McKinsey: Hybrid remote working will be legacy of COVID-19
Hybrid remote working could become the most influential legacy of the global COVID-19 pandemic, according to McKinsey & Company who predict the UK economy has the highest potential to lead this seismic shift.
An increase in remote working - mostly for a highly educated, well paid minority – is here to stay says the report but it is predicted to have a profound impact on urban economies, transportation and consumer spending.
“The virus has broken through cultural and technological barriers that prevented remote work in the past, setting in motion a structural shift in where work takes place, at least for some people,” comment McKinsey & Company.
Building on the McKinsey Global Institute’s work which looked at automation, Artificial Intelligence (AI) the report focuses on hybrid remote working - combining remote and office – with the impact on productivity.
“Our analysis finds that the potential for remote work is concentrated among highly skilled, highly educated workers in a handful of industries, occupations, and geographies,” says the report which predicts 20% of the workforce could work remotely three to five days a week as effectively as they could if working from an office.
UK highest potential for remote work
What’s next for remote work: An analysis of 2,000 tasks, 800 jobs, and nine countries, points out that labour forces in advanced economies will spend more time working remotely than those in emerging economies – with the UK leading the way.
The UK’s theoretical maximum was 46% compared to Germany (39%), US (39%) and Japan (39%) – India was the lowest at 16%.
“Business and financial services are a large share of the UK economy, for example, and it has the highest potential for remote work among the countries we examined. Its workforce could theoretically work remotely one-third of the time without a loss of productivity, or almost half the time but with diminished productivity,” comment McKinsey & Company.
The research found that remote work potential with no productivity loss is concentrated in a few sectors:
- Finance (76%)
- Management (68%)
- Professional and scientific services (62%)
Hybrid remote working model
The ability to work remotely depends on the need to use specialised equipment or machinery. According to the report, a chemical technician could work remotely only a quarter of the time because their equipment is in the laboratory.
The mixed pattern of remote and physical activities helps explain the results of a recent McKinsey survey of 800 corporate executives in which 38% of respondents expected their remote employees to work two or more days a week away from the office after the pandemic - compared to 22% before the pandemic.
“But just 19% of respondents to the recent survey said they expected employees to work three or more days remotely. This suggests that executives anticipate operating their businesses with a hybrid model of some sort, with employees working remotely and from an office during the workweek.
“JPMorgan already has a plan for its 60,950 employees to work from home one or two weeks a month or two days a week, depending on the line of business,” said McKinsey & Company but this will have a knock-on effect for the future of urban economies.
Impact on cities
A survey of 248 US chief operating officers found that one-third plan to reduce office space in the coming years as leases expire. “The impact of that will reverberate through the restaurants and bars, shops, and services businesses that cater to office workers and will put a dent in some state and local tax revenues,” says the report.
The potential for time spent on remote work drops in emerging economies. “Although India is known globally for its high-tech and financial services industries, the majority of its 464 million workforce is employed in occupations like retail services and agriculture that cannot be done remotely,” comment McKinsey & Company.
Remote – but only in a crisis
Although remote working looks set to take hold it will not apply to more than half the workforce. The report highlights that although some tasks can be done remotely in a crisis, they are more effectively done in person such as negotiating, teaching, collaborating and problem-solving.
The activities with the highest potential for remote work (with no productivity loss) and the theoretical maximum calculated in the report includes:
- Updating knowledge and learning – 82% (theoretical maximum 91%)
- Interacting with computers – 70% (theoretical maximum 75%)
- Communicating with colleagues or clients – 43% (theoretical maximum 63%)
- Training, teaching, coaching – 6% (theoretical maximum 47%)
- Selling to or influencing others 24% (theoretical maximum 41%)
Is remote work good for productivity?
With more than nine months of remote working, employers are experiencing better productivity from their remote workers, says the report.
“As employees have gained experience working remotely during the pandemic, their confidence in their productivity has grown, with the number of people saying they worked more productively increasing by 45% from April to May.”
It is anticipated a hybrid form of remote working is likely to persist long after COVID-19 is conquered. “This will require many shifts, such as investment in digital infrastructure, freeing up office space, and the structural transformation of cities, food services, commercial real estate, and retail, conclude McKinsey & Company.
