VANNOY:
Leading hybrid and remote teams. Hi, I’m Mike Vannoy with Asure and I have a special guest today who’s kind of written the book now, kind of literally has written the book on this topic. Gleb Tsipursky. He’s a bestselling author of seven books. Dr. Tsipursky is a cutting edge thought leadership has been featured in over 650 articles, over 550 interviews including Harvard Business Review, fortune U s A Today, fast Companies, c B s News, scientific American, psychology Today, entrepreneur, business Insider, business Insider Magazine, Forbes, and many others. Dr. Tsipursky’s expertise comes from over 20 years of consulting, coaching, speaking, and training for businesses. Dr. Tsipursky earns his PhD in the history of behavioral science at University of North Carolina Chapel Hill in 2011, his MA at Harvard University in 2004, and his BA at New York University in 2002. Today we’ll explore the principles from his book, returning to the office and leading hybrid and remote teams, Emmanuel on benchmarking to best practices for competitive advantage. Gla, good to talk to you again. Welcome to the show.
TSIPURSKY:
Thanks again, Mike. Really appreciated our second conversation.
VANNOY:
Yeah, so this whole topic of remote work, this is not like it’s a new thing, right? This is a continuum that’s been going on for at least 20 years, but clearly Covid accelerated this where Covid forced it upon people in early days of the pandemic and as we’ve got different names for different phases of the great resignation to the great stay to the great whatever things we’re in. Now it’s clear that especially as we face a labor shortage, that employees are voting with their feet and increasingly they want to work remotely or at least flexibly We’re possible. And I think we’re all over the board for how businesses, I’d say especially small businesses are or are not adopting virtual work a best practice. So really want to unpack this topic with you. I think you are maybe the most person I know on this topic, so can you maybe just, I want to talk through virtual work right through from pre-employment recruiting and hiring and onboarding all the way through post-employment, but give your high level assessment. What are you seeing in the market for businesses’ willingness to adopt virtual and remote teams?
TSIPURSKY:
Well, we are very clearly seeing businesses that are smaller, being more likely to adopt flexible work of whatever, hybrid work, remote work. So lemme give you some statistics first. So this is from the Scoop flex index. It shows that 39% of US companies require full-time in the office right now. So that’s just very recent statistics coming out in August of 2023. And that compares to 49% at the start of 2023. So we have less companies requiring full-time in the office now by quite a margin. So from 49% to 39%. And so that is very important. Another important dynamic is that smaller companies are embracing flexibility. So I talked about small companies, companies under 500 employees, 76% of the companies in the index are fully flexible and excluding tech companies, which of course have more flexibility, 59% of companies under 500 employees are fully flexible. So that’s pretty clear.
And so this, and especially tech is in the lead, 97% of all tech companies offer at least some work flexibility. And then that is pretty big. Now we also know that age matters. The more recent your company, the more flexibility you offer. For example, 93% of flex companies started since 2011 offer work flexibility. So that is very, very big. And so we clearly see that there’s more and more flexibility being offered by companies of all sizes. So for example, a number of US companies offering work location flexibility by fountain year companies that were offered created during the pandemic during 21 to 23, 90 3% of them offer flexibility. And if we exclude tech companies, 85% of them by comparison, if we look at companies that were created pre 1980, only 59% of them offer full flexibility. And let’s say if we look at the companies that were created from 96 to a thousand turn of a century, we’d have 78% offering for flexibility, 58% if we exclude tech companies.
So that is really important. Like newer companies, which of course tend to be smaller companies. So that is something that we really need to realize what is going on with smaller companies and larger companies because clearly smaller companies are offering more flexibility. So lemme go in depth into the smaller companies just so folks realize what’s going on. If you are a smaller company, so the flex index, you can look it up, it’s right there. The Q three flex index by scoop, look it up under 500 employees, 76% are fully flexible, fully flexible. So that’s huge. Being fully flexible, that is a very large number. If you look at structured hybrid, which means fully flexible means either employees decide or it’s fully remote, 11% are structured hybrid meaning there is a requirement of a mandate of some days in the office per week and then 13% are full-time in the office.
So that’s for companies under 500 employees. Now if you look at 500 to 5,000, we’re going from fully flexible at 76% to fully flexible, 34%, that’s about half. And then something structured hybrid is 27%, full-time in the office is 39%, 5,000 to 25,000 employees. Fully flexible is 25% structured hybrid, 40% full-time in the office is 35% and then 25,000 employees fully flexible. A 16% unstructured hybrid is 59%. So these breakdowns should give you some idea of the smaller the company is and the more the younger it is and the more it is in the tech sector, the more likely it is to be flexible. So
VANNOY:
I want to go to the why quickly here. I want to follow up though the first stat you put out, I don’t remember the exact number, was that the number changed materially just this year in 2023. Can you repeat that first one for me?
TSIPURSKY:
Sure. So it went, so just at the start of 2023, January, we had 49% of the companies fully in office now by end of the Q three, so August of 2023, it’s 39% of the companies all fully in office because they’re losing talent when they’re doing fully in office.
VANNOY:
And that’s what I wanted your insights on. So that’s a massive change, a 10 point swing, it’s
TSIPURSKY:
Huge
VANNOY:
In just like seven and a half months. So gleb this drop in 10 percentage points in the last eight and a half months. Is it your opinion or is it the results of this survey that explained it was people losing talent and they had to make an adjustment.
