PD Pathways

Over the last few years, many people may feel like they have lost a lot of their personal freedoms. Working from home, learning new technologies, wearing masks, and distancing from friends and community were mandates in many regions. Not choices. This led to many employees making choices where they could: whether to work in their pajamas or get dressed, whether to work from the sofa or the kitchen table, whether to start work at 7 am or 9 am, etc. As organizations ask their employees to come back to the office, employees still want choice and control over how and where they work. The difficulty is that employees are experiencing the endowment effect. Having acquired this freedom of working from home, they place greater value on it without recognizing the opportunity costs. Employees are focused on what they may lose when they are no longer able to work from home 100% of the time rather than on what they might gain from returning to the office a portion of the time. Not only are they focused on the perceived losses, but they are also inflating the value of the losses over the potential gains of returning. 

Research has shown us that we gain immense value when collocated with teammates. We build social capital, build trust, and share knowledge and ideas. Many of which then mediate innovation which is necessary for growth in our fast-paced, ever-changing world. An intervention to overcome the strength of the endowment effect would be to have all employees come together for an offsite multi-day gathering. This meeting would allow employees to reconnect to the sense of community and belonging that occurs when spending time face to face with peers.  When the salience of collocation benefits is high, employees can more rationally compare the value gained from returning to the office to the value of working from home. 

Unfortunately, the media is complicating the decision-making as well. The constant stream of fresh media articles touting the benefits of working from home feeds the availability heuristic of employees and often the confirmation bias as they select which articles to read. The availability heuristic leads to decision-making based on readily available or salient information, which is currently skewed towards working at home and complete freedom over choosing where and how to work. Often, when people are already leaning towards a decision, they will select to read the information that supports their position rather than understand all potential choices. Confirmation bias distorts our evidence collecting to confirm our existing beliefs rather than collecting unbiased information.

As employees have started trickling back to the office, they have found that they are returning to an office with a very low social density. If the value of the office is spending time with other people, we need to ensure that there will be other people there. Two commitment strategies that could help revolve around financial incentives and social pressure. The number one reason employees say they would prefer to work from home is the commute. If the home becomes the default place to work, employers may consider compensating employees to drive to the office, especially with our current soaring gas prices. The second commitment strategy involves social pressure, which would come with how knowledge is shared around who is in the office and when. Employees could see the quarterly plan for their peers and plan to show up on days when most of their team is in the office. They would also be encouraged to have an office buddy that they overlap with at least one day each week. Studies have shown that having strong social ties with a colleague leads to greater employee retention Employees come to the office to be around other people, so knowing when others will be there will facilitate more attendance.

Once people are returning to the office, another method of addressing the ‘home is freedom’ endowment effect is to provide choice and control over where and how people work within the office. There should be spaces for collaboration work with collocated colleagues, spaces to collaborate with remote colleagues, social spaces, focus spaces for both heads-down work and private enclaves for virtual meetings, and rejuvenation spaces. The office needs to be compelling – they can’t just be returning to the office they left before the pandemic. 

Managers who have only managed employees within spatial proximity struggled during the work from home mandate. As managers return to the office, both proximity bias and in-group bias may impact how they treat their employees. They may provide preferential treatment to the employees within their shared proximity. If a group of employees spend more time in the office, the manager may identify as part of that group, whereas employees who choose to spend more time at home would be in the out-group. This in-group bias could happen in reverse for a manager who works from home and sees the employees who work from home as their ‘in-group’. When we self-identify as being part of a group, we treat people in that group better than others. 

A simple intervention to overcome the in-group bias is a linguistic one. Employees are told that they all have ‘flexible working arrangements' and that nobody is an ‘in office employee’ or a ‘work-from-home employee’. In addition to the working arrangements, the organization can invest in their company culture to have everyone identify with the organization, increasing their sense of belonging to a single group. Belonging is a fundamental human need and one of the reasons why people say that they will want the office as a place to gather. 

Like managers, employees may also be feeling a binary bias between working from home and returning to the office. These feelings are connected to the ambiguity of the hybrid work environment. When an option is unknown or uncertain, we tend not to consider it because of the ambiguity effect. Employees have been working from home for two years. They may have been working from the office for decades before that – another experience that they know the outcomes of. However, the idea of hybrid working is a novel experience for many people. One that employees are uncertain how it will work or what the outcomes will be. This uncertainty prevents employees from giving equal weight to the options when deciding between working from home 100% and hybrid working. 

Understanding the biases and heuristics that subconsciously impact our decision-making helps us address them. We are steeped in a time of great uncertainty. Yet organizations are feeling the pressure to make a decision about encouraging their employees to return to an office, either full or flextime, or whether they get rid of their lease altogether. Many organizations succumb to status quo bias by defaulting to what they were doing before the pandemic and bounded rationality by choosing an option that is ‘good enough’ for right now. As organizations select the hybrid approach to return to work as a ‘good enough’ or middle ground, they must address the many biases and heuristics that prevent this change for their employees and the management team. When the organizations can find a balance between flexible working arrangements and intentional gathering, they may find the sweet spot that allows them to gain the benefits of a global team with the deep trust, culture, and knowledge sharing of a hometown office. 

Robin Rosebrugh, B.SC., CSBA, LEED GA has been integrating her love of research and design for over 10 years, while communicating to professionals about the impacts that our spatial experience has on our individual and group behaviors.

Prior to attending BCIT for Interior Design, she completed her Bachelor of Science from UBC and was awarded an NSERC grant to study neurodegenerative diseases. She has a strong passion for continually developing her education, specifically focusing on the influence that our designed environment has on our behaviors and wellbeing which has led her to pursue her Master’s degree in Organizational Psychology through Harvard University.

Listen to Robin in person as she delivers her breakout session on Reimagining the Office for Hybrid Work at our upcoming PD Nexus: Business Insights and Innovation Insights on December 7 at the Hyatt Hotel in Vancouver.