During the height of the pandemic, remote work was a necessity for businesses of all types and sizes. By December 2020, 71% of workers in the U.S. who said their job responsibilities could be done remotely were working at home all or most of the time. Before the COVID-19 outbreak, that figure was only 20%.
Now, as employees slowly begin returning to the office, we’re seeing a shift toward the hybrid work model—an approach that blends the collaborative nature of office environments with the flexibility of remote work. On one hand, it gives employees the opportunity to connect with colleagues and work together in person. On the other, it affords them a more flexible schedule and provides them with chances to work independently.
A hybrid work model can bring a variety of benefits for both the organization and its employees—from reduced expenses to increased productivity and engagement. It’s also a factor when it comes to retention. In a survey of more than 1,000 U.S. workers, 47% of employees said they would likely look for another job if their employer didn’t offer a hybrid work model. At the same time, the hybrid work model can also introduce challenges. Businesses may need to fundamentally transform their approaches to how, where, and when employees work, while at the same time readjusting organizational attitudes to align with new approaches. Many will also need to learn how to engage teams that are geographically dispersed and put supports in place to help their workforce develop and grow the skills they’ll need to meet changing market demands.
Staying at the forefront of industry trends will require employers to adapt to these shifts if they hope to survive. The hybrid work model is here to stay—is your company ready to make it work for you?
In this piece, we’ll explore what the hybrid work model is, the trends that are driving it, and the actions that your organization can take to create successful hybrid work cultures and workplaces.
What Is the Hybrid Work Model?
A hybrid work model is one in which some or all of an organization’s employees work part time in the office and part time from a remote setting. Not all hybrid work environments will look the same. Some businesses may choose to give employees complete freedom in choosing when or whether they come into the office, while others may identify certain days as dedicated in-office days. How companies choose which approach to take will vary depending on their needs, their employees’ needs and preferences, and the nature of the work being done.
A recent Harvard Business Review (HBR) article outlines four hybrid work models to help organizations—international ones in particular—decide how virtual- or office-centric they should be. Each model is based on two factors. First, are the core tasks each team performs more relational (changeable and encompassing spontaneous knowledge sharing, creativity, and collaboration) or transactional (based on established routines and procedures)? Second, does the organization have employees in a large number of countries or only a few?
Let’s break down HBR’s thinking a bit here:
- Large Hubs: This is the most office-based model. It’s ideally suited for situations where people need to work collaboratively together on relational, knowledge-based, or creative projects. Some remote work is allowed, but teams will be expected to have a regular presence in large, regional hubs.
- Hubs and Satellites: The office also features prominently here, but whereas the previous approach relies on major hubs, this one pairs those with smaller satellite locations around the world to meet the needs of an even more global workforce.
- Distributed: Here, the work can easily be done remotely, but the workforce may still be localized to a specific country or region for reasons such as the availability or cost of talent.
- Global Virtual: This model is the most remote-enabled one. Employees work together on a global scale but will typically connect at least once a year in person.
As enticing as it can seem to go all in on virtual, it’s important to weigh the benefits and costs of each side. Building an international workforce can give organizations access to a more diverse pool of talent, for example, but it also adds to their administrative burdens and requires them to abide by varying employment and tax laws. Organizations should choose the model that best meets the needs and preferences of both the organization and its employees.
3 Trends Driving the Shift Toward Hybrid Work
1. Sustaining an Organizational Transformation
Digital transformation—the rethinking of how organizations use technology in all areas of their business—is a term that’s been on the tip of everyone’s tongue since at least March 2020. It’s not hard to understand why. Almost overnight, companies had to fast-track plans for digitization or make it a priority if it wasn’t before. According to Statista, an international market and consumer data company, digital transformation spending is projected to reach $1.8 trillion in 2022 and soar to $2.8 trillion by 2025.
Yet as much progress as we’ve made, there’s a real risk of backsliding as we get back into our pre-pandemic work routines. Research from the Boston Consulting Group (BCG) estimates that 70% of digital transformations fail to reach their objectives. They can be, after all, intensely complex and challenging to implement.
The good news is that in studying what doesn’t work, we can find out and apply what does.
- Focus on creating a strong strategy. One of the mistakes organizations sometimes make is relying too heavily on technology as a driver rather than an enabler. If technology is the paint, strategy is the canvas on which it’s brought to life. An underlying vision is what gives your entire digital transformation its purpose, aligns stakeholders around common goals, and informs investments and initiatives.
- Make sure you have support at every level. While a digital transformation can be exciting, it can also be complicated and disruptive. All stakeholders—from the CEO to the appropriate team managers—need to be involved in the planning and execution of any digital transformation initiative to make sure they genuinely buy into the process and its outcomes.