TSIPURSKY:
So we know from other surveys why that’s the case. So the Flux report reports what they’re fighting, but there is other surveys that report closer to why. So there’s, for example, the Greenhouse candidate experience report is found that there was a lot of employees who are ready to jump ship if their companies pull a flexible schedule. Specifically 76% of employees are ready to jump ship if their companies become more strict. And it’s especially an issue for underrepresented groups, they’re 22% more likely to consider other options if flexibility comes to net. Another report from unispace returning for good report found that nearly half, 42% of companies with return to office mandates have a higher level of attrition than they anticipated. Almost a third of them, 29% are struggling, are struggling with recruitment. And here’s another survey from the Federal Reserve survey of household economics and decision-making.
It found that shifting from a flexible model to the traditional one had the same experience as a two to 3% pay cut. So all of this research from a number of different sources very clearly shows that you companies unexpectedly more than they expected. They knew they would lose some talent through mandated return to office, but it’s more than they expected. And the candidates are ready to jump ship and some are, and they’re experiencing the same as a pay cut which people hate. So that’s very clearly the answer, that it’s an issue of retention and recruitment, but companies that used to have more of a forced requirement in the office are less forcing that requirement in the office. Now
VANNOY:
Here’s what I think and I want you to comment on this. My research shows that, and I’ve done a couple talks on this topic, the mentality of a lot of employers post pandemic. So people kind of phase back to face-to-face work depending on the industry and where you were geographically, what stayed, et cetera. But here we are fully out of 2022. So call January one back to normal.
I think the mistake so many employers have made is they went unquote back to normal the same as it was in December of 19. But something really, really, really important happened here. And it wasn’t, and I’m not talking about the Ukrainian war, I’m not talking about the pandemic and I’m not talking about presidential politics. In 2020 something really huge happened where based on birth rates 30 and 60 years ago, the amount of available US workforce has actually flattened In 2020 was the first year ever where there are actually more people older than working age than there were younger than working age because the population has always had this kind of pyramid, right? Lots of young people, some middle people, and then just a few old people as people naturally are born and die. And I think what’s happened is this labor supply has all of a sudden flattened a three year window of absolute craziness between wars and pandemics and presidential politics. And we’ve tried to go back to normal, but the law of supply and demand employees have choices. Unemployment three and a half percent, that’s the 50 year trough, right? So they vote with their feet. What do you think the most underlying root causes of it? Is it as simple as supply and demand of labor like I’m making it or are there some other things going on here?
TSIPURSKY:
So I think one dynamic is a supply of labor. I’ll add a nuance to the supply of labor. Our demographics have not only been skewing older, our demographics have also been skewing less white. And that’s really important because if you recall what I just noted about the greenhouse report, employees from historically underrepresented groups are 22% more likely to consider other options if flexibility comes to an end. And we know that the US has become less white looking and we have more and more underrepresented groups in the employment. So that we think is another dynamic. A third dynamic is a specific group there, which is something like 8% of the US population, and that’s people with disabilities. So people with disabilities have been disproportionately impacted by the ability to work remotely before the pandemic. They have been asking many, many times for more flexible work options because obviously if you have mobility issues, it’s really difficult to get to the workplace.
If you have things like sensitivity to light or you have difficulty with social interactions with people who have autism, other on the autism spectrum, that’s another sort of dynamic. Now Covid itself caused a lot of disability. So thinking about long covid, we know something like about just under 20% of people with covid report. There are a variety of long covid symptoms according to the C D C and some of them, I mean some of the symptoms aren’t problematic for working like insomnia, meaning inability to smell, but some are like fatigue and brain fog. And about 25% of those with long covid had disabilities that caused them to shift their working hours. So that is mainly due to fatigue and brain fog ability to work remotely facilitates the ability to work for people who have fatigue and brain fog. And so what we’re seeing naturally is that group is a huge going to be desire for more flexible options.
And just in general, people from underrepresented categories, minorities besides people who are disabled have a stronger preference for remote work. And there are a number of causalities. So for example, black people have reported widely that they have more of a desire for remote work because it causes them to have less experience of discrimination and microaggressions in the office. So that’s black people, Hispanic people, women have more caregiving responsibilities, whether it’s childcare or elder care. So they also want more flexibility. And we know that more women have had college diplomas, so more women are entering the higher office worker workforce who are more able to work remotely. So the demographics in terms of those categories are also impacting things. So we have to think about that where your worker pool is coming from. So I think that’s one cause a big, big cause of the demographics.
Another big cause is just chaining our previous habits and norms. I do think the pandemic is huge here because being able to work remotely has proved to people that they can work remotely. Now if you’ve worked remotely for a year before, the vaccine was widely available and you feel and you were actually productive. I mean nobody’s really arguing that remote work is not individually productive. And we can talk about that. There’s definitely research showing that there’s some negative impacts on collaborative work and learning if you don’t do those things effectively. But on the individual level remote you can do your individual work very well full-time from home. And so having that experience caused people to see why do I need to go and do the commute? That’s the most dangerous part of the day, the time of the day that I’m most likely to be killed and it’s very stressful, has full and expensive.
So why do I need to do that? So I think that is a huge cause. Nothing with presidential politics, but disrupting your everyday life. I’m behavioral scientist, that’s my background, that’s my expertise. How do you behave? Why do you behave that way? That’s what my PhD is in. And looking at a disruption in your normal everyday routines that caused you for a year to be able to work successfully from home, of course you’re going to be resentful if you’re going to the office for a reason that doesn’t seem to you to be valid and helpful. So that’s another huge reason. So I think we need to consider both of those reasons, the demographic one and the behavioral science change in the routines, habits and norms and the information one.
