Remote working and COVID-19

On the 31st December 2019 the first official reports emerged from China of a new and virulent type of pneumonia affecting people in the city of Wuhan. A month later, authorities conceded human-to-human transmission. Only days afterwards, the World Health Organisation (WHO) had declared COVID-19 a global emergency. Then news reports started flooding in from locations beyond the People’s Republic that the virus was rapidly taking a foothold in other countries. On the 11th March 2020, the WHO elevated the status of the crisis to global pandemic and warned of a spread and societal impact of unprecedented scale.

As of the 17th March 2020, COVID-19 is believed to have taken over 7,951 lives. But the actions needed to be taken to contain it now threaten businesses with what some economists predict to be a catastrophic global implosion not seen for a generation.

Businesses, both local and global, are on a collision course with the virus.

Our general expectation of policymakers is to take the appropriate measures to support the communities they serve. But these unparalleled challenges sit governments firmly between a rock and hard place – protect society, or at least the weakest within society, or protect the commercial fabric that supports those who work in society.

The European Central Bank (ECB), The Federal Reserve and the Bank of England have all reduced interest rates, but what does a country like Sweden, Switzerland or Japan do when they already have negative interest rates?

Doing so may lessen the burden on industries who are already borrowing but will mean little to small businesses already nervous to borrow.

Focus then turns to countries. Italy, the coronavirus epicentre in Europe at the time of writing, is reporting over 31,506 cases and more than 2,503 deaths, and the entire nation is still in lockdown.

Its ski resort operators enter the spring with no reserves, and its spring and summer tourist industry facing a monumental decline. Most European countries are in no better a position, with borders being closed, airline fleets grounded, and cruise ships berthed indefinitely in docks.

The one glimmer of hope is that China is reporting a drop in the number of new cases. But how long will it be before normality returns there? With China being the central manufacturing hub of the world, any global road to recovery will surely need paving there first. Until then, the throttling back of high-tech Chinese manufacturing will continue to hit even the world’s most successful organisations, with Apple issuing a profit warning and acknowledging a $9 billion drop in sales this quarter.

The scale of these financial adjustments makes the mass consumer hysteria seem really rather puerile. Widespread panic buying has seen large supermarkets being cleaned out of toilet paper, hand sanitiser, tinned foods and pasta. In response, retailers are being forced into restricting sales on certain items.

Whilst food retailers margins may be protected by media-fuelled FORO (fear of running out), the travel industry has been brought to its knees in a series of body blows, first with traveller nervousness, then with Presidential decrees, and now with travel insurers one by one withdrawing protections.

It proved to be the straw that broke the back of UK regional carrier Flybe, and it’s pushed Norwegian Air Shuttle to announce the cancellation of some 85% of its regularly scheduled flights while also looking to temporarily lay off some 7,300 staff – around 90% of its workforce.

The hospitality industry has also been profoundly affected, with countless proprietors of hotels, bars and restaurants in the UK imploring the government to issue emergency assistance, as waves of cancellations pose an unparalleled threat to their financial stability.

While the majority suffer, there are inevitably always a select few who profit during a crisis. Who are they and where are they?

In countries where Covid-19 has a foothold, grocery delivery services have seen a marked increase in custom. The UK-based online grocery retailer Ocado have recently stated they have been experiencing an “exceptionally high demand.” Culminating in both their app and website crashing recently, having buckled under the pressure of the recent surge in orders.

For companies at the forefront of remote working software, recent circumstances have facilitated notable growth. While global markets suffer over 20% losses, in the last month video conferencing software developers, Zoom, have seen their share price rise by the same proportion.

Slack Technologies, creators of Slack, a communication platform, have seen their stock surge over 40% since the end of January.

Not shying away from capitalising on the situation, these companies and many similar to them are now offering new incentives to gain new business while demand for these types of services grows.

With the advent of software like Slack and Zoom, working from home has become undeniably more convenient. Employees have never felt more connected to the office and their colleagues without having to be physically in the same building – a glimmer of a success story perhaps as many corporate workplaces are either shutting down or limiting the number of employees allowed on-site.

The start of March saw Amazon taking measures by asking employees, where applicable, to check their VPN (virtual private network) connections in preparation for remote working.

With many other multinational giants following suit, corporate VPN’s will be put through their paces, needing to accommodate a usership of unprecedented magnitude.

While our superior technology is undoubtably facilitating remote working to a far greater extent than it would have done even a decade ago, there is still much to be desired, with questions arising about the long-term feasibility of it each day.

According to our database, 83% of those who already regularly work from home typically do so for just one day or less at a time. So, whilst they have some experience, the adjustment needed and long-term impacts of working remotely for an extended period of time are simply unknown.

Even for those remote working veterans, who are well-versed in working from home offices or kitchen tables, challenges will undoubtably present themselves when other family members, similarly grounded, have to
share the otherwise peaceful home-work locations.

As we start seeing more homes requisitioned by families into makeshift workplaces, internet strength in residential areas will certainly be tested.

As we start seeing more homes requisitioned by families into makeshift workplaces, internet strength in residential areas will certainly be tested.

According to Lisa Pierce, a network expert with Gartner, “the weak link in the chain, where the system could get overloaded, is going to be the home broadband network.”

School closures will also have an impact. On 4th March, UNESCO reported school closures were sweeping across thirteen countries, meaning 290.5 million full-time students were without schools, with that figure having undoubtably soared since then.

With hundreds of schools closing each day, many employees will see their work / home life equilibrium become unbalanced.

We then must consider if home working, even if unaffected by poor internet connection or noisy households, is suitable for everyone. While there are those of the working population who are adept at the skill of remote working, there will be millions of employees who are simply better suited to a more formal and structured working environment. For many, face time with their colleagues is imperative to their productivity and ability to navigate through the nuances of communication.

It’s for this very reason that in the pre-Covid-19 landscape, we saw companies such as Yahoo and Bank of America opting to either shut down or drastically scale back their work-from-home programmes, while IBM curtailed remote working across their engineering and marketing departments. The biggest grievances cited by team leaders in these remote setups were falling standards in teamwork, collaboration and communication – problems that have likely not been properly addressed before the current mass dispersion.

We may still be unclear on how long remote working will be the new normal, but we can be sure that this unprecedented test of remote working will have some suggesting that the value of corporate space is not what it’s cracked up to be.

Organisations and their leadership teams are desperate for a comprehensive understanding of how remote working is affecting employees. Whilst in the short term, an employee’s workplace is more likely to be steps away from his or her bedroom than it is near the office boardroom, their home working experience will be on the Board’s agenda for months to come. So, as an industry we must be clear on how the test is being marked. Are we merely judging whether or not employees can contribute from home? Or, should we not have a deeper understanding of how all of the moving parts interacted and performed so we have the information we need to weather this storm and its aftermath as well as the next one we can’t yet see coming. We must surely have an immensely better understanding of the role the home can play in a budget-constrained world.

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