43%

of Canadian CEOs say they expect to have most employees working remotely at least two days per week

Hybrid work is here to stay: 43% of Canadian CEOs surveyed in our latest CEO Outlook say they expect to have most employees working remotely at least two days per week. Adopting this workplace model may reduce operational costs, help companies attract and retain talent and keep employees engaged, but this new way of working also comes with new challenges.

The widespread move to remote work first occurred out of necessity during the pandemic. As lockdowns ended and vaccination rates rose, many of us expected a mass return to workplaces. However, this has not occurred. Should we return to the pre-pandemic "business as usual"? Or would doing so be a mistake? How far should we go? Is "work-from-anywhere" the way of the future?

The answer for any organization should start with purpose. A workplace model, whether traditional, remote or hybrid, should serve business goals. Organizations need to ask how the model will benefit customers, employees, shareholders and even their communities. If the model is simply a response to possibly short-lived employee expectations, leaders expose their organizations to longer term risks. But if a solid rationale exists, managers can proceed to work out the operational details and mitigate these risks.

48%

of Canadian CEOs say they will focus on a culture and policies that foster a better work-life balance for their employees

Doron Melnick

"A workforce model needs to work for the business as well as for workers. Any workplace model needs to be purposeful in its design and organizations need to ask how their customers, employees, shareholders and communities will benefit."

— Doron Melnick, Partner and National Leader, People and Change Services, KPMG in Canada

Flexible work challenges: Engagement and equity

Hybrid and remote models can foster employee engagement. Empowering employees to choose the best place to do their work demonstrates that leaders are listening, respectful and supportive. This does not mean that employers need to give employees full flexibility to determine their own work location schedules – there can still be requirements or guidelines to work in-office on certain days of the week, or for certain types of work.

In terms of engagement risk, long-term remote work can degrade motivation and productivity for some. Inspiration and emotional connection will remain a priority for leadership teams, with 40% of Canadian CEOs reporting strong focus on creating a purpose-led and values-driven culture. A common approach is to connect the organizational mission to a broader community impact goal, such as social justice, health outcomes and environmental protection. Another is to convert the sometimes-abstract notions of "the customer" and "customer experience" into something more concrete and relatable through personas and storytelling.

Hybrid work can also create new challenges for workplace inclusion, diversity and equity. Over the long term, employees working remotely should have the same career growth opportunities as they would working in the office and be assessed equitably for recognition and progression. On an everyday level, even something simple like participation in a meeting is disrupted by a hybrid work model. When we were all working remotely, we each enjoyed the equality of being allotted the same-sized tile on the computer screen. But when some meeting participants are together in-person and others are joining remotely, the meeting leader needs to be deliberate in enabling all voices to be heard and considered.

Similarly, with the amount of attention on the planning and implementation of office reopening, those who work permanently on-site and in the field can get lost in the shuffle. Leaders recognize the importance of continuing to listen, respect and recognize all employees regardless of work model.

Beyond flexible work models: the workforce evolution

The future of work is so much more than flexible location. The workforce of the future is a connected and digital one where each person understands their role in bringing the customer promise to life and is comfortable with continuous learning and change. CEOs are already allocating resources to support the needs of this workforce with 68% expecting to invest more capital in buying new tech over the next three years and 32% prioritizing investment in workforce skills and capabilities.

68%

of Canadian CEOs are investing more capital in buying new tech over the next three years

A "digital workforce" does not mean that every employee is a software programmer. Rather, the digital workforce is willing and able to learn rapidly and adopt new ways of working made possible by technology and flatter organizational structures. Many CEOs already see the importance of this, with four out of 10 believing they foster engagement by investing in a combination of technical and soft-skills training at all levels, with encouragement to learn, innovate and collaborate across traditional siloes. Performance measurement, recognition programs and team leader-as-coach are additional levers that leaders can use to create a growth- and innovation-oriented culture. The rapid shift to remote work at the start of the pandemic tested all organizations to quickly adapt to new technologies and work practices – a perfect illustration of why a "digital workforce" is future-proof.

New work models, new complexities

Many organizations have by now recognized that their formal remote work policies and programs, developed before the pandemic, are no longer fit for purpose. With more pervasive and sustained remote work, managers are clarifying expectations for a range of policies such as core working hours and permissible work locations, appropriate use of company technology outside the company office, eligibility for reimbursement for home office related expenses, health and safety in the home office, and others. Some may also need to invest in performance management training to help managers effectively motivate and manage their hybrid workforce.

Increased flexibility in work locations can also bring increased legal complexity to the workplace. Organizations will benefit from having a strategy for navigating the legal risks of change, including compliance with employment standards, constructive dismissal claims, class action risks, unionization-related issues, human rights and occupational health and safety. Similarly, setting up work in remote locations (including provinces and countries) may result in tax, immigration or data security implications.

Lisa Cabel

"Not all employees will be equally impacted by the transition to a hybrid work model. As such, employers should be prepared to address individual employees who require accommodations based on protected human rights grounds, including disability, family status or religion."

— Lisa Cabel, National Leader, Employment and Labour Law, KPMG Law LLP, KPMG in Canada

A sound understanding of the organization's legal obligations and risk exposure is key to effectively designing flexible work models and planning for future changes. It's also important to design a communication strategy that meets the employer's legal obligations while mitigating legal risk.

Key takeaways

Hybrid and remote work models are best designed with purpose. A well-constructed model and related supports will effectively address the human, legal and technical complexities. And whether such models remain pervasive or not, organizations will benefit from taking a strategic approach to the future of work. A broad range of talent development and management strategies are needed to create and sustain a truly agile organization.

Leaders should:

  • Think carefully about how hybrid work helps achieve organizational goals. Ask "What needs to be true for a hybrid model to be the right choice for us?"
  • Connect with workers who may be adversely affected by remote work and ensure their voices are heard and that they are treated equitably
  • Engage onsite and field workers and continue to listen to, recognize and inspire them
  • Invest in a portfolio of technology and learning programs to help sustain workforces that will thrive in the digital age
  • Support managers as they deal with the added complexity of distributed teamwork. This is an opportunity to reinforce good leadership and management practices for high-performing teams
  • Prepare leaders and employees for responding to evolving occupational health and safety protocols and update policies and procedures to reflect a more flexible approach to work

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