VANNOY:
So I appreciate you indulging me to open the conversation. On one hand it almost doesn’t matter because the tidal wave is rolling over us, whether you like it, whether you’re a manager who doesn’t believe in remote work or you love it, it kind of doesn’t matter. I think everyone sees it. I think it may be important that we unpacked some of the why at the top, but now let’s lean in here. So again, whether you want a remote workforce and a flexible team or not, you’re forced to deal with this, right? So let’s talk some of the best practices about leading these remote hybrid teams. And let’s maybe start with pre-employment. So what are you seeing as best practices? Maybe what are the best practices? What’s the impact of having a remote first mentality to recruiting and hiring and onboarding?
TSIPURSKY:
Some of my clients, I help 25 companies figure out their policies toward the future of work. Many of them, most of them have a hybrid flexible policy. Couple of them. So two of them have a fully remote first policy. The rest have a flexible hybrid policy. And so coming into the office occasionally team driven approach, we can talk about that. What we’ve definitely seen with pre-employment is that companies that put out publicly their policy toward flexible work are much more likely to get candidates than companies that don’t. So the companies that I work with generally on their websites, they’ll come work for a section on the website. They list their flexible work policy and that is a public pre-commitment both to their internal employees, which helps improve retention, but of course to the employees who they’re recruiting and they see, okay, you no employer actually sees all the people who pass them by because they don’t see their flexible work policy on their website.
And so once companies they work with posted their flexible work policies on their website, they’ve seen large boosted recruitment 30, 40% boost. If they offer more remote work, there’s a larger boost to going to 70, 80%. But even just flexible hybrid policies, 30, 40% boost the recruitment and that’s just because you post your policies and you put in the job description what kind of policies you have. So yes, in the job description as well because it gets spread around. So on your website, on the job description, having a description and having that public commitment is very important for the pre-employment conversation. For recruiting folks,
VANNOY:
What do you see around? So that’s huge. I mean you’re talking about 30 and 40% potential increases in candidate flow. In a world where I describe it as the war for talent has hit main street and everybody’s struggling to find employees, increasing your candidate flow by a third is gigantic. What data do you have or opinion do you have about access to talent? I’m of the opinion that if as soon as geography doesn’t matter, you are no longer recruiting people within, call it a 45 to 60 minute commute, your labor pool just became the entire globe. I have a friend who runs a company he pays if he’s going to have an engineer, it pays X and it might be a little less than Silicon Valley would pay, but it’s 10 x what somebody in another part of the world might pay, but he doesn’t care. He’s declared my mission is to find the top 1% of the 1% top talent in the world and have them work for my company. And so just a talent acquisition mindset versus any other number of reasons. What does your data or research tell you?
TSIPURSKY:
Sure, I’ll give you both data and the story. So data, LinkedIn research, put out data, finding that of all positions on LinkedIn, something like 13 to 14% are advertised as fully remote and those positions get over 50% of the applicants. So that’s 15% get over 50% partially because of course plenty of people want to work full-time remote, but partially because very many people are able to access these positions who wouldn’t be able to access them otherwise. When we look at surveys of people who want to work remote consistently, the number is full-time remote. The number is something like 25, 30, 35 depending on the survey and the wording in the industry. So we’re seeing more people actually apply for those positions than would be expected just from the basic demographic of who wants to work full-time remote. There are some people who would not want to work full-time remote, but they’re applying for full-time remote positions because they live in an area like you said yourself, where perhaps the cost of living is not that high and they’re applying to an area where cost of living is higher that offers a better salary.
So of course we’re seeing a much better pool of talent. And as a story, I was doing an opening keynote at a staffing conference, so for staffing professionals and after I presented, one of them told me a story where there was a company that advertised a position. The position, there were two positions, very similar positions. One was a position that you can work remotely. Another position was you had to come to the office, the position that you worked remotely got 350 or something. Applicants, the position that you had to come to the office got under 10. And this is a staffing professional who just observed this happen and told me that. So it’s both very clear research in LinkedIn research, they don’t have a stake in the outcome, but also staffing professionals who again, they don’t have a stake in the outcome, they just want to staff the position.
VANNOY:
All right, so clearly describing yourself. So it’s not enough to just have the policy. You need to brag about your policy because bragging about it, making it part of your employment brand message, including it in your open listings. These all have a dramatic impact.
TSIPURSKY:
They do.
VANNOY:
And then on the other side of that same coin is by opening up the world as your talent pool, the level of talent that you could bring into your organization, it really is stunning. So again, don’t think about this. My guidance to small businesses don’t think about this as who’s within that 30 to 60 minute commute and I’m going virtual. So now they can go two hours, it’s not two hours. It’s the entire globe depending on the position is now a potential candidate. And just imagine what you could do if you had the absolute most brilliant minds in the world working on your projects in your company.
TSIPURSKY:
Absolutely.
VANNOY:
Okay, so let’s move on into the employment cycles. Just talk about productivity of employees, whether they’re across the street or across the globe. What happens to productivity? You’ve got a lot of data on this when teams are remote and or hybrid.
