Managing the thornier future-of-work issues

A conversation with Erik Brynjolfsson and Nicholas Bloom

Learn how to manage the needs of the future of work, a hybrid work model of remote and in-office.

After a year of unprecedented challenges, companies are taking tentative steps to bring people back to the office. Managing the transition means reconciling the sometimes competing wishes of workers and managers, said Stanford professors Erik Brynjolfsson and Nicholas Bloom at Knowledge 2021, ServiceNow’s digital conference.

Before the pandemic, only about 17% of U.S. employees worked remotely at least five days a week; that increased to 44% during the pandemic—the biggest change in the workforce since World War II, said Brynjolfsson, a senior fellow at the Stanford Institute for Human-Centered AI and director of the Stanford Digital Economy Lab.

“If necessity is the mother of invention, then the pandemic drove lots of innovation,” he said.

The change forced a reconsideration of modern work practices, said Bloom, a professor in Stanford’s economics department who has extensively studied work-from-home employees. It also produced conflicting views about the benefits. Employees say they’re more productive when they work at home, free of office distractions. Managers fear they’re losing the creativity and strong culture that comes with mixing it up at the office.

The answer? “The future is a mix of working at home and the office,” said Bloom. According to his research, 70% of businesses in the skilled economy are going for a hybrid approach, where most people will work in an office three days a week and at home the other two. “Monday, Tuesday, and Thursday, everyone comes into the office and works together,” Bloom said. “On Wednesday and Friday, people work from home and get quiet time.”

That sounds like an easy fix, but Bloom and Brynjolfsson agreed that scheduling alone isn’t going to address the needs of both businesses and employees. “When people come back to the office, it won’t be business as usual,” said Brynjolfsson. “The time together is going to be focused on team-building, meetings, and culture.”

In some ways, just being back in one location will foster a more collaborative culture. To the extent that remote work succeeded, it was thanks to technologies like Zoom. Brynjolfsson said such tools are great for sharing explicit knowledge, which is easy to express and share. But it’s less effective for sharing more informal knowledge that is harder to articulate but is critical for creating a vibrant office culture. That “water-cooler network” knowledge that comes only from rubbing elbows with co-workers, Brynjolfsson said.

Deciding how and when to bring employees back to the office remains a big challenge. Companies could leave the choice to their workers, letting them decide whether they want to work at the office and how often. But, Bloom warned, that could worsen existing problems with workplace equality and diversity.

“If necessity is the mother of invention, then the pandemic drove lots of innovation.

Women are 50% more likely to prefer working at home than men, Bloom said, probably for family reasons. But, his data shows, people who work from home may be less likely to get promoted.

“If you let people choose between working in the office or at home, we can easily see only young single men rocket up the ladder at firms, while women don’t get promoted,” Bloom said. It’s better to apply consistent policies across the board, he said.

A successful return to the office requires that companies monitor data that might shed light on how hybrid work models are affecting productivity and promotions, Bloom said. And they need to learn from other businesses that effectively make the transition.

But data isn’t enough. Companies also need to pay attention to signs their cultures are thriving, Brynjolfsson said. “The cultural aspect and tacit knowledge are really important, yet sometimes they get shunted aside,” he said. “You have to be careful not to ignore the things that aren’t visible.”