Hacker News Reader

Comment by gabesullice | Hacker News Reader

I'm genuinely interested in why RTO is trending. I searched Harvard Business Review, Gartner, and other sources just last week trying to find the rationale, but I wasn't successful. In fact, I found those sources to be a little cautionary. E.g., they say "if you do switch to in-office or hybrid, make sure you actually have metrics to evaluate the effects" and "ensure it makes sense for the actual work to be done by each role".

I also found results suggesting flexible working policies had positive properties like higher employee satisfaction, retention , and a wider applicant pool.

I'm not interested in hearing why the choir here at HN thinks companies are making these decisions, I want to see evidence of their rationale so I can put myself in management's shoes.

View on HN

I was also studying many MBA books about decision making in corporate environments. Many cool things about data driven decision making. Costs and alternative costs, etc., many cool things, some even with scientific background. RTO is also analyzed in similar manner. The truth is that RTO is great way to ditch people with longer commute and/or kids easily and for free. And unions (as they’re in Germany) are happy.

But let’s get back to reality, the business decisions are made in the style “I like this” and “I don’t like this”. Only most obvious decisions are somehow backed up. And RTO is known to work well to ditch 2-3% of workforce in few months for free. Parents go first, high performers go afterwards. Headcount reduced, job well done!

The way with severance packages can go for years with many rounds when the packages are too small. Severance packages also involve social plan negotiations with unions… Somebody will go to court for sure and sue the company… So obviously let’s do RTO, it’s cheap and quick. And improves collaboration of course. First round with mandatory 3 days in the office and second one with 5 days in cheapest possible open office with chaos, distractions and noise.

I wonder if it’s possible for to sensibly short stock based on RTO announcements?

Generally people don’t push for redundancies is companies growing organically.

If this is a signal I wonder what the lead time is before it starts to bite?

I think, two rounds of RTO reduce headcount by 4-6% and the company is still functional. Work packages are delegated to the folks who stay. Few months later lost key persons get replacement. It’s not like throwing 2/3 workforce and concentrating on core business.

The problem is that proper studies on this topic will take years to really understand the positives and negatives of having the majority of your employees working remotely. --Researchers need to be able to track people through their careers to understand whether or not WFH is a net benefit to them and/or their companies.

So you're really going to have to deal with only hearing what people think.

RTO is trending for many reasons - some are doing this for bad reasons, I'm sure, but I also know that some managers are pushing for this because they a) see that junior developers aren't getting the necessary mentoring to help them develop and grow into seniors, and b) because they feel that people are spending more time on tasks because they're less likely to reach out if they have to ping people, wait for a response, and try to work through things without benefits like being able to draw on a whiteboard and such. --Maybe some companies are handling this better than others, but they are valid concerns.

To be clear, I'm not wishing for evidence of whether RTO is good or bad.

I want evidence that proves "it's about cheap layoffs" or "it's about real estate" or "it's because they want to monitor people" or "<insert any speculative reason on this thread>"

Once we have evidence"it's about layoffs" then we can debate whether it's ultimately helpful or harmful to cull headcount that way.

It's a lazy and cowardly way to get people to cull themselves and save money on severance packages. It's not that deep.

Isn't it possible to just not give people severance packages?

Somewhere between 85% and 90% of all countries have some sort of mandated severance pay in the event of a layoff.

A small percentage of countries also mandate severance even if the employee is fired (with cause).

US doesn't seem to be such a country though?

Depends what sort of contract they have (and/or how much perceived leverage they have - firing high-income workers who have a public platform can make for messy PR)

It is likely too late for many existing contracts with packages built-in, which probably also overlap with the longest-working (and thus most expensive) engineers.

It's also a dumb strategy because the good people will easily find another job and leave and you end up with office full of the least competent employees.

But yes I'm pretty sure this is a big part of the reason for these mandates.

From what I've seen (at a fortune 100 company) they made the supposedly "best" employees fully remote, and they neglected to tell the others that there were "limited slots" for fully remote and thus they had to come in to work. After a few months of coming in for work, they then laid off those employees, as not enough people quit for that to happen. To be fair, I was given a severance, but it still sucks. And the office was in bad shape, bathrooms poorly maintained, cafeteria in disarray, with substandard food (compared to before). The reason they're trying to get rid of employees is to make their stocks look good. We did better during covid by all measures, when everyone was working remotely.

I've long suspected it's got to do with office real estate.

You spent $10m or $100m on a building that's now half empty.

Either you downsize or commit to enterprise scale sunk cost fallacy and enforce RTO so your real estate investment isn't "wasted".

City centres also thrive on RTO, with high street shopping on a generational decline it's up to office workers and their employers to prop up the economy of the CBD one overpriced lunch at a time.

The city centre / real estate thing sounds like an externalisation - which companies famously dont give a shit about.

It should be a tradegy of commons at best: it may affect the CEOs 401k, but not by much (0.000001% for their individual decision to RTO for that company y). It like buying McD shares then going to McD for lunch every day with your team.

I think there are other reasons.

Most companies, at least in the U.S., don’t own their offices. They lease them.

In fact, a whole bunch of office leases were supposed to be expiring in 2024/2025. If this was the reason RTO wouldn’t be picking up right now since they would be cutting back and ending their leases.

I feel that companies still misunderstand how to evaluate these metrics they're collecting on the efficacy of RTO.

IMO, RTO efficacy should be measured on a team-by-team basis. There are no doubt zero "one size fits all" approaches for entire orgs, or entire companies (and if there are, then the metrics should /strongly/ reflect that)

To actually measure efficacy of any measures, you need to implement them in isolation. It is really hard to evaluate how working from home is affecting productivity while simultaneously doing mass layoffs and pushing people to replace their fired collagues with AI

> I want to see evidence of their rationale so I can put myself in management's shoes.

I think worthwhile evidence would only be available if two things, both questionable, were true:

1. an unbiased sample of companies implementing RTO are willing to disclose their reasons - e.g. make public announcements, or cooperate with academic studies. 2. they were honest about the reasons.

If common reasons for RTO would make the management look bad (and some might even be illegal in some places) then the first is less likely, and the second is highly unlikely.

You'll probably get better results than the level of Sloan from the NY Fed, the AEA or Glass Lewis. They point out that profit-seeking strategies outside of the concept of ordinary business[1] can exist on a spectrum from highly ethical to highly unethical, ideally[2] all pursued simultaneously in proportion to their risk.

[1] e.g. through leveraging class politics, hyperstition or militias.

[2] From the point of view of the responsible stakeholders, that is.

At some point I cared about the reason. I have since stopped caring.

Even if a bunch of companies adopt RTO, many others just embraced remote work as a competitive advantage. I can just choose to work for those.

So, RTO all you want. I am not joining.

> many others just embraced remote work as a competitive advantage. I can just choose to work for those.

Are you sure it's that easy?

Easy or not, It's what I have been doing so far.

What's your profession?

Software developer. One of those professions that thrive in remote environments.

Of the information I have reviewed brain storming / creative sessions are better in person versus online sessions. This does lend to hybrid approaches being useful. All other metrics were better or had no difference.

One point I did note is that there is an increase in management overhead when workers are separated, and this increase in workload by senior management is likely a pain point for them - even though there are likely productivity benefits in forcing management to communicate through official channels and have a more organised approach to task delegation/internal messaging.

From a financial perspective office spaces are a type of investment vehicle. Prior to the GFC office space was lucrative, and that was again peaking pre-covid. There are likely secondary motivations at play beyond productivity.

Reply on news.ycombinator.com