TSIPURSKY:
So we very clearly see that productivity for remote workers is great individually very good individually because they don’t have to do the commute. So if you’re thinking of fully remote, they don’t have to do the commute and they’re willing to devote about 40% on average of the time they would’ve spent commuting to working. That’s one dynamic. Second, when they are working in their home office, they’re much more focused, they’re much less distracted, especially if you have an open office that’s very distracting. So they are much more focused. They can also work more flexibly on the time when they have the highest energy. So some people are night owl, some people are morning doves and they can choose when to work. So maybe they want to work, wake up at 4:00 AM and start work at 6:00 AM and some people may want to work up at nine, wake up at 9:00 AM and start work at 12:00 PM So that flexibility enables them to work when their energy is highest. It also allows them to structure their lives around their work. So for example, they don’t have to work, leave work early to pick up their kids, they can pick up their kids and then they can do some work after they pick up their kids or whatever they need to do. So that flexibility very much increases individual productivity. However that comes at a cost of group collective productivity. There’s definitely going to be costs in coordination and learning and mentoring, collaboration. So those things
VANNOY:
Say more about this because I think the average employer listening today, they know what’s happening in the world, but they might actually be like, I don’t want all this remote work. I’m sick of, it’s gone so far, but people are more productive when they’re together in the office. So speak to that, cost has got to mitigate that.
TSIPURSKY:
Yeah, absolutely. So there is a cost. So you’ll have people who are individually more productive, but collectively as a team you’ll have lower productivity. So that collective because you’ll have higher costs for coordination, collaboration. So people who need to work more collaboratively, who have more time for less individual contributors who are more team members, you see costs of something maybe like 10% less productivity, something like that depending on the job. So for example, there was a study recently, so the more hourly based that is, and the more short-term it is, the less productivity you will get. There was a study that had short-term temps for data center who are randomly assigned to work at home for several weeks versus work remotely versus work in the office for several weeks doing data entry, very menial work and people who were working from home had 18% less productivity, which again, these are understandable why they are hourly employees, they don’t have a future there and this is not something that they are really investing into.
So that’s individual productivity. And so when you think of the kind of employees you have, if you have short-term temps who you can’t really monitor when they’re working from home and this study didn’t really make an effort to monitor and manage their performance, they will slack off. That’s understandable. So people who are salaried who have a future in the company, they will by far, vast majority of them will be more productive individually at home. So just make that clarification and clarity. So we definitely more productive at home individually for the team effort, you’ll have to put in a lot more time and effort into coordination and collaboration. We can talk about how to mitigate that. And there are a variety of strategies. The problem is in the companies that have 10 to 20% overall decreased productivity because of that fully remote work, they don’t put in their efforts to mitigate those problems.
They just try to work. They try to shoehorn remote work into the same methods of leadership and collaboration and management, team management that they used in the office. So if you do that, you’ll definitely have 10 to 20% less productivity. And there are some companies, there’s a reason why companies that have started more recently have more flexibility because they have much more of a culture and leadership style and management style collaboration style that is digitally informed, that is relying on digital technology, digital collaboration, digital tools. So if you don’t have that culture, if you have more of a pat on the back, do I see you working, walk around the office management style and you are very stubborn in the reluctance to adapt that to the remote setting, you’ll have 10 to 20% less productivity. So there’s very clearly that is what the data shows now
VANNOY:
Be specific beyond culture and I’m a huge culture guy, so I want to go there. But beyond culture, what are the specific tools or processes or behaviors that lend itself to the improved communications and reward and whatever else is involved that allow remote work without that loss in productivity?
TSIPURSKY:
Yeah, so there are a number of things you want to think about. The things that are better done in person, everything else being equal are more intense forms of synchronous communication. So we’re communicating face-to-face synchronously on an intense topic like a decision making or something like that. A second thing is nuanced conversations where maybe a performance conversation or addressing some conflicts, some tensions, maybe a leader conveying strategy to subordinates. That is another type of activity that’s better done in the person. A third is socializing and team bonding. So again, everything else being equal old style better done in person. And the third, fourth is mentoring and on the job training. So that one-on-one mentoring or answering questions quickly, that’s the on-the-job training metric component. So you need to address all four of those. We definitely have studies showing that if you don’t address all four of those, then you will lose productivity on the collaboration, on the teamwork front.
So how do you address those? So let’s talk about collaboration first. So you want people to be more collaborative and in order to do that you need to decrease coordination costs. To do that, you want to make sure to push you down your messaging communication to be as asynchronous as possible and as tracking documentation information as possible, coordination is easy in the office because you can go to each other, to the cubicle next door, the office next door, the open office, yell out across the office, ask questions quickly, get answers quickly to address that in advance. You want to document things much more. So document your systems, your processes. It should not be nearly as much in people’s heads. It should be documented and sent to each other with clear context because that loss of context is part of what makes that collaboration more difficult.
Then you also need to learn how to use asynchronous communication much more effectively. People if they don’t use that tend to get buried by email. Their inbox has like a thousand emails that they haven’t read or they’re missing channels. If they’re in teams or Microsoft teams or Slack, their message, they don’t know how to use that effectively. They’re missing messages. And so that all undermines collaboration. So you need to learn how to use those tools effectively and you need to learn how to use a project management tool, which you can use in teams. You can use something like Asana, you can use something like Trello, team management tools. So tools that allow effective management of your activities and reporting on projects and collaboration. So those all facility collaboration. You also want to be able to not only send messages in text, you want to be able to send messages using audio and video. So because those convey much more nuance than just text. So that’s going to be a problem if you just use text, if you don’t use messaging, messaging software that conveys your nuances of communication like we’re doing right now with voice and video, those are going to be really helpful. So those are activities that help address the collaboration problems, some of the collaboration problems. Now let’s talk about another activity. Do you have any questions on that before I go to another activity?
