The Future of the Office, with a New Afterword by the Author: Work from Home, Remote Work, and the Hard Choices We All Face

by Peter Cappelli

The COVID-19 pandemic forced an unprecedented experiment that reshaped white-collar work and turned remote work into a kind of "new normal." Now comes the hard part.

Many employees want to continue that normal and keep working remotely, and most at least want the ability to work occasionally from home. But for employers, the benefits of employees working from home or hybrid approaches are not so obvious. What should both groups do?

In a prescient new book, The Future of the Office: Work from Home, Remote Work, and the Hard Choices We All Face, Wharton professor Peter Cappelli lays out the facts in an effort to provide both employees and employers with a vision of their futures. Cappelli unveils the surprising tradeoffs both may have to accept to get what they want. Cappelli illustrates the challenges we face in drawing lessons from the pandemic and deciding what to do moving forward. Do we allow some workers to be permanently remote? Do we let others choose when to work from home? Do we get rid of their offices? What else has to change, depending on the approach we choose?

His research reveals there is no consensus among business leaders. Even the most high-profile and forward-thinking companies are taking divergent approaches:

Facebook, Twitter, and other tech companies say many employees can work remotely on a permanent basis.

Goldman Sachs, JP Morgan, and others say it is important for everyone to come back to the office.

Ford is redoing its office space so that most employees can work from home at least part of the time, and GM is planning to let local managers work out arrangements on an ad-hoc basis.
As Cappelli examines, earlier research on other types of remote work, including telecommuting offers some guidance as to what to expect when some people will be in the office and others work at home, and also what happened when employers tried to take back offices. Neither worked as expected.

In a call to action for both employers and employees, Cappelli explores how we should think about the choices going forward as well as who wins and who loses. As he implores, we have to choose soon.

Genres: Business, Nonfiction

102 pages, Kindle Edition

First published January 1, 2001

About the author

George W. Taylor Professor of Management Director of the Center for Human Resources

Reviews

[Jung · Rating 5 out of 5]

See how the global pandemic shook the foundations of how we work and what the future has in store

There was a time when tech giant Google was the epitome of the perfect office environment. In 2005 it was pioneering all the best perks – onsite meals, napping areas, and even options to bring your pet to work. It wanted people to work for Google, but more importantly, it wanted people to be in the office – and like it.

Jump forward to 2021 and 20 percent of Google employees are permanently working from home, another 20 percent are working in decentralized offices, and the rest are working a hybrid model – two days a week remote work with four weeks a year working from anywhere around the world.

There shouldn’t be any mystery as to what brought about Google’s shift in attitude. The COVID-19 pandemic was a revelation for many areas of our lives, not least of which was the role of the white-collar office worker.

While Google kept a positive, open-minded approach to working from home even after the restrictions began lifting, some other employers weren’t so enthusiastic. But no matter how you feel about the changing nature of work, it’s clear that something is happening.

In this book, we’ll explore exactly what that something is and what it means for the future of the office. The world is in a unique situation and what we do or don’t do will affect the lives of a great number of employees and employers alike.

First off, let’s look at what actually happened during those tumultuous years of the pandemic.

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What we learned from COVID-19

It’s April 2020. An ABC reporter is presenting the news from his home – a necessity with the recent COVID-19 restrictions. At the end of his piece, the camera zooms out to reveal the man isn’t wearing pants.

There was a time when this might have ruined his career. Instead, he laughed it off and – for the most part – the world laughed with him. This was an early sign that things were changing. By the final months of the pandemic, there was much that had come to be accepted as normal regarding work – not just going pantless on a Zoom call.

If we want any of these positive changes to continue, it’s important that we know what exactly happened during the pandemic.

Initially, many employers treated it like a bad storm. They just had to close up and wait it out – the public was saying no more than two weeks. The focus of a lot of businesses was on preparing financially for a stoppage, not on how to keep working.

As the realization sunk in that things might be like this for a while, companies started taking more drastic measures. The Marriott International hotel announced that two-thirds of its corporate staff would be suspended with 20 percent pay until further notice. Some big companies like Amazon and Walmart offered bonuses to encourage workers to stay, despite the risks.

The wiser businesses saw what was happening and started closing offices and letting employees work from home. Microsoft announced early on that it had no intention of reopening offices until 2021, and during the peak of the pandemic, it was reported that 35 percent of employees in the US were working remotely.

The general reception was positive – workers reported greater satisfaction in almost all areas. Even employers declared the whole work-from-home experience a success. It seems that the time employees saved by not having to commute was largely put into doing more work. People appreciated the trust that their bosses placed in them and they felt a certain obligation to maintain or even increase productivity.

