If you’ve been considering switching your workforce to hybrid work or expanding your hybrid offer, then it’s only right to consider your return on investment. But what are the hybrid working ROI benchmarks?
Let’s dive in by looking at how to measure ROI in this instance and how we do that across a workforce often separated by location.
Why it is important to measure hybrid working ROI
Measuring your ROI can be essential for several reasons:
- Cost-effectiveness – By measuring the costs and benefits of a hybrid working model, you can make informed decisions about whether or not to continue with this approach. Here’s our guide to discovering if hybrid working is right for your business.
- Performance improvement – Your performance metrics can help you to see where and how hybrid working affects output. For example, if your data shows that employee productivity has declined, you may need to reevaluate your policies around remote work or provide additional training to improve productivity. It is also critical to review your tech because that can also be an important factor in potential productivity levels.
- Employee well-being – By measuring employee satisfaction, mental health, and work-life balance, you can identify areas needing improvements to support employee well-being. This translates into improved engagement, productivity and reduced absenteeism.
- Competitive advantage – Measuring the ROI of a hybrid working model can help you stay competitive in a rapidly evolving business landscape. By demonstrating the effectiveness of this approach, you can attract top talent and differentiate yourself from competitors.
Now we know why we should be thinking about ROI; it’s time to show you where, when and how to do it.
How to measure hybrid working ROI
Before we look at any specific measurement points, we need first to consider what our goals are. Are you hoping to cut operating costs by offering hybrid options? Are you looking to increase employee output by facilitating a healthier work/life balance?
When we are clear on what our goals are, it’s much easier to measure for gains or losses.
Operating costs, expenses and office usage
Switching to hybrid work means investing in technology, but are you investing in the right technology? Are you seeing these new costs reducing operating costs and expenses?
Of course, we aren’t saying that switching to hybrid work will necessarily see substantial cost savings – that depends on your business. But if your goal is to reduce costs, your expenses will provide the right measurement data.
Understanding this data gives you a clear picture of how to work to meet your cost goals.
Employee productivity, absenteeism, engagement and satisfaction
There are three ways of measuring employee productivity and engagement: firstly, look at your output data compared to last year and drill down to performance metrics for in-house and remote work. And secondly, track employee absenteeism across your hybrid working period compared to before. Then finally, thirdly, track employee sentiment through surveys or other feedback mechanisms.
We must remember that for hybrid work to provide excellent results, we need management to instil trust in the workforce, give commitments to support hybrid transitions, offer the right tools, and build a nurturing culture.
Talent retention and recruitment
How many of your employees are leaving compared to pre or post-remote setups? Is your hybrid offer helping to attract stronger talent? Look at your data and ask leaving staff more specific questions on hybrid work to establish how you are doing.
Collaboration and innovation
It’s incredible how trust and freedom make a workforce feel confident and creative. What observations have you made about employee collaboration and innovation? How have you seen this affect business?
Customer satisfaction
There are several ways we can measure customer satisfaction:
- Net Promoter Score (NPS)
- Customer Service Satisfaction (CSS)
- Customer Effort Score (CES)
- Customer Satisfaction Score (CSAT)
- Customer Health Score (CHS)
- Customer Churn Rate (CCR)
- Customer reviews.
Ask yourself how these have changed since you offered hybrid working. Where specifically have you seen improvements, and what were the reasons? Conversely, have there been any increases in negative sentiment, and what were the reasons?
Now we know how to measure ROI, what benchmarks should we aim for beyond our business goals?
Hybrid working ROI benchmarks
It’s vital to preface benchmark discussion with a caveat – while we have researched and compiled our findings here on the blog, when, where and how you use these against your metrics is very personal.
That being said, some benchmarks can be used as a starting point for measuring the ROI of hybrid working. These may include
- Increased productivity – A study by Stanford University found that remote workers were 13% more productive than their in-office counterparts. 58% of employers have found their employees more productive individually and as a team in hybrid situations, according to a study by McKinsey and Company.
- Reduced real estate costs – A study by Global Workplace Analytics estimated that employers could save up to $11,000 per year for each employee who works remotely half of the time.
- Reduced absenteeism – The same study found that absenteeism was reduced by as much as 31% for each employee who works remotely half the time. In sick days this was a 1.1-day reduction over in-house staff.
- Improved employee retention and recruitment – A survey conducted by Deloitte found that flexibility in work arrangements is one of the top three factors that Millennials consider when choosing an employer. OwlLabs found that most employees would consider leaving or not taking a position if flexibility in hours and location was not an option.
- Increased employee satisfaction and wellness – A study by FlexJobs found that 65% of remote workers report being more productive, and 86% report feeling less stressed. The Office of National Statistics said that 47% of hybrid workers felt their work-life balance has improved.
- Improved customer satisfaction – McKinsey and Company found that 36% of businesses found that customer satisfaction increased due to hybrid working arrangements for staff. We believe that your employee experience has a significant impact here too.
So, can you measure hybrid working ROI effectively?
There are certainly measurement points you can take, but the goals you are setting for your hybrid working model should be your focus. You should ask yourself if your goals enhance your business and your staff’s ability to perform well.
That being said, understanding if this working model suits your business is crucial if you offer it to introduce fresh talent to your team and reduce employee friction and absenteeism. This means learning how your policy translates into a return on investment and how to update it.
We hope to have started you on your journey to effectively measuring hybrid working ROI by setting out points of measure and a guideline to possible benchmarks.
If you are looking for more guidance on hybrid working and specifically how we at Kind Mind are helping employers run their employee wellness strategy, check out our complete guide, “How Kind Mind and wellness attitudes can transform culture in hybrid working”.
