Editor’s note: There’s an exciting, growing body of research on when we work best, why we work best, how we work best and even with whom we work best… but what about where we work best? What about that?  Let’s learn a little more.

Editor's update August 30, 2019: Harvard Business Week just published a similar article. An interesting, complementary piece for AFTER you read the below.

PSSST! Hey, you. Are you at the office right now? If you’re reading this, there’s a good chance you are –because most Americans spend a lot of their time at work ... not actually working.

As The Atlantic succinctly put it, “U.S. employees at large-sized companies (1,000 employees or more) only spend 45 percent of their time on primary job duties.” Meaning that a majority of your workday is consistently spent on something other than on the job you were hired to do. 

Topping the non-productive list? Reading articles ((Editor’s note: Keep reading. This will help your company so, technically, this is “work.”), fixing a meal or “hot drink,” scanning social media, catching up with friends and family, and… looking for another job. Like a job with a more flexible work policy.

If, on the other hand, you’re currently working at home for part or all of the week – and it’s an arrangement that both you and your company value – you might just be a whole lot more productive (and engaged, and loyal) than your exclusively working-at-the-office peers. Keyword: might. And in the past decade or two since working from home (WFH) has become more viable from a technological standpoint, that might has gained more attention, enthusiasm – and scrutiny.

Keyword: Might.

Flexible work arrangements – where people can do part of their job remotely or adjust their schedules around lifestyle and peak performance times – is seen as either a solution to, or an outgrowth from, our  insatiable quest to drive more productivity (read: the rise of the gig economy/hustle culture. (Editor’s note: We have a companion article on that coming soon!)

Marisa Mayer famously banned such flexible arrangements shortly after her ascent CEO at Yahoo! in 2012. In a leaked memo, the head of HR announced the change, citing that “speed and quality are often sacrificed when we work from home” and that “some of the best decisions and insights come from hallway and cafeteria discussions … and impromptu team meetings.” Not everyone was pleased. In a 2016 New York Times piece, 15 employees came forward to vent their frustrations.

Even though more than 1,000 employees left, Yahoo! countered that its application numbers were strong. And Yahoo! stock during Mayer’s reign saw enormous growth. Verizon eventually acquired the company to the tune of $4.5 billion, and Mayer walked away nearly $260M richer.

But the connection between fewer flexible working options and raging company stock isn’t so clear. In an exchange we had with Stanford Professor Nicholas Bloom, he noted there were more than 20 other management changes made when Mayer took over, so it would be a “naïve case study” that declared, “Yahoo cancels working from home, stock prices rise 20%.”

The connection between fewer flexible working options and raging company stock isn’t so clear.

Bloom also took a firsthand look at the opposite effect of WFH. In the longest study of its kind, Bloom teamed up with James Liang, CEO of Ctrip, China’s largest travel agency – with 16,000 employees at the time – to measure the effects of working from home (aka, “Does Working from Home Work?”).

At the time, Liang wanted to shave overhead costs by reducing real estate. Shanghai’s rent is expensive (which is why so many Ctrip employees commute long distances). He was concerned that people working remotely wouldn't be as productive as when they’re in the office. Would the real estate savings outweigh the cost of lower-performing workers?

He may have gotten more than he bargained for. When they tested the effects on 500 employees (where half were an in-office “control” group and the other half worked remotely), he noticed “an astounding productivity boost … equivalent to a whole day’s work” among those who worked from home. And that wasn’t all. Ctrip also saw:

• 13.5% more calls (productivity = 1 full day more per week)

• 50% reduction in attrition (fewer sick days, less time off), and

• Nearly $2,000 in savings per employee on rent, etc. over the course of the experiment.

Other companies are also reaping benefits like these. Amex saw its WFH workforce perform 43% better than their in-office counterparts, and Compaq noted a 15-45% rise in productivity. Sun Microsystems saves $68M annually on office costs and claims it’s avoiding 32k metric tons of carbon output due to reduced commuting. (People, planet, profit – win, win, win.)

There’s also the access-to-talent factor.

