Decoding the Hybrid Workplace: Practical Approach To Work-From-Home Policies

Snehal Shah

Vineeta Dwivedi

Hybrid working from home improves retention without damaging performance, 2024; Bloom, N., Han, R. and James Liang, J.

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Decoding The Hybrid Workplace: A Approach To Work-From-Home Practical

Problem of Practice: Organisations globally are grappling with the search for an optimal approach to hybrid work. The shift towards remote work during the pandemic demonstrated both the possibilities and the challenges of a hybrid work arrangement. As companies navigate the ‘new normal’, some questions loom large in the minds of HR executives and business leaders: To what extent should hybrid work be embraced, and what approach will lead to success? Will productivity suffer? Our essay provides an evidence-based perspective to address these concerns, along with an approach to designing and implementing a robust, hybrid work-from-home (WFH) policy. A recent study by Nicholas Bloom, Ruobing Han and James Liang provides valuable insights into the impact of hybrid work.¹ The study suggests that well-implemented hybrid policies can significantly improve employee retention without negatively affecting performance levels. It highlights the importance of flexibility in enhancing employee satisfaction, ultimately reducing turnover. This article sifts through accumulating evidence to decode the hybrid nature of work. It proposes a pathway to policy making, referred to as the PFE (Pilot, Focus, and Educate) framework, while considering some boundary conditions that influence decision-making

To WFH, or not to WFH?

Recent data suggest that 68% of US firms do not require employees to work from the office five days a week.² Around 36% of employees prefer this arrangement over a pay raise.³

However, Andy Jassy, CEO of Amazon, believes that a full-time return to the office, mandated for corporate employees in the US starting in January 2025, will help foster collaboration and a strong culture. In a candid talk with Adi Ignatius of Harvard Business Review, Jassy explained his rationale: “When you are in person at the office, you invent and collaborate much better”.⁴

In a similar vein, Eric Schmidt, the former CEO of Google (now Alphabet), has underscored the importance of serendipitous encounters for idea generation, problem- solving and quick decision-making.⁵ These views are not restricted to the US. A senior executive from HCL Tech — an Indian Information Technology (IT) major — recently reiterated in a town hall:“… for complex projects and fostering team cohesion, a significant presence in the office is becoming essential”.⁶

Another IT giant from India, Wipro, also communicated the need for employees to return to the office for a certain number of days a week; their leadership noted the importance of on-the-job learning and mentorship, particularly for junior employees.⁷ Companies like Apple, Tesla and JPMorgan Chase have also implemented mandates for in-office presence, with reports indicating varying levels of employee pushback, but the companies have maintained a firm stance.⁸

These calls for return-to-office have had an impact. Data from Kastle Systems, which tracks office occupancy in major U.S. cities, shows a steady climb in average occupancy rates, reaching over 55% in May 2025 —a significant increase from the sub-40% levels seen throughout much of 2023 and 2024.⁹ This suggests a notable shift away from a remote work norm that had characterised the workplace during the COVID-19 pandemic. The question then arises: How can leaders sift through the mounting evidence on either side to find an optimal balance and a way forward?

“The business case for hybrid: 69% of the Fortune 500 are hybrid WFH for managers and professionals.”

Nicholas Bloom

Hybrid work landscape

Insights garnered by consulting firms such as McKinsey & Co., Inc., BCG, and the Big-4 identify several issues with a hybrid workplace, which include:¹⁰

Maintaining collaboration and cohesion across hybrid teams is challenging. Hybrid workers feel disconnected and perceive a greater sense of social distance from their superiors, fearing biased performance appraisals and inequitable rewards
Employee well-being remains a concern. As work-life boundaries blur and we become increasingly dependent on technology-enabled work, burnout and technology fatigue can set in.¹¹
The difficulty in accurately measuring productivity leads to subjective assessments of superiors, which in turn give rise to perceptions of inequity, chipping away at interpersonal trust between the superior and subordinate and within teams.
The trust issue is exacerbated by heightened monitoring mechanisms and a sense of implicit distrust due to physical and psychological distance.