- Deploy the right talent in the right places. This will likely involve both leveraging the skillsets of your existing workforce and hiring new employees to fill key gaps. Here as well, it’s not about the hard, technical skills alone. Soft skills—such as emotional intelligence, creativity, critical thinking, resilience, and collaboration—can be just as if not more important.
- Be agile in your approach. Leaders need to be ready to adapt priorities to meet evolving needs, and they need to make sure their teams are enabled and empowered to do that. This is another reason why a strong strategy is so important. Your mission is the final destination toward which all your teams are working. They may encounter a few unexpectedly closed roads along the way, but as long as they know where they’re going, they’ll be able to navigate effectively around them.
- Monitor your progress. This seems intuitive enough on the surface, but according to BCG only 20% of organizations reported doing it adequately. It comes down to understanding what metrics you want to keep an eye on, how often you want to monitor them, and where you’ll store and share the data and insights.
As challenging as it can seem, the returns that can come from undertaking a successful digital transformation can be significant. Research from BCG estimates that earnings growth for digital leaders is 1.8 times higher than for those who lag behind. The stakes for not investing in digital-first strategies can also be high. Insights from McKinsey & Company suggest that by 2023, most organizations will need to build new digital businesses to remain economically viable.
Case Study: Colliers Project Leaders
Organizational transformation in action: Colliers Project Leaders, a real estate and project management firm, sees the superior skill level of its practitioners as a competitive advantage, so the company focuses on onboarding new practitioners quickly and providing ongoing training to keep all staff at the peak of their profession. By adopting the D2L Brightspace platform, Colliers Project Leaders can train more people and raise skill levels faster, which is critical to maintaining the service quality of a business that is growing at 15% per year.
2. Improving Employee Engagement and Retention
Employee engagement isn’t a new issue for organizations, but it’s another one that’s attracted more attention during, and as a result of, the pandemic. The good news is that it’s not all doom and gloom when we dig into the figures. Research from Gallup shows that rates of employee engagement have been steadily rising over the last decade. In 2019, employee engagement climbed to 35%. In 2020, it hit 36%, which is where it still sat in 2021.
That doesn’t mean employee engagement is something organizations can ignore.
There remain real threats to employee well-being, one of the biggest being burnout—a state of physical, emotional, and mental exhaustion brought on by chronic, prolonged stress. A study from McKinsey & Company shows that rates of burnout jumped from 2020 to 2021, especially among women. In 2021, 42% of women said they have often or almost always been burned out, up from 32% in 2020. A similar trend happened among remote workers. Research from Gallup revealed that in 2019, 18% of people who worked fully from home reported burnout. In 2021, that figure jumped to 29%.
We also need to pay attention to who is engaged and, maybe more importantly, who isn’t. Gallup found that while overall rates of employee engagement increased through 2020, manager engagement dropped slightly from 34% at the start of the year to 33% by the end. This is significant because managers play a crucial role in setting the tone for their teams—aligning everyone around common goals, prioritizing the work to be done, and sharing feedback.
Employee retention is another issue for many organizations, and it’s one that looks like it’s going to get worse before it gets better. According to data from Mercer, the average turnover rate for companies in the U.S. tends to hover around 20%. In a survey conducted by PwC of over 1,000 employees from across the U.S., 65% of people said they’re looking for a new job. This is part of the Great Resignation, a post-pandemic trend in which employees are expected to leave their jobs in record numbers.
Mid-career employees—those between the ages of 30 and 45—are seeing the highest rates of resignation, climbing by more than 20% between 2020 and 2021. For other age groups, rates either fell or plateaued, according to reporting in HBR. There are also certain industries that seem to be more impacted than others. While manufacturing and finance companies saw declines in resignation rates, healthcare and technology businesses saw 3.6% and 4.5% increases, respectively.
Still, there are practical steps you can take to help boost engagement and turn attrition into attraction for your organization:
- Align employees around a common mission or purpose. Now more than ever, people are looking for more than a paycheck. They want to be confident that their organization is making an impact and understand how their work is contributing to it.
- Don’t make engagement HR-centric. One of the biggest mistakes organizations often make is assuming that employee engagement falls solely within the realm of human resources. Successfully moving the needle on engagement and retention means getting all leaders involved. Gallup found that 70% of the variation in team engagement, both positive and negative, is determined by managers.
- Focus on professional development. Employees want to know that your organization values their skills—both the ones they bring to the table when they first start and the ones they’ll need to develop down the road. In one HBR survey, 89% of people surveyed in the U.S. said they valued added benefits as much as pay.
