Why solving the hybrid enigma is still the biggest problem of workplace strategy
June 2024
Madalina Hanc, PhD
Introduction
As we move forward into 2024, the landscape of hybrid working continues to evolve, presenting both challenges and opportunities for organisations and their employees. But what are the biggest things to look out for? To find out, we asked an extended group of senior leaders who took part in our latest Corporate Real Estate (CRE) Poll to share their concerns for workplace strategy in 2024 in their own words. In this article, we present the most common concerns we identified across all 100+ comments1.
Lack of balance is the biggest problem
Hybrid may be the new norm, but it’s still an enigma that hasn’t been figured out (yet). Although elsewhere in the poll, 96% of the senior leaders indicated their organisations use a hybrid model, many also expressed a fear of “not getting hybrid work right”. Finding balance between conflicting priorities was the second most frequent issue identified across all the comments, with around one in every five leaders referring to this. It is often described as a matter of balancing priorities related to people, place, or the business, as well as the many nuances in between (Figure 1).
Employee-centric perspectives are gaining momentum
The topic mentioned more frequently than any other was Employee experience or satisfaction, with one in every four senior leaders intent to “have happy people in the workplace”. Elsewhere in the poll, we saw that employee experience was also seen as a key metric of success. However, “employee expectations for a hybrid workplace” have become a central part of the ‘happy people’ equation, with few employees now willing to work exclusively in the office. But how much choice should employees have so they are satisfied, and what sort of office mandates are right – these are some of the things that organisations must figure out. On the one hand, giving employees their desired flexibility over where to do their work can empower them and help them manage their work-life balance better. In line with Diversity, Equity, and Inclusion (DEI) principles, this is even more so for employees who have a hard time doing their work from the office.
The business case for increasing office use
On the other hand, employees’ reluctance to use the office daily can also be seen as going against business purposes like sense of community, creativity, or innovation that may need in-person collaboration, so maximising office time is also on leaders’ minds. “Balancing the employees’ desire for freedom and the organizational need for a cohesive culture, learning and development, productivity and quality of work” is a problem that many of the senior leaders worry about. Almost one in five leaders worried about Increasing office utilisation, with several expressing concern about productivity losses during remote working days.
Rightsizing the office: quality is just as important as size
And that’s not all. Having offices used mid-week but empty on Mondays and Fridays makes it extremely challenging to plan for “the rare day when everyone comes to the office”. Rightsizing the office portfolio is another big cause of concern for leaders, who are pressured to solve a complex equation: “the format/space configuration, how much space is needed, peak day schedule balancing, and where to renew, expand, contract, or consolidate locations at lease ends”.
Rightsizing is not just a matter of how much space is needed, but also how good that space needs to be, so Workplace quality is just as high on the senior leaders’ agenda. To some, this means having the “right mix of space and service propositions”, while others are concerned with ensuring “that the employees who come into our offices leave more energised and inspired than when they came in”. Most of the leaders concerned about workplace quality also mentioned employee experience or satisfaction, which goes to show just how strongly the two are connected. A few referred to the sustainability dimension of ESG, and others touched on the importance of “building sufficient future capacity to attract and retain talent”.
Cost containment conditions add even more pressure
As if delivering high-quality workplaces that support employees’ needs isn’t difficult enough on its own, the issue of Cost containment or reduction makes matters even worse. Some leaders pointed out the difficulties of providing a business case for workplace improvements or refurbishments when employees use the office rarely. Others are facing the double pressure of balancing expanding business needs while reducing real estate costs and are concerned about “Being able to shed space quickly enough to help fund other capital investments”. While these problems aren’t necessarily new, they are accentuated by the fast-changing hybrid landscape. While there is no clear solution that works for every scenario, having the right data around how and why people are using different locations can be a powerful tool in the decision-making process.
Change management is vital, but not common enough
The success of hybrid working, as with other workplace programmes, relies heavily on good Change management and employee behaviour, but many leaders are concerned these aspects aren’t going as well as they could. Managing employees’ willingness to adapt to new styles of working, new locations, and/or new work settings is perhaps the biggest concern. This may refer to ongoing communications with employees on how to use the new settings, but it often refers to “changing the mindset of employees” to make them more accepting of decisions that have been implemented. A good place to start would be to improve communication with employees about workplace strategy and hybrid working – as shown elsewhere in our poll, nearly half of the leaders thought there is too little communication.
Gaps in data flows lead to decision paralysis
Surprisingly perhaps, a few comments highlighted a data-related problem that, even in 2024, affects workplace strategy: the lack of “common data across people, place, and tech”. This can slow down the decision-making process within organisations, ultimately leading to more complex problems like decision paralysis. Some leaders can feel pressured by what feels like “too many priorities” including sustainability, making sense of hybrid, maximising employee satisfaction, while keeping costs contained. Juggling all these conflicting priorities contributes to a sense of overwhelm that can lead to decision paralysis and strategy fatigue.
The way out of the hybrid dilemma
Views from more than 100 senior leaders shared via the latest Leesman CRE Poll suggest the biggest challenges for workplace strategy revolve around ‘making sense of hybrid’ and finding the right balance between conflicting priorities. While employee-centric views emphasising the role of choice and flexibility are gaining traction, leaders feel pressured to balance them with business goals for productivity, creativity and innovation that demand more time together in the office. Rightsizing the office portfolio continues to be an active problem, with workplace quality seen as a major factor in enhancing experience, but financial pressures and shortcomings in change management make things even more difficult for leaders and employees alike. Decision paralysis and strategy fatigue are frequent.
Perhaps more so than ever before, a data-driven approach is now imperative to help leaders bridge the gap between the people, place and business sides of workplace strategy. By leveraging data on how and why employees use different work environments, what works and what doesn’t, organisations can tailor their strategy to support both remote and in-office work, ensuring that employees remain engaged, productive, and connected wherever they work and that their needs and expectations are being considered. Ultimately, the intelligent use of data not only enhances employee satisfaction and performance but also propels organisations towards their business objectives.
The way out of the current hybrid dilemma may look completely different for various organisations, but it will take less if you have a compass. Let that compass be data.
1 The January CRE Poll yielded 110 responses from 91 global organisations from sectors including Financial services (32%), Technology (20%), Professional services (8%), Manufacturing (6%), or Pharmaceutical (5%).
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The hybrid working landscape continues to evolve, presenting both challenges and opportunities for organisations and their employees. Discover the biggest things to look out for in 2024.
