Risky business: what should we consider as we transition back to the next phase of work?

As the restrictions from lockdown ease, business leaders are asking themselves, “if remote working is working, should we go back?”

The key parts of such discussions are understandably the logistical arrangements needed to keep employees safe, as well as the commercial perspectives of returning. However, firms also need to consider some fundamental culture and conduct questions in determining the right approach and how to mitigate potential risks arising from the choices made.

What is the purpose and experience of our office going forward?

A good starting point for determining whether, when and how to return to the office is to consider what the role of the office will be in the future. As Cyrus Ardalan recently commented, ‘we need to consider how we allocate time and tasks across the home versus the office setting. How will it differ?’. Will the purpose of the office be to enable the ways of working that are difficult to re-create in remote and dispersed settings?

Remote working has been an undoubted, if somewhat surprising, success. Yet there are several advantages that office working can provide. Some of these are long-standing logistical advantages e.g. access to a full range of IT capabilities, hard copy files, or other information not accessible from home. However, crucially, the office also provides some less obvious and less tangible ‘human’ benefits.

Firstly, certain employees may be keen to return to the office as a ‘safe haven’ or more conducive working environment (for those whose domestic arrangements make home working problematic). Facilitating their return will likely increase their productivity and motivation, and further allow firms to display they have employees’ interests at heart.

Secondly, the critical elements missing from remote working are ‘creativity, collaboration and community’. We have yet to find anyone who feels those serendipitous encounters, water-cooler chats or ‘can I grab you?’ moments can be re-created over Zoom. Video Conferencing (VC) does work well when a meeting’s purpose and structure is clear. But it cannot provide the richness of ad-hoc interactions and encounters that naturally occur in an office; you cannot pre-empt and arrange meetings about what you do not yet know! This means Executive and oversight functions are less able to have a full perspective on certain issues, and innovation is stifled as people are less able to share thoughts and ‘join the dots.’ It was precisely for this reason that Steve Jobs designed the Pixar building with one set of unisex toilets – to encourage chance encounters and the sharing of ideas. In contrast, can firms really stimulate innovation and diversity of thinking over VC? Extroverts need energy from human interaction to fuel their creativity. Similarly, the absence of both planned and chance interaction may impact the extent to which new hires can network across an organisation, and get a true sense of the firm and its culture.

Some of the positives of scheduled videoconferencing are also starting to wear a little thin. Many people have started to tire of endless ‘face time’, looking at a screen all day with limited human contact – with the result that, as noted by Marshall Bailey, we are all “riding on the fumes of relationships right now”. When deciding the future of the office, firms may need to consider the impact of such factors and how workforces will stay connected, energised and motivated at home if these ‘fumes’ fade further. Firms should explore two main considerations in further detail.

1.      Is the ‘remote working’ risk profile fully understood?

The risk landscape has fundamentally changed as we have adapted our work settings. Despite being catapulted to remote working with relative ease and few IT problems, the seismic changes to the way we work have – along with business profit pressures, volatile markets, and changing customer needs – amplified conduct risk in many businesses and raised questions over the effectiveness of controls. Again, some of the more operational perils are well publicised, such as the additional cyber risks created by working with home equipment and the potential for conduct and GDPR risks where people with sensitive information work in shared workspaces.

Conduct risks, too, are increased by the need for individuals to make rapid decisions without easy access to managers. They may also be increased by the need to use new or modified processes that are either not properly understood, fully tested or embedded, or may be bypassed if employees cannot get them to work at home. The FCA touched upon some of these in the recent paper noting “Some misconduct is actually facilitated by the home-working environment”[1], but it will be crucial for firms to have fully considered all the people risks related to home working.

For example, the health, wellbeing, and resilience of home-working employees has presented new challenge and risks for businesses, as well as for the employees themselves. As one executive noted, we should not overlook the risk of emotional exhaustion and tiredness triggering small errors which lead to significant conduct risks – especially as home working can blur the line between personal and professional time, and require people to focus on the screen for large parts of the day and often work longer hours.