- Create a flexible work environment. Though benefits like in-office games and snacks seem tempting, it’s the life-focused benefits that make the difference for employees. According to research by McKinsey & Company, 45% of people who left their jobs said taking care of family was an influential factor. A similar proportion of people who were thinking about leaving cited the same reason.
- Provide regular, meaningful feedback. Employees want to be supported in doing their best work, and that means having conversations with leaders about the progress they’re making. Research from Gallup shows that people who get daily feedback from their manager are three times more likely to be engaged than those who receive it once a year or less.
More than anything, it’s about being consistent with your organization’s approach. As with a digital transformation, employee engagement and retention strategies need to be intentional and well planned to have a lasting impact.
Want to learn more? Download the Ultimate Guide to Learning Data and Analytics
Case Study: Epworth HealthCare
Employee Engagement in Action: How do you transform a healthcare organization accustomed to equating education with compliance training into one with a vibrant learning culture? That was the challenge facing Epworth HealthCare, a large not-for-profit private healthcare group based in Melbourne, Australia. Its solution was to integrate a next-generation learning experience platform with a proven track record into Epworth’s legacy eLearning system.
3. Meeting the Demand for Skills Development
The need for skills development is great across all organizations and industries. Growing gaps in both soft and hard skills paired with workforce shortages are accelerating needs that were already acute. Even before the pandemic, almost 90% of executives said their organizations were already dealing with employee skills gaps or expected to develop them within the next five years. Today, 94% of employers are reporting their workforce needs to hone new skills for their company to stay competitive.
Blame for the skills gap is often placed on low compensation, the idea being that employers aren’t willing to pay enough to attract the right talent. But it’s not that simple. Skills gaps aren’t always caused by not being able to pay people who have the needed skills. Often, they’re caused by a shortage of skilled workers to begin with. And the impacts can be staggering. Even in 2019, a Deloitte report predicted that skills gaps between 2018 and 2028 in the manufacturing industry alone could have an economic impact of $2.5 trillion. McKinsey & Company estimates that 1 in 16 workers will need to find a different occupation by 2030—up to 25% more than before the pandemic.
Skills gaps have also been attributed to education models that aren’t in tune with modern employer needs. The reality is that many higher education institutions are working closely with organizations to use their learning infrastructure and expertise to create programs geared toward more people. But employers also need to be ready to drive skill development and invest in the continuous development of their workforces. This is where upskilling and reskilling strategies become especially important.
- Upskilling is the process of workers learning new skills to be more effective in their current career path, whether through internal training or external education.
- Reskilling is the process of learning new skills so workers can perform an entirely different job.
There are a number of steps organizations can take to develop training programs that meet the needs of current and future employees:
- Carry out a skills mapping initiative. This will help provide actionable insights you can use to develop your employees in the direction they need to go and make sure your organization has the talent it needs to compete. It’s a complex process, but at a high level it involves identifying skills related to your organizational culture and strategy, capturing skills evidence to establish baselines, using that knowledge to identify skill gaps, and then designing learning experiences to fill them.
- Support employees with easy-to-access training. Employees often want to develop their skills and take the next step in their careers just as much as the leaders within the organization would like them to. But they’re busy, so training often gets put on the back burner. There’s no doubt that employees need professional development opportunities, but they also need the time and guidance to take advantage of them.
- Make learning relevant and rewarding. Adult learners tend to be selective. When they’re approaching professional development, they want to know two things: First, how does the course (or seminar or certificate program) relate to and impact their careers? Second, what are they going to get out of it?
- Keep programs agile. The reality is that skill needs are going to shift as industries and the worlds around them evolve. Your organization needs the right technology, processes, and people in place to not only weather the changes but adapt and thrive with them.
Want to learn more? Download the Engage Remote Workers with a Culture of Learning ebook
What’s changed the most over the last number of years is the proactive role companies are now playing in developing skills and providing significant educational opportunities. IBM, for example, is undertaking a massive effort to skill 30 million people around the world by 2030. The programs cover a range of topics from AI learning and cybersecurity through professional skills like critical thinking and problem solving.
What skills will the workforce of the future need? That depends. There’s no doubt that technical, STEM skills will be needed to foster innovation and help us build advanced technologies and tools. Yet it’s crucial not to discount soft or durable skills like creativity and communication. These are the ones that will be key to helping employees add value beyond automation, operate effectively in digital environments, and adapt to changes in the way they work.
