Remote reckoning: Tech companies face tough trade-offs as WFH becomes permanent reality

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 Remote reckoning: Tech companies face tough trade-offs as WFH becomes permanent reality
Facebook’s Arbor Blocks 300 Building in Seattle. (Facebook Photo / Jen Leahy)

Fifty percent of Facebook’s workforce could permanently shift to remote work in the next 5-10 years, CEO Mark Zuckerburg told employees on Thursday. It’s a staggering statistic for a company that historically placed a high premium on in-person office culture, and it signals a broader trend in the technology industry.

“This is probably overdue,” Zuckerberg said. “Over the past few decades, economic growth in the U.S. has been quite concentrated, with major companies often hiring in a handful metropolitan areas. That means we’ve been missing out on a lot of talented people just because they happen to live outside a major hub.”

But as Zuckerberg acknowledged, it’s not that simple. And many others in the industry are coming to the same realization.

In the span of a few weeks, the coronavirus pandemic turned a somewhat theoretical debate over the pros and cons of working from home into a global, real-world experiment. Now, as communities across the country begin to re-open, employers are weighing what they’ve learned against the costs of returning to office life.

RELATED: If working from home is the ‘future of work,’ here are 11 reasons why the office sounds better

The benefits of working from home quickly became evident. Many teams proved to be just as productive as before the pandemic, particularly in the technology industry. Workers are able to handle issues that come up at home in real-time, exercise on their own schedules, and reduce fossil fuel emissions by avoiding commuting.

Those advantages have compelled employers across the technology industry to consider more flexible work arrangements after the pandemic subsides.

However, the trade-offs for those benefits remain an open question, one that is weighing on leaders across the technology industry, from tech giants to small startups. Most agree that pre-pandemic office culture is a thing of the past. But the next evolution of work will not be as simple as blanket remote work policies. Instead, employers will have to conduct a careful orchestra that allows employees to work from home equitably without sacrificing the aspects of work that are difficult to replicate digitally.

‘The two minutes before and after’

Microsoft was one of the first companies to take its tech workforce remote, and unlike many of its peers, the company’s bottom line hasn’t been negatively impacted by the pandemic.

But Microsoft CEO Satya Nadella is still concerned about the changes to work that the coronavirus crisis is forcing. He told the New York Times, “[W]hat I miss is when you walk into a physical meeting, you are talking to the person that is next to you, you’re able to connect with them for the two minutes before and after.”

Microsoft CEO Satya Nadella at the company’s Redmond headquarters. (GeekWire File Photo / Kevin Lisota)

Nadella warned about the consequences of embracing telecommuting permanently: “What does burnout look like? What does mental health look like? What does that connectivity and the community building look like? One of the things I feel is, hey, maybe we are burning some of the social capital we built up in this phase where we are all working remote. What’s the measure for that?”

Despite the drawbacks, the trend toward working remotely long-term is already well underway.

Twitter and Square will allow employees to telecommute indefinitely. Zillow and Google are embracing remote work through 2020, while Amazon is making it an option for employees until Oct. 2.

One-third of Seattleites plan to work from home for at least the remainder of the year, according to an Elucd poll conducted for the city. The shifts are raising alarm bells for restaurants and other businesses in Seattle’s downtown and South Lake Union neighborhoods, which are sleepy without office worker foot traffic.

Farewell, office life Dan Giuliani

Seattle-based Volt Athletics has already surrendered its physical office and moved its 25-person team to remote work through at least through 2020.

“I have historically been resistant to working remote and would never have made this decision had we not been forced to experiment with remote work due to the pandemic,” said Dan Giuliani, CEO of the high tech fitness platform.

The safety precautions that any return to office life would require — like masks and social distancing — made the prospect less appealing to Volt Athletics. Giuliani also predicts office rents will down as companies go under or shift teams to remote work long-term. If Volt decides an in-person presence makes more sense down the line, he anticipates more affordable options will be available.

Some companies have found the shift to be a money saver at a time of financial duress.

Jargon CEO Milkana Brace. (Jargon Photo)

“The savings from office space, and other cuts, have enabled us to keep the team intact while substantially lowering our burn,” said Jargon CEO Milkana Brace, who canceled the startup’s Seattle lease in mid-March. “I can see a future, health concerns aside, where we meet as a team once [a] week but otherwise continue to work remotely. We’re monitoring team productivity and personal wellness closely as the novelty of working remotely wears off and longer-term impacts become clearer.”

