That's not how you run a company!

“The human mind is a lot like the human egg, and the human egg has a shut-off device. When one sperm gets in, it shuts down so the next one can’t get in.”

- Charlie Munger

It's amazing to me that so many large company CEO's have come out recently and stated that flexible (digital, remote, hybrid, WFH, etc.) work is hurting the performance of their enterprise.

The first thing that comes to mind is "Compared to what!?"

It feels like they have completely disregarded the base rates of effectiveness and performance of a traditional office-based management approach.

Nicholas Bloom et al. (2015) who conducted a randomized controlled trial with a large Chinese travel agency and found that remote work led to a 13% increase in productivity. While looking at the dramatic increase in the performance, Bloom and Liang found it wasn't so much that working from home increased performance as it was working from the office decreased performance!

More recent work from Bloom et al. at Stanford, "Why Working From Home Will Stick", (April 2021) estimates that higher rates of ongoing WFH will boost overall productivity by 4.6% even after post-pandemic levels of WFM have decreased.

It would seem there is a disconnect between what employees are experiencing and what employers (management?) are feeling. And perhaps the size of the company also has to be isolated to properly understand the differences among small, medium and large enterprise.

But even the largest organizations like Goldman Sachs, according to their own research, saw productivity increase 3.1% during the first year of the pandemic. And due to the forced experimentation of the pandemic, James Gorman, CEO of Morgan Stanley stated: “If you’d said three months ago that 90% of our employees will be working from home and the firm would be functioning fine, I’d say that is a test I’m not prepared to take because the downside of being wrong on that is massive” (Cutter 2020).

So, now we know we're not on the wrong side what are we going to do about it?