A Blog by Jonathan Low


Dec 13, 2021

Leaders See Hybrid-Office Return Turmoil Is Biggest Boon To Consulting Since Y2K

In times of great uncertainty, smart leaders ask for outside advice. Unfortunately, when the events transpiring are unprecedented, the advisors are not likely to know much more than those seeking wisdom. 

What many skilled leaders are finding is that trusting their experience and intelligence - as well as those of their trusted subordinates - is probably going to be as useful as any ostensible guidance they attempt to purchase on the open market. JL 

Matthew Boyle reports in Business Week:

Confusion and a void of actual expertise create perfect conditions for corporate America’s most brazen opportunists. As executives across the country assembled internal cross-disciplinary SWAT teams and ordained remote-work czars, advice started to trickle in on RTO. But with RTO spanning everything from compensation to building operations to mental health, the topics expanded, and so did the range of advisers, with everyone flying blind, the greatest thing to happen to consulting since Y2K. (But) whether the RTO-industrial complex (achieves) success will depend on whether the gurus can pivot from prosaic advice on ventilation systems and Zoom etiquette to the ever-evolving “workplace”

There are 17,000 online courses at LinkedIn Learning, the professional development arm of the career site, all taught by what LinkedIn Corp. deems “credible industry experts.” A search for courses on returning to the office amid the seemingly never-ending pandemic—the most complex challenge corporate America has collectively faced, perhaps, ever—surfaces wisdom from every type of guru imaginable.

One course is taught by a genial etiquette expert named Jodi Smith, whose 33-minute video delivers the understatement that “things have changed, and so have we,” but “luckily, etiquette evolves to fit the situation at hand.” Another tutorial comes from Heidi Hanna, a “stress and resilience expert” with a doctorate in holistic nutrition who specializes in “possibility thinking.” There’s Listful Thinking author and former television producer Paula Rizzo, who’s affiliated with the National Association of Professional Organizers. “I took juggling in high school,” she says. “When one ball is up in the air, keep your eye on the other two. The same idea applies when you’re moving between your office life and your home life.” Then there’s advice from Jim Rogers, a self-described expert in “concrete, reinforcing, and post-tensioning,” who promises to give “a crash course on being a safety and health professional” before doling out pointers on upgrading air filtration systems.

You may be wondering how a manners aficionado, an organization whiz, and a construction guy became authorities in RTO, as return to office is known in business circles. The emergence of this vague and expansive new breed speaks to the desperation of employers trying to sort out how, when, and whether they and their workers should return to traditional offices. Big, hairy decisions need to be made: Go fully remote like Twitter Inc., require butts in seats like most Wall Street banks, or land on a new-age hybrid model? If it’s a hybrid, do you mandate specific days in the office or trust employees to decide for themselves? Should all desks be free-floating, even the chief executive officer’s? And do we really need all this office space to begin with?

The coronavirus and its ongoing variants have made a fool of any company that’s tried to set rigid ground rules. Two-thirds of organizations surveyed by research consultant Gartner delayed their original return dates—most had been scheduled around Labor Day—including Apple and Google, while just over one-third have imposed a vaccine mandate, among them Walmart and Walt Disney. Those who pushed plans back to January are now being blindsided by omicron; others still have no idea when or if they’re returning. “Anyone who tells you ‘This is how it will be’ doesn’t know,” says Steve Cadigan, a former HR chief at LinkedIn who consults on talent management issues and, yes, now also moonlights as an RTO consultant. “The employees who went home last year are not the same ones who are returning.”

Confusion, chaos, and a void of any actual expertise, of course, create perfect conditions for corporate America’s most brazen opportunists. Over the past 21 months, everyone from workforce and management consultants to design agencies, furniture companies, and real estate firms have swarmed in with their inevitable fresh angles and robust solutions. This new RTO industry began taking shape last year during lockdowns, when two things became clear: Working in an office was suddenly up for grabs, and old-school HR departments were in way over their heads. 

Seemingly overnight, human resources people needed to become experts in office design, airflow, information technology, ZWCR (Zooming while child rearing), and infectious disease protocols. Navigating the ever-shifting federal, state, and local Covid-19 policies and transmission rates made reopening offices a game of chance, and the disconnect between most workers’ desire for flexibility and most executives’ demand that workers return to their desks put HR in a no-win situation. “HR folks didn’t sign up for this,” laments Andrea Mullens, vice president for human resources at Ingram Micro Inc.’s cloud computing division, which employs about 2,000 workers. “Every six weeks the conversations I have change completely. It’s exhausting.”

