26. January, 2022
By Lars Kruse#remotework #4dayworkweek #meaningfulwork #leadership
What do developers want? Specifically in terms of employment. In the light of The Great Resignation wave across the globe. I’ve begun a quest for a new compelling bottom-line to measure by - other than salary - when recruiting talent.
The other day, I posted a poll on LinkedIn1, asking my network if there would be any employee perks, that would make them consider taking a pay-cut and still find the job compelling. I’ll get back to the result of the poll in a bit, but first let me share some background on this.
“The Great Resignation” (a.k.a “The Big Quit”) has created a wave across the world. People are quitting their jobs, without necessarily having another job (yet) to occupy them.
I’ve been researching a lot these past days and I found a really well written and convincing article I want to share: “Toxic Culture Is Driving the Great Resignation”2 The authors3 analyzed 1.4 million off-boarding interviews from Glassdoor and 34 million online employee profiles - so the numbers are pretty solid. I’ll give you the highlights from it here (numbers apply to USA):
In early 2021 - a year into the Corona pandemic - more then 40% of all employees were considering leaving their jobs. 24 million actually did. The industries of internet development and enterprise software came in 3rd and 4th with attrition rates for the period as high as 14% and 13% respectively. This trend is serious, allow me to emphasise:
13% of software professionals in USA quit their job during 1st year of the Corona Pandemic
Toxic corporate cultuture was mentioned as the super reason why employees quit. The article clarifies the term to mean failure to promote diversity, equity, and inclusion. Ouch! It seems like companies’ failure to comply with the signature values of generations Y and Z gets punished - really hard.
Number two Job insecurity and reorganization is also related to culture; instability, lay-offs and restructuring makes employees insecure and dissatisfied. Probably not a big surprise. But the next one did surprise the authors:
High level of innovation makes people leave their jobs more frequently. Why? The authors found that high-level innovation companies seems to require personal tolls on employees work-life balance.
So what can companies do about it? How do they boost retention? Well the authors have a refreshingly pragmatic attitude towards this impediment. Their take is, that if a company is suffering from any of the top two predictors to attrition above. “You brought this on yourself - the trust is broken, it’s probably already too late to create retention.” But in regards of some of the contributing predictors to attrition they compiled a list of what employees in general favoured. Retention could be - simply to give them what they desire.
It turns out that employees don’t necessarily seek to climb the career ladder only to take on more work and more responsibilities. What they do want is lateral career opportunities; side-ways promotions. Fresh challenges, professional development, change of pace. Authors found it 12 times more predictive of retention than upward promotions. In other words; when employers are promoting their employees to retain them, what 12 out of 13 really would have preferred was merely more interesting and work.
Remote work options is on the list too, but given the general hype about this particular opportunity in the media during Corona, the authors finds it to have a surprisingly modest impact on retention. They open a door for the possibility that this may be a _false low. Could it be, that offering remote work opportunities has become so normal during the pandemic, that employees now consider it a default. Maybe they now expect it - rather than desire it? I’ll share some more insights into this topic from a report by GitLab in a bit, it suggests that remote-work opportunities actually weigh quite heavy.
Supporting a fun and social life with colleagues through company-sponsored social events also made it to the top three. Employees see work as a social arrangement as much as an income - this should come as a surprise to absolutely no one.
GitLab is one the worlds largest workplaces that is all-remote - they don’t have any co-locations workplaces, no offices.
GitLab started out as an Open Source alternative to the proprietary GitHub (now acquired by Microsoft). Due to its crowd sourced Open Source nature the features of GitLab soon exceed those of GitHub. Both are storing and version controlling software source code. Every software developer in the world knows them.
Today GitLab has 1,400+ employees - and no offices.
As a byproduct to the tool itself GitLab made it their thing to know about remote work, and they made everything they experienced and refined about it publicly available. It is an impressive pool of insights.
GitLab complied an entire Remote Workbook4 available for free online. I would definitely recommend it to any employer as well as employee working in a remote or distributed setup. GitLab graduated the remote workplace in 10 stages; 1 is No remote and 10 is Strictly remote. They urge companies to find their desired stage of remote workplace and start adjusting towards that level. It’s solid advice, very operational, very inspiring. Read it!
…or stay tuned, I’m working on another blogpost where I will touch on some of GitLab’s as well as other’s findings and advises.
I’d specifically like to draw attention to GitLab’s latest annual report on the state of 2021 Remote Work5. The information in there is gathered during February and March 2021 from 3,900 remote or distributed workers, who worked remote even before the pandemic made it the new normal. So they are original remote workers. The respondents live in USA, UK, Australia, Brazil, South Korea and South Africa.
A lot of the findings in the report are related to improving the remote workplace, but some of them are specifically related to recruitment and retention. So in context of investigating the why behind the The Great resignation and the quest for new bottom lines to measure by when attracting talent I’ll briefly throw up the highlights of that report too:
52% of respondents would leave an all co-located company for a preferred remote job.
33% would quit their job if remote work was no longer an opportunity.
82% would recommend remote work to a friend, this is despite the fact that only 37% reported that their employer were good at aligning work processes to remote work. Consequently 63% of remote workplaces still have room for improvement.
32% of workers employed outside their home country (digital normads) value remote work option over work permits, visas, tax deductions and lodging.
59% work a consistent schedule on most days and the same percentage take regular lunch and coffee breaks.