Offsetting these challenges are several benefits, including substantial cost savings through reduced physical space requirements and access to a broader global talent pool. For instance, Global Workforce Analytics indicates IBM saved $50 million in real estate costs, whereas McKesson saved $2 million a year. Seen from an employee cost perspective, Nortel claimed it saved $100k in relocation costs.¹² Apart from quantifiable cost savings, hybrid work offers dual benefits — maintaining performance while enhancing employee recruitment and retention, as evidenced by extensive research conducted by Nicholas Bloom and team. This research—widely cited by both industry and policymakers —advocates neither for, nor against remote work, but focuses on data — driven optimisation of work arrangements. Findings highlight the productivity and retention benefits of structured hybrid models while acknowledging the continued value of in- person collaboration.

Going hybrid

Bloom and his collaborators conducted a rigorous study of hybrid working, in which eligible employees from Trip.com – a digital travel agent – were offered an option to work remotely for part of the work week. The research revealed a fascinating human dynamic: despite the potential benefits, only 35% of eligible employees initially volunteered for the hybrid programme.¹³ Many feared being seen as less ambitious or committed, a concern particularly strong among female employees, who volunteered at lower rates despite ultimately benefiting the most from the arrangement.

However, as the experiment progressed, the data told a compelling story. Hybrid workers demonstrated a remarkable 33% reduction in attrition rates, significant improvements in work-life balance and job satisfaction and no negative impact on performance metrics or promotion rates. Before the trial, managers predicted hybrid work would decrease productivity by 2.6%. After seeing the results firsthand, they revised this estimate to a 1% productivity gain—a complete reversal of their initial scepticism. One important implementation nuance also emerged: Employees overwhelmingly preferred working from home on Fridays rather than Wednesdays, as major meetings and collaborative work naturally clustered midweek.

By January 2022, the results were so compelling that Trip.com’s executive committee made hybrid work permanent across the entire company. The experiment demonstrated that a carefully structured hybrid model (2 days remote, 3 days in-office) could reduce costly employee turnover, maintain productivity and improve worker satisfaction. This study provides compelling evidence that hybrid work is neither a temporary, pandemic-induced adjustment nor a productivity killer, but rather the new equilibrium for knowledge work.

Equilibrium for knowledge work

Other examples provide further evidence. GitLab is a remote-first organisation with high structural flexibility and technology-driven WFH maturity.¹⁴ From its inception, GitLab built an all-remote culture, focusing on process documentation and employee autonomy and demonstrates how companies can thrive without physical offices by investing in digital infrastructure, trust and transparent communication. Tata Consultancy Services (TCS) is transitioning to a hybrid work model with an experimental mindset. TCS’s vision of only 25% of its workforce needing to work from the office by 2025 reflects its ambition to embrace flexibility.¹⁵

Taken together, these examples provide a framework for policy-making (see Figure 1) for organisations worldwide seeking to balance employee well-being while optimising performance. It does so by relying on data- driven experiments within the organisation (Pilot), focusing on the groups of employees with the potential for maximum impact (Focus) and educating sceptics with demonstrable examples and rigorous data analysis (Educate). These foundational pillars are further elaborated below.

Figure 1: Potential approach for hybrid work policy making

Potential approach for hybrid work policy making

Pilot: Considering the type of working culture an organisation exhibits, it can pilot a hybrid model by starting with two designated work-from-home days (e.g., Wednesday and Friday), while closely monitoring outcomes such as retention, performance and employee feedback.
Focus: Customisation with a focus on fairness is the key to a sustainable WFH policy. Organisations may prioritise inclusivity by addressing the needs of groups who are motivated by such flexibility, particularly women and employees with long commutes, to enhance the attractiveness of joining the organisation and subsequent retention.
Educate: WFH policy and its implementation are a change management exercise. Decision-makers need to share empirical evidence and examples of both within and outside the company to debunk some of the myths about the nature of WFH policies.