There’s also the access-to-talent factor. As Harvard Business Review reports, allowing people to work remotely (provided they were relatively close to the office for the occasional in-person meeting) helped JetBlue gain access to smart, motivated mothers who wanted flexibility in their work life – and there are literally millions more people who want that same flexibility. In fact, according to the Annual IWG Global Workspace Survey (conducted in January 2019 asking more than 15,000 professionals from 80 countries their views on workplace and flexible working), “80%  of people said when faced with two similar employment offers, they would turn down the one that didn’t offer flexible working.” 80%!

 (Editor’s note: We asked Professor Bloom if there were other studies showing true behavior – as opposed to just surveys reporting opinions – about WFH and he responded, “Unfortunately not. I started this project as I was amazed there were no rigorous studies of working from home. As you say, the literature is full of case-studies, surveys and anecdotes, and the problem is these are highly selective, and identifying causality is hard.”  In other words: Let’s experiment!)

And that’s people of all kinds and backgrounds, from Millennials – who are particularly attracted to flexible working arrangements – to senior workers wanting to contribute their life-long trove of skills without completely sacrificing the perks of retirement, because, duh. (71% of retired workers who later went back did so because flexible jobs were available.)

Those same people also say they’re more productive and more loyal to companies offering work-from-home arrangements (citing fewer distractions and interruptions and less time navigating office politics as primary reasons). They’re also more likely to leave if there’s a complete lack of flexibility. And if they can’t WFH, they may call in sick because they need a break from the drama. (Of workers who call in sick, 78% actually aren’t.) 

The downsides to a zero WFH policy may add up to more than businesses realize. That same Global Workplace Analytics report shows that unscheduled work absences cost an average of $1,800 per employee, per year – or $300 Billion (with a B) annually. You’d think flexible work arrangements would be a no-brainer, right?

Except here’s the thing: WFH doesn’t always work. In Bloom’s Ctrip experiment, more than half of the WFH volunteers gave up and decided to return to regular office life. Could it be linked to why, in a Harvard Business Review study, employees said they felt disconnected from their companies and reported not getting enough support from superiors?

Except here’s the thing: WFH doesn’t always work.

Turns out that a total 100% WFH arrangement causes too much social isolation, leading to loss of engagement and morale. So there’s a sweet spot to the equation. Gallup thinks a 60-80% WFH set-up is optimal, for a little F2F interaction at least some of time. Could businesses tap the flipped classrooms model where students learn self-paced, mostly at home, while the classroom is reserved for questions, interacting and practicing? Sort of that like weekly biology lab in college, without the daily lecture (Editor’s note: Or dissected frogs.).

In this “flipped workplace” equivalent, most of us are free to focus where we focus best, but then also have access to conversation and collaboration … we just don’t have to be there every day. And, heck, maybe we’ll even look forward to those precious in-person interactions? (How can we miss you if you’re never gone?)

Of course, not every job is well-suited to 60-80% WFH, like those jobs that literally require physical presence (it’s hard to be a remote TSA screener). But 50% of American jobs are actually compatible with at least partial telework(only 20-25% exercise that today.) Another survey suggests 87% of businesses rely on employees to use personal devices to get work done. Remote work is clearly on the rise – even if not officially – as is demand for it. 

What does company culture need to make this leap?

Adaptation is key, as is the willingness to experiment. (“Nothing beats testing,” Bloom hints. [Editor’s note: YES!]) But more than anything, employers need to cultivate trust in their employees to do their jobs, no matter where (or when) they are. 

Employers need to cultivate trust.

“It’s in the middle management where there’s resistance,” Bloom says. Case in point: 75% of managers say they trust their employees – but a third also admit they’d like to see them in the office … just to be sure. “If you trust an individual enough that you hired them to join your organization,” said Anne Donovan, PwC’s People Experience Leader, explaining how flexibility workedfor its business, “trust them to get the work done when and where they prefer, as long as they meet deadlines.”

That approach is simply going to look a bit different for everyone. The best flexibility policies are flexible and “should be individualized for each person,” Donovan urges, which may even involve an unscheduled break every once in a while.

In the end, it’s going to take some creativity to get the home/office balance just right. Since nearly half of jobs are vulnerable to automation in the next 20 years, creativity may just be the most important part of the job, wherever you do it.  (Editorbot’s note: Beep boop, yes, creativity cannot be done by robots. That would be like, beep boop, metaphor personal anecdote callback to dead frog.)