Remote Work

Can Hybrid Work Bring a Positive ROI?

Key takeaways:

  • Learn about the Value Chain for Remote and Hybrid Working Arrangements
  • Learn how to calculate ROI
  • Learn why the employee perspective is as important as organizational and environmental considerations.

With hybrid work becoming ever more present and with multiple generations now preferring or even demanding it to consider an employer desirable, questions on the value and effectiveness of hybrid work have surfaced in the minds of many executives. To help them decide whether hybrid work is the right choice for them requires selecting and tracking the right business data and metrics and comparing the results to the traditional work arrangement. This may mean examining success from three perspectives: 1) the organizations who support hybrid as an option, 2) the team members who see the advantages of the hybrid environment and 3) the community and environment that benefit by having fewer people in traffic congestion and less pollution.

We’ve seen the rapid shift to remote working evolve throughout the last few years, either in our own organization, our community, nationally, or internationally. Most knowledge workers who didn’t require facing customers were forced into a remote work environment. Many individuals have grown to like it, because they see the benefits and now prefer working from home. Although some employees do prefer to return to the office, most now prefer a hybrid work arrangement to be able to work both at home and at the office. The focus throughout this article therefore is on making sure that the hybrid arrangement is working.

The value chain

Before showing what needs to be done, it is helpful to think about remote work as a project with a value chain tied to it. This classic logic model, first developed in the 1800s, is the basis for most evaluation systems in the world. Almost everyone can relate to it, and it works. Figure 1 shows the five levels of outcome data (Level 1-5) from a hybrid work arrangement, starting from the level of input (Level 0).

Figure 1. The Value Chain for Remote and Hybrid Working Arrangements

The key with tracking business measures is to capture the impacts directly attributable to the difference due to working arrangements (ie. isolating the effects), converting them to money, and comparing them to the costs of the new working arrangements. Costs could range anywhere from minimal to extensive, particularly if the organization has invested a lot in setting up a work from home arrangement for an employee or providing support at home with some of their work. The important thing here is to capture all the costs.

The final step is a ROI calculation that can be done using either of two simple formulas: the benefit-cost ratio (BCR) or the ROI calculation.

The employee perspective

Although this won’t necessarily require an ROI calculation, collecting the advantages from the employee’s perspective compared to any disadvantages is beneficial. Again, if the employee prefers a hybrid arrangement, there should be job satisfaction, work-life balance, convenience, and personal cost savings for commute time, parking, and meals. Part of the feedback from employees could be asking: “Is this a good return on investment for you?” If the implementation was done right, you should receive a positive response to that question.

On a final note, it is important to realize that any approach making use of ROI described above usually improves multiple factors. This is because it aligns our efforts with measures on all 5 levels of data. In addition, each time we ask any stakeholder for feedback or read out a result on any level, this is yet another reminder giving everyone focus and showing the value of what we do as individuals and as an organization.

Interested to know more about this topic? 

This article will be expanded in the new issue of the HR World magazine, coming in October 2023, including the organizational and environmental perspective.



by Patti P. Phillips, Ph.D., CEO, ROI Institute, Jack J. Phillips, Ph.D., Chairman, ROI Institute, and Matic Kadliček, BSc (Psych), CEO, Video Center Ltd.

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