Case Study: Dematic
Skills Development in Action: As Dematic, a leading supplier of integrated automation technology, software, and services to optimize the supply chain, continues to grow it needs to ensure that new employees can quickly gain the competencies they need in order to contribute high-quality work, as well as helping established engineers to level-up by learning new skills. Working with D2L, the company has built a transparent, scalable certification program that helps engineers and managers match the right skills to the right projects.
4 Tips for Implementing a Successful Hybrid Work Model
1. Put in Place a Solid Strategy
We can’t overstate the importance of strategy. Regardless of the nature or scale of your organizational transformation, strategy is the glue that holds the initiatives together and gives them meaning. In concert with strategy, another important piece that should accompany process shifts—including revolutions to the ways in which employees can work—is change management. Three key pillars that support change management are:
- Executive Sponsorship: Executive sponsors play crucial roles in driving alignment between specific initiatives and overall business objectives, providing resources to support the change, and reinforcing successes. Prosci’s 11th edition of Best Practices in Change Management highlighted that 73% of change management initiatives that had an extremely effective sponsor met their objectives, compared with only 29% of those that had a very ineffective sponsor.
- Employee Involvement: Organizational change often boils down to individual change. To encourage individuals within organizations to take action, you need to generate awareness and bring them into the process along the way.
- Open Communication: It might go against the typical way of communicating, but when it comes to change management, you need to communicate a lot more than you might think—typically, five to seven times over the course of the initiative.
Change management, when done right, can contribute significantly to the success of organizational transformations. Research from Prosci suggests that when sufficient resources are allocated, 85% of change management projects are highly effective. When there are not enough resources provided, the same percentage of initiatives are not effective at all.
2. Understand How You Can Support Your Employees
As more organizations embrace hybrid and remote work models, there are a handful of common roadblocks that tend to emerge. The first is a lack of informal communication opportunities. While web conferencing technologies have made it incredibly easy for people to set up dedicated times to connect, what’s harder to replicate virtually are those spontaneous conversations that happen when someone passes by a co-worker’s desk. Those seemingly small moments can play a big role in helping teams feel cohesive and in building a strong company culture. In one survey from Achievers Workforce Institute of 2,000 employees across North America, 42% of employees said company culture had diminished since the start of the pandemic, with 25% blaming that on a lack of effort to make remote employees feel connected.
The second is unequal access to learning. While 55% of employees say they value career growth over salary, only 47% of remote employees are satisfied with their employer’s professional development opportunities. The more dispersed workforces become, the bigger this problem could get unless organizations take action to address it.
3. Set Expectations Around Work and Learning
Although remote work can bring a variety of benefits for employees, additional flexibility included, it can also come with challenges. For example, some people who work remotely may have trouble switching off at the end of their workday, which can contribute to burnout and disengagement. According to the Achievers Workforce Institute 2021 survey, 25% of employees who plan to look for new jobs in 2021 list a better work-life balance as their top reason, while 23% of people said work-life balance was also the number one reason they would stay in their current roles.
It can also be a challenge for people to prioritize professional development. Sometimes, it’s because they don’t have the time or resources needed to make that happen. They may also struggle not having the cultural reinforcement they’d normally get from peers and managers in the office. It’s important that organizations both take measures to make professional development accessible and educate and empower employees to use it.
4. Monitor the Progress You’re Making
At the end of the day, you want to be able to demonstrate that the initiatives your organization is undertaking—from engagement with an individual professional development course to large-scale changes like the transition to a hybrid work model—are having an impact.
The metrics your organization chooses to focus on will vary depending on its needs, but they could include factors such as:
- Employee engagement and retention
- Time to productivity for new hires
- Internal promotion rates
- Learning retention rates
- Usage of learning and development programs
Data points like these can help drive business decisions. Plus, they can help you better position and articulate the value of learning and development investments, so you can see strong evidence of a return on investment.
Related resource: The Ultimate Guide to Learning Data and Analytics
Create a Vibrant Culture of Learning to Support the Hybrid Workforce of the Future
After a year dominated by remote work, what we’re seeing today is a shift toward a hybrid work model, one that allows employees to connect with colleagues in an office environment while still giving them flexibility and freedom to decide what their workday looks like. It’s an approach that can bring both benefits—including reduced expenses and increased productivity and challenges. Adopting a hybrid work model may require organizations to fundamentally transform processes, policies, and attitudes around how, where, and when employees work. Companies also need to grapple with how they engage remote teams and provide skills development opportunities to meet evolving demands.
True success with a hybrid work model comes down to having more than a shiny tool or two in your tech stack. It’s about choosing technology that will support your organization’s needs now and into the future. It’s about building a strong strategy that will drive lasting long-term change. It’s about having the talent and expertise to turn your goals into realities.