Company bosses warn hybrid working can damage productivity and career progression

The switch to hybrid working is causing concerns among chief executives about productivity and career progression for staff as fears of a two-tier workforce increase.

Research into the views of more than 500 CEOs showed that hybrid working was also intensifying concerns over staff retention and creativity.

The study, commissioned by Definition Group, spoke to the heads of firms with more than 250 employees and revenues ranging from £50 million to more than £500 million and in diverse sectors of the economy.

The work revealed that senior leaders could see the positives in hybrid working, with 33 per cent agreeing that it offers a better work-life balance for staff, leading to increased productivity.

Hybrid working is being embraced but will it create a two tier system?

A further 29 per cent said they were seeing financial savings through reduced real estate costs as a benefit.

However, these were countered by concerns about the adverse impact on productivity by a disengaged workforce (29 per cent), greater challenges around training and career progression (29 per cent) and a potential to create a two-tier workforce with negative impact on morale (26 per cent).

Additionally, a quarter of respondents envisaged hybrid working resulting in a less loyal workforce posing greater retention challenges, with 23 per cent saying they foresaw negative impact on creative thinking and problem solving.

Peter Davenport, Senior Strategic Consultant at Definition Group, said: “We are at a watershed moment in business life.

Homeworking has been advantageous for working parents.

“The benefits of a strong workplace culture are widely acknowledged, but how to maintain that in the ‘new world of work’ in the long term is uncertain. Balancing corporate requirements and employee preference will be a major challenge.”

In the survey, 92 per cent of decision-makers reported that communications priorities have changed since the start of the pandemic.

In addition to these changing priorities, respondents believed that communicating their ‘purpose’ as an organisation has become more important now than ever before, with a third of those asked making sure their purpose is reflected in all communications activity and 29 per cent demonstrating it in practical ways such as supporting charities and community projects.

Values and purpose also have a significant impact on people strategies, with 31 per cent agreeing it makes their staff proud to work for the business and 28 per cent saying it helps with recruitment.

Bill Bullen, founder and chief executive of Utilita Energy, which has more than 800,000 domestic and business customers, is one of the senior business leaders interviewed as part of ‘A Unified Voice’, the report based on the survey findings.

He said that the benefits of involving staff at all levels in defining the company’s values had created a shared sense of purpose that was vital in the pandemic.

“Nobody could have imagined that those values would be put to the test in quite such a dramatic way as that imposed by Covid,” said Mr Bullen.

“We have certainly seen the benefits of a shared sense of purpose in some of the most challenging times any of us have faced and, I have to say, I have been enormously humbled by the way our people have responded.”

Mr Davenport added: “British businesses have faced their biggest peacetime challenge in coping with the disruptive impacts of the pandemic. For some, the crisis created opportunity; for others, it was a question of simple survival.

“Communication was at the heart of how organisations engaged with frightened and bewildered staff as well as confused and concerned customers and clients.

“How well they managed both will impact on their future reputations and fortunes,