Research: 2014 work from home study proved benefits of remote work

Believe it or not, the pandemic hasn’t been the first instance of companies switching to work from home or a hybrid work model. In the United States alone, work from home rates have tripled over the last 30 years. From only 0.75% of American companies allowing for remote work in 1980, to 2.4% in 2010 – just imagine what this rate has been shifted to today.

Are you interested in knowing more about how remote work has benefited employees much earlier than before the beginning of the pandemic? This 2014 Stanford University study by prof Nicholas Bloom was based on a work from home experiment with Ctrip, a 16,000-employee, NASDAQ-listed Chinese travel agency, where call center employees, who volunteered to work from home, were randomly assigned either to work from home or in the office for 9 months. Are you wondering what the benefits of work from home were for these employees?

Here are the results in a nutshell: 

• Fear of ‘‘shirking from home’’ is unfounded and the gains of learning and selection effects are significant when companies allow employees to benefit from modern management practices ie. working from home / remote work 
• The experiment was a success: 
• Home working led to a 13% performance increase, of which: 
  • 9% was from working more minutes per shift — fewer breaks and sick days, 
  • 4% from more calls per minute — attributed to a quieter and more convenient working environment.
• Home workers reported improved work satisfaction and their attrition rates halved (!) 
• However, their promotion rate, conditional on performance, fell. 
• Ctrip rolled out the option to work from home to the entire firm 
• Ctrip allowed the experimental employees to reselect between the home and office, and over half of them switched, which led to the gains from work from home to almost double to 22%. 

Why did we have to wait until COVID for the ‘business world’ to adopt remote and work from home?

The entire world became a “Ctrip-like experiment” with no optionality but full-force. The pandemic forced this ‘experiment’ through (and we’re lucky it happened in 2020, not 1995 for example). But why were behaviors and attitudes so often held ‘against’ remote work and work from home? We’ll explore this later on our blog. 

We are sure of this though — the next decade will see enormous global and structural changes impacting corporations, small and medium businesses, startups, tech ecosystems, cities, countries, migration and foreign direct investment. Skeptics will be proven wrong, and the “return to normal” will not fully materialize. 

Will you benefit from work from home adoption?

Internationally, work from home has continued to become more and more common. Whether you work in a country that possesses a strong economy, or living in a developing nation, there is now enough connectivity for you to leverage the benefits of work from home. Aside from this, the study did, however, note some negative attributes.

The 2014 Stanford study mentioned two major issues related to remote work. First, they questioned if the benefits of work from home are only produced if the management knows which strategies would produce the most productivity and performance. The researchers admitted that as of 2014, there was not enough evidence linked to the importance of having good management. In the case of Ctrip, the company’s managers did report their doubts that the younger workforce may find difficulty focusing and completing their workload without direct supervision.

Secondly, the study highlighted work from home producing obstacles from work-life balance. This factor is very controversial, though, since it just depends on the employee. Work from home may either improve someone’s work-life balance or significantly decrease it, depending on the type of work style one has. To actually determine how your work-life balance would be affected, we recommend taking a work style assessment which can analyze your work culture mindset.

Knowing your work style will allow you to identify your core strengths and traits in the professional setting. In case your employer gives you the option to work from home, work with a hybrid work style, or work all in-office, you will be able to relate your assessment results to this study and choose the most fitting option for you.

We hope you found the results of this study interesting – it was really “before it’s time” considering how popularized work from home has become now!

Roberto