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Better Business?
Remote Work Isn’t Working for IBM

Remote work (or telework, telecommuting, whatever you want to call it) has been taking off in recent years as employers have looked to take advantage of modern technologies that divorce the ability to get work done from the need to be colocated. But we’ve been seeing something of a backlash against this shift, with several high-profile companies rolling back remote work benefits for employees. The latest example is also the most significant: IBM, considered by many to be one of the first (and perhaps the biggest) companies to fully embrace remote work, is now calling its employees back to the office. Quartz reports:

IBM had decided to “co-locate” the US marketing department, about 2,600 people, which meant that all teams would now work together, “shoulder to shoulder,” from one of six different locations—Atlanta, Raleigh, Austin, Boston, San Francisco, and New York. Employees who worked primarily from home would be required to commute, and employees who worked remotely or from an office that was not on the list (or an office that was on the list, but different than the one to which their teams had been assigned) would be required to either move or look for another job. Similar announcements had already been made in other departments, and more would be made in the future.

The list of remote work’s benefits is long and varied, ranging from better mental health for employees who are better able to balance work and home life, to reduced emissions and less traffic congestion from a lack of commuting, to stronger relationships (outside the office), to increased productivity. That last point is obviously the most attractive for employers, and it’s why we’ve seen so many firms accede to letting their workers toil from far-flung locations.

But IBM’s decision underscore one of the biggest problems with remote work: it can alienate workers and prevent valuable informal social interactions between employees. Quartz has more:

Team proximity appears to help foster better new ideas. One Harvard study found that researchers who worked in close physical proximity produced more impactful papers. Another report used data from badges that collect data on employee interaction to argue that employees who have more chance encounters and unplanned interaction perform better. This idea, known as the “water cooler effect,” has been embraced by the most successful technology companies…“The surprising question we get is: ‘How many people telecommute at Google?’” Patrick Pichette, then Google’s CFO, said in a 2013 talk. “And our answer is: ‘As few as possible.’”

Even as remote work becomes normal, IBM isn’t alone in placing an emphasis on working together in person. Yahoo made headlines in 2013 when Marissa Mayer made an abrupt decision to end Yahoo’s remote work policy, and companies like Reddit and Best Buy have, like Yahoo, formally co-located their teams within the last several years. It’s not that remote work didn’t have benefits—Best Buy, for instance, reported in 2006 that productivity had on average increased 35% in departments that shifted to working from wherever they wanted, whenever they wanted. Rather, it’s that working together, in person, has a different set of benefits. Like Best Buy and Yahoo at the points at which they decided to co-locate, IBM is a business that needs to do something new. Doing what it has always done, but better, won’t cut it.

There is something ironic about a company deciding that the only way it can innovate is by returning to an older, more tried-and-true method of working. That said, there’s something to be said for face to face interactions, and it’s clear that there’s a balance to be struck—studies have suggested that there’s a teleworking sweet spot between two and three days a week. Finding that Goldilocks level of remote work is difficult, and it obviously varies company to company, but the benefits are too great to shy away from the challenge.

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  • Eurydice

    Well, that makes sense. If the goal is creativity, then interaction of some sort is necessary. And if the goal is a specific kind of creativity, then the kind of interaction is important.

  • ——————————

    You would think that these large corps, with all their resources, would figure these things before wasting everybody’s time.
    Nah, it’s okay, their just employees….

  • Andrew Allison

    “There is something ironic about a company deciding that the only way it can innovate is by returning to an older, more tried-and-true method of working.”? Um, how about a company acknowledging that a mistake and reversing it? Remote work has been over-hyped, especially here.

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  • FriendlyGoat

    My guess is that one big problem is a conflicting jealousy from workers who have to be “there” against those who have recently not had to be “there”. Another may have been people trying from remote sites to be “creative” in ways that ended up willy-nilly to the whole. We have to understand why corporations increasingly want “team everything” (to make all cogs interchangeable). We also need to understand that this is often better for the corporation than for the individuals who are employed, because teams can have negative inside dynamics.

    • Anthony (please excuse what may be construed as excessive link correspondence)

      • FriendlyGoat

        No excuse needed! You send me good, thoughtful stuff. Sure, it’s sometimes a lot to read. I always appreciate it, and you too.

        This one hints that America’s earlier taxation, regulation and more socialistic policies were the correct direction all along and that the disdain for these things since 1980 is very destructive. I’ve “felt” this for three decades and it is the reason I went from “raised conservative”——- to——- “wait a minute, economic conservatism is hooey and requires to much disingenuousness from its would-be proponents”.

        • Anthony

          Thanks. And you know we are generally an ahistorical people, especially concerning government and the mixed economy (as an aside, I linked a piece from one of our favorite economists – T. Piketty – on another thread [doing your down time read it]).

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