During the COVID-19 crisis, companies moved nearly all their white-collar workers around the world to work from home. It was an eye-opening experience. Almost universally, executives were surprised that working from home is far more effective than they anticipated. In fact, in many instances, it appears that people are more productive working from home than they were when working in their offices. But some of this supposed improvement in productivity is a mirage.
This illusion is revealed once we consider that much of this productivity is not greater efficiency but, rather, more time on task. Working from home eliminates commute times and thus blurs the line between work and life.
However, it seems likely that companies may lose some, if not all, of these gains over time as recreational activities open and employees learn to exercise more discipline on setting boundaries between work and home life.
That is not to say that the new distributed work-from-home operating model does not offer the potential for increased productivity; rather, without a disciplined approach to productivity, companies are likely to dramatically underperform against expectations.
As we emerge from the crisis and some people return to offices, many companies consider incorporating a distributed model in which working from home becomes part of how they operate, to some degree. Some companies will eliminate their office space; others will reduce their office space and allow more of their teams to work from home.
As I stated in a prior blog, the COVID-19 crisis has a silver lining. It forces companies to deal with the realities of an ongoing work-from-home model. If they understand how to make the distributed model sustainable, they gain an intriguing opportunity to unlock dramatic improvement in productivity. I am talking about huge opportunities – more than improving function or process productivity by just a few percentage points a year. In some instances, they can double or triple their productivity over the course of a year.
Problems with managing productivity
Sustaining and managing a distributed model requires a company to measure and manage productivity. But history shows that many companies are not good at doing this. Why not? Because productivity is illusive.
Productivity is not just the result of a technology or any one thing. It is the outcome of a lot of different components. And here is a hugely significant factor affecting productivity: at the team level, productivity is always in the context of what that team is doing and the conditions – and constraints – in which the team operates.
Therefore, standard or uniform measurements of productivity do not work. Am not saying that a company cannot measure productivity consistently and objectively. I am saying it must be measured in the context – the unique situation in which the function, process or team operates.
So, let’s look at the context (and unique conditions and restraints) of productivity in the work-from-home model and how to measure it. Is it a mirage?
Measuring work-from-home productivity
The first step is to establish end-to-end, holistic metrics. (See my prior blog about these “breakthrough metrics.”) Again, keep in mind that the measures of productivity must be situational to the unique context in which a function, process or team operates. A team, for instance, needs to develop its own situational productivity measures.
It is a mistake to look for precision and accuracy over objectivity and simplicity. The most effective measures are simple, objective and directionally correct. The trick is not to get obsessed with the old time and motion studies. Instead, focus on the outcomes by asking such questions as the following:
· Are we doing the right things (activities that align with the business objectives)?
· Can we increase the velocity of the outcomes or results?
· What is the error rate or rework required?
· What is the overall cost to serve or to operate?
By focusing on these end-to-end, holistic metrics, one can establish clear, simple and objective metrics.
Second step: Put the metrics into dashboards. Make it clear to the team or organization that improvement is important and then inspect the dashboard on a regular cadence.
Third step: Empower the team to make adjustments to their environment. These adjustments will likely start encouraging them to take simple steps to improve communication and accountability and, over time, migrate to more sophisticated and challenging initiatives that can range from technology investments to reorganizing or reskilling part of the organization.
Because of the complex interrelationships among people, technology, techniques, and process, much of this journey is one of constant change and change management. Using the dashboard as a north star, the team can navigate this complicated journey through a series of initiative initiatives.
It is important to remember that this is a journey – not a destination but an ongoing record of accomplishment. It is also wise to remember that success breeds success. When teams or organizations attempt to push productivity too fast in the early stages of the journey by undertaking to many initiatives at once, they are likely to miss the interrelated aspects of the problem and fail to establish that oh-so-important track record, which is vital for morale and ongoing investment.
The simple truth is that the journey to astounding gains in productivity is in the reach of all organizations. All they need to do is measure the productivity of their teams, functions and processes and then provide the incentives and support to their teams to attain these remarkable results.
We at Everest Group investigated the many dimensions and components of productivity. We found that when companies combine insights and data with customized metrics, teams can make remarkable, fast progress and accomplish astounding results.