Some other interesting trends were noticed. The number of meetings increased but they were shorter and more efficient – made possible by the fact that video conferencing was better than ever. Some companies also noticed an increase in remote work in the evening, presumably after parents had put their kids to bed. People were working the way they wanted.

So what did the pandemic teach us? Not only is working from home a viable option but it can actually be better. But this does depend largely on how it’s executed. Now, in the waning years of the pandemic, this style of work has gone from a necessity to an option. It’s time to think about what you can expect when given this option to work from home.

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Some key questions we should be asking about remote work

The headline of the Washington Post declared that we’ll never have to go to work again. The article went on to explain how developments in IT mean you can work from anywhere you like. The most remarkable thing about this news article is that it was actually published in 1969.

The idea isn’t new. The Los Angeles smog crisis of the 1970s took work to the telephone, leading to the term “telecommuting.” The issues surrounding it and the lessons we’ve learned from remote work have remained largely unchanged since then.

Now that it could be here to stay, what should you do when faced with the prospect of remote work? There are a few questions to ask.

First, think about who is actually still working from the office. It’s been shown that people who work from home are slower to receive new information, can have lower-quality relationships with their coworkers, and often miss out on opportunities for advancement because they’re less visible to management. This is less of a problem when everyone is working from home, but if it’s just a few people, it’s easy for them to feel isolated from the core of the workforce.

Another question to ask is what kind of work is being done remotely? The tasks best suited for remote work are those of individual contributors who don’t have to regularly collaborate with others. Unfortunately, this is also work that can easily be done by external contractors, bringing job security into question.

When remote teamwork is necessary, there are other problems to consider. Communication can be an issue, with office workers being slow to respond to their remote colleagues, or silence being misinterpreted. Issues of fairness sometimes come up, as supervisors have been known to be reluctant to contact remote workers for last-minute tasks for fear of intruding on their homelife.

Finally, remote workers must consider the question of who their boss is. Interestingly, it seems that less experienced supervisors are more suited to managing those working from home. New bosses are known to micromanage, a bad habit which is more difficult in a remote setting. But if the work is especially complicated, an experienced supervisor with the right knowledge and connections might be necessary.

If you find yourself in a position to work remotely, look at how your employer handled things during the pandemic. If it invested heavily in software to monitor computer usage and keep workers at their desks, it suggests a lack of trust that might negate any benefit of remote work. On the other hand, if it focused on clearly explaining performance expectations and how that would be monitored, then it suggests a healthy attitude to working from home.

That’s what you should consider now that it’s becoming more commonplace.

In the next section, we’ll discuss the two main models that remote work is likely to take.

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The two hybrid models of remote work

There was a time when Facebook would give bonuses to encourage employees to work close to the office. This attitude has changed recently with workers now being sourced from further and further away.

This has interesting implications. If a company can source workers from outside national borders, then it greatly changes its hiring options. Likewise, it gives employees more opportunities to job-hop.

But how this unfolds largely depends on what model of remote work is adopted. At the moment there appear to be two main hybrid models of combining remote and office work, each with their own pros and cons.

First, there’s the two-tier system, which is the simpler and most predictable route. This involves having two separate classes of workers – those onsite at the office and those working from home. These remote workers will have a role slightly more than that of a contractor but still without easy access to the managers, internal knowledge, and advancement opportunities seen by those remaining in the office.

While this may involve a bit more supervision for those working remotely, the savings for employers are clear: fewer costs caught up in office space and other associated necessities, like parking or food.

The second hybrid option is the choose-your-own model. This is where the workers choose when they work from home, and for how long. Understandably, this is what most employees opt for as it offers the most flexibility and freedom while also maintaining useful ties to the office environment.

On the other hand, it’s the most administratively tricky. This model was relatively commonplace before the pandemic – though it was more of an informal arrangement at the discretion of the boss. Once it becomes more widespread and fair, things get complicated.

Even though everyone has the possibility to work like this, there’ll still have to be some criteria and restrictions when writing up the policies, and it’ll be important to make sure that such policies don’t unfairly discriminate on factors such as race, gender, or religion, for example.

Scheduling also becomes a problem. What if everyone wants to come in on Tuesday, Wednesday, or Thursday, but work from home around the weekend? The offices may become overcrowded during busy times and empty the rest of the week.

While there are solutions to these sorts of problems – mandatory office days, or preference-based algorithms for example – it’s something to consider moving forward. Another common practice is flextime, where schedules are negotiated among individual teams.

Overall, which method gets implemented will be a weigh-up between what’s more important for the employer and what employees want.

