Google's remote work extension could inspire more companies to enact permanent remote work policies

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Executives at Google's parent company Alphabet decided that nearly all 200,000 employees and contract workers would work remotely until at least July 2021, pushing back the original restart target of January 2021, according to an email sent by CEO Sundar Pichai and obtained by Business Insider.

The decision will likely help set a new precedent, as Google is the first major US corporation to extend the return target beyond the current January 2021 consensus. The Wall Street Journal reported that Alphabet executives opted for the longer commitment to remote work in part to help employees deal with logistical challenges, such as figuring out schooling plans for children and deciding whether to relocate. 

As companies follow Google's lead in embracing a prolonged period of remote work, we anticipate the following three impacts:

  • Enterprise hardware sales will increase as companies look to outfit remote workers with the tools they need to be productive. Over half (55%) of US executives plan to provide better equipment to increase remote worker productivity, according to a PwC survey from June 2020 of 120 US executives. Providing hardware like monitors, headphones, video conferencing systems, and wireless hotspots for when employees work remotely can help boost productivity — something that 31% of the executives surveyed by PwC believed has declined since shelter-in-place measures went into effect. For companies still on the fence about remote work, it will likely be easier to justify investment in hardware if they anticipate offices won't reopen until at least mid-2021, rather than the start of the year.
  • Zoom, Microsoft, and Google will compete to add features that improve the remote meeting experience, as this will be of even greater importance to enterprises. People have a harder time concentrating on virtual meetings compared with those conducted in-person, and participants' ability to pay attention falls precipitously around the 25-minute mark of a video call, according to Protocol. To address these concerns, Zoom, Microsoft, and Google have added a bevy of new features to their respective platforms, such as AI noise filtering, background blurring, and enterprise software integrations. We believe there is still considerable room for advancements in the video conferencing experience, which will help attract enterprises looking for a better long-term solution for remote meetings. Microsoft, for instance, introduced Together mode for Teams in early July, which uses AI segmentation to place participants in a continuous virtual environment, helping participants convey body language that would otherwise be lost in video meetings.
  • An even greater share of companies will instate permanent remote work policies. Since the onset of the pandemic, Facebook, Twitter, and Square all decided to give employees the option to work remotely indefinitely. This is part of a larger trend, wherein 55% of US executives expect most of their employees (over 60%) will work remotely more than one day per week after COVID-19 — 39% of the executives reported that most employees worked remotely prior to COVID-19, according to the aforementioned PwC survey. Companies will need to invest even more resources in developing remote work capabilities if offices remain shut through mid-2021. These investments will put those companies in a better position to embrace indefinite remote work policies, which can enable them to cut lease costs and hire from a global pool of employee talent.

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