In addition, it is possible that firms may be underestimating their previous reliance on physical observation as part of their supervision controls – walking the floor, sitting with a team, observing others. There is a natural lattice of supervision that occurs in a physical environment through noticing behaviours of different teams and employees. This natural lattice is simply not possible given the dispersed and remote nature of home working. The risks of unsupervised activity could further increase if the likely wave of job cuts and associated uncertainty prompts some employees to become disenfranchised and the potential for untoward behaviours.

Moreover, the absence of direct supervision and physical oversight will likely impact the collection and accuracy of the very conduct metrics that firms typically use to manage and oversee such behaviours and risks – e.g.  absenteeism, and length and timing of work hours.

Furthermore, does remote working support employees’ ability and willingness to ‘Speak Up’ and ‘Be Heard’? Have firms considered the new channels required to raise concerns and replace the desk-side ‘can I just check…’ moment? Or is it not possible to raise concerns in such informal ways during home-working, where a call typically needs to be scheduled or a formal email written?

Similarly, firms may need to consider how intentional misconduct might manifest itself differently within the home environment: cyber bullying, drinking at home, excluding people from meetings, and taking privileged data on a mobile camera could all become more likely.

How will these risks be identified, measured and governed?

2.      When will our organisations and people be ready to emerge?

For firms returning to offices, the focus is understandably on logistical preparedness to support the safe return of certain employees, including reshaping the office to support social distancing, ensuring appropriate sanitising regimes, developing ‘rule books’, phasing/rotas and enabling tracking devices. However, firms will also need to consider the people impacts – both for those returning to the office but also for those continuing to work from home. Are we addressing the emotional preparedness of our people, and how are we fostering the right behaviours whilst keeping our people engaged and motivated?

Culture and conduct are influenced and reinforced through many organisational factors. but there are four which merit a deeper dive in the context of altered models necessitated by working through the Covid-19 pandemic.

Engagement – Many organisations are engaging their people to understand their ability, safety and willingness to return, using surveys and tools such as Work.Com. Yet, it is clear that a balance must first be struck between instruction and personal choice. Where there is individual choice, it is worth considering whether a power difference might be forged, between potentially lower risk junior staff choosing to return if they are unable to effectively work remotely or feel disconnected, and potentially higher risk senior managers with the luxury of space and good broadband deciding to stay home. Where decisions are more ‘directional’ e.g. requiring providers of critical services to return first, there may be other issues such as employees who wish to return feeling disenfranchised, or others who do not wish to return feeling pressured to go back to work. In all instances, firms should communicate clearly to all employees explaining their evolving position and the reasons for it.

Development – As businesses move to ‘transition states’ and ‘hybrid working models’, with teams straddling both remote and onsite working – are managers equipped to deal with the new complexity of managing teams (with potentially different needs) whilst simultaneously delivering results and maintaining team spirit?

Formation – A workforce must have flex and mobility across roles in order to respond to utilisation and requirements. But, can teams be effectively redeployed or upskilled from the homeworking environment? What operational resilience is in place for the possibility of critical role or mass team absence before there is a full return to the office?

Recognition – Many organisations announced employees will be spared Furlough or Layoffs in the near term. However, as the prolonged crisis has a profound impact on our economy and company performance, how will employment, bonuses and reward be impacted? How will employees be fairly rewarded for their contributions in these ‘unprecedented times?’ Have performance management structures responded to the current focus on ‘people first’, empathy and social care priorities? Will they be able to measure and appropriately reward performance when managers do not have direct line of sight of employees’ workload?

These people challenges show that, as firms transition to the next phase, they should not only focus on the commercials and logistics, but also on how culture and conduct has evolved and will continue to transform. Firms must consider not only the new purpose of the office, but also understand how risk profiles have changed. They should define the controls required to address new operational and behavioural risk exposures, and to create a healthy workplace culture in the stages of transition. Only then will they fully be able to drive the right behaviours needed, not just to survive, but to thrive through the challenges ahead.

[1] Conduct, culture and Covid-19, Insights hosted by FCA  www.fca.org.uk/insight/conduct-culture-and-covid-19