Although technology enabling out-of-office work has been available for some time, until the pandemic, the uptake was low. A key reason for this is almost certainly concern about reduced productivity.

The impact of hybrid work on productivity

Claims about both increased and decreased productivity have been widely published in New Zealand and overseas, but generally lack hard evidence.

Our experience of the pandemic in Aotearoa showed that as a Public Service, we can have staff working from home or remotely and continue to deliver high-quality services, including the pandemic response, to the government and New Zealanders. A number of government agencies have also had staff working remotely as part of their business as usual for many years.

A productive Public Service is critical to New Zealand’s growth and prosperity, and the wellbeing of New Zealanders. Any changes to the ways in which we work should sustain, and preferably enhance, our productivity.

This section draws on academic and government research and literature, and what we already know about managing and measuring productivity.   We want to provide assurance to the Government and the public that Public Service productivity will not reduce because of hybrid working.

The Public Service reports regularly and publicly on performance

At an organisational level, all Public Service organisations have obligations to report regularly and publicly on their performance through annual reports and other planning and reporting requirements. This reporting includes performance measures to provide assurance that agencies are delivering what is expected of them.  

Agencies should continue to regularly monitor their performance against the indicators they have in place to ensure that hybrid working is having a neutral or positive impact.

Usual performance management approaches apply

Normal performance management practices such as defining what outputs/outcomes are expected, along with time and quality expectations based on the staff member’s role and experience are the key to ensuring productivity in a hybrid work environment. Managers need to be clear about what the staff member is expected to deliver and why, what good looks like, and how well the staff member is performing against their expectations. Appendix E has a simple model of setting expectations.

Appendix E: Setting expectations and the SMART model

We know that we get the best from our people when delivery expectations are clear, we measure quality against these expectations, and we provide good feedback. Likewise, our staff, whether they work flexibly or not, do their best work when they manage their time, deliver to expectations, and maintain good lines of communication with their managers and the rest of the team. When working flexibly, it is especially important that managers, employees, and teams talk regularly about flexible arrangements, how they are working and how any challenges can be addressed.

The research on individual and team productivity

Pre-pandemic research on working from home is limited about the impact on productivity. A key limitation (of both pre-pandemic and pandemic studies) is the reliance on subjective measures, usually surveys of employees and managers.

COVID-19 studies are limited by pandemic conditions. In particular,

  • childcare was unavailable
  • schooling was done at home
  • people were working from home 100% of the time as mandated by the Government (rather than a personal choice)
  • staff had to quickly learn new technologies and keep up with changes in work procedures.

All of this was in an environment of significant concern for the wellbeing of themselves, their families, and communities.

Notwithstanding these limitations, studies show that individual productivity can be affected in different ways:

  • Where productivity was increased, this was linked to working for longer (enabled by reduced commuting time or taking shorter breaks), and working in a quieter environment with fewer distractions.
  • Where productivity decreased, this was linked to the impact of childcare, social isolation, feeling disconnected, and uneven use of hybrid working across the team.

The research also helps us to understand what factors drive productivity and therefore, the things that organisations should actively manage.

Drivers of productivity in a hybrid working context

The work

Not all work is suitable to be undertaken in a hybrid way. Some work clearly requires physical presence in a specific place.  For work that isn’t constrained in that way, the question that agencies need to consider is how much of that work requires in-person interaction with others (both inside and outside the team). See the previous section for guidance on this.

Agencies may be able to increase productivity by carefully selecting the work that is done in a hybrid way. Where agencies have staff working remotely, utilising the regional knowledge and community connections of those staff on the work they do is likely to lift their, and the organisation’s, productivity.

Staff who undertake tasks requiring focused concentration will likely benefit from some time working away from the office on those tasks. Conversely, individuals and teams whose work requires intense collaboration may be less productive if they are largely working apart.

What this means for agencies

  • Consider the degree to which specific work (or tasks) requires input from across the team.
  • Consider how much of the work a person does needs to be kanohi ki te kanohi (Part 3: What work needs to be done kanohi ki te kanohi/face to face).
  • The balance of tasks that a person undertakes may change over time, so hybrid arrangements should never be open-ended and should have regular review dates.

Team communication and isolation

Some literature finds that hybrid working by a staff member may make communication, problem-solving, and coordination more difficult for their team. It can also create fewer opportunities to interact with managers, colleagues, and customers, which can lead to less knowledgeable and more isolated employees feeling less confident in their abilities to perform their work well.

Optimising hybrid working arrangements will involve considering productivity at the team level. Organisational policies related to working from home tend to focus mainly on the individual worker, but research has shown that working from home can also affect team productivity, especially when there is a high degree of task interdependence.

