9 min read.Updated: 16 Sep 2020, 08:32 AM ISTGoutam Das
Both firms and employees are unhappy with WFH. Will the old office order return post the pandemic?
The long-term outlook is work from office or a blended model where a minority works out of home. A number of companies appear to have tilted towards a hybrid working model already
A month ago, the marketing chief of a real estate company with sprawling commercial and retail developments in Gurugram started nudging his team members to rejoin office. As the landlord, the company wanted to signal to tenants, which includes corporates, coffee shops, salons, and fashion outlets, that it was time to get back to business.
“Many of us were not comfortable joining back yet because our neighbourhood had covid cases. Our work was getting done from home and output wasn’t a problem," said an employee who didn’t want to be identified. The marketing head, however, kept applying pressure. “He began finding faults and called late evenings to complain. We tried to reason but wanted to hold on to our jobs as well," he added.
Eventually, the team gave in. “The boss is a micro-manager. He found peace once he could physically see us working everyday," the employee said.
Fact is, companies are filled up with older-generation leaders who love control. This is one of the reasons why many companies feel work from home (WFH) will remain a slow-starter in India once the pandemic ends. Instead of being ‘the future of work’, WFH could become an alternative to fall back on for business continuity.
Workers across every company toiled long hours during the lockdown, partly because of an adrenaline rush induced by the crisis and partly thanks to the anxiety of retaining jobs. But assumptions around productivity as well as lower real estate rentals due to WFH are now being challenged, anecdotally and via research.
Recently, real estate advisory Knight Frank (India) Pvt Ltd. surveyed 1,600 technology professionals in India and found that 30% of them reported deterioration in productivity and work performance while working from home. A PwC study in the United States suggested that productivity during the pandemic was shored up by super achievers that masked a fall among the rest who struggled with a combination of physical and emotional issues while working from home.
Indeed, after five months into the experiment, some organisations have identified the cons, which include reduced scope for innovation. They appear keen on getting offices throbbing with people again once the pandemic is under control. This cohort includes big and the small companies, cutting across technology services, manufacturing and food companies.
The recent Mint-Bain India CEO survey, in which 105 CEOs were polled on the economy and business scenarios, underlined the temporary nature of remote working. Less than one-third of the CEOs saw over 25% their workforce continue to work from home, post covid-19. In short, remote work is the present, not the future. The long-term outlook is work from office or a blended model where a minority works out of home.
Take the case of Milk Mantra Dairy Pvt Ltd., a dairy products company based out of Odisha. Founder Srikumar Misra has a roadmap. “Our operations are even more intensive than FMCG manufacturing. We are exploring WFH for a couple days every two weeks, maybe. Otherwise, we want people to be back at work," he said.
Infosys Ltd., India’s second-largest IT exporter, has over 95% of its workers working remotely at the moment. Depending on when the covid-19 caseloads ebb, the company plans to get employees back to offices in a phased manner. Richard Lobo, executive vice president at Infosys said that in any work, there are individual components and places where employees need to collaborate. The social capital is compromised when working from home over a long period. He added that employees are keen to rejoin offices.
Lobo’s point around employees wanting to be back is backed by new findings. One such is a study released in July by JLL, a professional services firm, which stated that 82% of office employees in India have missed working from office and cited a lack of personal interaction as the primary factor. There is also increasing recognition that prolonged work from home is leading to stress. Senior professionals, the more experienced, have greater anxiety issues and would much rather be in office than their younger colleagues.
Pratik Kumar, CEO of Wipro Infrastructure Engineering Ltd. and member of the board of Wipro Enterprises Ltd, said that he always viewed WFH as an alternative. “People were a little hasty in saying WFH is the new defined way of working," he explained. “At the end of the day we are social animals. We crave for connects, which is other than virtual. You could remain in the virtual mode for a while, but then fatigue begins to set in."
Myth of productivity
A number of companies appear to have tilted towards a hybrid working model, already. RPG Enterprises is allowing all sales employees to work from home permanently. Flipkart, the Essar Group, and the Indian Hotels Company Limited (IHCL) among other corporates are all contemplating the hybrid approach.
While those working in plants, warehouses, the supply-chain, and in the hotels will need to be physically present, professionals in corporate offices can afford to be working remotely. Herein lies a dilemma—a few executives Mint spoke to don’t think this arrangement is fair on the front-line staff who are risking their health.
In any case, there are many other questions around the workability of the hybrid model. On Quora, a social media platform, someone queried: “What does it feel like to work from home?" There were 89 responses discussing both the positives and the shortcomings in great detail.
