In March 2020, companies and governments across the globe shut down their offices, which forced employees to work from home. “Zoom” shifted from an obscure company to a verb in the corporate lexicon. With over 114 million people vaccinated in the U.S. since December 14, 2020, people are beginning to sense a return to normalcy. Yet, the pandemic has left an indelible mark. Companies are questioning how people’s behaviors as consumers and employees have changed permanently. One of the biggest? Is working from home a permanent option?
Some companies already had an answer. In May 2020, Mark Zuckerberg, CEO of Facebook, stated by 2030, over half of his 50,000 employees would be working from home permanently. “We are going to be the most forward-leaning company on remote work at our scale.” Jack Dorsey, CEO of Twitter, stated that his employees would be allowed to work “where[ever] they feel most creative and productive…even once offices begin to reopen.”
Despite seeing employee productivity stats increase, Satya Nadella, CEO of Microsoft, publicly warned against an all-remote setup. “We’re replacing one dogma with another… 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?” (It should be noted that in October, Microsoft changed their policy to allow employees to work from home freely for less than 50% of their working week or for managers to approve permanent remote work.)
The tech giants’ choices will set a new paradigm for company-employee relationships. Yet, it is also unfair to use their policies as de facto best practices. A warehouse cannot operate with everyone working from home. Each industry and company will have to explore what is best for it and its employees.
Many bosses have cast doubt that remote workers are as productive compared to their fully in-office employees. Jamie Dimon, CEO of JPMorgan Chase, stated that remote work is not great “for those that want to hustle.” David Solomon, CEO of Goldman Sachs, called it “an aberration that we are going to correct as soon as possible.”
The Wall Street Journal has published multiple quote compilations of CEOs voicing a wide range of opinions on teleworking. Many worried that work-from-home (WFH) was deleterious to the company culture and hurting the development of junior employees.
“That unplanned kind of interaction that contributes so much to how we build relationships with people and how we build culture, those things are what are missing,” Andi Owen, CEO of Herman Miller Inc, said.
There is evidence to support this. In a Gartner study of 3,000 people, junior employees were more likely to say a physical office space was essential for learning and brainstorming.
Managers also have, or at least believe they have, trouble leading remote teams. In a Harvard Business Review article, “Remote Managers Are Having Trust Issues,” Sharon Parker found that out of 215 interviewed supervisors, 40% expressed low self-confidence leading workers remotely. A similar proportion of managers had negative views about remote workers’ performance. Finally, 41% were skeptical that remote workers could stay motivated in the long term.
This widespread doubt that remote employees are as productive as their in-office counterparts has a pernicious effect on telecommuters’ career advancement. “A February 2020 study of more than 400 tech workers by researchers at Rensselaer Polytechnic Institute and Northeastern University found that while remote and non-remote workers won roughly the same number of promotions, the salaries of remote workers grew more slowly. At companies where remote work was less common, telecommuters won fewer promotions,” Vanessa Fuhrmans said in a Wall Street Journal article on WFH.
Academic research on work-from-home productivity is sparse, but evidence points to increased productivity rather than a decrease. In “Does Working From Home Work,” Nicholas Bloom, a Stanford researcher, and his team surveyed a Chinese travel agency with 16,000 employees. The CEO wanted to see if working from home would reduce the attrition of his workforce while maintaining productivity standards.
The team randomly selected 500 employees from the company’s call center and divided them into two groups: a control group and a work-from-home group. The two-year study showed a boost to productivity, equivalent to a full day’s work. Employee attrition also fell by 50% among the teleworker group, with employees taking shorter breaks and taking fewer sick and vacation days.
“The overall impact of WFH was striking. The firm improved total factor productivity by 20% to 30% and saved about $2,000 a year per employee WFH. About two-thirds of this improvement came from the reduction in office space and the rest from improved employee performance and reduced turnover,” Bloom, et al wrote.
Bloom also found that employees working from home were 50% less likely to receive a promotion than individuals who worked in the office.
In October 2020, Harvard Professor Prithwiraj Choudhury reviewed the productivity performance of working in the office versus working-from-home versus working-from-anywhere (WFA), which allowed complete geographic flexibility. Choudhury studied 831 employees from the United States Patent and Trademark Office (USPTO). The study’s results concurred with Bloom’s findings from 2015. Choudhury also found that when employees were allowed to work-from-anywhere, productivity increase another 4.42% with no increase in rework.
“We also report an increase in employee effort after the transition to WFA and document qualitative evidence on how geographic flexibility benefits individual workers and the USPTO (e.g., real estate savings),” Choudhury wrote.
Prodoscore, an employee productivity software company, has found similar findings. Using an array of metrics for 30,000 employees, including tracking emails, chats, calendar appointments, and other cloud-based tools, the company has found that employees were more productive in 2020 than in 2019.
“The data revealed a 5% increase in productivity comparing May – August 2019 to May – August 2020, challenging the assumption by business leaders that employees working-from-home are less productive than when working on-site in an office,” Nadine Malek, Chief Marketing Officer, said in a recent Prodoscore press release.
In La Fleur’s Lottery Industry Survey, employees felt their productivity did not shift at all. In the survey, 80% of survey respondents believe they are just as productive from home as they were at the office, with 50% strongly agreeing. In a more extensive study of 1,115 Americans conducted by IPSOS in March 2021, only 34% of Americans believed their home was a difficult place to be productive.