All in all GitLab’s report suggests, that offering remote work is probably a compelling descriptor of recruitment and retention - undoubtedly something to consider. To some extend their oven success is a living proof, that they have the long end og this stick.
The path of research I followed is a rabbit hole. One reference leads on to the next. Another report I want to recommend is one by Mattermost. Like GitLab - they too started out as an Open Source alternative, in their case to Slack - the de facto standard in chat platforms.
The report is called Unblocking Workflows6 and is a state report on developer productivity. The conclusions are much the same as the GitLab report - remote work is a compelling argument when recruiting. But they also bare some convincing proof, that even an efficient tool stack to support it (the 63% room for improvement mentioned earlier) has quite a potential in terms of recruitment and retention.
But it was specific number in that report which really caught my attention - a reference to yet another report by IDC - revealing some jaw dropping predictions to support the claim that Software Is Eating the world:
By 2023, over 500 million digital apps and services will be developed and deployed using cloud-native approaches – the same number of apps developed in the last 40 years. 7
The prediction continues that “this explosion of new digital apps and services will define the new minimum competitive requirements in every industry.” It’s official: The world is truly being eaten by software.
The most important enabler for companies in the foreseeable future is their ability to recruit and retain - maybe even delight - software developers.
So it has got to be worth the effort to investigate - what does software developers want?
As mentioned in the beginning, I made my own investigation, asking for feedback in a LinkedIn poll on four specific perks that I personally assumed would score high. And more importantly they are all four within reasonably reach: They aren’t expensive to implement at all, the only thing a forward thinking employer would have to do, would be to turn everything on it’s head:
Ask not what the developer can do for you. Ask what you can do for the developer
I would deem them to be quite plausible offerings - if they turn out to be decisive.
In the survey, attendees can only cast one vote, so even if someone would like all four perks, they would have to point out one to be more compelling than the others. I can’t claim as large respondent volume as the reports I referred to earlier. The result shown is based on 136 votes picked up over 4 days and even though I didn’t specifically screen this to IT professionals but it turns out, reading through the profiles that voted, that (77%) of the respondents are actually employed in either software or DevOps positions. 65% of the respondents are in my 1st degree network but 35% are further out. So I belive that all though it’s not exactly science, it’s solid enough for me to dare lean on it for an analysis.
I admit that the all-remote workplace is perhaps a bit extreme. In GitLab’s staged model it is level 9. “All” is literal. It means that there are no offices to co-work in. Everything is done remote. An all-remote company gathers all employees in camps or internal conferences on a frequent basis, probably quarterly, and it support local social initiatives by the employees. But the company don’t own an office. Despite this 13% of the respondents in the poll see it as their most likely win-me-over perk.
But nothing beats the fabled 4-day work week almost half (47%) mentioned it as their favourite perk. But how plausible is et really, that at company with a 4-day work week would even be profitable? Isn’t this merely a fairytale? No! Quite the opposite. There are plenty of experience reports out there to support that the employer’s fear of lost efficiency, productivity and engagement in a 4-day work week is just as imagined as it is in the remote workplace discussion.
And even if there might be some productivity loss in a 4-day work week, it would never yield to a 20% loss. Consider the following: A better work-life balance, combined with Competent management which in context of self-manged professionals would mean fever managers in exchange of more leaders - we just onboarded another 17% of the respondents in the poll. Combine that with fever meetings, a workflow optimized for asynchronous tasks and communication.
All in all a lean optimized work smarter not harder culture.
In my former company Praqma, we went with a self-invented variant of a 4-day work week. We would spend 4 days a week on our core activity - being a consultancy bureau, that would mean working for our customers. But we would set aside all Fridays to meaningful purpose - 23% of respondent of the poll would love that above all. On Fridays we would flock to work on stuff we liked; contributing to Open Source, write tech blog posts, arrange meetups and conferences, prepare speaks and presentations, travel to meet colleagues in different locations - or whatever seemed meaningful.
Imagine that a work place culture along these lines would mean that employers would more easily recruit and retain skilled developers. With a workplace like this, employers could probably just recruit from their current employees’ network or from community events. This is exactly what we experienced in Praqma.
The going market tariff for recruiting a software developer with help from recruiters is easily 3 months pay - There would be no more of that. And just imagine all the cost saved from having less organizational infrastructure to own and maintain with a flexible work force like this.
What is happening instead is companies pulling the exact same levers which they have always pulled, offering higher salaries, creating a fragile, volatile and expensive market for themselves. Looking at the the same proved-to-fail alternatives which they’ve been starring at with empty eyes for years: Bring more foreign work labour to the country, educate more youngsters, train left-over personnel to magically become software specialists in 2-3 months time.
It beats me why so few have tried to go down this alternative but obvious path; offer some variant of a 4-day work week, a meaningful purpose, self-managed teams where team members point out their own leaders and make remote workplaces and asynchronous processes the default.
Would you wanna work in a place like this? Are you in the process of transforming your workplace along these lines? I would love to hear from you. Share your thoughts and ideas Connect to me on LinkedIn and send me a message.
Donald Sull, senior lecturer at the MIT Sloan School of Management and a cofounder of CultureX. Charles Sull is a cofounder of CultureX. Ben Zweig is the CEO of Revelio Labs and an adjunct professor of economics at New York University’s Stern School of Business. ↩