Eventually, the HR folks hit peak burnout: Executive recruiter Heidrick & Struggles has seen a 65% increase in searches for HR senior leaders, in part because of exhaustion. “We don’t know how to manage these hybrid arrangements, which is the reality now,” says Brad Bell, director of the Center for Advanced Human Resource Studies at Cornell. “I’ve studied remote work for two decades, but what we experienced over the last year and a half is nothing like what we studied.”

As executives across the country frantically assembled internal cross-disciplinary SWAT teams and ordained remote-work czars, advice started to trickle in from human resources firms, many of which were already advising companies on broader projects and began tacking on the RTO work. But with RTO spanning everything from compensation to building operations to mental health, soon the tail began wagging the dog. The range of topics expanded, and so did the range of advisers, with most everyone flying blind. Finally, the greatest thing to happen to the consulting racket since Y2K had arrived. 

In January, Chris Hyams, CEO of job site Indeed Inc., made the decision that about 70% of his 11,000 employees could permanently continue working from home. When vaccines became available last spring, just about all of the remaining 30%—with roles that sometimes demanded face to face, such as sales and client services—would be required to go back to the office at least two days a week beginning in September.

Over the summer he opened a handful of Indeed’s 33 offices at about 25% capacity. By July the delta variant’s spread forced offices to close again and made a September return untenable, so after consulting with his in-house RTO task force—about a dozen people including his deputies in real estate, communications, HR, finance, facilities, and sales—he pushed it back to January 2022. Then, in September, after yet another task force summit, Hyams pushed the date back again, to July 2022, giving employees with kids flexibility through the end of the school year—a hard deadline that could very well still change. “We’ve been using the word ‘unprecedented’ an unprecedented number of times lately,” Hyams says, exhausted by the maelstrom of meetings, mandates, and misgivings that now occupy a good chunk of his time.

The stress for CEOs isn’t just a logistical nightmare; botched RTOs could lead to a breakdown in trust between labor and management, exacerbating what are already record rates of employee turnover. More than half of workers would consider quitting if asked back to the office before they’re ready, according to an ongoing weekly survey of about 400 remote workers by pollster Morning Consult LLC.

Don’t assume younger workers are the most eager to ditch the office: Employees over the age of 60 are actually more likely to want to work remotely full time, according to the Future Forum, a research consortium founded by Slack Technologies Inc. Defections are likely to be highest among women, who’ve borne the brunt of domestic duties while working from home; people of color, who are more hesitant to return to the everyday microaggressions of office life; and in-demand technology talent, who see greener, more virtual pastures elsewhere. All of this is amid the precarious backdrop of the Great Resignation, in which members of an antsy workforce who largely sat tight during the height of the pandemic are now abandoning jobs en masse.

Through all this, managers are having a hard time just managing. Should vaccines be mandated? Should sweatpants be outlawed? The choices companies make now will shape their cultures for years.

The pandemic has turned organizations into labor laboratories, testing in real time the impact that remote work has had on productivity, collaboration, innovation, engagement, and mental health. Research has shown that employees are just as effective, often more so, working from home, but when you poll those working remotely now, a clear disconnect emerges. Almost half of executives want to be in the office every day, but only 17% of the rank and file do, according to the Future Forum’s ongoing survey of more than 10,000 knowledge workers. Some never want to return to the office, some would be happy coming in a few times a week, and some aren’t really sure what they want yet.

FUD—fear, uncertainty, and doubt—is, of course, catnip for consultants. Early in the pandemic, much of the RTO advice began coming from HR specialists such as Mercer and Willis Towers Watson. Soon the workforce units of the Big Four professional services firms— PwC, EY (formerly Ernst & Young), KPMG, and Deloitte—smelled opportunity and joined the fray. The blue-chip management consultants— McKinsey, Bain, Boston Consulting Group—also couldn’t resist applying their PowerPoint wizardry to the mix. Then boutique firms rushed in to fill the gaps. “Even if it’s not a traditional RTO project, we are engaging in this discussion with almost all of our clients,” says Melissa Jezior, CEO of Eagle Hill Consulting LLC, a workforce consulting agency based in Arlington, Va. “It touches everything.”

In recent years, most of these firms began trafficking in the hot new catchall of “transformation services,” which isn’t tied to a specific event such as a merger or layoff, but rather is an ongoing process that, like therapy, intentionally never ends. Engagements can run from $5 million to $10 million or more per project, becoming one of the fastest-growing sectors of the $480 billion global consulting industry, according to Kennedy Research Reports, which tracks the sector. Since it already incorporates talent, technology, and even the “future of work,” many of these firms were already perfectly situated to offer clients RTO hand-holding. “The future of work was on the back burner before Covid,” says Jeff Schwartz, who spent 31 years as a consultant before joining a startup that does artificial-intelligence-powered job matchmaking. “Now we’ve all become futurists.”