But Zuckerberg said Thursday that he doesn’t expect the partial shift to telecommuting to be a big cost-saver for Facebook, despite plans to pay lower salaries in less competitive talent markets.

“The cost of supporting remote workers has generally offset the real estate and other costs of supporting people in the office,” he said on a call with employees that was live-streamed on Facebook. “There are just different costs here. Remote workers need different benefits in some cases, including things like more tooling to make their offices work at home.”

Covering home-office expenses

Seattle-based Uplevel made that tooling a priority as soon as its leaders made the decision to stay remote at least through 2020. Uplevel is allowing employees to expense whatever they need to create their home offices. The startup sent care packages to employees with plants, puzzles, snacks, and office supplies. Uplevel also delivered everyone’s desk belongings to their homes.

Uplevel VP of Marketing Jori Saeger. (Uplevel Photo)

“We are helping our employees reimagine what [it] looks like for them to make their home environments as comfortable and productive as possible,” said Uplevel VP of marketing Jori Saeger.

Meetings at Uplevel are barred from 12-1:30 p.m. to ensure everyone has time for a lunch break. A minimum of 10 minutes is required between Zoom meetings. On Fridays employees can expense lunch delivery and teams play games online together to stay connected.

Uplevel provides a productivity dashboard to help companies understand logjams and inefficiencies on their engineering teams. The company has adjusted its product to provide customers with data on how work has changed since the outset of the pandemic.

Investors see opportunity for tech companies, like Uplevel, to improve the remote experience for workers and employers. Demand could also surge for meeting and collaboration spaces that are not used every day.

An office that you go to every day in the morning and leave in the evening? That's surely coming to an end. But – collaboration days? Get everyone together in a productive space to work for a few hours? Huge huge demand on the horizon. I'd be investing heavily in that.

— Dave Lee (@DaveLeeFT) May 20, 2020

While there is certainly room for innovation in the telecommuting space, many in the tech industry worry there is no substitute for in-person mentorship and networking. Facebook polled employees on their work preferences and while 40% said they were very or somewhat interested in working from home permanently, the preference favored more tenured workers over junior ones.

There is good that comes with the flexibility to WFH. But I can't help but feel like it disproportionately benefits people who are further along in their lives — the already coupled up, networked, mentored.

How does perma-WFH avoid becoming one more tax on the next generation?

— Casey Newton (@CaseyNewton) May 20, 2020

Workdays appear to be longer and more meeting-intensive when teams are distributed. The overall number of meetings scheduled has gone up 7-10% since the start of the pandemic, Recode reports. Microsoft crunched the numbers on usage of its Teams video collaboration software and found the average time from first usage to last has increased by an hour.

The pros and cons of widespread remote work are emerging in real-time — and it’s not a perfect experiment. The pandemic forced knowledge workers around the world into entirely remote, often isolated, work arrangements overnight. And the shift is occurring during a period of high anxiety and uncertainty.

“The situation in which we are all working remote is not a normal situation,” said Kieran Snyder, CEO of Textio, a Seattle startup that uses AI to augment writing. “Everybody’s carrying so much more stress. If it’s a difference between choosing to work at home today, but then you still head to the gym, you head to the grocery store, you go see your friends at night for dinner, [it’s] really different than what’s happening right now where everyone’s trapped in their homes.”

Striking the right balance

As economies start to re-open, the big question is where do we go from here?

A return to 9-5 office life may not be on the horizon anytime soon, but leaders like Nadella and Zuckerberg don’t see entirely remote work as the future either. Nadella told The New York Times that would be “replacing one dogma with another dogma.”

Tech workers seem to agree. About 60% of Facebook employees surveyed didn’t ask to work entirely remotely or return to the office full-time. Instead, they want a mix of both, the flexibility to choose.

Textio CEO Kieran Snyder

Snyder expects to give employees that choice when the crisis wanes.

“We already had a situation where people could work from home once a week if they wanted to,” she said. “But I won’t be surprised if we leave it more in the employees’ hands as to how often they want to be in the office.”

Striking the right balance could lead to more equity in tech, allowing working parents to do school pick-up while supporting new hires with in-person mentorship. It could also open up opportunity in communities across the country that have been historically left behind by the digital revolution clustered in a handful of coastal tech hubs.

“I want us to live in a country where people can have access to opportunity, no matter where they choose to live, and I think that enabling more remote work is going to be very positive on that front toward creating more broad-based economic prosperity,” Zuckerberg said. “Hopefully, a more sustainable social and political climate, as well, if opportunity can be shared more broadly.”

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