Either way, there’s going to be some planning to make the transition as smooth as possible; if it’s not handled carefully, a great opportunity may be missed.

In the final section, you’ll see what managers will need to consider to make sure this works.

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We have an opportunity we can’t afford to miss

It’s fitting that one of the most clever and forward-thinking corporate responses to the COVID-19 pandemic came from a company whose product was inexorably tied to it. Clorox – producer of the all-too-necessary disinfectant products that boomed during those first few months – saw the future potential of remote work, and acted.

It adjusted the planned renovation of its Oakland headquarters to better accommodate a remote work model – mainly by getting rid of private offices and replacing them with workspaces with an emphasis on being able to engage with remote workers. By having a core group of onsite workers organized around the needs of the remote workers, its aim was to value all employees and end up with the best outcomes for the company.

It took advantage of an opportunity that was – and still is – there for many employers: to change the way things work and operate. Getting rid of old habits is one of the hardest parts of organizational development and the pandemic offered the opportunity to test one of the oldest habits in the book – the necessity of the office.

Winston Churchill once noted that one must never let a good crisis go to waste – so what things do we need to watch out for to make sure that this opportunity isn’t missed?

First, organizational culture needs to be adapted. It’s hard to learn the rules and conventions of a company when you’re not around other people, so it’s crucial that companies learn how to identify risks to the company culture and mitigate them as best they can. This can only really be done through more vigorous hiring and training programs, where company values and norms are clearly taught. Recruiting with “cultural fit” in mind will be of utmost importance.

It’s also necessary to change the way we think about performance appraisals. It’s no longer reasonable to rely on personal interactions and the work that a supervisor sees an employee do. It may be necessary to have more check-ins with remote workers or create a more formal appraisal system based on performance outcomes.

The norms around wages may also change. With employees separated from one another, it’ll be harder for them to know how much other workers are contributing and therefore harder to complain about pay or bonus discrepancies. Unless laws are implemented and enforced, we may see a greater variety of pay for similar work.

There are other things to consider, such as what would career advancement opportunities look like for remote workers? The truth is, remote workers are always going to miss out on many informal opportunities for development and promotion. A solution is to make it clear from the start that remote workers are less eligible for these opportunities.

Overall, companies that did better going into the pandemic were those with better management policies. The same can only be true as we come out of it.

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We’re at a crucial moment for deciding the future of the office. The COVID-19 pandemic is one of the most significant and pervasive events in recent history and it has left us with a rare opportunity to create a positive and long-lasting change in what was supposedly one of the greatest constants in the nature of white-collar work.

But success isn’t guaranteed. Establishing productive and functional remote work systems will require dedicated and proactive management. Onboarding practices will have to be perfected, to ensure that employees are a good fit for the company and that they can be trusted to remain engaged without being monitored.

There’ll have to be more effort on the part of supervisors and managers to keep in touch with the workers and performance-based appraisal methods to keep everyone on track.

As more and more people return to work, we’re faced with this new normal. Whether a business tries to bring everyone back or opts for one of the hybrid models available, the decisions going forward will set the precedent for what the modern office will look like.

Are you ready for the future?

[BookwormMom · Rating 4 out of 5]

Insightful and informative. Every company manager or business owner should read this and think about its own office model going forward. The actual content of the book though comes to only about 75% of the entire book. The rest is a listing of over a hundred references used by the author.

[Scott Pearson · Rating 4 out of 5]

The COVID pandemic continues to shape the face of the global workforce in 2024. This book, written in the middle of the pandemic in 2021, sought to bring prior research about remote work to the forefront of business leaders. Written by a Wharton School professor, it briefly summarizes earlier studies and speculates on the pandemic’s future business outcomes. Given that it was written in the middle of a global crisis, this work is tightly coupled to its situation in time and place. Nonetheless, the exploration of academic work on remote work since the 1990s continues to be welcome in ongoing management discussions.

In a broad brush, Peter Cappelli presents a skeptical case about the long-term promise of remote work. Although he welcomes an inability to micromanage employees, he laments the loss of company culture, though without supporting data. While remote works frees up hiring to national and international forums, he worries that employees will become independent contractors. He’s not persuaded that some industries have become more productive in the pandemic.

I’ll divulge my biases: I work in IT at an academic medical center. These industries have been doing remote work for a long time. Further, I grew up watching my researcher/father work from home for decades. I studied throughout graduate school at home. Even before the pandemic, I worked 2-3 hours per day at home. Remote work was not new to me when COVID hit.

