Bosses Push Back on WFH Die-Hards: ‘They Will Need to Show Up’
Managers say team productivity has taken a hit as employees stay remote
3 min
Office attendance is slumping again and bosses have a warning: We are a worse company when you stay home.
In buildings across 10 major U.S. cities, office occupancy has fallen back below 50% for the past three weeks, according to Kastle Systems, which tracks security swipes into offices. The drop comes despite new return-to-office mandates that affect more than 600,000 workers and counting.
Hundreds of Wall Street Journal readers—many of them bosses and team leaders—responded to our story on the workers who say “it’s not my responsibility” to save the office economy. These bosses say employees who insist they are more productive while working from home are missing the larger picture: Team productivity is taking a hit.
The purpose of an office is to create a dynamic environment where people feed off one another’s energy, bond on a personal level and explore ideas in unstructured ways, many company leaders said. Remote work can’t provide those kinds of casual interactions that build culture and camaraderie, they say, which means it is worse for the organisation and, in many cases, individual careers, too.
“Team collaboration really is much better and more effective with actual face time. Career growth also,” said William McNamara, a hiring manager who lives in Bellevue, Wash. “Sure, zealots will claim you can do it all remotely, but you can’t do it all as effectively for everyone, remotely.”
Still, work-life balance is a vital piece of company culture—one that workers say is helped by the option to work from home, at least part of the time. That leaves bosses to strike a difficult balance, something they are more keenly aware of than their employees might realise.
“We are stuck. Remote work means remote engagement. In-office means less flexibility,” said John Hayes, founder of Blackney Hayes Architects, a Philadelphia-based firm.
Eavesdropping as education
Bosses say that developing young workers and new hires is a priority, and that it’s tougher and slower to accomplish it when people aren’t gathered together in offices. Structured training sessions can often be conducted via Zoom, but the daily rhythms of mentoring and learning on the job require a less-structured exchange of questions and answers that happen organically.
“Eavesdropping is a huge form of education,” Hayes said. “Hearing what other people are saying, how they’re dealing with problems.”
Blackney Hayes asks employees to do their jobs from the office at least two days a week, but doesn’t mandate the face time because so many workers have said they prize flexibility.
“If leadership and all the energy radiate from the office, then people will understand that if they want to be part of the team they will need to show up,” Hayes said.
Jenny von Podewils, co-chief executive of Leapsome, an HR productivity and engagement platform, has taken a similar approach in the hopes of boosting young workers’ professionalism, such as appropriate conversations with colleagues and how to present in client meetings. Without office time, newer staff members take longer to get up to speed—if they catch up at all.
“Learning doesn’t happen on Zoom calls. It happens during meetings, together, through body language, listening to how people approach certain situations,” she said.
Breakthrough problem-solving
Ad-hoc interactions are important for seasoned employees, too, said Kevin Kowalczuk, a technology product manager based in Franklin, Tenn., who retired in April.
“We could literally make progress on a task while waiting for our coffee cup to fill up or while we heated lunch in the microwave,” he said of his return to the office.
Kowalczuk resolved one of his tougher challenges while chatting with colleagues in the company kitchen last spring. After discussing the housing market, their conversation turned to a new application that was only loading for some users despite being released to hundreds. The group quickly determined the problem stemmed from incorrect group permissions being granted to the users.
“That saved us days of time,” Kowalczuk said.
Team productivity vs. individual output
Individual contributors with task-oriented roles and a clear to-do list can perform satisfactorily in a remote setting in a way that doesn’t work for more strategic roles, said Edward Boggs, an information-technology team lead who lives in Durham, N.C., and goes in five days a week.
“If the tasks they are receiving are of the ‘figure it out’ variety, they often don’t do a very good job, or it takes them much longer than it should,” he said. The critical thinking required for those jobs usually requires a team working through issues in real time, Boggs added.
Working from home introduces other performance-related issues, even for conscientious employees with the best intentions, said Kim McClung, a former vice president of clinic operations for a large medical group, who’s now retired.
Managers who reported to McClung struggled to step back from work. They answered emails and took calls after hours, a habit she said she tried to discourage because it leads to burnout.
“If you’re in the car driving or trying to watch your kid’s recital while you’re answering emails, you’re not giving your best to anyone,” she said. “I don’t want your attention under those circumstances.”
McClung would rather her team work shorter hours together in the office, 100% focused on work, then go home and have true downtime.
When people are “on 24/7, the quality of work is going to suffer,” she said.
Mirzaian is a senior director within CBRE’s Development NSW business, operating across the company’s Western Sydney and North Sydney offices
Singapore’s Formula 1 weekend has always looked different. Held beneath floodlights on the Marina Bay Street Circuit, the race transforms the city into a nocturnal spectacle of speed, heat and saturated colour. It is this distinctive atmosphere — and one of Singapore’s most important natural symbols — that has shaped IWC Schaffhausen’s latest motorsport-inspired watch. …
Continue reading “IWC’s purple Formula 1 chronograph pays tribute to Singapore after dark”
Wall Street’s hottest momentum trade has reversed sharply, as former winners tumble and heavily shorted stocks surge.