A potential flaw with this research is in the way that it measures productivity—for instance, Bloom measured the number of phone calls made and Choudhury measured the number of patents filed. Their research may prove that this type of work benefits from work-from-home policies, but it does not prove it universally increases productivity. It also doesn’t alleviate concerns that a company’s culture and junior employees aren’t negatively affected by teleworking.
In our survey, we asked lottery staff to give their opinions on teleworking, and we got a wide range of views:
“Teleworking might be a useful way for professions like developers, but in no way can serve any creative field, like marketing, advertising, corporate communications, etc. And definitely, teleworking cannot replace the physical project management meetings!”
“Teleworking has allowed me more time to spend with family than before while being just as productive as being in the office. I have a much better work/life balance.”
“Teleworking is productive for matters of process but it falls short where creativity and team interaction is required. Soft skills are under-estimated in today’s society. When does efficiency lead to a lack of effectiveness?”
“I love working from home but do realize the importance of social interaction with colleagues just to keep on their ‘good’ side. A hybrid solution is the way to go I believe.”
Lottery directors are trying to balance a broad-spectrum of opinions. As an industry, leaders are still far from coming to a consensus. Some are adamant that working-from-home has harmed their organization, while others are continuing work-from-home policies.
The Oklahoma Lottery broadened its work-from-home policy at the onset of the pandemic. Everyone was allowed to work from home for the first few months. Over the next six months, employees had a flexible schedule to reduce the number of people in the office at one time.
In January 2021, Jay Finks, director of the Oklahoma Lottery, switched the office layout from cubicles to offices. “We have been back in full since then. This is not 100% across the board, but the vast majority of the team wanted to come back and welcomed the opportunity to return to the office,” Finks said.
Finks has no plans to broaden work-from-home policies in the future. “Productivity is NOT the same when everyone is home versus in the office. Just simply from a workload and project management standpoint, you could see the level of productivity increase,” Finks said.
Finks thought work-from-home policies most negatively impacted the sales team and project management. “One, our sales team members’ ability to drive sales in the field. You can’t effectively engage retailers from home via an occasional phone call. Second, project management, which ultimately requires employees to engage across departments, and the inability to do that in a face-to-face environment impacts effectiveness.”
The Texas and Colorado lotteries are taking the opposite approach. Except for staff that needs to be onsite, like claim center employees and draw game operators, almost all the lottery employees at the two organizations have remained working from home since April.
“We will continue to have many positions working remotely after the pandemic. So far, productivity has remained high, and it has been very well received by our staff,” Tom Seaver, director of the Colorado Lottery, said. “Our key-performance-indicators have remained consistent with what they were pre-pandemic.”
The Texas Lottery is moving to a new headquarters beginning in April 2022. The new facility will have a significantly smaller footprint and will facilitate the continued need for robust telecommuting for eligible staff.
“The reaction from staff has been extremely positive,” Gary Grief, director of the Texas Lottery, said. “The challenge will be to continue having an effective onboarding program for new employees, socializing them into a business culture of excellence, and providing opportunities for entry-level staff to learn and be mentored by more experienced staff.”
Seaver also recognized the difficulties with working from home. “Many of our staff have enjoyed not commuting and having a better work/life balance. The downsides are that collaborating virtually is not as effective as face to face, and people miss the socialization of the lottery workplace. Our sales team has missed the high level of interaction they have with our retailers. We also miss interacting with our players at events and through our claim centers being only open by appointment. The human factor is a big part of our business, with our players, our retailers, and each other.”
After Bloom’s initial nine-month study concluded, the Chinese company allowed all workers the option to work from home. Interestingly, two-thirds of the control group and half the treatment (work-from-home) group elected to work in the office. The individuals from the treatment group who returned cited that they underperformed at home and missed social interactions.
After employees were allowed to select what was best for them, employee performance doubled over the next 15 months. Individuals picked the environment that was best for them, and it had a direct impact on performance. “This highlights how selection affects employees across different working practices are an important part of the impact of management practices…” Bloom said.
Academic research indicates that when employees choose their environment, their choice happens to be best for the company. Some individuals work best from home; others work best from the office. Rather than extolling the virtues of one over the other, the research suggests that managers should emphasize employee choice to maximize productivity for the firm. Similarly, once an individual has chosen a work schedule, they should be given an option to reconsider after some time. Their opinions may have changed based on their experience.
From La Fleur’s Lottery Industry Survey, respondents wanted flexibility. Over 67% of respondents preferred to work-from-home in the foreseeable future. The most common comment was that a hybrid schedule would be the best option moving forward:
“Having options is key for me. I enjoy the flexibility of working from home and having an office that I can go in to see co-workers. Challenge is getting those I care about seeing in the office on the same schedule.”
These comments echo the sentiment most workers feel. In an Ernst & Young survey of more than 16,000 employees conducted in May 2021, 90% said they wanted flexibility in when and where they work post-pandemic. More than half said they would consider quitting their jobs if they didn’t have that flexibility.
Each lottery director will determine what is best for their organization. But the industry may have the decision made for it. Location flexibility could become a critical nonpecuniary benefit employees demand in the future. “We compete with all other employers for people to fill lottery jobs. The workplace demands more flexibility for work location—this will probably be a permanent change. We will offer remote work as long as it makes sense for our business and doesn’t compromise our service to our retailers and players,” Seaver concluded.