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IBM’s Remote Work Reversal Is A Losing Battle Against The New Normal

One CEO explains why IBM’s latest directive is retrograde and likely to backfire.

IBM’s Remote Work Reversal Is A Losing Battle Against The New Normal
[Photo: Flickr user giesing]

This story reflects the views of this author, but not necessarily the editorial position of Fast Company.

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Until recently, IBM was one of the first and biggest proponents of remote work. But no longer. In March, the company began directing thousands of employees to work from set locations or else look for another job, an ultimatum it extended more widely last week. The move is an alarming policy reversal that neither current trends nor recent history suggest is wise.

History Isn’t On IBM’s Side

IBM’s curtailment of remote work echoes Yahoo’s reversal more than four yeas ago, when CEO Marissa Mayer began requiring workers to come back to a traditional office so they could start “physically being together,” as then-HR chief Jackie Reses put it at the time.

To all appearances, all that physical togetherness hasn’t worked out so well. After weathering a firestorm, Yahoo initially stood by the policy change. But in the years that followed, it failed to regain its position as a leading internet company, suffered a series of devastating hacks, and finally agreed last year to sell itself to Verizon for about $4.4 billion–far less than the $100 billion market cap it had had at its peak.

Like Mayer in 2013, IBM CEO Ginni Rometty is under pressure to turn her company around. And like Yahoo, IBM claims that the policy change is meant to improve collaboration and accelerate innovation.

It won’t work. Attempting to force workers back to IBM offices is a terrible idea for at least three reasons.

Why Mandatory Office Work Will Backfire

First, IBM will diminish the quality of its team. As much as 40% of the company’s workforce was already remote as of a decade ago, so it’s easy to see the new mandate as a way to trim staff without having to actually make layoffs. But if IBM is trying to get rid of people it deems extraneous, it’s pretty short-sighted. In all likelihood, what happened to Yahoo will also happen to IBM: The best talent will easily find new jobs with companies that are more open to remote work.

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Not only do flexible work arrangements top job seekers’ lists of priorities, but making successful hires depends much more on relevant skills than on physical location. So if, months from now, IBM points to the number of employees choosing to relocate in order to keep their jobs as evidence of success, don’t buy it. Many will do just that because they have no other options, while the most high-performing, in-demand talent flies the coop. In the end, IBM will reduce the quality of its workforce while its competitors reap the benefits.

Second, requiring employees to work in an office will hurt productivity, not improve it. In a study published in Harvard Business Review in 2014, remote workers proved both more productive and more loyal than their peers onsite. In fact, IBM’s recent policy switch goes against its own research. In both a 2014 white paper by IBM’s Smarter Workplace Institute and in a conference panel the company hosted just weeks ago, its own experts suggested that remote workers tend to be happier, less stressed, more productive, more engaged with their jobs and teams, and believe that their companies are more innovative as a result of flexible work arrangements.

Third, this is the wrong thing to do and the wrong time to do it–not only for the company but for the U.S. economy. A big employer like IBM, which employs over 380,000 people worldwide, has a social responsibility it simply can’t overlook. At a time when smaller cities and rural areas are struggling, it’s backward-looking for a major corporation–especially one with such deep experience in remote work–to implement a policy that could take jobs away from regions that need them most. By demanding its employees flock to IBM’s urban headquarters, the company isn’t just sapping everyplace else of highly skilled talent, it’s also contributing to depopulating the communities where those remote workers live, and depressing local economies as a result.

There’s a sad irony to that. Thanks to the technologies and pioneering examples of many tech companies–including Microsoft, Google, Apple, and, yes, IBM itself–work is now far less time- and location-dependent than ever before. That means companies now have the ability to conceive of themselves as “results-only work environments,” where what really matters is what someone produces, not how many hours they work or where they sit in order to do it. Some, like the automation platform Zapier, are even offering bonuses to employees so they can move away to places where the cost of living is lower. Meanwhile, IBM will keep selling cloud-based software and services that support an “anytime, anywhere workforce” it’s no longer a part of. Good luck making that sales pitch.

Flexible work isn’t just the future of work–it’s already here. Forcing people back into offices is like handing them all paper time cards and telling them to start punching in and out. It’s not just retrograde and absurd, it’s also a surefire way to lose the best people you’ve got already and to turn away tomorrow’s top hires. Just ask Yahoo.

About the author

Stephane Kasriel is the chief executive of Upwork, where he built and led a distributed team of more than 300 engineers located around the world as SVP of engineering before becoming CEO. Stephane holds an MBA from INSEAD, an MSc in computer science from Stanford, and a BS from École Polytechnique in France.

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