3 min
Wall Street’s hottest trade has gone ice cold.
For years, it paid off to buy stocks that were rising in price—and bet against struggling shares. The momentum trade was especially profitable this year, as investors piled into hot stocks including Micron Technology, Nvidia, Advanced Micro Devices and other artificial-intelligence darlings while wagering against those likely to be hurt by the embrace of AI.
The S&P 500 Momentum Index soared 44% in the second quarter, its best quarterly performance on record, and it surged 133% over the past five years, nearly double the broad market’s performance.
Mega funds and rookie investors alike piled into the trade, some using leverage and options contracts in an effort to amplify their returns, propelling the underlying shares higher.
“It is a self-fulfilling prophecy,” said Matthew Tym, managing director at Cantor Fitzgerald, of the trade.
Suddenly, the trade is a loser. The momentum index has tumbled more than 9% since July 1, lagging behind the S&P 500’s 2.8% gain. The index—which tracks stocks in the S&P 500 based on a “momentum score”—is on track for the biggest quarterly underperformance in 25 years. July was the second-worst month for the momentum trade in around 40 years, according to Bank of America estimates; the only month worse was April 2009, in the teeth of the global financial crisis.
Hedge funds that bought momentum shares while shorting low-momentum stocks suffered even more. At the same time, a basket of the most popular stocks held by hedge funds tracked by Goldman Sachs recorded its biggest one-month underperformance in July relative to the S&P 500 in more than 20 years, according to the bank’s analysts.
Momentum trading is based on a rather simple observation: Investments that go up tend to keep outperforming; those that underperform often remain laggards. This kind of trading might seem too simple a stock-picking strategy to work. Yet it often has.
“For decades, it didn’t take a lot of sophistication to run a momentum strategy and make a decent living at it,” says Agustin Lebron, senior researcher at EquiLibre, a trading firm.
Part of the reason: It takes a while for corporate and other information to spread to various investors, so they slowly build positions, producing buying momentum.
“A huge pension fund can’t flip around its positions in a day,” says Lebron. “Behavioral biases also account for some of the effect, as well—people tend to sell their winners too early and hold losers too long.”
Fans of the strategy point to the human tendency to extrapolate from past results—and chase investment returns—noting that momentum patterns have been evident in markets for decades, even centuries. They also say that some of the worst months for momentum strategies are during longer periods of outperformance.
Some have been doing the trade by buying the strongest investments in a sector while shorting the weakest; others lean in to rising markets or asset classes. Still others use a quantitative approach or turn to banks or others who sell ways to make distinct wagers on momentum as a “tradable factor” or a “thematic basket.”
The fans remain believers. “Any strategy has disappointing periods,” says Antti Ilmanen, global co-head of the portfolio solutions group at AQR Capital Management.
The surge in Moderna and other biotech stocks helped crush the momentum trade. These shares were among the most heavily shorted in recent years, but positive news on a cancer vaccine from Moderna and Merck sent those stocks flying, crushing some quant and other hedge funds. Moderna is up around 150% so far this month.
These traders had an especially rough day on Aug. 19, which Goldman Sachs told its clients was the worst day for “systematic long-short managers” in more than two years. About half of the losses were because of momentum trades, the bank said.
Some traders have begun to short, or bet against, the very stocks that propelled the momentum trade earlier this year. Net short positions in futures tied to the Nasdaq-100 index among speculators recently climbed to some of the highest levels of the past two decades, according to data from the Commodity Futures Trading Commission.
The about-face is a sign of how markets have become more treacherous for investors, even as indexes keep climbing. Part of the issue: the recent meltdown of Situational Awareness, a hedge fund that had piled into some of the most popular momentum shares, including chip stocks. After a period of market tumult, Nvidia shares rocketed almost 9% after its earnings, showing how quickly sentiment can shift.
Some investors say the run-up in share prices driving tech stocks higher reminds them at times of the dot-com frenzy decades ago.
Mike Ogborne, the founder of San Francisco-based Ogborne Capital Management, said he has grown more cautious on technology stocks and is keeping more of his portfolio in cash than he typically does.
And he is nervous about the surge in spending by technology giants and quarterly capital expenditures that keep rising.
“It is a little bit like Cinderella and the clock striking midnight. You don’t know when midnight is going to come around,” Ogborne said. “They don’t send a memo around telling you when the capex cycle is over.”
The era of the gorgeous golden retriever is over. Today’s most coveted pooches have frightful faces bred to tug at our hearts.
When the Writers Festival was called off and the skies refused to clear, one weekend away turned into a rare lesson in slowing down, ice baths included.