Insufficient communication can lead to feelings of isolation which can impact performance. Strong team and organisational-level, processes to co-ordinate and facilitate communication will help to moderate this impact.

What this means for agencies

  • Agencies need to consider the balance of time spent in and away from the office — there is no single standard that can be applied.
  • Hybrid arrangements need to work for the agency, teams and the individual.
  • Teams need to spend time talking about how they work together in a hybrid environment. The development of a team charter that covers how and when the team will communicate in different situations would be a good start. For the avoidance of doubt, this is not about giving team members a veto over each other’s working conditions.

Suitable working environment

An adequate workspace (in terms of noise, temperature, and other factors) is associated with higher productivity in both offices and at home. Having a suitable place of work at home has been positively associated with self-reported productivity.

The office environment doesn’t need to be replicated at home, but a good ergonomic set-up is important.

Supporting workers to work from home — Government Health and Safety Lead  has further guidance on managing the health and safety risk of working from home.

IT infrastructure to support hybrid working is essential. This can include software that enables communication, and the ability to access systems that are essential for a person’s work. If staff can’t communicate well, or can’t access the information and systems they need to do their work, their ability to deliver will be reduced. There may be valid reasons (for example security or privacy) why such access or technology can’t be provided remotely.

What this means for agencies

  • Get some assurance from staff that their home environment is suitable for work
  • Not everyone has a suitable space at home, and managers need to be sensitive to this when talking to their staff
  • Ensure IT infrastructure supports communication and access essential for work. If it is not possible to do this for valid business reasons, agencies need to consider the extent of hybrid working they can enable.
  • Provision of equipment for working from home has guidance on providing equipment.

Time savings and ‘boundary’ management

Removing the need to commute has been associated with job performance. Longer commutes (unless they involve physical activity) have typically been related to reduced job performance.

Avoiding the commute has also been linked to increased productivity, and it is frequently cited by workers as the major benefit to them.  However, increased productivity in studies has often been due to people working longer hours.  Hybrid working shouldn’t increase or decrease the hours that a person works. What it can do is enable people to find more balance in their lives and to spend time that was spent commuting with whānau, friends, community or in leisure or educational pursuits. 

Managers and employees will need to develop strategies to manage boundaries between work and home. Examples of things employees should consider are having a dedicated workspace, setting expectations with family members regarding interruptions, and setting aside specific times for family activities (e.g., school pick-up). Examples of things organisations and managers should consider are agreeing when and how to communicate, ensuring the team understands when other team members are and aren’t available, and supporting employees’ skills in time management.

Where staff are sick or need to care for children or others, they need to use leave. In general, working from home can’t be undertaken concurrently with childcare or other caring responsibilities. This will always depend on the circumstances. For example, being at home with an older child who is home from school with a cold is not the same as being at home with a younger child needing constant or frequent supervision.

In addition, working from home in emergency situations, like the COVID-19 response, is not representative of hybrid working in general. Such situations involve lack of choice to work from home, heightened stress, and additional family caring responsibilities. Agencies that have hybrid working practices in place are likely to be better placed to deal with unexpected events that prevent staff from accessing their building.

What this means for agencies

  • Ensure that staff don’t feel compelled to work longer hours, or be more available at times outside of work, and take breaks during working hours.
  • Talk to staff about how they manage their boundaries at home.
  • Agree when people will and won’t be available.
  • Business continuity responses are not the same as hybrid working and will require different approaches to this guidance.
  • Have respectful conversations with staff to ensure caring responsibilities aren’t impacting work time.
  • Ensure staff are using sick and domestic leave when appropriate.

Autonomy and choice

Giving staff the ability to choose, particularly to opt-out of hybrid arrangements after trialling the experience, may lead to better productivity outcomes. In one of the biggest pre-pandemic studies undertaken, around half of the work from home group decided to return to the office, mostly because they either felt isolated or found it difficult to work to their usual level at home. This self-selection further enhanced the productivity gains shown in the study.

A key area of choice for staff may be the balance of time spent working from home and time spent working in the office. This balance may also have an impact on productivity. Unfortunately, the research doesn’t provide a clear guide to the perfect balance.  Future studies may look at this, but the likelihood is that it depends on all the other factors addressed in this guidance, and that organisations will need to determine the right balance for their circumstances. The balance will likely change over time for organisations and for individual staff and teams.

What this means for agencies

  • Working from home doesn’t suit everyone, and agencies need to allow office space for staff whose preference is to be in the office or whose home environment doesn’t support working from home.
  • Where staff are hired to work remotely, or permanently from home, be clear up-front that there is no option to work from an office.
  • Seek input from staff and trial approaches to hybrid working. Involve staff in reviewing how arrangements are working for them, the team, and the organisation.