VANNOY:
No. So I think the guidance here for entrepreneurs, for business owners, for managers is this isn’t just a lift and shift. This isn’t. I’m going to take my old work practices that were face-to-face and now I’m going to manage the exact same way in a virtual and think you’re going to get the same more better results. You’re not, you’re going to get worse results most likely to accommodate the need. Well, I’ll call it the need of the marketplace because employees are voting with their feet. You are going to have to change your management practices.
TSIPURSKY:
Yep, your management practices, your team leadership exec. Then how does your team coordinate and communicate to build bonds and answer questions quickly. One really good technique is called virtual coworking. Virtual coworking involves getting on the video conference. By the way, I describe all of this if you want to get in depth in my book, returning to the office and linking hybrid in remote teams, plus I’m going to describe this quickly here, virtual coworking, we’ll
VANNOY:
Provide a link in the show notes for you as well, Glenn.
TSIPURSKY:
Excellent. So virtual coworking is you get on a video conference call, whether it’s teams or Zoom for about an hour. You get your whole team. So six to eight people, that’s the usual size of a team. For small business, it might be a little bit more and a little bit less. So depending on how many people are in each team, then what you do during that time is you do your individual work. It’s not meant for collaboration. So you leave your speakers on, you turn your microphone off and your video is optional. Some extroverts will leave it on, other introverts will tend to leave it off. But the key is that when you have a question as you’re working on your individual tasks, you can turn on your microphone and ask a question. So I facilitate these as teams are getting into it. What I tend to see is that people work for five, 10 minutes and somebody usually someone who’s more junior has a question and she or he turns out on their microphone and they ask a question and then some other team members turn on their microphones and they answer the question.
There’s some chatting, there’s some problem solving maybe. And then they turn that off and they go on to do more of their work. And then again, the same thing happens in 15 minutes, someone more senior might ask a question about a client and how to resolve a problem that they’re dealing with a client and there’s that conversation. Then they stop and they go on. And so you might have during an hour long session, three or four of these conversations, that is very helpful for team bonding for people. Again, building those ties and that’s one of the challenges. It’s very helpful for junior staff, especially integrating into the team and training. So on the JOBB training, that’s what on the job training is the ability to get your questions quickly answered. And that virtual coworking is a really good tool of getting your questions quickly answered. So it sort of replicates the ability to work in an open office except you’re not distracting the other people around you and you’re able to just get your questions answered. So that’s a really helpful technique.
VANNOY:
Glad, it’s interesting. I think that the next generation coming up, they just intuitively know how to use tech to do exactly what you’re driving, right? I remember school just started today, today’s first day of school for my kids here. I remember last year it was supposed to be heads down homework time, and I see my daughter at the kitchen table books out, but phone out and I see it’s a video and I’m like, Hey, get back to work on your homework. Long story short, it’s a conference call with about five of our friends and you’re like, we are doing our homework, what are you talking about? And it took some explanation and me calming down a little bit. But that collaboration, they were sitting silent mostly doing their homework. Hey, you got this one, what does she mean by this? How long of an answer, let me read this one to you. What do you think of that? They’re literally, if she had her friends over at the kitchen table, I wouldn’t have raised an eyebrow. They’re doing all that together, but these guys get it. I think some of as old folks, sometimes we have to to implement the exact same tools where all the reasons you just said.
TSIPURSKY:
Exactly right? Yep, absolutely. So that is a really useful tool and that’s an example. Of course you can do that with any sort of activity you’re doing, right? So that’s good. Then another activity that you want to think about is how to have virtual coffee hour activities. So you want to address the socializing and team bond, something that works really well. And by the way, these are all techniques I introduced to my clients and that’s very helpful. So socializing and team bonding, you want to have some kind of virtual coffee hour where you get randomly matched with people from your company where you get to have a chance to chat and the company pays you five bucks for your coffee for that period to chat with another team member for a half hour to get to know each other better. To build those bonds, you want to do it across teams, so not match the people in the same team, but across teams. That is very helpful to build those bonds, have those connections. That is a really valuable practice that has, I’ve seen done not nearly enough. So the virtual coffee hour, that’s kind of one activity for team bonding. Another activity for team bonding is finding virtual activities that are fun to do together. For example, virtual escape rooms. That’s a really great activity. So for team bonding, team belonging, another activity is playing video games together.
VANNOY:
You got to explain that one. I’ve done a lot of team building games and stuff remotely. I’ve never heard of a virtual escape room. What the heck is that?
