Wars and revolutions provide the majority of chapter headings in human history. But not all of them. Plagues can also play a role. Markets hate all three because they each signify massive changes – changes in economic circumstances and in the human behaviour that underpins them. And markets hate uncertainty. But sometimes “as the dust settles” and we have mourned the negative consequences and suffering, positive effects can also be seen. In the last few weeks the majority of the Western World is suddenly “out of office.” Working from home is the order of the day – and it just might not be such a bad thing.
In a matter of days, most companies on both sides of the Atlantic have gone from “business as usual” to being on a “war-footing.” For office-based employees the efforts to contain the contagion have meant the near universal adoption of working from home. Tech companies led the way with Amazon, LinkedIn, Microsoft and Google all being early adopters, but within days everyone from Unilever to Clifford Chance was asking office workers to work remotely. All of KPMG’s 8,000 London staff are working from home, and Lloyd’s of London has closed down its underwriting room for the first time in its 334 year history.
There were some hiccoughs. For some businesses the IT challenges of so many people logging on remotely to their networks proved frustrating, and Downdetector reported a surge in complaints about Microsoft Teams not working. In California, the Facebook corporate network was temporarily banned from ordering takeaways from DoorDash as a surge in orders from the same IP address in San Francisco triggered its suspension.
In the UK there was dark talk of the entire broadband network collapsing under the surge pressure, until the trade body IPSA pointed out that evening demand, caused by everyone playing video games or streaming Netflix, was ten times higher than working day usage. Indeed, Bloomberg reported that the real surge in demand in Italy came from when schools were suspended and millions of Italian schoolchildren suddenly wanted to play Fortnite at the same time.
But for the majority of businesses the large scale migration to remote working seems to have gone remarkably smoothly. And many companies with remote working products saw the enormous opportunity this seismic change represented. Microsoft announced that small businesses would have free access to its “productivity suite” for the next six months, prompting similar action from Google, while Zoom, the video conferencing experts, extended their time period of free conference-calling. Slack (which markets a popular business chat software) this week offered free consultations to companies attempting remote working for the first time.
Long before Coronavirus, there has been considerable growth in these remote working enablers. And they seem to have realized they have to tackle one of the biggest breaks on change:middle management ‘control freakery.’ Zoom, apart from allowing up to one thousand people on a call at any one time, also allows Chinese style “attention tracking” so your Boss can check you are paying attention to his monologue. Trello has developed project management software that allows controlling bosses to monitor workflow and assign tasks in project management.
To more enlightened entrepreneurs this week’s developments were almost a long awaited “cry to arms.” Matt Mullenweg the CEO of Automattic (owner of Tumblr and WordPress) has long championed what he calls “the distributed work revolution.” At last this is the “chance for a great reset in terms of how we work.” Millions of people getting the chance to cast aside the tedious daily commute, to discover flexibility in their working day, and to avoid the distractions of a noisy office. A 2019 study by Density found that distraction in the office led to a 28 percent decline in efficiency. It will indeed be interesting to see what this week’s changes might harbour in productivity numbers.
The trend to remote working was already well established before Corona. According to the forecasts made in Upwork’s Future Workforce Report, 73 per cent of all teams across the US were already set to have remote workers by 2028. By then, freelancers and agency workers were also set to be 28 per cent of the total US workforce. These numbers may well need revising now.
This trend was already strong, not just in the States but globally, for two reasons. In part it reflected employees’ changing needs. Workers are living longer and working longer, but doing so in different ways. In 2017 Mercer’s Global Talent Survey found that more than half of UK workers wanted more fluid work options. Not just career breaks or flexible hours, but above all remote and part time working. This allows everyone better work/life balance, and the chance to juggle responsibilities for childcare or elderly parents.
It also reflected the employer’s changing interests. The ‘Fourth Industrial Revolution’ has led to the large scale adoption of “agile working” practices across offices. This has led to a breakdown in the old hierarchical management structures. Agile teams assemble individuals with different expertise on a project basis; and often these are freelancers. They succeed in achieving goals and then move on to the next challenge. By their nature they work best in flexible workspaces, or where employees are able to work remotely. Apart from increasing efficiency the shift to more remote working can also mean a major saving in office costs. The increased use of freelancers also has considerable benefits in terms of flexibility and cost.
Investors were already waking up to the importance of companies re-assessing their working practices, but they might also consider another silver lining in all of this. Transportation is one of the largest contributors to global warming, and daily commuting is the biggest factor. Romany Webb of Columbia has created a very useful website “mapmyemissions.com” allowing each of us to calculate our CO2 emissions for our daily commute. The figures are always very interesting. In her own case, if Romany drove from her home in Queens to the Columbia campus in Morningside she would generate a whopping 8.3 pounds of carbon dioxide equivalent. If she took public transport this would only be 1.7 pounds.
“Only?” That still sounds too much to me. How about not going to the office at all?
For those of us who have long been part of the remote and flexible working revolution, many of the concerns expressed this week about the challenges of working from home are ones we have long ago conquered. “How to stay focussed?” “How to avoid distractions?” et cetera. So many of the articles I have read this week have also betrayed an extraordinary degree of micromanagement obsession amongst managers. The challenges really are not that big for individuals or companies, when weighed against the rewards. They might just help save the planet also.
Christopher Walker writes on business and global issues. He ran a large equity fund and has many years of investment experience.