Vishal Mishra from Kolkata, one of the respondents, said he could save time spent on public transport. “I used to waste two hours to reach the office and then get back to my flat," he wrote. “You can save a lot of money," he went on. “I used to spend a lot on junk food throughout the day during my office hours and even after office. Now, I get homemade food."
Mishra then listed the cons. “I face a lot of connectivity issues while connecting to the office server, which takes a long time to get fixed," he wrote. “I am not able to concentrate. As a result, I have to extend my shift every day and work 10–11 hours."
The lack of concentration worries executives. India Inc never had a culture of WFH and few Indian families can afford a study. WFH could be even more challenging if one is living in a joint family.
“In the short-term, work from home can give you the impression that productivity has improved. However, productivity could come down because of the diversion and distractions at home," AS Mehta, president and director, JK Paper Ltd., a paper manufacturer, said. “Most professionals live in a two-bedroom flat. They could be working on the dining table or on the bed. The spouse, children, maid all work in the same areas. How will you concentrate?" he asked.
Besides family and Internet-related distractions, professionals also don’t have ergonomic furniture at home. Mehta said that about 70% of the employees are coming into the office; the rest could return when they are comfortable.
Myth of savings
In August, The Times of India reported that Indian corporates and multinationals gave up over six million sq ft of top class commercial office space in the first half of 2020 as they downsized operations. Corporates do see WFH as an opportune model to rationalise expensive real estate rentals.
On paper, this is simple maths. Not only are rentals cut, companies save on employee transportation, electricity costs as well as facilities management. Nevertheless, a recent modelling based on the financial statements of IT companies threw up interesting results. What if corporates have to compensate employees for the expenses they incur at home to replicate the office environment?
Knight Frank analysed 119 large, medium and small tech companies, the biggest driver of India’s office real estate rentals. Real estate operating expenses totals about 4.3% of the operating income of IT companies, Knight Frank found. The cost includes expenses on facility management, common area maintenance, electricity, amortised capital and transportation provided to employees.
When adjusted for the additional cost companies should be paying for setting up WFH infrastructure, the savings yielded are negligible. This modelling assumes that in the new normal, 50% of the employees would work from home.
“Initially, companies did not account for the home infrastructure required or did not pay employees. If we are talking about WFH becoming the new normal, employees would expect to be compensated," Rajani Sinha, chief economist and national director at Knight Frank said. Besides Internet bills, companies would have to invest in productivity monitoring tools, software for data protection, and reimburse furniture expenses.
“We calculated the per employee additional cost to between ₹5,000 and ₹10,000 per month depending on how much a company is willing to pay. If a company is bearing the additional expenditure for 50% of their employees, the net cost savings comes to about 1% from the WFH arrangement," she added.
The secret sauce
Radhika Binani, chief product officer at Paisabazaar.com, a loans and cards marketplace, is still working from home.
She misses the buzz of the office, the energy that comes with working for a products company. Technology and product discussions often require working with multiple stakeholders. That secret sauce of getting things done, the ideas and innovations that come from meeting people, is missing while working from home, she felt.
And yet, the company could have a percentage of employees working form home in the future. Paisabazaar employs an army of tele callers to sell to potential customers and hiring local talent in different states could lead to better conversions. Thus far, the company’s tele callers were centralised in Gurugram. “If we have to service Tamil Nadu or Kerala, we need to hire people who can speak local languages. WFH opens up the ability to hire from anywhere," Binani said.
So how could the hybrid model work, given the bottlenecks?
For instance, Indian Hotels Company Limited is working on a model where the social capital remains intact even as people WFH. The company is identifying roles where professionals working in its corporate offices can work remotely but visit the office one or two days a week for face-to-face meetings.
In many ways, making hybrid systems work will begin with instituting the right culture, Krishna Raghavan, chief people officer at Flipkart felt. Remote working has always been part of the e-commerce firm’s working culture well before the pandemic and now, this is the default option till end of 2020. “We are non-hierarchical, very bottom up driven in terms of innovation. Therefore, we were able to respond in a very resilient manner to the crisis," Raghavan said.
Flipkart also evaluates performance in terms of outcome or what an employee delivers. Everything else such as their clock in and clock out time, are secondary.
Trust, therefore, is fundamental to this model. And micro management wouldn’t work either and leadership styles need adjustments.
“That is the biggest challenge India Inc will face, going ahead," Kaustubh Sonalkar, president of HR at Essar Group said and added that organisations that have young and trusting leadership might adapt quicker. “But there would be organisations with leaders who are older. They may not trust a person at home. That level of maturity needs to sink in."
Till that happens, it would be premature to conclude that the workday in office is done and dusted.
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