Amidst the changing tides of modern work, the Return to Office movement has become a focal point, shaping the priorities of business leaders, middle management, and frontline employees. Balancing corporate culture, employee engagement, and productivity remains key to maintaining a strong and competitive company today. With the push to bring professionals back to physical workspaces, the big question remains: how do we make this transition effective, while also supporting flexible work setups? This article explains how effective leadership, smart financial decisions, and a commitment to staying competitive come together to chart a course that goes beyond the usual scope of corporate change.

Here at Thought Logic, we routinely engage with CEOs and executive teams, listening and advising on how to solve specific challenges. From these conversations and our continuous research, we’ve noticed that although the outcomes might appear similar, the rationale for bringing employees back to the office differs significantly. Specifically, we’ve identified three primary rationales: Fear-Based, Cost-Based, and Competition-Based. The options for how to make the most out of hybrid work environments differ based on why you brought your employees back to the office.

Rationale Number 1: When Leadership Struggles to Trust Workforce – “Fear Based”

The most common rationale we’ve seen for why leaders are bringing their employees back is due to a lack of trust. Everywhere you look there’s another article, blog post, or video claiming that employees are simply not working like they used to before the Pandemic. Out of fear that their employees are playing golf every Friday instead of working, CEOs want to see everyone back in the office 3-5 days a week. These companies tend to lean on mandates or other compliance-based mechanisms to force their workforce back to the office. Fundamentally, a lack of trust is a symptom of a broken or deteriorating company culture. However, it doesn’t have to be this way, proven by successful companies’ focusing on having healthy cultures. A good first step in improving company culture is to look at whether Authentic Connections exist. These subtle yet impactful interactions encompass water cooler conversations, face-to-face (offline) dialogues, and the unscripted moments that bring coworkers and work friends together, forming a sense of belonging to the community.

From an employer’s perspective, know that Authentic Connections are built on 3 elements – empathetic listening, true curiosity, and connecting through storytelling. Empathetic listening involves tuning into the emotions behind the words, rather than fixating on mere agreement, and can build bridges of understanding and a more supportive and inclusive environment. Further, we can take cues from researchers who excel at the art of inquiry. By consciously asking thoughtful questions, we delve beyond the surface, unearthing the perspectives and experiences that shape our coworkers’ viewpoints. This commitment to asking questions with intention not only sparks engaging conversations but also nurtures an atmosphere of intellectual curiosity and mutual respect. Lastly, when we speak from personal experience and share our journey, we unlock a deeper level of authenticity. Whether it’s narrating how challenges transformed us or recounting lessons learned, our stories become bridges, connecting us to others who might resonate with our journeys and developing trust. Studies in organizational psychology underscore the impact of personal storytelling on team cohesion and performance, and as a leader it’s important for you to model this behavior so your team and their teams will feel confident exhibiting it.

In other words, to solve for a lack of trust, create an environment that brings your teams together through authenticity, mutual respect, and storytelling. Focusing on Authentic Connections is one way to create bonds between coworkers and build trust into how future challenges will be handled.

Rationale Number 2: When No One Questions the Status Quo Anymore – “Cost Based”

At first glance, the second rationale might look like it’s rooted in cost structures, specifically those associated with real estate costs. Yes, the global pandemic brought about a massive shift in the corporate real estate sector, with patterns swinging from only 6% of employees working from home before COVID to more than 75% of all employees working remotely at the peak in 2020. However, it would be foolish to think the solution is simple accounting, and commercial real estate contracts are not something that can be changed on a whim. You’ve heard it said that these days, “every company is a tech company” but the truth is that few companies know how to make the most out of the data they do have. There is a direct connection between data management and cost structures, and successful companies take advantage of hidden cost savings opportunities. Analysis run by Kastle Systems, a provider of building access controls that monitors over 2,600 commercial properties across the U.S., supports this finding – after analyzing movement nationally, they identified greater cost flexibility through smart use of data.

For many companies, renegotiating the entire building lease is not feasible, which is why leadership should evaluate their operations against their data strategies. For example, during COVID the Cincinnati/Northern Kentucky International Airport (CVG) improved their operations and reduced costs using connected sensors and camera vision intelligence in each terminal, where they analyzed and identified patterns in passenger foot traffic in the terminal. Using real-time information and advanced algorithms, they redirected resources such as HVAC, lighting, and cleaning crews/baggage handlers to only those terminals that had foot traffic. This enabled the employees to focus on areas that needed attention, ensuring they were not wasting time, money, or effort. Additionally, by connecting to outside cameras monitoring incoming vehicle traffic, they were able to predict congestion before it happened.

Wasted efforts lead to employee burnout and frustration over perceived ‘busy work.’ Inefficient use of talent, combined with inflexible work environments results in higher employee attrition. The Society of Human Resources Management (SHRM) state that the average cost to replace an employee is 150%-300% of that position’s salary, so employers with inflexible work arrangements not only have top talent leave, but they also incur extra costs to recruit and hire replacements for those individuals that left. It doesn’t have to be this way.

Lastly, in addition to reducing overhead and facilities expense, intentionally flexible working arrangements can increase the top line revenue growth too. According to a recent report, the average public company that gives employees choice over whether to come into an office outperformed on revenue growth over the past three years by 16 percentage points, compared to companies with more restrictive policies. So don’t stop questioning the status quo. You might just unlock revenue and cost savings.

Rationale Number 3: When Leadership Knows How to Unlock Team Potential for Market Success – “Competition Based”

The third rationale we’ve observed is rooted in the War on Talent emphasizing the activation of a well-designed talent strategy. As a leader, it’s crucial to consider your Return to Office approach and Workplace Flexibility within the broader context of the Employer Value Proposition (“EVP”). Melinda Battle, Thought Logic’s Head of HR & People Strategy, underscores the importance of developing a balanced Return to Office strategy to attract and retain top talent. “To retain employees, employers will need to evolve their approach to building community and creating a sense of belonging at work.” According to surveys conducted by Gartner and FlexJobs, flexible work arrangements are crucial to 78% of job seekers when considering a new job and 70% of employees, including those not actively seeking jobs, expect to have a hybrid work arrangement in the future.

While talent strategies are beneficial for any company, their significance becomes particularly acute in certain environments such as startups and professional services firms that rely on problem solving capabilities, fast-paced collaboration, and non-linear conversations. These benefit the most from in-person environments. Recent research done by Reach Capital showed that early-stage startups with an office presence grew 3 ½ times faster than those working entirely from home.

Diving deeper, it’s essential to assess whether your workforce possesses the skillsets needed to maintain your competitive edge in the marketplace. Consider what steps you are taking to enable the workforce to build or acquire the necessary skillsets. Does your product team understand your customers so innately that they can anticipate changing preferences before your competitors do?

In summary, the Return to Office movement is fueled by distinct rationales – trust dynamics, cost considerations, and talent-based competitive advantages. As we navigate this evolving landscape, it becomes evident that the future of work necessitates an intentional blend of physical presence and virtual adaptability. Whether rooted in culture-enhancing trust-building, data-driven cost optimization, or strategic talent planning and workforce management, organizations must forge paths that honor their workforce and position them at the forefront of their industries.