A strong case can be made that my industries of IT and biomedical research have become more productive and happier since 2020. Our local surveys certainly say such. Of course, I function in high-trust environments with a great deal of responsibility. Management can measure productive results by lines of code, downloads, publications, and funded grants. Cappelli’s skepticism seems out of place for my workplace, but it helps to understand the challenges other workplaces face.

I have two specific criticisms. First, the cited studies start in the 1990s when telework started. However, today’s technology via almost ubiquitous high-speed Internet is an entirely different animal than in the 1990s. Virtual, video, multi-site meetings are only now possible, and now the norm. Cappelli did not acknowledge the impossibility to use these technologies widely in the 1990s.

Second, he attempts to generalize across industries, and I just don’t think this is possible. Primarily, the nature of the work should drive decisions about remote work, and then maximizing benefits to employers and employees should come second. Work varies greatly from industry to industry. We should organize our hybrid approaches to advance our particular work – and ultimately, our place in the economy – most.

In 2024, it’s already clear that this book was just an opening salvo on remote work. Published far before even the end of the pandemic, it seems timed towards organizations trying to figure a way out. Detailed studies and business outcomes will eventually tell the tale much better, and subsequent books continue to plead their cases and add their nuances. This book’s central value lies in branching early research in the 1990s about remote work to pandemic-era developments. We all continue to figure out how to push our own work forward.

[Brandon Jubar · Rating 2 out of 5]

Biased conclusions

It's clear that the purpose of this book is to poo-poo the success many organizations have experienced being fully remote during the pandemic. The author's conclusion was that supporting a fully remote workforce is basically saying that the past 100 years of office work was a waste of time and money. Really? The author completely ignores the changes in technology that allow very effective collaboration among remote employees. Then he says that managing remote workers is difficult because you can't see them. Really? Just because you could "see" people in their cubicles doesn't mean they were being productive. This was clearly written by a professor who didn't actually manage a large remote team through the pandemic. Instead, he's listening to the comments from old school managers who don't know how to lead if they don't have "butts in seats."

The only reason I gave this 2 stars was in the hopes that more people might read my review. If you're looking for a thoughtful discussion on effectively leading remote teams and creating a future of work that is better for employees and for their organizations, this is not the book for you. Of course, if you're looking for a cynical treatise on a return to cubicle farms, then I guess this might be exactly what you're looking for.

[Henry Barry · Rating 3 out of 5]

While this book was not as substantial (70 pages) or insightful as I thought it would be, I did learn a few interesting things about remote work. However, it feels like a stretch to be a full book - this feels like a series of blog posts or research articles rather than a book. Part of that is due to the fact that the author mostly eschews the common nonfiction book trope of starting chapters off with stories, but the other part is that there just doesn't seem to be that much content covered. The book feels like it was written and released quickly to capitalize on a moment in time, rather than fleshed out as much as it could have been.

I'm glad I read it, but can't, in good conscience, give it a higher rating when I compare it to the value of some of the other books I've read.

[Leyla · Rating 4 out of 5]

It could be a simple and short read that focuses both on the advantages and disadvantages of remote work. Nevertheless, it is more than that. It provides an overview of the whole remote/hybrid/on-site work agenda, the political standing behind it, and what the employers and employees should consider when embarking on such a journey.
There is no answer or clear description of what is going to happen in the future but it highlights concerns that might disrupt productivity and innovation in the workplace. For having a better understanding about the office and its political and economic influence, this is a valuable read that will provide you with tons of arguments.

[Clarissa Lee · Rating 4 out of 5]

It is a very up-to-date to current working culture and the leadership views. It feels like reading a thesis with examples of research done for the different companies' approach and adoptions. But it is definitely not the hard to understand or boring read. Appreciate all the effort of research references done.

[Synthia Salomon · Rating 3 out of 5]

See how the global pandemic shook the foundations of how we work and what the future has in store

I wouldn’t mind working from home

I love flexibility and options.

THINGS ARE CHANGING
POSITIVE CHANGES SHOULD CONTINUE

[Karen Patrick · Rating 5 out of 5]

An informative read!

[Patrick Pilz · Rating 2 out of 5]

By now a vastly outdated book as it has been written during Covid-19 with a lot of predictions about how life at the office unfolds. Unfortunately, there is more to it than that.

[Iván · Rating 3 out of 5]

Interesante libro sobre el futuro de la oficina y del trabajo. Libro corto, de lectura fácil.

[Jack B · Rating 3 out of 5]

Some interesting thoughts, but all too brief. I recognise we are in an early period of WFH culture but it felt more like a cash grab than something considered.

[Virginia · Rating 4 out of 5]

⭐️⭐️⭐️⭐️
I received an advance review copy for free, and I am leaving this review voluntarily.