO’s WFA program increased individual productivity by 4.4% compared to the baseline WFH program, as measured by the number of patents examined each month.
Besides increasing the job satisfaction and productivity of their employees, another attraction for employers is shrinking real estate costs. The USPTO estimates that they’ve saved over $38 million in headquarters office space.
In addition, companies have access to a larger pool of talented employees who may not afford to relocate to expensive cities or prefer not to do so for family or other reasons. Furthermore, post-pandemic, organizations will need to accommodate employees who may hesitate at the idea of commuting in a crowded train or bus and riding an elevator to an office where people are crowded together.
For society. A 2019 McKinsey report found that while in aggregate the US was doing well, there were actually multiple Americas, each with widely different economic patterns and on sharply different trajectories, some of which were heading toward a positive, exciting future, while others risked falling further behind. The study concluded that net job growth through 2030 will likely be concentrated in urban areas and high-growth innovation hubs, while much of the rest of the country may see little employment growth or even lose jobs. In particular, small towns and rural counties could see a decade of very low or even negative net job growth.
WFA has the potential to ameliorate this brain drain, enabling people to return to and work from their hometowns. Some localities like Tulsa are making a concerted effort to lure remote workers, pointing out that the average rent on a two-bedroom apartment in Tulsa is a mere $675 compared to $4,128 in pre-Covid San Francisco. Choudhury cites the example of Tulsa Remote, which was established “to attract diverse, energetic, community-minded newcomers to a city still healing from historic race riots a century ago. With an offer of $10,000 to relocate to Tulsa, the company attracted more than 10,000 applications for just 250 slots from 2019 to 2020… Talented newcomers of varied ethnicities are arguably making the city more multicultural.”
Addressing WFA Concerns
“The office – with its meeting rooms and break areas and opportunities for both formal and informal interaction – has been a way of life for so long that it’s hard to imagine getting rid of it. And legitimate hurdles exist to making all-remote work not only manageable but successful. However, the Covid-19 all-remote experiment has taught many knowledge-work organizations and their employees that with time and attention, those concerns can be addressed. And in the companies I’ve studied, several best practices are emerging.” These include:
Communications, brain storming and problem solving. Since synchronous communications are more difficult when workers are distributed, WFA organizations must learn how to get more comfortable with asynchronous communications, using tools like Slack, intracompany portals or shared documents.
Knowledge sharing. Much workplace knowledge resides in people’s head and has not been codified or written down. This is a problem for all organizations, but it’s more so when colleagues are working remote and can’t just walk over to ask a question. “The companies I’ve studied solve it with transparent and easily accessible documentation.” While this creates extra work for employees, codifying knowledge and sharing information “are necessary trade-offs to allow for geographic flexibility.”
Performance evaluation and compensation. “How can you rate and review employees you’re never physically with, particularly on ‘soft’ but important metrics such as interpersonal skills? All-remote companies evaluate remote workers according to the quality of their work output, the quality of virtual interactions, and feedback from clients and colleagues.”
Socialization, camaraderie, and mentoring. Another major concern is the potential for remote workers to feel “disconnected from colleagues and the company itself, particularly in organizations where some people are colocated and some are not.” Remote workers often feel cut off socially and professionally from the information flow they would be part of in a physical office. Companies need to carefully address these serious concerns. For example, “Many WFA organizations rely on technology to help facilitate virtual watercoolers and ‘planned randomized interactions,’ whereby someone in the company schedules groups of employees to chat online.” Post-pandemic, another solution is to host “temporary colocation events,” where all workers spend a few days with colleagues in person.