The PFE framework:

Pilot (P) – data-driven experiments within the organisation
Focus (F) – focusing on the groups of employees with the potential for maximum impact
Educate (E) – educating sceptics with demonstrable examples and rigorous data analysis

Rollout pointers & cautions

Although evidence supports the idea of WFH policy as a lever for strategic advantage, a few cautionary tales remind us of the boundary conditions that challenge its design and implementation. Most recently, a moonlighting scam came to light when Soham Parekh, a software engineer, was exposed on social media for holding multiple jobs without his employers being aware of it. Such examples are growing in number, blurring the boundaries between ethical conduct and policy governance.¹⁶

For the successful design and implementation of the PFE framework, two key conditions must be met: supportive culture and technological flexibility. Organisations need to create a culture built on trust that embraces the principle of autonomy with accountability. Such a culture enables management to prioritise outcomes over hours and support employees’ choices in a psychologically safe environment. Earlier studies have highlighted a strong correlation between the alignment of culture with employee engagement, productivity and retention, especially when the organisation is implementing evolving work models.¹⁷ This strong linkage provides a sense of cohesive identity and purpose when the hybrid environment is characterised by varying physical presence, commitment and a sense of belonging.¹⁸

Technological flexibility includes robust digital infrastructure, digital workflows and processes that provide clear guidance to distributed work teams. Equally important is continuous training, investment in technology to ensure digital fluency and remote technical support. These boundary conditions are further customised at the team level. Raj Choudhury, of the Harvard Business School, known for his scholarship and expertise in the area of hybrid management practices, acknowledges the importance of customisation at the team level to determine who works how, where and when.¹⁹

Diagnosing work culture that aligns with the company’s overarching vision and mission is the ideal first step. CBRE’s Global Workplace & Occupancy Insights report (2024-25) provides a simple approach to diagnose relevant parts of the culture to arrive at three basic categories of hybrid work: a) Office first, b) Blended, c) Virtual first.²⁰

Office first: Believes office attendance most of the time is critical to company culture or mode of operation
Blended: Offers flexibility to work outside the office but expects a balance of time between home and office
Virtual first: Accepts that virtual working most of the time works for their business, people and culture.

Source: Adapted from CBRE’s Global Workplace G Occupancy Insights report (2024-25) by the authors

The next step is implementing a needs-based, culturally sensitive hybrid policy at the team level. Describing one of the key insights from his new book in the Harvard Business Review’s IdeaCast episode ‘Navigating the Hybrid Work Dilemma’, Raj Choudhury argues persuasively that hybrid work policies should be customised and implemented primarily at the work unit level. Such granularity is wise because, for instance, a software development team deeply engaged in coding sprints might benefit from more flexible remote options. In contrast, a client-facing sales team may require a more consistent in-office presence for team-building and collaborative strategy sessions. This team-centric approach, as Choudhury advocates, allows for customised hybrid models that maximise both individual flexibility and team effectiveness.

A win-win if done right

The growing body of research on hybrid work points to a clear consensus: hybrid work is not a passing trend but a durable shift in how organisations operate. Rather than enforcing blanket return-to-office mandates, leadership must approach this transformation with strategic intent, guided by evidence and proper organisational fit.

A win-win if done right

While hybrid policies may vary across industries, policymakers and corporate decision-makers alike should prioritise pilot programs with measurable outcomes. When both productivity gains and emp loyee satisfaction can be demonstrated, hybrid work emerges not only as a viable option but as a strategic advantage. It can be a long-term policy solution that benefits both organisations and their people.

About the author

Snehal Shah

Snehal Shah is Professor in the Organisation & Leadership Studies department at SPJIMR. She is the Associate Dean, Academics & Research.

You can reach out to her at snehal.shah @spjimr.org

Vineeta Dwivedi

Vineeta Dwivedi is Associate Professor in the Organisation and Leadership Studies department at SPJIMR.

You can reach out to her at vineeta.dwivedi@spjimr.org.

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What are Interviews for? A Qualitative Study of Employment Interview Goals and Design, 2024; Wingate, T.G. and Bourdage, J.S.

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