It didn’t take long for an even broader feeding frenzy to ensue. Architects and designers swooped in to redesign traditional workspaces, advising clients that since the office is no longer an everyday necessity for many workers, it has to be recast as a more desirable destination. “It’s created quite a bit of great new work for our firm,” says Lise Newman, director of workplace practice at design firm SmithGroup, which is redesigning offices for General Motors Co. and other big clients. The challenge in the post-office world, Newman says, is settling on a design that employees “want to come back to, rather than kicking and screaming.”

For the GM project, SmithGroup is creating “neighborhoods” inside the automaker’s engineering hub, where teams have a dedicated space to collaborate, socialize, and work privately when they need to. Office furniture maker Herman Miller—famous for bringing us the cubicle and the Aeron chair—started a partnership with SmithGroup to provide mobile, Zoom-friendly furniture. (Not to be outdone, office furniture rival Steelcase Inc., which has its own workplace consulting practice, has rolled out 16 products under a pandemic-inspired collection dubbed Flex that includes desks, stools, and something called “privacy wraps,” partially covered cubicles for workers toggling between video calls and “sustained heads-down focus time.”) Ryan Anderson, vice president for global research and insights at MillerKnoll (owner of Herman Miller), says the pandemic provided “the catalyst we needed to finally rethink office design, which was not in a great state pre-pandemic.”

Office landlords, sensing that revenue was about to plummet, began peddling RTO strategies, too. Fitch Ratings Inc. recently reported that if companies were to adopt just a day and a half of remote work per week, landlords’ cash flows would fall 15%. In June real estate titan JLL, whose customers include Microsoft Corp. and Capital One Financial Corp., rebranded its Corporate Solutions practice as Work Dynamics, with the goal of taking a more “human-centric” approach to managing office environments, according to Sanjay Rishi, Americas CEO of the unit. In April 2021 it rolled out Experience/Anywhere, a bundle of software and services that lets JLL tenants manage a hybrid workforce—such as employee communication, contractor management, onboarding new hires, and “ergonomic assessments”—regardless of whether they’re tethered to a downtown high-rise or not. “We used to go to work,” says Rishi, sounding newly enlightened, perhaps since trying to offset potential revenue losses. “But now work is not where you go. It’s what you do.”

In 1999 fear ripped through companies across the country as word spread that the coming millennium would crash their computer operations, which spawned an army of in-demand Y2K consultants. Fast-forward to the summer of 2020, when the murder of George Floyd led to a national racial reckoning. Next came the flood of diversity and inclusion consultants, promising to help clueless companies navigate complex issues around race. The Y2K consultants turned out to be fleeting (spoiler for those who weren’t in the workforce then: the crash never happened), while diversity and inclusion consultants, for good reason, aren’t going anywhere anytime soon.

RTO has landed somewhere in the middle. “We have seen a whole new industry sprout up over the last year,” says Kelly Yeates, vice president for service operations at Insperity Inc., which serves as the HR department for hundreds of small-business clients. Like any dramatic moment that draws a new set of experts to steer deep-pocketed companies through perilous water—recessions, terrorist attacks, financial crises—the quality of the talent and the advice is a mixed bag. “There will always be charlatans, but you can only succeed on bluster for so long,” says Eagle Hill’s Jezior. “It’s crazy,” says Bryan Walker, a partner at innovation and design firm Ideo, who works with companies to overhaul their cultures. “People in this space are selling a solution, but there is no precedent to [RTO]. How is that going to work, exactly?”

Whether the RTO-industrial complex ultimately advises itself out of a job will depend largely on whether the gurus can successfully pivot from prosaic advice on ventilation systems and Zoom etiquette to the more complex issue of the ever-evolving “workplace” and how to manage the shifting demands that come with it.

In the meantime, it seems even the RTO consultants could use some help planning their own transition. PwC counsels its billion-dollar clients on RTO, but U.S. Chief Products and Technology Officer Joe Atkinson is the one saddled with getting PwC’s 79 U.S. offices ready for its workforce to return.

Like many companies, the consulting firm had planned to open back up fully in September, but in late August it pushed that to November. Then, in early October, it made the radical decision to allow its 40,000 U.S.-based client services staff to work remotely in perpetuity. For those who choose to return to their desks by their own free will, Atkinson has the earthly task of upgrading four-year-old computer monitors so they’re HDMI-compatible. “No management team has tried to figure out how to bring everyone back at once,” he concedes. “There is no playbook.”


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