TSIPURSKY:
Oh yeah. So same I t L. There are several people in a team in an escape room. So you know what those in-person escape rooms are. You need to have clues and find each other, find things together. Same thing. So you have a virtual escape room. I’ll introduce you to someone with the virtual escape from. I think you’ll enjoy it. It’ll be interesting. So yes, it’s the same idea. You have several team members who are together and they need to figure out how to escape this room. They need to look at clues, they need to solve dynamics, solve puzzles, and eventually they escape the room. So that’s an example of one kind of activity. And there are a number of other sorts of activities like this. And the other activity that you can do here is an activity like playing video games or watching a movie together and commenting on it. So something that would allow you to bond with other people as more of a group. So the virtual coffee activity is going to be more of a one-on-one bonding and that will be helpful. And the escape productivity and the video game playing, watching a movie that’s going to be more of a group activity. So you want both one-on-one bonding and group activity. Bond
VANNOY:
Glib. Talk about costs. So I gave an example earlier, a friend of mine who is A C E O and he chose to not use this as a cost arbitrage, as a labor arbitrage by going, I’ll call it offshore for talent. He saw this as a way to, in some markets probably paying an obscene high salary to someone compared to market value. But because he really was after that 1% of the 1% top talent, not everyone will choose that strategy. What do you find, what does the data say about cost containment? Does this save employers money and if so, how? Oh,
TSIPURSKY:
Absolutely, yeah. So the research on remote work productivity shows that even if you use traditional methods, your R O I, your R O I return on investment will still be higher if you hire remote workers because you don’t have to pay nearly as much for a remote worker. First of all, you’re saving on real estate. I mean that’s a huge cost for any new service sector. That’s the number second, cost two cost after the employee salary, right? Then your various office based services, you don’t need to pay those and you can afford to pay quite a bit lower salary if you choose to do so. Now when I work with clients, what I typically do is looking not so much at collaborative activities where there’s going to be some issues if you have team members who are paid vastly different salaries, but if you are looking more at individual contributors, let’s say you have an accountant or something like that, so people who are in more an individual contributor role, that’s definitely a good person to hire fully, remotely and to offer them not the kind of salary that they would command in the local market.
And so those positions, you want to think about not creating as much jealousy again. And so that’s the dynamic I would just warn people about because I’ve seen that be a problem if you have very collaborative people who need to do a lot of work, but if you don’t, that’s great. Or another option there is to hire a full team remote. So remote from a certain area, from a certain dynamic that would be approximately the same salaries. So that’s kind of another thing to be thinking about. So just the only issue is creating those jealousy dynamics and problematic dynamics. But if you don’t do that, if you hire everyone one on a certain team fully remote with this equivalent salary or individual contributors, you’re going to save a lot of money and very clearly your R o I will be higher. So this is why smaller companies who don’t have as much RI roll and bureaucracy and thinking about various comparisons, they’re much more likely to be fully flexible. So that’s why you’re seeing the smaller businesses, 76% of them are fully flexible, and again, that’s counting the tech sector. So really when you have in the tech, you’ll have something like 97% fully flexible. This is very huge.
VANNOY:
Yeah, I think people don’t realize, I think a lot of times people will think, okay, here’s my domestic labor cost and there’s been enough news sharing to say, okay, if I go offshore, India, Russia, south America, it doesn’t matter where I’m going for x pennies on the dollar, I can have labor there. But they don’t think necessarily about exactly what you said, a job that reports to the office, but 15 minutes away, a lot of times people will take less money to work from home to have that flexibility. But I found in my own personal life running businesses, I might put out a certain dollar amount. Here’s the salary for this position. I couldn’t recruit in New York, Chicago, Dallas, Houston, San Francisco, but I could get really great talent in Chattanooga Fargo. It’s these smaller markets have really talented, really experienced, highly educated people that are willing to work their tails off and get kind of big city money, if you will, and be ever the more grateful for it. So
TSIPURSKY:
Absolutely, you’ll get that. And you can hire people. I mean you’re talking about you can hire people in Costa Rica and Jamaica and Honduras in Brazil and Argentina, Nicaragua. So I’m talking about those areas because they’re in the same time zone. So that’s kind of another consideration that you’ll want to be thinking about as a small business owner. Having people on the same time zone is quite helpful or shifted by maybe an hour or two. So if you’re on the east coast, if you’re on the west coast, also not that much of a shift. So thinking about that is also something valuable when you think about who to hire, where
VANNOY:
Can you talk about performance management gl? So I think it makes a lot of sense. You talk about one of the adjustments that management has to make, leadership has to make is around collaboration.
TSIPURSKY:
You can
VANNOY:
Use technology and tools and not just have this management by walking around a model of, call it the eighties, nineties. I think that’s intuitive enough, but I think people frequently really struggle with job performance when if it’s a sales job, hey, it’s how much they sell. If they’re manufacturing, well, it’s not going virtually anyway. How many widgets did they use that day? But so many of our jobs, it’s nuanced and it’s a lot of managers rely on their own observations of behaviors to measure performance. How do managers effectively manage performance when it’s a remote situation?
TSIPURSKY:
So usually managers have some kind of OKRs objectives and key results or KPIs, key performance indicators for their teams, but they’re not tied to the individual perform. That’s usually the case. So the manager needs to hit certain OKRs. So what you want to do instead is very much tie those OKRs to the individual performance. There’s a reason the person is on your team. And so you want to think about, okay, how much does each person contribute to my team’s goals, whatever my team needs to create. So tying that to the individual is really important. And then switching from that one big annual performance evaluation to frequent small scale performance evaluations once every one or two weeks, weekly or bi-week. And so what does that involve? What do you want to do is think about what are, let’s say you have OKRs and what are the OKRs broken down approximately into weekly biweekly sprints.
