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.
People Moves EMEA: Kearney, KPMG, Oliver Wyman, Skoda
It’s been a busy week for executive transitions across EMEA and especially in the world of consulting, with partner/CEO announcements at Oliver Wyman, KPMG and Kearney, and in the role of head of sustainability, with new CSO appointments at Laing O’Rourke and Syngenta Group.
We round up the biggest executive moves across Europe, the Middle East and Africa.
Nick Studer announced as CEO of consulting giant Oliver Wyman
Set to take the top job at consulting giant Oliver Wyman next month, Nick Studer has been named CEO and Dual President of the firm’s economic and brand consulting subsidiaries NERA and Lippincott and will be based in London. Having been with Oliver Wyman for more than two decades, becoming partner in 2003, Studer has since served in a variety of international leadership roles, including head of Global Corporate and Institutional banking Practice, before becoming managing partner at the start of 2021.
According to Dan Glaser, CEO of Oliver Wyman parent Marsh McLennan, Studer has not just led many of the firm’s practices, but he “has been a leading voice for change and a major driver of our Inclusion and Diversity agenda”.
Delphine Bourrilly to lead Kearney in France
Seasoned consultant Delphine Bourrilly has been appointed leader of consulting firm Kearney for France, one of the firm’s larger locations in Europe, becoming fifth head of the Paris office. Having been with Kearney for more than a decade, most recently leading the Leadership, Change and Organisation practice across Europe, Bourrilly has an array of client successes under her consulting belt, including overseeing an operating model transformation at a large retailer. Prior to this, she spent five years at UBS. According to Geir Olsen, Head of Europe at Kearney, Bourrilly’s “talent, energy and charisma will be critical in leading Kearney through its next growth phase in France”.
Roland Villinger becomes head of corporate and product strategy, Skoda Auto
A consulting veteran, Roland Villinger has been appointed head of Skoda Auto’s corporate and product strategy, a newly created area for the Czech car manufacturer that combines two departments. Described by Skoda’s CEO Thomas Schafer as “an international experienced leader and proven digital expert”, Villinger most recently oversaw the implementation of Volkswagen Group strategy and was also previously chief strategy officer and chief digital officer at Audi AG. Prior to this, he spent 25 years at consultancy McKinsey including serving as a senior partner and running McKinsey’s operations in the APAC region.
Hanan Alowain promoted to Partner, public sector, KPMG
Becoming the second Saudi female partner in the history of KPMG, Hanan Alowain has been promoted to Partner in the firm’s Public Sector function. With 14 years of experience in human capital and social development in the Kingdom, including the last three and a half years at KPMG, Alowain is a Harvard Business School graduate with extensive experience both in the public sector, as director of research and development for the Saudi government’s Ministry of Labour, and the private sector, including as a partner at investment & development group Eradah.
Vicky Bullivant named Laing O’Rourke’s first-ever group head of sustainability
Seasoned ESG leader Vicky Bullivant is joining Laing O’Rourke as its first-ever group head of sustainability from Drax Group where she was head of sustainable business and responsible for developing the firm’s climate ambition, social strategy and community and charity policies. Having led the world’s first company ambition to be carbon negative by 2030, and the UK’s first energy company to commit to improving skills and education for one million people by 2025, Bullivant boasts 25 years of ESG business experience in highly regulated sectors, FTSE 100 companies, government and NGOs.
Bullivant spent eight years at Experian, where she was head of corporate affairs and community, nearly four years as head of corporate responsibility at Eon, five years as group head of sustainability at Rolls-Royce, where she turned around the firm’s performance in the Dow Jones Sustainability index, as well as sustainability heads at Tate & Lyle and Drax Group.
Daniel Vennard joins Syngenta Group as new CSO
Former global director at the World Resources Institute Daniel Vennard has been appointed chief sustainability officer for Syngenta Group. Based in Basel, Switzerland, Vennard will be responsible for developing and implementing the Group’s sustainability into its business strategy. Bringing extensive experience in the development of sustainability strategies and in launching global sustainability programmes that deliver growth and impact, Vennard most recently served as global director at the World Resources Institute, Vennard founded the Better Buying Lab bringing together scientists to develop, test and scale innovations that help consumers opt for sustainable plant-based food.
Prior to this he spent 15 years at Mars and Procter & Gamble in sustainability, corporate strategy and marketing and brings “creativity and remarkable expertise in sustainability” that will “help us further advance regenerative farming practices and help mitigate the harmful effects of global warming”, says Erik Fyrwald, CEO, Syngenta Group.