One may have been doing it for years, the other is forced by the prevailing coronavirus. The fact remains that we will be working massively at home in the coming period. But what does that do to our productivity? Do we get more done because we can concentrate better at home than in the busy office garden? Or can't we withstand the distractions that lurk at home and walk away from them? We looked into it through scientific research, and put the positive and negative effects of working from home among each other.

Case study: Positive effects of working from home

A few years ago at Stanford University, research was started in collaboration with CTrip, China's largest travel provider.¹. CTrip is located in Shanghai, where house prices were so high that the staff could no longer afford housing in the city. CTrip was therefore interested in the possibility of working from home, but first wanted to know what this would do to productivity and turnover.

A group of 249 volunteers from the call centre department was divided into two groups. The employees in the first group worked four out of five days at home for six months. On the fifth day they worked at the office for the necessary consultations. The second group of employees worked 5 days a week in the office. Both groups worked the same shifts, were managed by the same manager and were rewarded equally. The only difference was the location where the work was done. The results were (during these 6 months) very positive:

1. Home workers 13% more productive

The group of homeworkers had on average 13% more output than the employees who worked in the office. That's almost a full day's extra work. But where does that come from? 

Firstly, more working hours were used. There were no unforeseen traffic jams on the way to the office, long lunch breaks or having to go home earlier to let a mechanic in. Nevertheless, the biggest factor was concentration. Anyone who works a day from home realizes what a noisy environment an office actually is. Colleagues walk in and out, phone customers or want to discuss their weekend in too much detail. Although you generally still stay in touch with colleagues at home, it is much easier to regulate.

2. 50% reduction in staff turnover when working from home

In addition to the increased productivity, there was another advantage of working from home. The employee satisfaction rose sharply, making it staff turnover fell by as much as 50%. This is not only good for the employees themselves, but also for the organisation. The time that normally had to be spent on recruiting, selecting and training new employees could be spent on other things. 

3. Homeworkers each turned $2,000 extra revenue

During the six months of the investigation, each home-based employee generated an average of $2,000 in additional sales. It will therefore not come as a surprise that four days a week working from home at CTrip is now the norm in the other departments. 

Other positive effects of working from home

There are more studies that show that employees are more productive when they work from home. A survey of U.S. homeworkers found that about 91% felt more productive than in the office.². Homeworkers gave their productivity an average of 7.7 while this was 6.5 for employees in open-plan offices. In addition to productivity, employee satisfaction and staff turnoverworking from home also seems to have a positive effect on involvement. Research by Gallup shows that employees who work from home three to four days a week experience a sense of commitment more quickly than people who work in the office every day.³. 

Working from home

Despite these positive effects of working from home, it is not a good idea in all cases. In the study at Ctrip, working from home had a positive effect, but it is good to take a critical look per organization to see if working from home suits the organization, the activities and the employees. These are the three most important effects of working from home to keep in mind:

1. The effects weaken

A survey of more than 500 employees shows that the positive effects of working from home diminish over time.⁴. This probably has to do with the fact that after some time employees get used to the homework and it is no longer a privilege. In this way, they will slowly start to perform the same as in the office, and therefore achieve comparable results again. 

2. Working from home can be at the expense of cooperation and communication

Employees from the study mentioned above lacked professional support from the employer while working from home. In addition, they experienced that working from home was at the expense of the employer. Communication between colleagues and from personal contact within the organisation. Employees got the feeling that they were inhibited in their development by the employer, which in turn led to a decline in the number of employees. company loyalty decrease. 

The communication and collaboration problems are what drove large companies like IBM and Yahoo to reverse their homework policies.⁵. They were of the opinion that although working from home can lead to an increase in productivity in individual activities, it was at the expense of the productivity of team work. This can be well reconciled with the results found in the previously discussed study at CTrip. The employees in this study worked in the call center department of the company. The work of a call center employee is individual, which can explain the positive results. 

3. Working from home is not for everyone

The nature of the work (individual vs. team) is not the only thing that counts in productivity. Of course, the personality of the employee also plays an important role in this. Where one employee becomes distracted from telephoning colleagues, the other employee may suffer much more from the distractions lurking at home. Think, for example, of the Netflix series you just started, the floor that can use a vacuum cleaner or the remaining piece of cake in the fridge. Working from home requires quite a bit of discipline, and that simply isn't for everyone. In addition to the danger of distractions, the lack of social interaction can be a problem for some people. Of course you can stay in touch with your colleagues by Skype or by calling, but this is no substitute for personal contact. Some studies even show that working from home can make employees lonely.

Conclusion

Working from home can therefore have a positive effect on productivity, provided it concerns individual activities and the employee has a good dose of discipline. The best solution is to keep the work situation flexible. Working from home when you have to accomplish many individual tasks, working at the office when consultation is necessary or when problems need to be tackled. In this way you reap the benefits of both ways of working and avoid social isolation. 

Sources

1. Bloom, N., Liang, J., Roberts, J., & Ying, Z. J. (2015). Does working from home work? Evidence from a Chinese experiment. The Quarterly Journal of Economics, 130(1), 165-218. / Ted Talk Nicholas Bloom.
2. Lipman, V. (2016). Are Remote Workers Happier And More Productive? New Survey Offers Answers. Forbes. 
3. Chokshi, N. (2017). Out of the Office: More People Are Working Remotely, Survey Finds. New York Times. 
4. Canonico, E. (2016). Putting the work-life interface into a temporal context: an empirical study of work-life balance by life stage and the consequences of homeworking. (Doctoral thesis, London School of Economics and Political Science (LSE)).
5. Goman, C. K. (2017). Why IBM Brought Remote Workers Back To The Office - And Why Your Company Might Be Next. Forbes. 

17 March 2020