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This management theory could reshape the return-to-office debate

Kevin Oakes, i4cp
Kevin Oakes
Kevin Oakes is the CEO of the Institute for Corporate Productivity (i4cp) and is a frequent author and international keynote speaker on topics such as organizational culture, talent management, leadership, innovation, metrics and strategic learning in organizations.

Many decades ago, my company was co-founded by George Odiorne, an influential figure in academics and business whose contributions significantly shaped modern management practices. Odiorne was a professor at several universities but is probably best known as one of the developers of the theory of Management by Objectives (MBO) and authoring a book by the same name in 1965. Odiorne’s work on MBO built on Peter Drucker’s introduction of the concept 10 years earlier and brought a more practical and operational perspective to Drucker’s original vision. Throughout his career, Odiorne published 26 books and 300 articles that influenced managerial theory before he passed away in 1992.

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And I’m sure he’d be turning over in his grave if he listened to all of the rhetoric of the last few years on return-to-office vs. hybrid vs. remote work.

Shifting the perspective on return-to-office

What appears to be one of the enduring lessons from the pandemic era is that work doesn’t necessarily need to happen in an office. Yet, many organizations would still prefer it did. Given the time that has passed, it would be logical to think the business community would have sorted this out by now, but it’s clear from the endless published stories that’s far from the case:

  • “Dell said return to the office or else—nearly half of workers chose ‘or else’,” read one headline, which, along with hundreds of articles, cited claims by Business Insider that it has seen internal Dell tracking data that revealed nearly 50% of the workforce opted to accept the consequences of staying remote. This is despite Dell’s policy that by classifying themselves as remote, workers agree they can no longer be promoted or hired into new roles within the company.
  • Wells Fargo fired over a dozen employees last month after an internal investigation revealed workers were engaged in a “simulation of keyboard activity creating impression of active work,” and employed mouse-jiggling technology according to a filing with the Financial Industry Regulatory Authority.
  • A study last month out of the University of Chicago found that RTO mandates at three large companies—Microsoft, SpaceX and Apple—had a negative effect on the tenure and seniority of their respective workforces. Notably, the study found that long-tenured and senior employees are more likely to leave than junior employees, and frequently they’re leaving to join direct competitors.

To be fair, both proponents of return-to-office, as well as defenders of remote work, point to different research that defends their positions. But I think if Odiorne were still alive he’d be asking, “Why do you care so much about where someone physically works … shouldn’t you be more focused on whether they are meeting their objectives?”

Uh, good point, George.

The link between MBO and return-to-office

If you need a refresher, here’s a quick history lesson on the time-tested practice that Drucker and Odiorne championed in the 1950s and ’60s. Management by Objective is made up of some simple yet very familiar core principles:

  1. Goal setting: Managers and employees collaboratively set specific, measurable objectives with a clear timeframe.
  2. Participative decision-making: Employees are involved in the decision-making process regarding the objectives and the means to achieve them.
  3. Explicit time periods: Objectives are set with clear deadlines, providing a structured timeline for achieving goals.
  4. Performance evaluation: Regular progress reviews and performance appraisals are conducted to assess achievement of objectives, providing feedback and identifying areas for improvement.

These goals are ideally aligned with organizational goals and—done right—can provide some very basic benefits such as clarity, focus and accountability. They aren’t without their challenges, however. Establishing and reviewing objectives can be time-consuming; it requires buy-in from management and employees, and there is the potential for misalignment with overall organizational goals. And MBO isn’t without its critics. Some believe it focuses too much on routine task performance rather than fostering creativity and employee aspirations. Others feel it can be too rigid and reduce agility as market conditions change or infringe on quality if “the end justifies the means” is taken too literally.

Frankly, I’ll accept those challenges vs. the workforce volatility caused by trying to track when and where someone is actually working. Reportedly, a startling 60% of organizations with remote employees use remote monitoring software. And unsurprisingly, 59% of employees feel stress and anxiety about workplace surveillance.

The Wells Fargo story on return-to-office, in particular, struck a nerve with many. The very existence of a technology to jiggle your mouse and thwart your boss suggests a complete lack of trust between management and employees. There are endless reasons why monitoring keyboard or mouse activity isn’t effective (people work at different speeds, they need bathroom breaks, they have to take a call), but as I read these articles, I kept wondering, “Don’t these workers have goals or objectives to meet, or are they measured solely on activity?”

The same is true for in-office mandates. Just because you can see someone in the office doesn’t mean they are accomplishing a damn thing (an old Seinfeld episode where George sleeps under his desk comes to mind). There are thousands of reports of lost productivity by being forced to commute to an office or work set hours on site. In fact, in a recent Microsoft survey of 31,000 working adults, half said they often commuted to the office only to discover their manager or teammates hadn’t.

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I hope organizations haven’t lost sight of what’s really important. MBO might be alive and well and practiced in multiple forms (many organizations use KPIs or OKRs today), but it’s perplexing to see the concept mentioned so infrequently in the various news articles about work structures. For many managers (and likely some organizations), I suspect a refocus on this 70-year-old concept might be in order.

And I also suspect Odiorne would be quite pleased to see that happen.