5 Ways Leaders Can Create a Healthy Workplace Culture
This week (14th-20th June 2021) is Men’s Health Week. Physical and mental well-being have been important considerations for leaders over the past year, and it is essential this focus is maintained as we build back for the future. Here we have asked 5 experts for practical tips leaders can implement to create healthy workplace cultures.
Know the early signs of burnout
Recently it was reported by the BBC that burnout for health and social care staff had reached emergency levels.
Monkey Puzzle Training Co-Founder Karen Meager has studied the burnout recovery process in partnership with Coventry University: “The past year has seen people suffer from job-loss worries, work from home challenges, isolation, and feeling overworked. These are continuing, and all have the potential to contribute towards burnout. Healthcare workers, executives, leaders, managers and small business owners will continue to be the top people to suffer from extreme burnout.”
“At the onset of burnout, people commonly enter a phase of denial. So leaders need to be aware of those who are reluctant to take their time off, are compelled to work all hours, or have changes in their behaviour or mood, as these can all be indications of burnout taking hold. Encouraging them to take a burnout self-test provides a starting point to supporting these employees through recovery, as is role modelling healthy sustainable ways of working.” Karen suggests.
Encourage professional self-reflection
Creating an environment that encourages self-reflection is an effective tool for promoting personal development. Journaling may not be something you instantly think of for professional development; however, it is a successful technique for adults to aid mindfulness and productivity. “Journaling is a form of self-expression that can empower you to understand your feelings and ambitions and how to deal with them, therefore promoting positive well-being and a healthy workplace culture,” describes Elisa Nardi, founder of Notebook Mentor.
“Just 15-20 minutes of journaling a day over the course of four months are enough to lessen the impact of physical stressors on your health,” explains Elisa. “It can also inspire creativity, aid your memory, and help set actionable goals. It is an underused tool that can help employees manage tricky workplace situations such as conflict, illness or new leadership roles.”
Manage your stress and resilience too
As a leader or manager, often, your complete focus is on the business or protecting your team, but you cannot pour from an empty cup. Leaders should also have strategies in place to manage their own stress, so they can sustain high levels of positive energy throughout the day. “Fueled by a burning desire for success, I ignored all the warning signs of exhaustion, which eventually took its toll on me - I literally collapsed from stress, and I didn’t even see it coming.” reflects Sascha Heinemann, an expert in Performance Recovery and Stress Resilience.
“When leaders manage their energy, create healthy daily habits, and practice resilience, they are able to perform to their fullest capacity and to provide the best possible support for others.”
“Taking a break every 90 minutes or so helps you to refuel, recharge, and re-energize and ultimately allows you to get more accomplished, in less time, at a higher level of quality, and more sustainably. This role model contributes dramatically to a healthier, more engaged, sustainable, and productive workplace culture," he adds.
Instil a sense of purpose for your team
The idea that success equals working 12-15 hour days and giving everything of yourself to your workplace continues to prevail in many organisations. This is not healthy, nor is it productive for anyone involved. “The healthiest and happiest workplace cultures are the ones that are organised around purpose.” describes business and life coach Anand Kulkarni.
“Leaders should be giving meaning to the work they are doing within their business and beyond and sharing this purpose with their staff, rather than focusing on long hours, crippling workloads or someone else’s idea of ‘success’. When people understand why they are doing what they do and how this contributes to something greater, productivity and well-being is increased.” adds Anand.
Promote well-being from the top down
Leaders need to act as role models if well-being is to become embedded at the very core of the organisation. It’s very unlikely that employees will start acting in a new way that puts their own needs first if the leadership team continues to behave in an entirely different manner.
‘Many organisations have worked hard in recent months to put new policies in place that better support well-being, promote hybrid working and attempt to set clear boundaries, but many leaders seem to assume that they are exempt from it all, that’s when it all falls over’, explains leadership experts Martin Boroson and Carmel Moore, from The One Moment Company.
A recent ONS report into Homeworking in the UK revealed that people are on average working 6 hours extra per week, and many are working until late in the evening, indicating that the boundaries between work and life are more blurred than ever.
“Despite all of these wonderful opportunities for people to self-organise, if the leadership team continues to work in the office Monday to Friday, or are communicating at all hours, then it’s a clear indicator that hybrid working is simply a ‘bolt-on’ tactic rather than an integral part of the company’s approach to promoting the importance of maintaining a healthy work-life balance.’