In a rapidly evolving landscape of work arrangements, a new survey has shed light on the impact of remote work on corporate performance, adding fuel to the ongoing debate about productivity and workplace culture. The findings, based on an analysis of 554 public companies employing over 26.7 million people, reveal a significant disparity in revenue growth between companies embracing remote work flexibility and those adhering to strict in-office attendance policies.
The study, conducted by Scoop Technologies Inc., a flex-work advisor, in collaboration with Boston Consulting Group, encompassed companies from 20 different sectors, ranging from technology to insurance. What stands out is the stark contrast in revenue growth between “fully flexible” firms, which either operate entirely remotely or allow employees to choose their office attendance schedule, and companies with hybrid or fully onsite workforces.
According to the survey, fully flexible companies experienced a remarkable 21 percent increase in sales between 2020 and 2022 when adjusted for industry averages. In contrast, companies with hybrid or fully onsite workforces only saw a 5 percent growth over the same period. The data is normalized to ensure that companies in high-performing sectors do not skew the results.
Even among companies that mandated at least some office attendance, those allowing employees to come in a few days a week showed twice the sales growth compared to those requiring full-time office presence. This discrepancy suggests that remote-friendly companies may have a competitive edge when it comes to recruiting talent from a broader geographic pool and retaining employees.
Rob Sadow, Co-founder and CEO of Scoop Technologies, emphasizes the implications of this data for business leaders in a report by Bloomberg: “This starts to be a more compelling case for CFOs and CEOs to not be five days in the office.” While revenue growth is not the sole determinant of success, it does provide valuable insights into the impact of remote work policies.
This survey is among the first comprehensive examinations of how various work arrangements influence corporate performance. Most previous research on remote work has been narrow in scope, often focusing on specific job types or regions. Business leaders, including those at Amazon.com Inc. and JPMorgan Chase & Co., have tended to stress the benefits of in-person work for collaboration and corporate culture rather than financial data.
However, the survey indicates a changing landscape. Of the 5,565 companies in Scoop’s database, the proportion requiring full-time in-office work decreased from 49 percent at the beginning of the year to 38 percent by October. The evolving preferences of employees and the increasing competition for talent have spurred this transformation.
Nevertheless, proponents of in-person work can also cite fresh data in their favor, according to Bloomberg. A separate survey conducted by workplace consultant Mercer, encompassing 4,505 full-time US employees, found that those who worked in the office four days a week reported the highest levels of motivation and belonging. They were also more likely to recommend their companies as good employers and were confident that their career goals could be achieved. This contradicts a Mercer survey from the previous year, which indicated that employees working just one day on-site were the most engaged.
Lauren Mason, senior principal at Mercer, suggests in the Bloomberg report that remote employees may sometimes feel marginalized within their organizations despite their satisfaction with their work arrangements. This phenomenon may be more prevalent among women, who tend to embrace flexible work options at higher rates.
When it comes to in-office mandates, the Scoop-BCG survey revealed that only 6 percent of companies require employees to be in the office four days a week, with the majority demanding two or three days. Prior research by Harvard Business School associate professor Prithwiraj Choudhury suggests that one or two days in the office represent an ideal balance for hybrid work, offering flexibility without the isolation of full-time remote work.
Experts in workplace management advise granting individual teams autonomy in deciding when and where they work. This approach, rather than imposing a one-size-fits-all attendance policy, tends to result in higher employee engagement, as noted by Gallup.
Debbie Lovich, a senior partner at BCG who leads the firm’s workplace efforts, observed the growing trend in the Bloomberg report: “I’m talking to more companies these days that have weakly-enforced hybrid guidelines but haven’t come out with a policy yet. They are looking for data to figure out what to do.”