When the pandemic struck, work from home (WFH) was received with much fanfare. Companies were counting on saving rent/transportation costs. Convenience and time-saving factors kept the employees happy. Companies also recorded high productivity gains in the initial stage.
Euphoria dying down?
After the initial hype, the frenzy around WFH now seems to be abating. In countries where Covid-19 is under control, the employees are returning to offices. Around 84% of employees in France and ~74% in Germany have returned to their workplaces. China and South Korea are also observing a similar trend.
In India, new deals in office lease/rental space are increasing. It points out that companies are expecting a similar trend here as well. Interestingly, the IT sector, the champion of WFH, seems to be at the forefront of signing these new deals.
Various media reports have confirmed the trend. Cognizant has rented 3.5-lakh sq ft at DLF IT park in Kolkata. Walmart Labs is looking to lease 2,50,000 square feet space in Chennai. Paytm is also searching for office space in Noida and Bengaluru.
ANSR has leased 3 lakh sq ft office space from Embassy Office Parks in Bengaluru. Microsoft, Intel and E&Y are also looking to close similar deals. Indian IT major TCS has also announced its grand leasing plan in Pune and greater Mumbai regions.
Why has the trend failed to sustain?
In the early days, the companies saw cost-effectiveness as a major positive from WFH. But, that doesn't seem to be the case. A Knight Frank study says that during WFH, net cost savings for tech companies are < 1% of operating income. According to Tata Sons Chairman, N Chandrasekaran, WFH has only added expenses for them.
Loss of social capital and lack of innovation are also identified as major cons of WFH trend. According to Richard Lobo, executive vice president, Infosys, work requires employees to collaborate. It is not possible via WFH. Employees, with line blurring between personal and professional lives, are also feeling burnout. The problem is more acute for working parents. They have to balance their work commitments with childcare and education. Single people are facing issues of loneliness, leading to mental health risks.
WFH provided great flexibility to workers. Most companies quickly adapted to new requirements of online work. It helped maintain business continuity while managing a health crisis.
On the flip side, WFH cannot replicate the human element present in a working space. The need for building an organization culture, team bonding, and collaboration is also being realized. These factors will ensure employees returning to offices once Covid-19 is under control.