And so thinking about sprints, that’s pretty typical for programmers, but that’s very easily done for other jobs as well. If you think of it in terms of goals. So what you do is for each week or each two week period, you and the employee come up with three to five goals for the week. And that can be something related. Let’s say customer, you have certain amount of calls or customer satisfaction or responding to calls within a certain amount of time, something like that within hr, it could be having to do with recruitment or a certain amount, policy writing, whatever it is, make them as qualitative, as quantitative as possible. So ideally they would be smart, specific, measurable, actionable, relevant and timely, at least one of them, ideally all of them, but at least one of them. And then over the course of a period of time you have a meeting where you do that and then you have another meeting in a week or in two weeks where before the meeting about 24 hours, the employee sends to you a report on how they did on those three to five weekly goals, any problems they encountered, how they solve those problems and on the self evaluation.
Then at the meeting you discuss those things. Maybe you coach the employee on how to solve the problems better. You approve or revise their performance evaluation and you choose three to four, five goals for the next week or two weeks, and this is the good managers already meet with their employees on a weekly or a biweekly basis. So this just introduces a performance evaluation element to it. It’s a very helpful technique because you can observe now the behaviors and the goals, the outputs, the really important things are the outputs, right? Not the inputs, not the behaviors, but the outputs. What is the employee putting out in terms of those three to five weekly goals? And you also get to build a better relationship with the employee because you’re meeting with ’em consistently, how you evaluate them all the time, what their rating are, because you can look at the ratings in the past and how they’ve been doing.
You can catch any issues as they’re developing and improve them rather than waiting for the annual performance evaluation to address any issues that are going on. The employee has a lot of psychological safety because they know how they’re doing. They can feel confident about your rating of them and how they’re feeling about them. So they’re not going to be polishing their resume because they’re worried and anxious about how you think of them. And you in general have a better relationship with ’em. That’s also a good time to check on their wellbeing if you think they’re being stressed or something. So it’s a good opportunity to have a conversation about other aspects of their lives. So this is a really useful technique that a lot of my clients are using in order to evaluate the performance of their employees, make sure they’re managing to the OKRs effectively and that everyone has a good relationship, has psychological safety. It really improves retention and engagement of your employees.
VANNOY:
My experience here is that if you’re going to offshore or outsource work, if you just simply say, Hey, you now do this for me without defining the how’s and the processes, you’re going to be really disappointed with the work because you can’t just lift and shift because we’re all naive to how much the tribal knowledge, the water cooler conversations, the listening to each other over the cubicle walls, the conversation in the parking lot after the real meeting. Those things have so much impact that when all of a sudden you outsource it, it’s like everything falls through the cracks of all that white space and the processes. And so I learned a long time ago that to have a successful offshore or outsourced project, it requires great definition of process and expectations. The same thing here, and the irony, maybe it’s not ironic, is by, if you’re going to lean into the virtual hybrid work, it requires you to do all those same things. It requires great job descriptions, it requires great KPIs and OKRs. It requires great communication, all of which you should have been doing in a face-to-face world. And so by having to do this for virtual remote teams, you wouldn’t not then do that for your local teams as well. I really think leaning into this the right way can really just simply make you a better leader, a better manager across the board, not just one aspect of your business.
TSIPURSKY:
Absolutely agree, Mike. We knew that this was a best practice not having the once annual performance evaluation, but having many frequent performance evaluations. Really a lot of research showed that that was the best practice even before virtual work. But it’s just especially important when you’re working virtually. We knew that before the pandemic, it was very important to document things as I was talking about from the very beginning, document your processes, your context, your systems, which is exactly what you’re talking about here. If you don’t document things, you’ll lose context and you’ll be disappointed with the results of you trying to do have a remote hire. And so if you don’t have a documentation that will be a problem. It was clear already before the pandemic that plenty of people suffer because they’re not so good at picking up nuance and context from those conversations. So you are losing people who are not able to thrive at your firm because they are not as good at that social auditory learning. They’re much better at textual learning. So we’re talking about people with certain disabilities, but even within the normal variance of personality, there are plenty of people who are readers rather than listeners. And so people prefer to learn by rating. And so you already were excluding people who didn’t have that ability and now the people can be included and they can have those skills and they can do the work effectively and address the employment issue that many employees are suffering, especially small businesses.
VANNOY:
Glad the title of this show is Leading Hybrid and Remote Teams. When I’ve studied the annual Gallup survey, it seemed like what jumped out to me is disengagement for fully remote and fully in office was about the same that they found productivity highest when it was this hybrid. They have the choice, but they’re in office two or three days a week at home, two or three days a week. What does the data tell you and what’s your guidance to businesses? Should they be thinking hybrid? Should they be thinking fully remote? What’s your sense here?
TSIPURSKY:
So with my clients, as I mentioned, 23 of them chose a flexible hybrid model and two of them chose remote first model. And the two that chose remote first model were smaller businesses that under 500 employees, both that were more recently created. So for footing very well within the scoop dynamic. And here is what you want to be thinking about. So the Gallup poll, the bit that you mentioned, it showed that the highest engagement came when people spent about one to two days in the office. And that’s understandable if you don’t have everything that I talked about earlier. Those are not easy things to put in. It takes effort, it takes time, it takes knowing about them. So I talked about them in the book, but if you don’t know about them, how would you know to do them? So you naturally, Gallup is going to report exactly that you have somewhat lower engagement if you are fully remote because you don’t have all this context, you don’t have all these performance management, you don’t have the coordination, collaboration, socializing, team building.
We didn’t even talk about mentoring. That’s an important thing I talk about with my clients, chat about that so that you are going to be in a worse spot if you’re working fully remote, about the same disengagement as if you’re working fully in office and you’re incredibly frustrated when you’re coming in and you’re spending your time on Zoom video conference calls and you’re writing your report in the office when you know could have been doing that much more productively, effectively in the comfort of your own home without commuting to the office. So if you don’t do the things that I talked about, the best dynamic is going to be a flexible hybrid model and you should be still doing some of them because it’s much better to do that just as a general best practice. And certainly you can’t manage by walking around in a hybrid setting. So you definitely need to do those small scale performance evaluations and that will get you the best engagement. So that’s would be what I would say would be my answer to that question.
VANNOY:
Maybe the last thing I want to explore with you. So there are some really high profile CEOs. I’m thinking Jimmy Diamond, I’m thinking Elon Musk have very publicly anti remote work. You got to be in the office, we’ve lost our soul. We are not nearly as productive, we’re better together, et cetera. I want to kind of share how my assessment and I want you to react. I believe that the very most productive teams probably are in office or working together side by side. But what I said at the top stands based on the supply and demand of labor. Labor has options and employees vote with their feet and they prefer and choose remote work. So if you are going to be a C E O, who declares, no, we are an in-office company, take it or leave it. You had Dan, well better have one heck of a good reason why.
Either you pay your people the very best or you have the very best culture, or probably most likely is you have mission alignment. So if you are a scientist and you share in Elon’s vision to put humankind on the moon, you’re probably willing to commute two hours and work 80 hour weeks to be part of that mission and collaborate with the brightest minds in the world to do so. If you want to be in Manhattan at the epicenter of the world of finance, in architecting the biggest deals that finance our economy, you’re probably willing to show up to an office. It doesn’t have to be that bold or dramatic. It may be it’s a faith-based school and I’m willing to take a pay cut to go work for this particular thing because I believe in it so much. But to me the punchline would be unless you have a company culture or a set of mission, vision and values that is going to attract people, you must face this new reality and you must implement some of these best practices around virtual work. So that’s my close. What do you say? What would be your final words for our audience today, Glenn?
TSIPURSKY:
I would say that even if you have a company culture, you are definitely going to be outcompeted. I mean, there’s no question about that. You don’t have to work in JP Morgan to architect the complex financial deals. You can go work in Citigroup, which to architect complex financial deals or in U B Ss, which offer much more flexibility than Jamie Diamond does. You can work in Rivian instead of working in Tesla, you can work in other companies that have other models. And Elon Musk is known as a problematic boss for a number of reasons. So it might not work for him for a number of reasons. If you’re a fanboy of Elon Musk, I like Elon Musk, I think he’s very smart. So I like the things that he put out. I think he’s quite problematic in his judgments about remote work and some other things having to do with, let’s say, changing Twitter to destroying brand value. So I’m not a fanboy beyond Musk, but if you
VANNOY:
Said it, the fanboy will work for you. So if you want to go do something that goes against the green and you have a bunch of fans that are willing to sign on, God bless you.
TSIPURSKY:
Exactly.
VANNOY:
But you’re playing against the house because the house knows the math and the math is going against you. Right?
TSIPURSKY:
Exactly. So if you have a strong personal brand, then sure you can do that. But the vast majority of people don’t want that. What we clearly see from surveys is that something like maybe 20% of people actually want to do full-time in office work and something like 30% of people want full-time remote work and something like 50% of people want a flexible hybrid model. So if you want people to actually work in your company, you want to give ’em flexibility. Otherwise you’ll have to pay them quite a bit more to stay in your company. And in the long term, no company can succeed if it’s paying above market rate because it’ll not be able to compete effectively for talent. If you’re paying them 20% above market rate, which is what people report, they need to be paid in order to go work the office
VANNOY:
And maybe glad it’s our kids who are giving us the example. It’s my daughter who’s doing homework with her friends. She could have invited the friends over, but her friends being at the kitchen table to her was no different. That all of them on their phones, they can see each other. They can hear each other. They’re doing their homework together. And when done right using the tools and the processes, remote collaboration can still be extremely effective.
TSIPURSKY:
Absolutely. It can be extremely effective. It doesn’t mean it’s the most effective. Like I said, for most of the companies I work with, I recommend a flexible hybrid model because it’s very hard for us who have not grown up as digital natives to work in that modality. But I think we are very clearly seeing that younger people with more digital native skills are going to be, if they adopt these techniques, are going to be fully as productive if they work full-time remotely. Especially as we have more technology like generative AI coming online that is able to solve some of these coordination, communication, collaboration issues.
VANNOY:
No question gl, is there anything you’d want to say to the audience in closing today?
TSIPURSKY:
I think I want to really encourage business owners who want people to come to the office to ask what is the office for and to only have people come to the office for things that are best done in the office. So again, as I mentioned, more intense forms of collaboration, nuance conversations, mentoring on the jobb, training and socializing and team bonding, those things, unless you, again, adopt those more wholesale transformations, those are the things best done in the office. Everything else best done remotely for the vast majority of people. So having a flexible hybrid model, that’s what you want to do if you don’t want to do these more thorough, deeper changes that would enable you to effectively work in a full-time about mortality.
VANNOY:
Thank you so much. I really enjoyed talking to you and very much enjoyed conversation number two. We’ll have to set up a conversation number three someday. So thanks to you and thanks to everybody else for joining today. Until next week,
TSIPURSKY:
Thank you Mike.